New Jersey Gov. Christine Todd Whitman signed an executive order Tuesday reversing a ban on most negotiated bond deals sold by the state.
Scheduled to take effect Jan. 1, Whitman's order gives more latitude to the state and its authorities in using negotiated sales.
The state can sell a negotiated issue that is a "complex or new type of credit," or when it "is in the taxpayers' interest to negotiate the fee structure," said Lisa Kruse, director of communications in the New Jersey treasurer's office.
The order also requires a competitive process for the selection of bond counsel and financial advisers, and says that the state should use competitive sales under other circumstances.
Last year, former Gov. Jim Florio issued an executive order banning most negotiated sales of debt. The order was issued in the wake of a federal investigation of state issuance that led to the resignation of his chief of staff, Joseph Salem. The controversy contributed to a ban on gifts by the Municipal Securities Rulemaking Board.
"When the governor came into office she wanted to look at what was in place and see if this was still the best way to do it," Kruse said. Whitman's order was initially recommended in August by an advisory panel on government contracting procedures formed at Whitman's request.
