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Illegal Paychecks? Council Argues That Administration Paid Municipal Employees Without Authorization

February 20, 2013 at 6:40 AM

PATERSON, NJ – Several City Council members on Tuesday night accused the administration of illegally issuing municipal paychecks last week, arguing that the finance department never had proper authorization to spend the money because the temporary budget for February had been rejected.

Corporation Council Paul Forsman told the council that Finance Director Anthony Zambrano had gotten special approval from the New Jersey Department of Community Affairs (DCA) last week to issue the checks as a result of the council’s decision on February 12 not to approve a temporary budget for February. [Editor's note: The original version of this story erroneously attributed the above statement to Business Administartor Charles Thomas.]

But council members asserted that the state had no authority to override their decision and that Zambrano should not have sought the state’s approval without at least consulting with the council.

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“I wasn’t aware that we are fully under state takeover,’’ said Councilman Kenneth Morris, referring to the DCA’s role. “If they want total and complete control over the city, let them take control totally and completely,’’ Morris added. “They cannot govern the city this way from Trenton.’’

“This right here is totally illegal,’’ said Councilman Rigo Rodriguez. “Even though you have the money there, you can’t spend it unless it’s authorized.’’

At first, the council at its meeting on Tuesday night gave its approval to what’s normally a routine procedure – the payment of city bills. But after a 6-2 vote, Rodriguez and Morris raised objections to the legality of paying bills for which there was no budget authorization and the rest of the council reconsidered its approval. Instead, the council decided to wait until next week to vote on paying the $4.5 million worth bills, most of them consisting of last week’s paychecks.

In practical terms, the $4.5 million has already been spent because the paychecks had been issued last Friday. But council members said they did not want to set a precedent of signing off on bill payments that they thought were improper.

At the council’s request,  Forsman agreed to provide his legal opinion on two questions: first whether the DCA has legal authority to intervene in the city’s bill payments, and second, whether the administration could make the payments without the council’s authorization.

Councilman William McKoy outlined what he called  four “stipulations” that the administration ought to meet to get the council’s approval on the bills next week:

*That a temporary budget be crafted for February that only includes the $4.5 million bills that were postponed Tuesday night

*That Zambrano attend the meeting and provide an explanation in writing for the actions he took

*That Mayor Jeffery Jones be at the meeting “to account for his administration’s actions’’

*That the administrationpresent the council with a plan for closing the current $8.5 million structural deficit in the 2013 budget.

McKoy said the conflict over the temporary budget and whether last week’s paychecks were legally authorized confronted city officials with some challenging questions. He said he agreed with his colleagues’ assessment that the administration had overstepped its authority by paying the bills without authorization, but he also pointed out federal and state labor laws required the city to pay employees in timely fashion.

Other council members also said they did not want to do anything that would interfere with the issuance of the city’s regular paychecks.

“I completely understand that what we’re doing is not like appropriate, but you also have to think about the other side that people need to get paid,’’ said Councilman Mohammed Akhtaruzzaman. “We cannot stop that.” Akhtaruzzaman warned that any uncertainty about the payroll would “demoralize people.’’

But Morris responded that the council had a responsibility to taxpayers and not just to employees. “You can’t get paid if there’s no money,’’ Morris said. “You can’t continue to squeeze a penny and hope it’s going to turn into a dime.’’

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