Investing in California - The Golden State

Under no circumstances shall this announcement constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of State Public Works Board of the State of California Bonds in any jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under securities laws of any such jurisdiction. The State Public Works Board of the State of California Bonds will be sold only by means of an Official Statement.

Please call Ramirez & Co. at 1-800-888-4086 or click New Issues if you would like a copy of the Preliminary Official Statement.The official statement should be read carefully before investing.

State Public Works Board of the State of California
$59,215,000 Lease Revenue Bonds (Judicial Council of California) 2013 Series D (Yuba City Courthouse)
$330,380,000 Lease Revenue Refunding Bonds (Department of State Hospitals) 2013 Series E (Coalinga State Hospital)

During the week of April 22, 2013, the State of California will sell approximately $389.6 million State Public Works Board Bonds consisting of $59.2 million Lease Revenue Bonds (Judicial Council of California) 2013 Series D (Yuba City Courthouse) and $330.4 million Lease Revenue Refunding Bonds (Department of State Hospitals) 2013 Series E (Coalinga State Hospital). Ramirez & Co., Inc. is a co-manager for this transaction.

The State of California is the most populous state in the nation, with 37.8 million residents, representing 12% of the total U.S. population. California also benefits from a broad, diverse, and wealthy economy, with an estimated gross domestic product (GDP) of $1.8 trillion in 2013, accounting for 13% of the nation’s GDP. Unemployment was 9.8% as of December 2012, above the nation’s average of 7.8%

The 2013D Bonds are being issued to (i) fund construction of certain projects of the Judicial Council of California, (ii) pay capitalized interest on the 2013D Bonds, and (iii) pay the costs of issuance of the 2013D Bonds. The 2013E Bonds are being issued to (i) refund a portion of the State Public Works Board’s bonds previously issued to fund certain projects of the Department of Mental Health, and (ii) pay the costs of issuance of the 2013E Bonds.

The 2013D and 2013E Bonds are being separately issued and secured under separate indentures. Each Series will be secured by a first pledge of Revenue, which consists primarily of Base Rental to be paid by the agency participating in each Series under the terms of a Facility Lease for each Series. Each Series is also secured by a first pledge of amounts on deposit in funds related to such Series, as well as by a Master Indenture Reserve Fund which may be drawn upon in the event Revenue available under the Indenture for a Series is insufficient to pay debt service on that Series.

After several consecutive years in which the state faced projected budget deficits, the governor’s budget proposal estimates that the state will end fiscal 2012 – 2013 with a positive reserve. In addition, the proposed budget expects to end fiscal year 2014 with a $1 billion reserve. The state’s portion of the California public employees’ retirement system (CalPERS) is funded at 79%, based on the latest actuarial valuation.

The state’s preliminary assessment of the impact of sequestration on its general fund is that it will have minimal impact under current law and policy. Although the state had been scheduled to receive about $367 million in federal BABs subsidy payments for fiscal 2013, the state treasurer’s office estimates that its subsidy receipt will be reduced by about $15.3 million under sequestration.

The Bonds are rated A2 by Moody’s, A– by S&P and BBB+ by Fitch.

If you already have an account with us, simply call your Investment Representative and they will provide you with complete information regarding State Public Works Board of the State of California Bonds.

If you would like to open an account with Ramirez & Co.
Just call us at (800) 888-4086 ext 531 and one of our Investment Representatives will be happy to assist you with the account opening process. We will gather information about you and your investment goals, and discuss how State Public Works Board of the State of California Bonds can help you fulfill these goals. It is a simple process and one that we have been helping investors with for over 41 years.

Investment Representatives who speak Spanish and English are available at (800) 888-4086.