PATERSON, NJ – The Paterson Municipal Utilities Authority plans to hire its first executive director under a $360,200 budget that received preliminary approval on Monday.

Creating the executive director’s position is part of Mayor Jeffrey Jones’ administration’s plan to craft a bigger role for the municipal utilities authority (MUA), an agency whose primary purpose over the years has been to collect payments from the private company that operates the city-owned hydroelectric plant at the Great Falls.

Under Jones, the MUA is planning to sell bottled water and may enter the solar energy business. Last year, the agency sponsored series of jazz concerts at the Great Falls – something it plans to do again in 2012 – and started making contributions to community groups, a move that became controversial because there was no formal process for distributing the funds.

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Jones said he wants to retain an expert to examine the hydroelectric plant contract with Algonquin Power Systems of Toronto to determine whether the city has been getting the best deal possible.

“Someone has to be there day-to-day to run this,’’ said Jones.

The utilities authority has received about 10 applications for the director’s job, which would pay between $50,000 and $60,000, said the MUA’s Chairman Erik Lowe. The field has been narrowed down to two people and a decision likely will be made within a month, officials said.

Jones said he has met with both applicants. Officials would not divulge their names, but the mayor said neither is from Paterson. “We were looking for someone who knows water,’’ said Jones, explaining that the agency conducted a search for people with expertise in issues involving a utilities authority.

“This is all being done for us to become a fully operating utilities authority,’’ said Lowe.

Several city officials are somewhat skeptical about the agency’s plans to bring on an executive director.

“To do what?’’ asked City Council Finance Chairman Kenneth Morris. “I would be supportive of any authority activities that have a positive return for the City of Paterson taxpayers, but I would have to see a plan.’’

“I don’t see the urgency in hiring an executive director unless they have an objective that can only be met if they have an executive director,’’ said Councilman Andre Sayegh, chairman of the committee that oversees statutory agencies.

Some Patersonians have questioned the need for the MUA and have suggested the agency’s functions be folded into city government.  Morris said he would support a “forensic audit of the finances” of all city agencies “to see if the functions benefit the city.’’

Under its proposed 2012 budget, the MUA expects to receive $360,200 in revenue - $167,200 from Algonquin, $180,000 from a state historic trust grant and $13,000 in interest payments. Meanwhile, the agency budget projects it will spend $265,000 in 2012 - $117,000 on administrative costs and $148,000 on services.

The budget does not provide a breakdown of those expenses. In addition to the executive director, the agency also plans to retain a $35,000 water consultant this year and make another $30,000 in community contributions, Lowe said.

In 2011, the MUA had a $2,000 per month project manager, Frank Blesso, on the payroll. He is no longer an agency employee. The authority in 2011 also paid $2,000 per month to its law firm, Hackensack-based Pashman Stein.

The state Department of Community Affairs is currently reviewing the MUA’s budget and must approve it before the agency can adopt it. At its meeting on Monday, the MUA did not make copies of the budget available to the public. Officials at the meeting said anyone requesting a copy of the budget would have to file an Open Public Records Act (OPRA) request.

After protested, pointing out that it is common practice among local governments in New Jersey to provide budget copies without the delay of an OPRA request, the agency allowed a reporter to review the budget at its offices at 72 McBride Avenue Extension.

The agency’s attorney, Bruce Ackerman, said anyone wanting a "personal copy" of the budget would have to pay a fee for the copying costs. State law does not require the agency to incur that expense, he said. Paterson’s city government and its school district provided the media with copies of their budgets without charging fees, a practice common among New Jersey government entities.

The MUA has not yet scheduled the adoption of its budget. Its meetings are held on the second Monday of every month at 6 pm.

Jones made it clear he had plans to expand the MUA’s role soon after he became mayor. He appointed as commissioners his chief of staff, Charles Pettiford, and his campaign manager, Shavonda Sumter, who has since been elected to the state Assembly. Lowe, a friend and ally of Jones, already had been serving on the authority as a commissioner.

Jones described his approach toward the utilities authority. “You’re generating electricity with your water, what else can you do with your water?” Jones said. “They found out they can sell water. Now that’s what I’m talking about.’’

The bottled water, which would feature a Great Falls logo, would not actually come from the Passaic River, but from an out-of-state spring. Jones unveiled the Great Falls water idea at his State of the City address last June, but sales have not yet begun.