Burlco Bridge Commission has deep ties to county GOP

As he assumed control of the obscure but powerful Burlington County Bridge Commission three years ago, chairman John Comegno oversaw the launch of a public-relations campaign designed to burnish a badly tarnished image.

The commission, historically a piggy bank for the Burlington County Republicans that collects almost $30 million a year in tolls on the Tacony-Palmyra and Burlington-Bristol Bridges, was reeling.

Its longtime lobbyist had just pleaded guilty to fraudulently billing the agency in what he would later describe in court as a scheme to kick back money to the county's influential Republican Party.

Although never charged with wrongdoing, two of the bridge commission's top leaders - chairman J. Garfield DeMarco, a former county GOP chairman, and executive director George Nyikita, a contributor to the party - left after the scandal.

A new public-relations officer quickly came up with a catchy slogan to herald the reforms Comegno planned: "New Era, New Span."

"We're going to take a fresh look at the way the commission does business," Comegno, an up-and-coming Moorestown lawyer, pledged after taking office in January 2007.

Now, as Comegno, 37, begins a second term, the commission has compiled a solid record of accomplishment and remained scandal free.

But the reform agenda has had little effect on Republican ties to the commission. It remains an agency run by party supporters and served by lawyers, engineers, and other professional-services contractors who regularly contribute to GOP candidates in the county. Those candidates often then give and receive money from the Burlington County Republican Committee, which raises more than any of its 20 counterparts across New Jersey.

An Inquirer review of campaign-finance reports, contracts, and other records shows that:

The commission and its staff have a number of Republican ties. Comegno's law firm, the Comegno Law Group, is a GOP donor. The executive director is the son of a Republican political action committee treasurer. And the new chief financial officer is a former GOP councilwoman from Riverton.

The law firm Capehart Scatchard, an influential backer of the Burlington County Republican Party, has received $2.2 million in legal fees since 2007. That's the equivalent of billing 13 hours a workday over the last three years.

Seven of the 10 professional-services firms that receive the most money from the commission have donated more than $600,000 to Republicans in Burlington County during the last three years. Of that amount, $250,000 came from the commission's engineering firm, Pennoni Associates.

The bridge commission did not go at its reform efforts alone. It benefited from the retention of a man well-suited for this particular turnaround: North Jersey Republican W. Cary Edwards, a former assemblyman whose gold-plated party credentials are burnished by a stint as state attorney general in the 1980s and his current position as chairman of the State Commission of Investigation.

His assessment of the 2007 commission: "Their operating procedures were very old - backwoods, I guess, is the way to describe it," he said. "And they were not contemporary with the modern requirements for a government agency, operationally and in their perception from the outside."

Today, according to Edwards, "it is an open, accountable, transparent government operation now that has significant checks and balances in places that operationally they never, ever had before."

Comegno described the commission as a model of transparency and accountability, saying political relationships and donations are not related to agency operations in any way.

He noted that the $2 toll on commission spans has stayed flat for a decade and is half that on bridges run by the Delaware River Port Authority.

And on Tuesday, Comegno and his fellow commissioners, Republican Priscilla Anderson and Democrat Troy Singleton, voted to forgo their $14,439 in salaries and benefits, citing Gov. Christie's efforts to control spending during the state's fiscal crisis.

Comegno is "very well-spoken, and I think he's a good commissioner," said Lumberton resident Richard Young, who occasionally attends commission meetings and has expressed support for a major agency project to remove debris from Rancocas Creek. "He's a Republican, but I don't hold that against him."

Not surprising, Chris Brown, one of two Democrats on the five-member Burlington County Board of Chosen Freeholders, who voted against Comegno's reappointment in January, sees things differently.

"I think John Comegno serves the interest of his political handlers as opposed to serving the interest of the residents of Burlington County," he said. "It's quite simple: You take a look at the contracts awarded."

One of the commission's most substantial new bridge initiatives and one of its most prominent longtime relationships were on display at its September meeting, when officials gathered at a maintenance building in Burlington City within view of the 2,300-foot Burlington-Bristol Bridge.

The agency, whose commissioners are appointed by the GOP-majority freeholder board, maintains six smaller county bridges in addition to the two spanning the Delaware River.

It also serves as the county's economic-development authority, empowered to sell bonds on behalf of towns to help them buy equipment and finance capital projects.

As the meeting proceeded, votes were taken on about a dozen agenda items before everyone walked over to the Burlington-Bristol, which connects Burlington with Bucks County. There, commission officials proudly demonstrated a new "traveler system," which they said would save money and improve safety for drivers and bridge workers.

The system consists of a motorized platform that rolls along the underside of the span. Officials said it enabled workers to inspect the bridge without blocking traffic, and was cheaper than renting the typical equipment.

When the demonstration ended, the commission recessed its meeting for lunch, then met in a private, executive session. The commissioners emerged, and publicly voted to increase the ceiling on Capehart Scatchard's legal contract from $300,000 to $800,000, in part to cover work Capehart Scatchard had already billed but for which it had not yet been paid.

The item had never made it onto the meeting agenda. Commission solicitor Carmen Saginario, a partner at Capehart Scatchard, explained that it had been discussed in executive session because it concerned litigation, and was not done "with any intent not to be open."

Saginario said the increase had come under a process by which he obtains "implicit authorization" for work beyond the contract ceiling, with the understanding that commissioners will later consider amending the contract. He said he had a legal obligation to continue working.

Capehart Scatchard is also home to Glenn Paulsen, still a GOP power broker five years after his 14-year run as Burlington County Republican chairman.

Year after year, the commission hires the 55-lawyer Mount Laurel firm, where he is a partner, to do most of its legal work, in addition to awarding contracts to about a half-dozen other law firms for specialized services.

The work is publicly advertised, and the commission receives submissions from law firms each year in renewing legal contracts, including Capehart Scatchard's. State law grants officials broad discretion in awarding professional-services agreements, which do not need to go to the lowest bidder.

The firm has received $2.2 million for legal services since 2007. Capehart Scatchard volunteered in December 2008 to lower its hourly rate from $225 to $200 because of the recession.

In addition to its general legal fees, Capehart Scatchard has earned $973,215 as counsel on $400 million in bonds the commission has issued since 2002 for economic development.

Among the lawyers billing the commission are Paulsen and Anthony Drollas, who also do legal work for the county GOP committee. Along with Brian Kowalski, a third partner of Capehart Scatchard who does much of that bond work for the commission, they have guaranteed $60,000 in loans to the Burlington County Republican Committee between 2007 and 2009, according to campaign finance records.

As a firm, Capehart Scatchard contributed more than $170,000 to Republican candidates and committees in the county during that period.

Saginario, the solicitor, attributed an increase in billing from $265,939 in 2005 to $767,107 last year to an array of complex issues handled by the firm. One involved litigation and protracted negotiations that produced a $10.9 million reimbursement claim for damage to a triangular metal fender, designed to protect a bridge support pier from boats and debris in the water, that he and Drollas recently won from Lloyd's of London, "arguably the world's largest and most powerful insurance conglomerate," Saginario wrote in an e-mail.

Another, he said, resulted in the commission's keeping dredge material from the Delaware out of Palmyra Cove Nature Park and preserving 50 acres from future use, as part of the agency's management of the park.

Saginario additionally cited legal work tied to the commission's increased economic-development activities, as well as assistance with permitting and site access for the clearing of debris from Rancocas Creek.

Saginario, 51, began working in New Jersey government as assistant counsel to Republican Gov. Thomas Kean in 1984 before moving up to deputy attorney general under Edwards.

There, Saginario met Paulsen, picked by Edwards to be commissioner of the Division of Motor Vehicles. Saginario left his $54,315-a-year post in 1988 for private practice.

Saginario returned to government in 1995 when the commission hired him as solicitor while he was at Capehart Scatchard with Paulsen. For almost all of his years in the part-time position, Saginario was on the payroll as an employee earning $100,000 a year while also billing as an independent contractor - and accruing public pension and health benefits.

Saginario said his salary had covered his routine work as solicitor. He and colleagues billed as a contractor for more specialized work, including litigation.

Saginario said Comegno had approached him about leaving the payroll and billing for all his services as a contractor as part of the agency's reform effort. When a new state law in 2008 prohibited those on public payrolls from billing for additional work as contractors, he left the payroll.

Comegno said he had "tremendous confidence" in Saginario. He said he did not believe it would be more economical to hire in-house lawyers, given the complex issues facing the commission.

Saginario said he risked losing the work every year, "and it's something that I worry about, so what I do every year is the best work that I can."

One of the outside legal contractors Saginario oversees is Edwards, whom he described as a longtime mentor to him and Paulsen. Edwards' firms were paid more than $350,000 in the last five years; his hourly billing rate is $380, up from $350.

"How can we do things better, how can we put better internal controls in place, better checks and balances? He really helped us a lot with that stuff," said Saginario. "With his experience in running governmental agencies and investigating governmental agencies, his experience and advice was invaluable."

Edwards, who said he briefly consulted for the commission in the 1990s, returned in 2004 to help the agency cooperate with investigators looking into another prominent political figure, then-State Sen. Martha Bark (R., Burlington).

From 1997 to 2001, the commission paid Bark $52,000 a year as a part-time consultant. According to published reports, she was hired by Nyikita, who was the executive director and, along with Bark, was among about 20 Republicans who joined forces on several occasions to personally guarantee a loan of $200,000 to $300,000 to bankroll GOP campaigns.

A month after leaving, Bark sponsored legislation authorizing the commission, beginning in 2002, to float bonds and serve as the county's improvement authority.

In 2004, the state Attorney General's Office launched an investigation of the agency after published reports that it had little evidence of work she performed. The office never pursued charges, and Bark did not run for reelection in 2007. She declined to comment.

A federal probe in 2006 did snare GOP operative Robert Stears, the commission's longtime lobbyist.

When sentenced to 27 months in 2008 on mail-fraud and tax-evasion charges for defrauding the commission, Stears told a federal judge in Camden that he had submitted bogus invoices to the agency for $4,000 a month and kicked back some of that in contributions to the Burlington County Republicans.

Stears said in court that he had been "sucked into a corrupt group of people" who told him how much to bill and contribute to the GOP in order to keep his contract. But no one else was charged.

Comegno called it "old history."

"We've become a more transparent public agency because of the lessons of the past," he said. "We've moved on."

In January 2007, Nyikita announced he was retiring as executive director and left the commission. But his paychecks, totaling $177,260, continued throughout 2007, amounting to the highest annual earnings of his long government career, according to the state treasury.

Why did he continue collecting a paycheck? In November 2006, 10 days before Stears' guilty plea, the commission agreed to Nyikita's request that his retirement take effect Jan. 1, 2008, records show.

Saginario said the payments from the bridge commission were for accrued sick time and vacation under a policy no longer in effect. Nyikita also received workers' compensation.

Such payouts drew criticism in a December report by the State Commission of Investigation, which Edwards chairs. The report, without naming the bridge commission, called for restricting payments of accrued leave and ending "schemes that enable public employees to remain on the public payroll without working."

In 2008, Nyikita began collecting an annual pension of $76,000, according to treasury data.

Nyikita, now 59, also went to work in January 2008 for engineering firm Pennoni Associates, where he is manager of corporate development.

The company, headquartered in University City, has overseen most of the engineering work on commission bridges since 2004 and is the commission's largest professional-services contractor.

"George was hired because of his knowledge and experience with New Jersey local, county, and state public entities and his community and business contacts," Peter Coote, Pennoni's vice president and general counsel, wrote in an e-mail. "He also has knowledge and experience with transportation agencies throughout the Northeast region."

Pennoni oversees major capital projects, such as the replacement of the Tacony-Palmyra grid deck, and is teaming up with Drexel University to implement real-time monitoring technology on the bridges under what state records show is the firm's largest public contract in New Jersey.

Between 2007 and 2009, Pennoni received $9.9 million from the agency while becoming a top donor to the county GOP, donating more than $250,000 to its candidates and committees.

Pennoni for years had failed to comply with a requirement by the New Jersey Election Law Enforcement Commission that it disclose its public contracts and its campaign contributions, records show.

Asked about the company's lack of disclosure, Coote replied in an e-mail that the firm had since filed the reports.

Within weeks of Nyikita's delayed departure from the commission's payroll, his son, Josh, began occasionally doing billable work for the commission under its contract with Acacia Financial Group.

Josh Nyikita and a partner, Kim Whelan, founded the firm in 2006 with several others after earlier working at Public Financial Management. In all, PFM and Acacia have made $514,378 since 2002 serving as financial adviser on most of the agency's bond issues.

Whelan was formerly married to Kowalski, the Capehart Scatchard partner who is bond counsel to the commission, Saginario said. Saginario called Acacia "a great company," said Josh Nyikita was qualified, and added that, as of last fall, he had personally billed for only 17 hours' work since early 2008.

Taxpayers, rather than toll-payers, foot the costs of bond issuance, including fees paid to Acacia and Capehart Scatchard. The issuance costs are paid from bond proceeds and prorated among participating towns and other local government units depending on how much they borrow.

Towns can sell bonds for various expenses through the commission and have saved $641,878 in borrowing costs by doing so, commission spokeswoman Liz Verna said. The program has also saved county taxpayers more than $13.9 million because they receive better interest rates when the county guarantees the bonds, she said.

Early in Comegno's term, a Philadelphia consulting firm's review of commission contracting practices found an absence of standardized procedures to ensure that firms performed within the agency's requirements and budget.

The consultants found that the commission lacked detailed documentation backing up invoices for professional-services contracts. The system, the consultants concluded, allowed for "potential manipulation of the contract price and escalation of project costs."

Officials said they had enacted all of the recommendations in the 2007 report, which cost $44,388. Last year the agency replaced an antiquated financial system with a more advanced, efficient version that Comegno said was a "very good example of pushing the institution forward." For greater accountability, it adopted a recommendation by Edwards to have the chief financial officer report directly to commissioners.

Spearheading that and other financial changes was lawyer and certified public accountant Christine Nociti, formerly a county treasurer and Republican councilwoman in Riverton.

The commission hired her more than a year ago at a $155,000 salary as chief financial officer and compliance officer, and Comegno credited her with bringing a "fresh perspective."

In replacing Nyikita as executive director, the commission directed Edwards in 2009 to review 20 employment applications and make a recommendation.

His top choice - backed by the commissioners' vote - was an insider, John Jeffers, who started in 1983 on the maintenance staff operating heavy equipment and planning construction and rose to become Nyikita's deputy, then acting executive director in 2007.

Jeffers' mother, Nancy, is a former county superintendent of elections and is treasurer of the Burlington County Republican Women PAC, which makes campaign contributions to local Republicans.

"I did find that Jeffers had made all the hard decisions. . . . Not only was he more than willing, but he was enthusiastic and had done what I believe was an excellent job in actually changing the face of the agency itself as the acting director," said Edwards.

Jeffers, 51, makes $175,000 - more than anyone in county government.

Comegno spoke proudly of having an executive director who had come up through the ranks, and noted that Jeffers had held the position of deputy director - still vacant - and executive director simultaneously.

Another of the commission's recent hires, Kim Addiego, came from the Burlington County Republican Committee, where she worked as a field director. The sister of Assemblywoman Dawn Addiego (R., Burlington), she works as a $38,000-a-year assistant at Palmyra Cove Nature Park, but said that she had received no special treatment and that the job had been publicly advertised.

In late 2006, freeholders decided not to reappoint DeMarco as chairman of the bridge commission and replaced him with Comegno. Then-Freeholder Director James Wujcik noted that Comegno, while a Republican, had not contributed any money to the county GOP, the Courier-Post reported at the time.

Since his appointment, Comegno's law firm has contributed $15,000 to Republican candidates in Burlington County, about half to freeholder candidates.

Comegno's emergence as a party contributor came to the fore in 2008, when Republicans faced one of their toughest election years in history and two Democrats won freeholder seats for the first time in a quarter-century.

The Comegno Law Group, Capehart Scatchard, and Pennoni were the first and only donors Oct. 24 to the newly formed primary election campaign account of Wujcik, a Republican, campaign records show. They donated a total of $7,200, though Wujcik was not up for reelection for another year. The next day, the Wujcik account gave $7,000 to a fund for GOP freeholder candidates Aubrey Fenton and Stacey Jordan, who eventually lost.

The Comegno firm, Capehart, and Pennoni made the first contributions, worth a total of $7,200, on Oct. 24 to the new primary election campaign account of Republican Freeholder Joe Donnelly, who was not up for reelection until 2010. The only other donor that day was the Riverton Republican Committee, which gave $800. The Donnelly account then gave $7,500 to Fenton and Jordan the next day.

Pennoni had already made the maximum contribution allowed to Fenton and Jordan directly.

Comegno said his firm contributed to candidates that it believed in. But those contributions, he said, have no relations to his chairmanship of the bridge commission.

Saginario said his firm had no control over where money went after Capehart Scatchard made a donation.

Coote, Pennoni's vice president and general counsel, said the firm did "not know whether the candidates we have supported decided to support other candidates." He said all the firm's donations complied with the law.

"Pennoni contributes to those candidates and committees of both parties that are committed to infrastructure funding at a level that will ensure safety," Coote said.

Pennoni also contributes $7,200 each year - the legal limit - to the Burlington County Republican Women PAC, formed in 2004. Election filings list the treasurer as Jeffers' mother and the chairwoman as Grainne Drollas, wife of the Capehart Scatchard lawyer.

The PAC has accepted more than $70,000 since 2007 from commission contractors, some of whom also work for Burlington County government.

"I love my mother dearly, and we discuss many things. However, I have never spoken to her about this organization," Jeffers wrote in a statement.

Edwards said one of his recommendations to commissioners - which officials say is in effect - was never to look at political-contribution records, "because if you look and you either hire or don't hire somebody, you're going to be accused of doing it for that reason. If you don't look, then you make decisions based on merit and not on campaign contributions."

Comegno bristles at questions about political donations and relationships, saying he had never been told to give work to a firm.

He's eager, instead, to talk about the agency's accomplishments under his watch, as he did at his annual "state of the bridge" speech in January. In it, among other accomplishments, he touted the agency's efforts to save tax dollars for county residents by having a commission consultant secure $8 million in government grants for "cash-strapped" municipalities in 2009, and a new program that provides funding for energy audits for towns and schools.

In an earlier interview, Comegno said: "I know sincerely and wholeheartedly that we have brought real change. . . . Do we still have work to do? Absolutely."