The story of the day may be Dunstan's McNichol's report that New Jersey is paying $657,000 a month - about $22,000 every day - to the Bank of Montreal "for an interest-rate swap approved by state officials and linked to bonds that were never sold."

"The interest rate swap, an agreement between borrowers to exchange fixed and variable-rate payments on a set amount of debt, was arranged in 2004 to protect taxpayers against rising borrowing costs. The strategy backfired after officials decided against issuing the securities," McNichol wrote for Bloomberg.  "The payments... show how elected and appointed officials failed taxpayers by agreeing to financial strategies they didn't fully understand. New Jersey spent $21.3 million in 2008 to exit three contracts signed when James Florio and James McGreevey were governors. The state's transportation trust fund is giving almost $1 million a month to a Goldman Sachs Group Inc. partnership in an agreement linked to bonds that were redeemed."

The well liked and talented Dunstan McNichol, who spent fifteen years as a Star-Ledger and The Record statehouse reporter before taking a buyout last year, has joined Bloomberg as their New Jersey state government reporter.  McNichol was part of the Star-Ledger team that won the Pulitzer Prize in 2006 for their coverage of Gov. James E. McGreevey's resignation.

Some encouraging new from the New York Times: the paper of record that has closed its Trenton news bureau and pulled their New Jersey reporting team, sent one of their top-flight reporters, David Chen, to the statehouse yesterday to cover Gov. Jon Corzine’s State of the State Address.  This is the NYT’s second story on the New Jersey governor this week; on Sunday, freelancer Dunstan McNichol wrote about Corzine’s future prospects.  Chen ran the Trenton bureau for the NYT before being assigned to New York City Hall.

It should not go unnoticed that The New York Times’ Sunday “New Jersey and the Region” section included a story on the 2009 race for Governor of New Jersey.  It was written by freelancer Dunstan McNichol, the respected veteran Star-Ledger statehouse reporter who took a buyout last year.  This was the second story on the gubernatorial race this month; last week, David Kocieniewski, who in the days of Donald DiFrancesco and Bob Torricelli covered New Jersey almost daily, covered the entrance of Republican Christopher Christie, the former U.S. Attorney, into the field of potential Corzine challengers.

Capitol Beat, an association of Capitol Reporters and Editors, gave out awards over the weekend for the bets of statehouse reporting in 2008.  The Star-Ledger won honors in three categories: In the Single Report category, first place went to Susan Livio and Mary Jo Patterson for their story on “Problems Beset Program for Troubled Kids”  Patterson, the wife of former Star-Ledger political reporter David Wald (now the spokesman for Attorney General Anne Milgram) has taken the newspaper buyout, while Livio will remain at the Star-Ledger.

Dunstan McNichol and John Martin won second place honors in he In-Depth Reporting category with their story “Waiting in pain” McNichol and Martin have both accepted buyouts. Joe Donohue, who is leaving the Star-Ledger to join the Gov. Jon Corzine's administration, won an Honrable Mention in the Beat Reporting category.

Sources familiar with the Star-Ledger newsroom say that Robert Schwaneberg, Joe Donohue, Rick Hepp, Dunstan McNichol, Kate Coscarelli, Matt Reilly and Tom Hester Sr. are among the veteran reporters who have accepted a buyout agreement.   Josh Margolin, Claire Heininger, Susan Livio and Tom Martello are part of the group that will stay on.