On Monday, May 6, 2024, Acting State Comptroller Kevin Walsh testified before the NJ Senate Community and Urban Affairs Committee about Bill S2702. In December 2023, OSC released a report that found Union County failed to comply with a law  that required the County to set top officials' compensation by ordinance, through a public process. Bill S2072 would reduce public transparency and would not require the compensation to be set through an ordinance. 

Below is a lightly edited transcript of the Acting State Comptroller's remarks. 

In December of last year, the Office of the State Comptroller, issued a report regarding compliance with the law addressed in this bill, S2702, in a report involving Union County. The investigation found that the Director of Finance received $303,000 in stipends for a second job and for a partial tuition reimbursement from October 2019 to August 2022, and took graduate classes worth nearly $40,000 as well. Something similar occurred with the Director of Public Works, who was paid an additional nearly $100,000 from January 2019 through August 2022 to assist the municipality's public works department.

We found that the law in place that addresses the compensation paid to high-level county officials was violated in this instance because under any reading of that law, over $400,000 of payments to a few high-level people would seem to be compensation.

We also noted that the county manager received tuition reimbursements totaling $16,500—again, not through the process that's required, in our view, by law.

As I understand it, this bill has been introduced to address the findings in that report.

As drafted, S2702 would upset the current balance throughout the state, in which county residents have notice and an opportunity to engage on how much senior county officials are compensated. There are different approaches depending on the form of (county) government, but they all provide notice and a chance to engage. This bill, S2702, would eliminate that process and allow senior county officials to receive potentially substantial stipends and bonuses without going through the normal process. They would go through the process for the base salary for their first county job, but bonuses for that job, as well as stipends for second, maybe even third or more county jobs, would be outside the normal process.

It seems to me that the pay for the additional jobs and the bonuses that senior county officials get, are at least as deserving—and likely even more deserving—of the checks and balances the public currently has. (Currently, the public can reject the pay, in which it has notice, and an opportunity to be heard over maybe a month's time period.) That process is at least as appropriate for the second, or the third, job, where the greatest risk of waste and abuse lies.

The public would want to know how the second and third jobs are going to work, I'd imagine. How many hours will be worked in the second and third jobs? Will the senior county officials record their hours? What other benefits will there be for the second and third jobs?

I urge caution, and a rethinking of the role of the public, when the people with the greatest access to power and access to the greatest perks, get paid.

As best I can tell, based on the facts available to me which were addressed in that report, this would immediately apply to the additional pay for the second jobs of just two Union County officials and no one else in the state of New Jersey.

If the goal is to avoid an ordinance for de minimis fringe benefits, maybe S2702 could be amended to say that base salary, bonuses, tuition reimbursement, raises and stipends, are compensation for the purposes of the act, but de minimis fringe benefits are not. And so the base salary, bonuses, tuition reimbursement, raises and stipends for senior county officials would have to go through the existing ordinance process (for top officials). That's what the law currently provides.

I urge you to amend the bill to use that approach, at a minimum, before moving this bill forward. Thank you.

Listen to the full testimony starting at 1:08:00