TRENTON – A state watchdog has found that Newark improperly awarded a no-bid contract to a business associated with the New Jersey Devils to renovate a public ice rink, in a method that cost taxpayers $5.5 million for a park adoption that should have cost them nothing.
The Office of the State Comptroller investigation released Wednesday found that Newark financed the entirety of the ice rink renovation, in violation of the Adopt-a-Park law that lets municipalities contract with private entities to improve or maintain a public, so long as it’s done at no cost to the municipality.
The state enacted the Adopt-a-Park law in 1992, and this is at least the third time Newark has run afoul of it.
“Municipalities that renovate parks are required to follow an open and transparent process that invites competition to avoid favoritism and advance the economic interests of taxpayers,” said acting State Comptroller Kevin Walsh. “Newark violated state law when it simply selected its preferred contractor without seeking competition through a public bid.”
In 2017, Newark sold $5.225 million in municipal bonds to finance the renovation of the ice rink at the Sharpe James and Kenneth A. Gibson Recreation and Aquatic Center.
The proceeds were used to enter a nearly $5.5 million construction contract in 2018 with Devils Renaissance Development that wasn’t publicly advertised and subject to competitive bidding. That was required because public money was involved. The contract with DRD omitted all references to the part of the Adopt-a-Park statute that requires municipalities pay no costs associated with the project.
The report said DRD was a general contractor, forwarded funds to subcontractors who did the renovation and did not receive any financial compensation.
“There are legally permissible and transparent ways for the City of Newark to partner with companies and non-profits while also complying with public contracting law, but that did not happen here,” Walsh said. “The public bidding process in New Jersey exists to prevent both favoritism and the appearance of favoritism when taxpayer money is being spent.”
Newark officials told the comptroller’s office its actions, such as appearing before the state Local Finance Board, approving the agreement through the City Council and submitting the contract to the state comptroller for review, show it “was acting transparently and in good faith.”
The comptroller’s report found five other Adopt-a-Park related projects in Newark dating back to 2008, including two in which the city partially paid for the projects.
Michael Symons is State House bureau chief for New Jersey 101.5. Contact him at [email protected].
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