New Jersey issuers should know there’s a new bond counsel in town — no wait … maybe not so new. John L. “Jack” Kraft, the state’s first nationally recognized bond attorney, is now heading up Lomurro, Davison, Eastman & Munoz PA’s new public finance department. The impetus behind this merger of sorts was to blend the firm’s growing exposure and access with Kraft’s 40 years of bond counsel experience, knowledge, and energy. Already, Kraft’s new colleagues say they are benefiting from his openness and enthusiasm for the market. For years, Donald Lomurro has been asking his newest lawyers to sing their school fight song as a way of introduction at the firm’s biweekly social luncheon. Lomurro had yet to be taken up on his request — that was, until Jack.“Jack got up and … sang the Georgetown fight song and everybody’s jaw dropped,” Lomurro said. “His name is such, everywhere I go people have been telling me, 'Boy, it’s so exciting that Jack has joined you,’ so it’s kind of an internal and external energy.”Lomurro and Edward Eastman tried to break into the municipal bond market in the 1980s, but the then-new firm was up against larger, more experienced bond counsel outfits. Since then, the firm, located in central New Jersey, has expanded from three lawyers to 38 attorneys.“I’ve always had contact with Jack over the years and it seemed like the perfect time for the firm to go back into that area now with a considerably stronger firm presence, and we wanted the best we could find — and that’s Jack,” Lomurro said.Kraft, who is 71, grew up in northern New Jersey and went to Yale Law School. He began his bond career in 1967 when he joined Hawkins, Delafield & Wood LLP, working on New Jersey issues from the Wall Street-based practice. In 1970, he served as associate counsel to then-Gov. William T. Cahill where he handled bonding matters for the state. After one year in the governor’s administration, Kraft then did what he says many called “foolhardy” at the time: he established his own bond counsel practice at Kraft & Hughes, becoming New Jersey’s first bond lawyer. Up until then, New Jersey issuers used out-of-state firms as bond counsel as the state did not require firms to be licensed to practice in New Jersey.For the next 30 years, Kraft practiced as bond attorney at Kraft & McManimon, now McManimon & Scotland LLC, and Lowenstein Sandler before once again striking out on his own in 2001 with John L. Kraft, Esq. LLC.Kraft said when Lomurro approached him about joining the firm, it “made a lot of sense” as the firm’s exposure would help enhance his already sizable client base. “I probably have 40 or so active clients, including Sussex County and Passaic County,” Kraft said. “And over the years, as my practice developed, I have represented the state of New Jersey, the New Jersey Turnpike Authority, many other agencies throughout the state, and 18 of the 21 counties at one time used me as their bond counsel.”Looking back over the years, Kraft said the legal side of the municipal market has changed in that issuers are more dependant on bond counsel and tax counsel to determine a deal’s tax-exempt status as with private-activity bonds and transactions that involve payments in lieu of taxes. One change that Kraft is not fond of is the increasing use of derivative products, and he is an outspoken opponent of swap agreements. Luckily for him, the state prohibits swaps at the municipal level.“I look at swaps — from my perspective representing issuers — as gambling, and I don’t think it’s right for governments to gamble with the money of the citizens and it’s not a popular viewpoint,” Kraft said. “You can talk to a swap provider and he will tell you all the benefits of swaps, but in New Jersey swaps are not permitted under the law.”Kraft is a founding fellow of the American College of Bond Counsel and served for three years as its first president, beginning in 1995. In 2002 the college began the Kraft Lecture Series, an annual forum that brings in prominent speakers from the public finance community.
