Oroho: Investor Experts Agree Corzine Should Disclose Jobless Fund Deficit

By Andrew Pratt

An executive at a fund that "purchased bonds in last week's sale, said off-budget funds such as New Jersey's unemployment fund should be detailed in a deal's POS" (Preliminary Official Statement).

-- From Bond Buyer article on Republican Complaint Filed with SEC Asking for Honest Disclosure of the State's Financial Condition

Senator Steve Oroho, a Republican member of the Senate Budget and Appropriations Committee, said he doesn't understand how the Corzine administration can call the Republican complaint to the federal Securities and Exchange Commission "frivolous" when respected professionals in the investment community know that the complaint raises valid concerns. For example, investment advisers agree that a growing, multi-billion dollar deficit in the fund that pays out unemployment compensation for state workers is worthy of mention in marketing aimed at bond investors, yet this deficit was not fully disclosed in marketing materials for a $200 million school bond sale conducted last week.

"The state is asking average New Jersey citizens to invest in bonds through its 'Buy NJ Bonds' promotion," Senator Oroho said. "These mom and pop investors should expect and get absolute transparency from the Corzine administration, and they aren't getting it."

Among the details absent from bond market materials are disclosures of a growing, multi-billion dollar deficit in the fund that pays unemployment claims and the pending insolvency of the fund that pays for transportation projects.