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Updated Version: Audit Fees Skyrocket in Police Overtime Lawsuit

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PATERSON, NJ – The cost of the overtime battle between the City Council and Paterson's police union has grown by $70,000.

The council Tuesday night voted to increase its contract for an audit of police department overtime and payroll records to $85,000, which is almost five times larger than the original price of $15,000 approved last month.

Council members said the audit ended up costing so much more because many of the documents are only kept on paper. “It’s a very time-consuming effort,’’ said Councilman William McKoy, who works in finance.

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[Editor's note: This story has been updated with additional comments from Councilman McKoy regarding the increase in the size of the contract. Those comments are in bod down below in the story.]

The Policemen’s Benevolent Association (PBA) sued the city council last year on the grounds that it had blocked officers’ overtime checks for several months, violating the terms of a labor contract that requires timely payment. The council had refused to pay the overtime until it received documents substantiating the payments. Eventually, the council signed off on about $269,000 in police overtime bills, but only after the PBA filed its lawsuit.

The union is now seeking damages from the city. “It’s a slap in the face of the taxpayers and a disservice to the city with them (the union) knowing we’re a distressed city and we’re facing a budget deficit of more than $8 million,’’ McKoy said of the union’s lawsuit. McKoy, who is chairman of the council’s public safety committee, said the police officers should be satisfied they received the belated overtime pay. Many public works employees make less money in regular salaries than the police officers do in overtime, McKoy said.

But Alex Cruz, president of the police union, said the officers deserved better treatment from the council.  “I would like to see what Councilman McKoy and Councilman (Kenneth) Morris would do if they were working for three months without being paid,’’ said Cruz.  “The PBA by no means wants to insult the taxpayers of the city or the council. But the council should not affront the men and women of the Paterson Police Department who come to work every day and work the overtime and should be paid for the overtime.’’

Cruz suggested that McKoy and Morris save the city $85,000 by conducting the audit themselves “on their own time.’’ The union president said, “I’m sure they could do that with their expertise.’’

McKoy said the auditor's are going to review the timeliness of police overtime payments for the past three years, including the amount of time it normally would take the department to process overtime requisitions once they were submitted by officers to their supervisors for approval.

McKoy said the judge in the case has asked that the overtime report be completed by an upcoming February 13 court date. McKoy said the judge wants the auditor's findings to serve as the factual basis in the case by which both sides - the council and the union - would have to abide.

The city's lawyers orginally told the council in private discussions that they could hire a firm to do the job for $90,000, McKoy said. But the council decided to go with the firm that it uses for the city's regular annual audit. McKoy said the initial $15,000 contract was for "exploratory" work and that the additional cost came as no surprise to city officials.

Mayor Jeffrey Jones accused the city council of being irresponsible by withholding the police overtime in violation of the PBA contract. “The first thing they should have asked was:  ‘What does the contract call for?’” said Jones.

In addition to the fees for the auditing firm of Donohue, Gironda & Dorio, the city will end paying legal fees for the private law firm representing the council in the case and may end up on the hook for the PBA’s legal fees as well as damages of more than $200,000, the mayor said. “The potential cost for all of this could be very high,’’ said Jones.

McKoy dismissed the mayor’s criticism. “That’s a short-sighted approach,’’ he said.  He argued that the council simply was attempting to hold the police department accountable by requesting the documentation before signing off on the overtime bills. McKoy said the police department’s payroll system has flaws, including the way overtime is monitored, that provide opportunities for abuse. “It’s a broken system that had created this problem,’’ he said.

During the 2012 fiscal year, Paterson spent $1.6 million on police overtime, about $314,000 more than what had been budgeted, according to city records.  Preliminary figures for the 2013 budget put police overtime at $1.7 million.

McKoy said the council would have approved all the overtime in timely fashion if the administration and police department had provided the payroll records the council requested. McKoy the police department itself was responsible for the delay by not cooperating with the council’s request for documents.

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