Welcome to a state where
you can get overtime pay to
recharge your cell phone

One of the most shocking examples of your tax dollars being wasted on a grand scale was revealed this week when an independent audit disclosed hundreds of thousands of dollars have been wasted by a single urban school district, which receives more than three-quarters of its funding from the state.

The audit findings, obtained by Republicans from the state Department of Education through an Open Public Records Act (OPRA) request, were egregious enough to startle even the Democratic chairman of the Assembly Budget Committee, who categorized them as "an atrocity."

Republican Assemblywomen Marcia Karrow and Alison Littell McHose, members of the budget committee, said that in light of the audit's findings the Corzine Administration’s new school funding formula should be discarded and replaced with an equitable plan that does not reward school districts like Union City, which was the target of the audit, that mismanage and waste hundreds of thousands of dollars of taxpayer money. Among other things, the audit revealed that the school district pays $13,000 a month for 39 cell phones for bus drivers which equates to $345 a month per each cell phone.

The 2007 audit results of the Union City School District revealed numerous examples of questionable and wasteful spending practices, including significant overtime pay to bus drivers. Those same drivers receive six hours of overtime pay each month to charge their cell phones.

Other wasteful spending includes a $26,097 monthly payment for website development, $11,600 in advertising costs to promote the opening of a new school, $9,268 for hotel expenses for an out-of-state administrative retreat, $2,600 for a staff party, $2,315 for a student field trip to the Medieval Times, and $1,716 for a wall-mounted LCD Flat Panel TV for a Human Resources office.

Karrow, R-Hunterdon and Warren, said she was horrified to learn that at least five Union City School District bus drivers were paid anywhere from $39,000 to $73,000 in overtime, accounting for 167 percent to 237 percent of their base pay.

"Mr. Corzine and his Democrat allies rammed a new, but clearly flawed school funding formula through the lame duck session of the Legislature in January that rewards school districts like Union City, which is mismanaging and wasting precious tax dollars," she said. "The governor needs to explain to taxpayers why he approved such an inequitable formula which leaves most suburban and rural school districts with very little aid yet increases state monies to urban districts where waste is rampant."

Union City is slated to receive $149.2 million in state education aid for Fiscal Year 2008-2009, an increase of $20.4 million over the $128.7 million it was awarded for FY 2007-2008.

McHose, R-Sussex, Morris and Hunterdon, noting that the Union City School District currently receives 76 percent of its total funding from state taxpayers, said it is mind-boggling that the state would continue to pour millions of dollars into a district that has little regard for how it spends that money.

"Union City is just the tip of the iceberg," she said. "Why should our hardworking taxpayers all over the state continue to pay for such blatant waste in Abbott school districts and then have Trenton, year after year, rake them over the coals for more money due to yet another flawed school funding formula?"

McHose, adding that state aid to education accounts for about $8 billion of the total state budget, said it is "this kind of questionable and unnecessary spending that the Administration needs to address before it arbitrarily proposes budget cuts. State spending cuts are absolutely necessary, but they should be fair, however, with an inequitable school funding formula that isn’t possible. The responsible thing to do is to go back to the drawing board."

A review of the KPMG audit compiled by Millennium Radio News found:

• One individual was paid for 14 pay periods after termination at the employee's request.
• Two individuals were paid 21 and 24 pay periods after termination.
• The audit report says that, according to the contract, school bus drivers are paid six hours of overtime each month in order to charge their cell phones.
• One bus driver in the 2005-06 school year earned $73,125 in overtime, which accounted for 237 percent of the driver's base pay. In other words, the driver earned over $100,000 in wages that year.
• A bus driver in the 2004-05 school year earned $61,456 in overtime, 217 percent of base salary.
• One bus driver in the 2005-06 school year earned $51,725 in overtime, 204 percent of base salary.
• $150,000 for an annual lease of the Ronald Dario Swimming Complex, which was used only part-time in year 2005-06; and $100,000 for 2004-05, again for part-time.
• The district spent $72,843 for cable TV spots.
• $55,000 was sent to a PR company for helping the district to prepare monthly superintendent's newsletters, which were sent out in August 2004.
• Another approximately $50,000 was expended in printing costs for 1,000 posters and 25,000 brochures.
• $32,302 was sent to a DC law firm to help the district secure grants
• $26,000 in monthly payments were made for website development. Monthly?
• The district paid $2,315 to send kids to Medieval Times, which is a restaurant chain that provides dinner and a live jousting show.
• $2,600 for a staff party.
• Taxpayers spent $9,268 for hotel expenses incurred for an out-of-state administrative retreat.
• $3,476 was spent to send 28 students to visit colleges; one trip was to Boston.
• The district spent $3,000 to pay for "floats for [a] Thanksgiving Day Parade."
• A firm called Furia Rubel, based out of PA, was paid big bucks from the district for PR and website development. Just singling out the period from October 2004 to February 2005, the firm received over $148,000. And the payments don't stop after that.
• A trip to a Poconos resort, paying for a "field trip" for 140 seventh graders and chaperones back in June 2004.
• $400 for a "clown show" at Gilmore school, which the auditor labeled "questionable."
• $13,411 monthly payment for 39 cell phones used by bus drivers.
• A "Cocktail Dinner" for 50 people at the Old Tapas Restaurant -- $1,150. "Food for staff."
• $21,125 for 25,000 brochures called "Keys to the City," which were sent to the entire city.
• $1,716 for an LCD flat panel TV for the HR Director's Office.
• $2,268 to the Sheraton Edison Hotel back in February 2005, which paid the tab for students and two teachers. According to the audit report, no agenda was found and they were unable to determine the purpose or necessity of the trip.

Assembly Republican Budget Officer Joseph Malone said he has a growing concern that the deeper the Assembly Budget Committee digs into state government, the more pervasive the waste of tax dollars they are identifying, with no answers as to how that waste can be eradicated.

"The more we look at these departments, the more apparent it becomes that our government is currently incapable of managing the financial affairs of this state," said Malone, R-Burlington, Monmouth, Ocean and Mercer. "This week alone we have discussed over $20 billion – nearly two-thirds of the state budget – and every day brings new revelations of waste or abuse."

Earlier in the week, during the hearing on Medicaid, the budget committee learned that the state auditor found serious flaws in monitoring Medicaid expenses, including examples of equipment providers who improperly billed Medicaid for $2.1 million during one 30-month period reviewed.

A second audit found examples of individuals enrolled in the state’s FamilyCare program, a program which offers health coverage for children and some adults with low-incomes, who have incomes too high to qualify for the program’s benefits, yet are still receiving those benefits.

"What is more disturbing is that there appears to be no concerted effort underway to stop this waste and abuse of tax dollars," Malone said. "With 611 school districts and 567 municipalities, I am not at all confident in the ability of our state departments to monitor and control the fiscal management of these many governing bodies."

"The reality is that New Jersey right now is incapable of managing its finances, and unless we find a solution, matters will only get worse," Malone added.

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