Newark illegally spent $5M renovating ice rink by skipping bidding process, officials say

Published: Sep. 01, 2021

Newark violated the law when it spent more than $5 million of its own money to renovate a skating rink without opening up the project to bidders, state officials say.

The state comptroller released a report Wednesday claiming Newark skirted the required public bidding process and instead gave a $5.4 million private contract to a group associated with the New Jersey Devils. Such a move may have led taxpayers to spend more money on the project, and also could undermine public trust in government processes, the report said.

At issue is the Adopt-a-Park statute, which allows cities and towns to contract private companies to maintain or improve public parks. The catch: The project must come at no cost to the municipality.

But the comptroller’s office says Newark financed the entire renovation at the Sharpe James and Kenneth A. Gibson Recreation and Aquatic Center, issuing $5,225,000 in municipal bonds in 2017 and taking on debt to do so.

“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,” acting State Comptroller Kevin D. Walsh said in a statement. “Newark violated state law when it simply selected its preferred contractor without seeking competition through a public bid.”

Newark objected to the report’s conclusion.

“We disagree with the Comptroller’s findings,” the city said in a statement. “We relied on advice of outside counsel and will continue to comply with the law. Most importantly, Newark’s youth can enjoy skating on a first-class ice rink built by the Jersey Devils.”

The contract between the city and Devils Renaissance Development omitted parts of the Adopt-a-Park statute that mandate municipalities pay nothing for the projects, officials said.

Devils Renaissance Development worked as a general contractor but did not receive money for the project, according to the report. Instead, it sent funds it received from the city to subcontractors.

A spokesperson for the New Jersey Devils did not immediately return a request for comment Wednesday.

It’s not just the ice rink. The comptroller’s office has looked at five other park projects Newark has worked on since 2008. It found the city partially paid for two of them.

The city initially argued that a provision in the state Constitution, read along with the Adopt-a-Park Statute, allows municipalities to provide “equipment, materials, supplies, or services,” and that also allowed it to fund the project, according to the report. State officials disagreed with this argument.

Officials listed four recommendations for the city to abide by in contracts, and Newark has agreed to implement them, according to the report.

“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’s statement said. “The public bidding process in New Jersey exists to prevent both favoritism and the appearance of favoritism when taxpayer money is being spent.”

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published this page in News and Politics 2021-09-02 02:38:50 -0700