NYS Tobacco Settlement Financing Corporation (TSFC) Considers Refunding Bonds to Redeem Auction Rate Bonds

NEW YORK, NY (03/10/2008)(readMedia)-- In response to the current instability in the municipal auction bond market, the New York State Tobacco Settlement Financing Corporation (TSFC) is considering the issuance of refunding bonds to redeem at par all of its outstanding auction rate bonds.

The auction rate bonds that are being considered for refunding are the $217.5 million outstanding Tobacco Settlement Financing Corporation Asset-Backed Revenue Bonds, Series 2003A-2, A-3, and A-4 (State Contingency Contract Secured), and the $225 million outstanding Tobacco Settlement Financing Corporation Asset-Backed Revenue Bonds, Series 2003B-2, B-3, B-4, and B-5 (State Contingency Contract Secured) (collectively known as the “TSFC Auction Rate Bonds”).

The refunding under consideration may result in the redemption of a portion or all of the TSFC Auction Rate Bonds on one or more dates beginning April 18, 2008.

The issuance of the refunding bonds must be authorized by the TSFC Board of Directors. Should TSFC decide to issue the refunding bonds, the issuance and the timing are subject to certain conditions, including but not limited to relevant financial considerations, and to the approval by the New York State Comptroller and by the Director of the Budget of the State of New York.

The TSFC Board of Directors is scheduled to meet on Thursday to consider the refunding.

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The NYS Tobacco Settlement Financing Corporation, a subsidiary of the State of New York Municipal Bond Bank Agency (MBBA), is a New York State public benefit corporation created to purchase New York State’s share of the tobacco settlement revenues.

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