After a review of town expenditures for the years 2007, 2008, and half of 2009, the state Office of the Comptroller has ordered Secaucus to improve some of its public spending practices.
The directive, issued to the town last month, came after a one-year Comptroller’s Office investigation of municipal contracts and spending habits in the 30 months leading up to the arrest of former Secaucus Mayor Dennis Elwell. The Office of the Comptroller launched similar investigations in every municipality that had a public official nabbed in a July 2009 government sting operation. Elwell was among 44 public officials and religious leaders in New Jersey and New York arrested in July 2009 in a massive FBI sting operation.
In 2009 the council implemented a new policy regarding trips to the League of Municipalities conferences.
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‘Expenditures remain a concern’
In a two-page letter addressed to Town Administrator David Drumeler and dated Feb. 25, the comptroller’s procurement director, Dorothy Donnelly, wrote that Secaucus did not explicitly consider costs and “costs related criteria” when awarding a recreational services contract.
The town must also ensure that charitable donations made to community groups are compatible with state law and must guarantee that municipal meals and trips are in line with state guidelines already used by school districts throughout the state.
Detailing each of these concerns individually, Donnelly wrote that Secaucus must improve “internal controls or other procedures the town has in place or will put in place to ensure the propriety of future expenses.”
Of particular concern to the comptroller was a five-year $250,000 contract awarded in 2006 to Cliffhanger Productions for recreational services. The contract covered the costs of an Easter egg hunt, the Secaucus Hoe Down, the annual summer concert series in Buchmuller Park, and entertainment for various town wide celebrations.
Donnelly wrote that “While using competitive contracting pursuant to local public contracts law, Secaucus failed to consider cost.” In addition, Secaucus’ “request for proposals did not include ‘costs related criteria’ in the list of factors to be evaluated, even though the governing statute required consideration of such costs.”
The letter also flagged hundreds of dollars in taxpayer money that was spent on congratulatory ads in commemorative journals printed by such community groups as UNICO and the Kiwanis Club. Donnelly labeled these ads “impermissible expenditures of public funds” under state law.
She also took issue with a $5,000 expenditure made in 2008 to send several town employees to the annual League of Municipalities conference, and questioned whether the $4,650 spent in 2008 and 2009 on food for council caucus meetings met accepted state guidelines.
The town’s response
The Town Council had already addressed most of these concerns prior to receiving Donnelly’s letter last month.
Mayor Michael Gonnelli, who took over as mayor in January 2010 after serving three years as a councilman, said that 2011 is the last year of Cliffhanger’s five-year contract with the town and the council took steps last year to organize community entertainment in-house. Last summer, for example, Deputy Mayor John Bueckner, chair of the council’s Recreation Committee, organized the summer concert series with the help of volunteers.
And in 2009 the council implemented a new policy regarding trips to the League of Municipalities conferences.
Previously, the town covered the costs of hotel rooms and conference registration fees for department heads who wanted to attend the conference. Since 2009, however, the town pays these fees for only two employees, Drumeler and Chief Financial Officer Margaret Barkala. If other department heads wish to attend the conference, the town will pay the $40 registration fee, but employees must pay their own hotel costs and no other travel fees are reimbursed.
Drumeler said last week that he has taken a look at the state’s School District Travel Policies and Procedures, which many municipalities use as a guide for their own travel and meal expenditures. He and Town Attorney Anthony D’Elia are currently drafting a revised travel policy for Secaucus that is in line with the School District Travel Policies and Procedures. This document, he said, will be added to the municipal employee handbook.
Drumeler said the town is already in compliance with state policies regarding food expenditures for meetings.
In a memo given to council members last week, Drumeler stated the town spends less than $10 per person for meals provided to council members at caucus meetings. The town only orders food for the seven council members and municipal employees required to attend caucus meetings.
“The only thing we’re really guilty of are those ads,” said Gonnelli last week. “It never occurred to me that those were a violation.”
The town must respond to Donnelly’s letter by March 25.
‘We appreciate the steps the town has taken’
The comptroller’s office acknowledged that the town has made improvements in some areas.
“We understand that following our [March 2010] meeting, the town took steps to stabilize its budget by eliminating some…expenditures. Specifically, the town eliminated the biennial fire chief’s dinner that cost nearly $30,000 and ended its retention of multiple lobbyists who were paid approximately $25,000 a year to provide seemingly duplicative services,” the letter stated. “We appreciate the steps the town has taken.”
The Town Council eliminated several professional service contracts last year, saving about $270,000.
The scope of the comptroller’s investigation focused solely on professional service contracts and procurement practices within Secaucus and did not examine practices in the Tax Collector’s Office, where $777,725 was allegedly stolen by an employee.
In 2009 the Secaucus Town Council ordered an independent audit of the Tax Collector’s office, the results of which were released last year.
E-mail E. Assata Wright at awright@hudsonreporter.com.