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For three years running, federal securities regulators have been cracking down on a sleazy aspect of the municipal bond industry that had been its dirty little secret for a long time. The practice of donating to political campaigns of local officials who, while in office, dole out lucrative contracts for muni-bond offerings. It's been called "paying to play," and ridding the $1.3 trillion muni-bond market of the practice has been a top priority of the Democratic chairman of the Securities and Exchange Commission. Since 1994, the investment banking firms that underwrite these offerings have been banned form making such contributions. To find out whether bond lawyers indeed "pay to play," the NLJ put one locale in New Jersey under a microscope and found that lawyers are continuing this game. (July 1, 1996)