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<p>New York, Dec. 19 (Bloomberg) -- California's bond rating was cut by Standard & Poor's because of a projected $34.8 billion budget deficit in the next two fiscal years, tying the most- populous U.S. state with Louisiana for the lowest credit rating.</p>

What is expected to be the biggest municipal bond sale in history is under way. The state of California is selling the first of the bonds to pay for electricity that it had been buying to keep the lights on in homes and businesses across the state. Wednesday's sale of $4.25 billion of Department of Water Resources Power Supply Revenue Bonds is the initial sale of what will be the largest municipal bond issuance in history at an estimated $11.95 billion, says state Treasurer Phil Angelides. The sale was met by strong demand from a wide range of institutional investors,...

Existing power supply resources owned by or under contract to the IOUs, governmental entities, and non-utility generators are not expected to be sufficient to meet the needs of the Customers and all other electric consumers in California during the Study Period. Consequently, DWR (through December 31, 2002) and other end-use providers will need to rely on new generating facilities constructed within California and the continuation of imported power to satisfy the capacity and energy requirements of electric end-users within the State.

<p>For California investors, the state's $11.9 billion energy bond issue will be like a circus elephant walking through the front door: too big to ignore, kind of scary but maybe worth a ride.</p> <p>The bonds won't be priced for several weeks, but experts say they should offer attractive yields to make up for their substantial risk and the boffo size of the deal, which will be 3 1/2 times bigger than the previous record municipal bond issue.</p>

<p>Rating agencies were lukewarm about the offering, assigning them tepid grades that indicate a relative degree of risk. While several notches above junk status, the bonds were nonetheless rated below California's usual debt grade.</p> <p>The debt issue will be the largest in municipal bond history, in part repaying $6.5 billion in state funds and $3.5 billion in remaining bank loans that the state took out to buy power on behalf of California utilities, which were no longer able to do so because their credit had been destroyed. The rest will be used for reserves, costs and other issues.</p>

<p>Sacramento, California, Sept. 27 (Bloomberg) -- California will start selling the biggest issue of municipal bonds in U.S. history, $11.9 billion, the week of Oct. 21, said Treasurer Philip Angelides.</p> <p>The bonds will repay the state for the costs it incurred during last year's power crisis and pay off bank loans. The sale will come right after the state sells as much as a record $12.5 billion in notes to make up for lower tax collections.</p>

CALIFORNIA DWR WILL ISSUE $11.9 BILLION TO FUND PAST ENERGY PURCHASES Moody's has assigned the credit rating of A3 to the California Department of Water Resources (DWR) Power Supply Revenue Bonds. The state DWR expects to issue in October 2002 approximately $11.9 billion of revenue bonds including $5.9 billion of fixed rate bonds and an expected $6 billion of floating rate bonds. The bonds are secured by charges to be paid by customers of the state's three investor-owned utilities. The charges are paid as part of the customers' regular electric bill based on electricity usage and the revenue is passed...

Ever since soaring energy prices and rolling blackouts forced California to spend more than $50 billion buying electricity, selling revenue bonds has been the key element in recovering much of that money.--More than 16 months later, however, the largest municipal bond offering in U.S. history still hasn't hit the market. And the state's general fund desperately needs the reimbursement of the $6.6 billion state officials borrowed to keep the lights on.--California's new budget reportedly settled a $23.6 billion deficit, a feat accomplished by assuming money already will be rolling into state coffers next month from three bonds totaling $11.95 billion....

SACRAMENTO -- California's top officials are leading what critics call an unprecedented expansion and reshaping of the role bonds play in government finance, urging taxpayers to plunge tens of billions of dollars deeper in long-term debt for an array of needs. In one of two major new strategies that are alarming critics, state and local officials are urging voters to pass bonds in historic proportions for infrastructure work, tapping the state's remaining capacity for borrowing as the last easy source of cash. Three statewide bonds totaling more than $18.5 billion will be on the November ballot, along with numerous locally...

SAN FRANCISCO, May 29 (Reuters) - Pacific Gas & Electric Co. (NYSE:PCG - News) has challenged an order by state regulators needed for California to launch an $11.1 billion bond issue to help recoup the cost of the state's emergency power purchases last year. The challenge, made late on Tuesday by the PG&E Corp. subsidiary, California's biggest utility, could delay the bond issue, one of the largest municipal bond sales ever, credit analysts said. While state Treasurer Phil Angelides has not set a schedule for any bond deal, he recently told investors he would likely issue a timetable sometime...