Gov. Christine Todd Whitman

last week signed legislation

authorizing the state's Economic

Development Authority to issue up to

$750 million of bonds to help

eliminate a deficit in the state's high-risk

auto insurance pool.

The bonds will be backed by

revenues generated by surcharges on bad

drivers in the state who have

accumulated six or more points on their

licenses.

Under the agreement the state

worked out with New Jersey

insurance companies, which had been

fighting attempts to make the

industry pay off the pool's $1.3 billion

deficit, insures in the state will pay

about $761 million of the cost of the

deficit.

Under the terms of the agreement,

the insurance industry also agreed to

drop a lawsuit against the state that

companies filed to force the state to

pay the entire deficit.

The companies argued that it was

the insurance policies of former

Gov. Jim Florio that created the

deficit, and so the industry should not

be forced to pay the price.

The bond sale is expected next

month.

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