Democratic Candidate Pushes for Local Pay-to-Play Ordinance

The township will consider a pay-to-play ordinance, one that prohibits some monetary contributions to local candidates from firms interested in services and contracts, after Democratic candidate Gary Vaccaro encouraged the Committee to do so.

“Back in 2011, when I ran for township Committee, one of my initiatives was pay-to-play reform, specifically I had developed a pay-to-play ordinance,” Vaccaro said at a recent Committee meeting. “My plan was to introduce it once I was elected.”

Vaccaro ran for Committee against current Mayor David Most. Now that he is vying for a seat once again, he is hoping to put a pay-to-play ordinance back on the table.

“However, in light of recent current events, it’s time to bring this issue back to the forefront,” he said, in reference to Birdsall Services Group, a Monmouth County-based engineering firm that is under investigation for skirting the state’s pay-to-play laws by allegedly reimbursing its employees for their personal, unreportable political contributions.

The firm has engineering contracts with a host of Shore-area communities and completed a feasibility study for the conception of a new power plant in Lacey Township.

Lacey was served a subpoena for its business with Birdsall in September 2012. The feasibility study was the only time Lacey has worked with Birdsall, and the municipality hasn't heard from investigators since, township Administrator and Municipal Clerk Veronica Laureigh said.

Instead of Birdsall making corporate political contributions to campaigns and political organizations that would disqualify it from public contracts awarded by certain government agencies, shareholders and employees of the firm allegedly made personal political contributions of $300 or less, which are deemed unreportable, according to the attorney general's office.

Under state law, personal political contributions under $300 do not have to be reported to the state Election Law Enforcement Commission.

In March, the state's Division of Criminal Justice Corruption Bureau obtained a nine-count state grand jury indictment charging Birdsall Services Group and several employees and shareholders.

“This revelation re-emphasizes the importance of implementing pay-to-play reform and the need to address this directly at the local level,” Vaccaro said.

Lacey Township does not have a pay-to-play ordinance regulating contract awards from political contributors, Vaccaro said. The township follows New Jersey’s Pay-to-Play Law, which was enacted in 2006.

Under state law, businesses are prohibited from being awarded a local contract with a value in excess of $17,500 if they contributed more than $300 to a candidate’s campaign within the preceding year.

“However, there is a loophole in this law and this is where the problem lies,” Vaccaro said. “This prohibition only applies to contracts awarded under a non-fair and open, no-bid process. There is no pay-to-play restriction for contracts which are awarded under a fair and open, competitively bid process.”

For example, if ABC Consulting contributed $500 to an elected official’s campaign, they could not be awarded a no-bid contract with a value in excess of $17,500. But if the contract was competitively bid with ABC and other firms, ABC could be awarded the contract, as the pay-to-play prohibition would not apply.

Within a year after the law was enacted, the fair and open exemption was eliminated for state government contracts. The $300 threshold applies to both types of contracts, Vaccaro said. But this is not the case with local contracts.

“So what’s the problem? Fair and open sounds good, it’s competitively bid,” he said.

The bid criteria for selection in a fair and open process is at the discretion of the municipality, and the municipality does not have to document their selection or maintain records — a flaw documented in the September 2011 NJ State Comptroller report on pay-to-play weaknesses, Vaccaro said.

“Simply put, bids can be wired,” he said. “And I can tell you from being a private consultant, who responded to bids, we can tell when bids are wired.

“This pay-to-play loophole has been criticized by public interest groups and state officials, including Gov. Christie who called the practice of pay to play the “hidden tax” to the public because when contracts are awarded based on friends and families and not qualifications, it ends up costing you, the taxpayer.”

So Vaccaro prepared a pay-to-play ordinance for the township after reviewing other municipalities' ordinances, including the NJ Citizen’s Campaign model with the assistance of an attorney experienced in municipal law, he said.

The ordinance was presented to the township Committee for consideration and future adoption.

“I think it’s something we need. There’s a lot of criticism and concern, especially now with pay-to-play and I think it’s something we should do,” he said.

The cumulative monetary contributions made to Committee members Gary Quinn and Mark Dykoff for the 2012 general election was $33,670, many of which were from professionals that have done business with the township, such as O’Donnel, Stanton & Associates; Birdsall Services; Mid-State Abstract Company; Richard Alaimo Associates; T&M Associates and others.

The same goes for Mayor David Most. For the 2011 general election, the cumulative monetary contributions made to Most was $42,243, according to the 20-day post-election report. Contributions included donations from T&M Associates; O’Donnel, Stanton & Associates; Gilmore & Monahan; Dasti, Murphy & McGuckin; Cafarelli & Reid, LLC and more.

But for Committee members Helen DelaCruz and Sean Sharkey, the cumulative monetary contributions made for the 2010 general election was $17,205, most of which were contributions from unions and individuals not associated with businesses.

There is no indication that any of the contributions to Lacey officeholders violated the state’s pay-to-play law.

For example, Birdsall Services donated $800 to the Committee to Elect Quinn and Dykoff in October 2012. The company performed a feasibility study for Lacey Township for $22,500, but the agreement was made prior to Birdsall’s contribution. Although the services exceeded the $17,500 value threshold the township accepted Requests for Proposals, so there is no pay-to-play restriction for contracts.

Under the ordinance crafted by Vaccaro:

• Any firm that wishes to do business with Lacey, regardless of the contract type, is restricted to the $300 political contribution limit.
• The township would not be able to enter into an agreement with a business entity if a contribution of money has been made in excess of the threshold within one year immediately preceding the date of the contract or agreement.
• A business entity that submits a proposal for, enters into negotiations for or agrees to a contract or agreement with the township, cannot knowingly make contributions of money between the first time of communication between that business and municipality and the termination of negotiations, rejection of proposal or the completion of the contract or agreement.
• Any professional business entity that violates the ordinance would be disqualified from eligibility for future Lacey Township contracts for a period of four years from the date of the violation.
• If a business notified the municipality in writing and seeks and receives reimbursement of the contribution from the candidate, officeholder, political party or committee within 30 days after the general election, the violation can be cured.

“Implementation of this ordinance will not only eliminate the 'hidden tax' to our citizens, it will also serve to build confidence and trust, as stated in the ordinance, by establishing a 'policy that will avoid improper influence and the perception of improper influence in local elections,' " Vaccaro said.

Most thanked Vaccaro for his comments.

“We’ll consider them,” he said. “We’re not going to rush this either. Obviously we want to digest this material.”

Quinn and Dykoff were absent from this Committee meeting and would need time to read the ordinance and paperwork provided by Vaccaro, Most said.

A best practice checklist that the municipality received asked whether Lacey has a pay-to-play ordinance in place, Sharkey said.

“And we do not,” Sharkey said, asking Laureigh to include the issue on the agenda of an upcoming Committee meeting.

Laureigh said once all the Committee members and township attorney Lauren Staiger reviews the information and ordinance, it will be put on the caucus agenda for discussion.

A copy of Vaccaro's pay-to-play ordinance is attached to this story as a PDF.