New Jersey Administrative Code
Title 5 - COMMUNITY AFFAIRS
Chapter 38 - JOINT INSURANCE FUNDS
Subchapter 1 - INVESTMENTS
Section 5:38-1.2 - Long-term investments

1. The governmental entity responsible for the issuance of the long-term investment is not in default as to the payment of principal or interest upon any of its outstanding obligations;

2. The long-term investment is purchased at fair market value;

3. The long-term investment is secured by a pledge of all or a portion of the government entity issuer's revenues, secured by the government entity issuer's pledge to raise taxes without limitation as to the rate or amount and/or secured by another government entity's guaranty. This paragraph shall not be interpreted to bar JIF or JCMI program investment in long-term investments issued by governmental entities without taxing power, so long as the issuer and issuance meet the provisions of this section; and

4. The long-term investment has, or is being issued or guaranteed by a government entity that has, a credit rating of A3 or higher by Moody's Investor Services, Inc., A- or higher by Standard & Poor's Corporation, and A- or higher by Fitch Ratings, except that ratings from two of the three aforementioned credit ratings agencies shall be sufficient. If a rating for the long-term investment, or the government entity issuer or guarantor, has not been obtained from at least two of the three credit ratings agencies, the long-term investment may be purchased if the governmental entity responsible for the issuance or guaranty thereof has pledged to raise taxes without limitation as to rate or amount in order to satisfy repayment, and the issuance or the governmental entity responsible for the issuance or guarantee thereof has a rating from at least one of the aforementioned credit rating agencies that meets the above-referenced minimum rating criteria.

1. In the event that the percentage exceeds 50 percent due to the maturity of other investments not meeting the definition of a "long-term investment" pursuant to this section, the JCMI program shall:

2. If the Division of Local Government Services or the Department of Banking and Insurance does not approve the corrective action plan offered by a joint insurance fund or a JCMI program, either agency may order appropriate remedies, up to and including divestment of one or more long-term investments, to reduce the share of long-term investments to 50 percent or less of an investment portfolio.