If federal authorities are planning to investigate billboard deals made by two former aides to Gov. Jim McGreevey, Secaucus officials say they have nothing to worry about.
“We did everything legal,” said Town Administrator Anthony Iacono in response to a widening probe by two daily newspapers.
Two billboards built on town-owned property in Secaucus are among 14 such signs constructed throughout the state that may be under a federal probe.
In a story published in late April, the Newark Star-Ledger said the federal investigators were looking into deals made by Gary Taffet and Paul Levinsohn, top aides to McGreevey’s campaign for governor. The two men sold the business when they joined the McGreevey cabinet, then eventually resigned those positions as a result of the scandal. In a written statement, Levinsohn said he did nothing illegal or improper, a sentiment echoed by Taffet in a separate statement.
“A federal investigation is not likely here in Secaucus,” Iacono said.
In a published account on May 8 in the Star-Ledger, Gov. McGreevey expressed grave concerns about possible “hidden corporations” connected with the billboard company when owned by Taffet and Levinsohn. According to several published accounts, the two men may have generated last-minute advertising deals that generated additional money just before selling the company in anticipation of becoming members of the governor’s staff in 2001. An investigation, if it takes place, would probably focus on whether they used their connection to the governor and their impending state positions to gain business or get state agency approvals.
The two billboards in Secaucus differ in some respects from others around the state. The money generated from both billboards was to go to two not-for-profit organizations, one to generated funds for the Secaucus Library through the Friends of the Secaucus Library, the other to possibly build a new recreation center through an organization called the “Secaucus Youth Alliance.”
The Secaucus deal also required town officials to seek several layers of approvals that other deals did not face, from the New Jersey Turnpike Authority, the New Jersey Department of Transportation and the New Jersey Meadowlands Commissions.
Early on, local officials hoped to be able to use the funds to pay off bonds taken out by the town. In one $1 million bond, the town purchased furnishings for the newly constructed library. In the second, the town hoped to combine this bond money with other revenue to begin construction on a recreation center.
During the approval process, state officials expressed doubts about what some of the billboard money would be used for and put a provision on its approval that the town show where the money went after a year. This provision, however, was dropped after McGreevey took office, leading to some speculation as to whether or not the two men, who later became cabinet members, used their influence on the DOT.
As town officials later learned, the money could not be used to pay back loans taken out by the town. At this point, none of the money from either billboard deal – about $60,000 for the first year – has been used.
“All of it is currently in bank accounts,” Iacono said.
Local critics, such as Councilman John Bueckner and former Housing Authority Commissioner Frank MacCormack, have questioned how the town “got mixed up” with Levinsohn and Taffet.
Iacono said he approached them after asking various people in the billboard industry about using town land for possible fundraising efforts. Mayor Dennis Elwell said a vendor – who might or might not have been one of the two men – approached him at the November 2000 League of Municipalities Convention in Atlantic City, after which Elwell asked Iacono to investigate the options.
Although local officials claim not to be defending the Levinsohn and Taffet, Elwell pointed out that reports of the men getting $2 million for the sale of the company controlling the billboards was not an indication of how much the men made in Secaucus.
“Some people are trying to make it look as if someone made a fortune here,” Elwell said, alluding to questions raised by Bueckner. “The two men sold the business. But that is no indication of how much profit they made.”
The Philadelphia Inquirer, who broke the story earlier this year, reported in early May that the actual figure the two men made from selling the business as well as previously undisclosed deals for advertising was $4 million. In a follow-up to this, the Star-Ledger also reported significant additional profits made by the two men in the last few weeks leading up to the sale of the company in early 2001.
State law prohibits high-ranking officials to own a controlling interest in privately held companies such as theirs.
Several reports claim the FBI has been looking into the matter. Iacono said federal authorities have not yet requested any information from his office.
“Even if they did, we would give them exactly what we have issued the press,” Iacono said. “We put together a packet of information that includes copies of every check we’ve received. That’s all there is to get. We did everything properly. We get checks once a month. These go into a bank account. Our records are open to the public or to federal authorities. If they choose to come here, we will be more than cooperative.”
North Bergen confession won’t affect Secaucus bid
Mayor Elwell said the recent confession of Domenic Grano in bribing North Bergen Municipal Utilities Authority officials will have no effect on Secaucus even though Grano’s firm has contracts with the town and the Secaucus Municipal Utilities Authority.
“We looked into the matter and learned that Grano has severed his ties with the company [used by Secaucus], so we are not concerned,” Elwell said. Grano’s son took over the companies.
Grano, an excavation contractor, confessed two weeks ago that he had made cash payments, provided free construction work and given a jet ski to a former North Bergen Municipal Utilities Authority official and concealed the corrupt payments, according to U.S. Attorney Christopher J. Christie.
Grano is the primary owner and operator of two companies, Grano, Inc. and Persistent Construction Corporation in Fairview.
Persistent has two contracts with the town – one to rebuild the sewer lines on Castle Road, a multi-million dollar project, and one with the SMUA for emergency repairs. Persistent Construction is also a political contributor to Elwell’s campaign war chest.
“Grano Sr. separated himself from the company,” Elwell said. “Both contracts were the result of a bidding process, and Persistent was low bitter.” – Al Sullivan