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The State of California Public Works Board Lease Revenue Bonds

The State of California has chosen Fidelity Capital Markets to serve as a co-manager on its upcoming $400 million1 Lease Revenue Bond sale.

What is the opportunity?

  • Potential for stable, tax-exempt income for California residents2
  • Bond sale consists of two fixed-rate series of bonds: 2014 Series B (backed by the Judicial Council of California) and 2014 Series C (backed by the Department of Corrections and Rehabilitation)
  • Bond ratings of A2 from Moody's, and A- from S&P and Fitch3
  • Bonds are secured primarily by rental payments from participating agencies. However, bonds are not obligations of the State of California.
  • Same prices and yields to individual investors as institutional with allocation priority given to California retail clients

When can I place my order?

Individual investors may place orders during the retail order period starting Wednesday, April 9. Please note that the underwriters may close the retail period (or certain maturities) early due to market conditions, or in the event the bonds are all sold. As a result, interested individual investors are encouraged to place their orders at their earliest convenience.

Additional resources

Municipal Bonds
Review the risks and benefits of investing in municipal bonds.

California State Treasurer
Learn more about California bonds and notes and about how to become an investor.

Municipal Bonds: Understanding Credit Risk (PDF)
Learn more about assessing credit risks when purchasing municipal bonds in this SEC investor bulletin.

Investing in a volatile bond market
Get the latest insights on the bond market, outlook for future rates, and investments strategies from Fidelity Viewpoints®.

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an independent organization that assigns credit ratings to debt instruments and securities to help investors assess credit risk

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Standard & Poor's (S&P) Corporation

an independent company that provides investors with market intelligence in the form of credit ratings, indices, investment research and risk evaluations and solutions

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the percentage of return an investor receives based on the amount invested or on the current market value of holdings; it is expressed as an annual percentage rate; yield stated is the yield to worst — the yield if the worst possible bond repayment takes place, reflecting the lower of the yield to maturity or the yield to call based on the previous close


This information does not constitute an offer of any securities for sale.
The municipal market can be affected by adverse tax, legislative or political changes and the financial condition of the issuers of municipal securities.
1. Preliminary, subject to change
2. Interest income generated by municipal bonds is generally expected to be exempt from federal income taxes and, if the bonds are held by an investor resident in the state of issuance, state and local income taxes. Such interest income may be subject to federal and/or state alternative minimum taxes. Investing in municipal bonds for the purpose of generating tax-exempt income may not be appropriate for investors in all tax brackets. Generally, tax-exempt municipal securities are not appropriate holdings for tax advantaged accounts such as IRAs and 401(k)s.
3. As of April 4, 2014. Ratings are subject to change or withdrawal by the rating agencies at any time. Please refer to the Official Statement for more detailed credit rating information including credit outlook.
In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk, liquidity risk, call risk and credit and default risks for both issuers and counterparties.