June 2005

People for Open Government takes Mayor and City to court for campaign contributions violating pay-to-play ordinance

Mayor Roberts conducting his million dollar campaign to get re-elected in Hoboken with major support caming from developers and the HCDO.

The powerful Hudson County Democratic Organization, chaired by State Senator Bernard Kenny, has provided $299,600. Another $64,000 has come in from the Election Fund of Senator Kenny. Local developers have contributed $162,600. The grand total collected by the two political committees paying for Hoboken Mayor David Roberts' re-election campaign has now reached more than $1 million.

A local campaign finance reform group, People for Open Government (POG), however, has cried foul. In an amended complaint filed June 10 in Hudson County Superior Court, POG claims that over $400,000 in contributions violate a local ordinance that prohibits pay-to-play in Hoboken, the practice of businesses giving political contributions while enjoying or seeking no-bid contracts with the city. On November 2, 2004, the voters of Hoboken enacted this ordinance by a 10,185 to 1,178 vote in a public referendum. POG was the group that initiated this referendum, forcing it to be placed on the ballot after the Hoboken City Council refused to pass the ordinance.

POG has also challenged the Mayor's use of two political organizations to collect money for his campaign. Last week, POG asked the state's Election Law Enforcement Commission (ELEC) to investigate the use of the Hoboken Democratic Party, chaired by Roberts, to pay for his campaign, in addition to the joint candidate committee, the Roberts Team. POG's complaint to ELEC contends that the use of the two political committees is a means for exceeding the campaign contribution limits set by the state. A number of donors have contributed the maximum permitted $10,400 to the Roberts Team ($2,600 per candidate) and $7,200 to the Hoboken Democratic Party (maximum contribution allowed to a political committee). A number of these donors wrote checks to the two organizations within days of each other.

POG's lawsuit, originally filed last week, states that Senator Kenny is prohibited by the ordinance from contributing through the Election Fund of Senator Kenny and the Hudson County Democratic Organization. Kenny controls both of these political committees and is also a partner in the law firm, Sarkisian Florio & Kenny. Since Mayor Roberts took office four years ago, this firm has secured legal contracts with the City of Hoboken totaling more than $1.2 million.

Rahway attorney Roy Konray represents POG. He contends the ordinance banning pay-to-play cannot be circumvented by using intermediaries. Konray states "if an organization showers a candidate with money, the city is barred from awarding a no-bid contract to that organization or to any person who orchestrated the flow of money from that organization."

Ann Graham, Chair of POG, stated, "The purpose of this ordinance is to limit the excessive amounts of campaign money that can be raised in local elections. This ordinance goes a long way in restricting contributions from companies with a vested interest in City business. But since the Mayor has violated our ordinance, we are compelled to go to court to enforce it."

POG's lawsuit lists a number of other professional businesses including Business Governmental Insurance Agency, Birdsall Engineering, Kaufman Bern & Deutsch, Krivit & Krivit, Meadowlands Associates, PMK Group, Schoor DePalma, Statfeld-Vantage, Metro Stop, URSA Development and Tarragon Realty Investors. According to POG, these firms have no-bid contracts with the City of Hoboken and have made contributions over the past four months to the Roberts Team and/or the Hoboken Democratic Party. The developers with contracts in the Northwest Redevelopment Area, Dean Geibel of Metro Stop, LLC, Michael Sciarra of URSA Development and Arthur Garfield of Tarragon Realty Investors all contributed $10,400 to the Roberts Team and $7,200 to the Hoboken Democratic Party.

Under the ordinance, professional businesses interested in being considered for a contract with the City of Hoboken can donate but there are limitations. Contributions cannot exceed $400 per candidate and $500 to local political parties and political action committees. If a company contributes more than this amount, it cannot be considered for a contract. If a business currently has a no-bid professional contract with the City or is negotiating for one, it is prohibited from making any contributions to Hoboken candidates or a Hoboken/Hudson County party committee.

State Senator Kenny has recently come under scrutiny for a $5,000 contribution he solicited from the Friends of Senator Wayne Bryant for the Hoboken Democratic Party. According to the Star-Ledger, the contribution was made just two weeks prior to a vote by the Joint Committee on Ethical Standards which Senator Kenny chairs. The Committee rejected a request to investigate legal contracts that Bryant's law firm obtained in Camden, New Jersey. These $270,000 in contracts were awarded following Bryant's sponsorship of legislation that made these funds available. Kenny is close political ally of Mayor David Roberts, who is the chair of the Hoboken Democratic Party.

Mayor Roberts is running for re-election against City Councilwoman Carol Marsh. The field of five mayoral candidates was narrowed down to two in the May 10 election. The run-off election is scheduled for June 14 and also includes two slates of three at-large City Council candidates associated with the two mayoral hopefuls. The amount raised by Marsh pales in comparison to Roberts. She has collected $172,600 thus far in her campaign none of which came from companies with municipal contracts or political committees. So far she has received just one developer contribution, $1,000 from Lawrence Bijou. In the May 10th race, Roberts collected 3,803 votes (36.8%) and Marsh 2,976 (28.8%) out of a total of 10,342 votes cast.