By Mark Lagerkvist │ New Jersey Watchdog
TRENTON — In a sudden reversal, the New Jersey Government Records Council has decided the documents detailing Lt. Gov. Kim Guadagno’s involvement in a $245,000 pension scandal are too hot for the agency to handle.
The GRC voted unanimously Tuesday to quit the case and not review the records it twice ordered the State Treasury to submit for inspection. Instead, the matter will be sent to an administrative law unit in Gov. Chris Christie’s executive branch for a decision, a process likely to take months.
Despite a victory in Appellate Court last month, the council lost its will to pursue a complaint likely to embarrass or implicate Guadagno, who will remain as Christie’s running mate for the 2013 gubernatorial election.
“Because of the nature of the subject of this complaint, this complaint should be referred to the Office of Administrative Law…” according to a draft of the GRC staff recommendation released just before the meeting.
But as soon as the meeting started, the GRC went into executive session to discuss the case behind closed doors – and change the wording of the resolution it would adopt.
When the public was invited to return, the reference to “the nature of the subject of this complaint” and its political inference had disappeared. It was replaced by an assertion the agency did not have enough resources or staff to finish the case it started.
The council is comprised of four voting members. Two are officials in Christie’s cabinet – his education and community affairs commissioners. The other two are public members appointed by the governor’s office.
The governor also appoints the judges in the Office of Administrative Law. The chief administrative law judge presides over the office and reports directly to Christie.
The records in question focus on an alleged pension scheme while Guadagno was Monmouth County sheriff. The story was first reported by New Jersey Watchdog in 2010.
Treasury officials gathered the documents during its inquiry of whether Guadagno’s chief officer, Michael W. Donovan Jr., improperly collected nearly $85,000 a year in state retirement pay in addition to his $87,500 annual salary.
In 2008, Guadagno hired Donovan, a retired investigator for the county prosecutor, as the sheriff’s “chief of law enforcement division.” She announced the appointment in a memo to her staff. The sheriff’s official website subsequently identified Donovan as “sheriff’s officer chief,” supervising 115 subordinate officers and 30 civilian employees.
But Donovan faced a legal problem. As a sheriff’s officer chief — a position covered by the pension system — Donovan should have been required to stop receiving pension checks, plus resume his contributions to the state retirement fund.
So Guadagno changed Donovan’s job title, enabling her chief officer to double-dip.
In county payroll records, the oath of office and a news release, Donovan was listed as the sheriff’s “chief warrant officer” — a similar sounding, but low-ranking position that’s exempt from the pension system. A chief warrant officer is responsible for serving warrants and other legal documents.
On Guadagno’s organizational chart, Donovan was listed as chief of law enforcement. The position of chief warrant officer cannot be found on the chart.
The following year, Donovan campaigned for Guadagno and Gov. Chris Christie as Monmouth County chairman of the “Law Enforcement for Christie-Guadagno” team in the gubernatorial election. (Click here for New Jersey Watchdog’s story on LECG’s 12 double-dippers.)
While sheriff’s chief, Donovan pocketed $227,000 in checks from the Police and Firemen’s Retirement System. Since he did not re-enroll in PFRS, he avoided another $18,000 in contributions. If the state decides Donovan violated pension law, he could be forced to repay $245,000.
The stakes are also high for Guadagno. Under state statute, “Any person who shall knowingly make any false statement or shall falsify or permit to be falsified any record or records of this retirement system … shall be guilty of a misdemeanor.”
After its review of the circumstances, the Treasury failed to take conclusive action. Not satisfied with that result, the PFRS Board of Trustees voted in May 2011 to call for a criminal investigation of Donovan — plus parallel instances involving John Dough, of Essex County, and Harold Gibson, of Union County.
The case was referred to the Attorney General’s Division of Criminal Justice. However, the DCJ investigation is riddled with potential conflicts of interest:
Guadagno is DCJ’s former deputy director. She held the post from 1998 to 2001.
Nearly two dozen DCJ investigators and supervisors are “double-dippers” who collect state paychecks and pensions.
Attorney General Jeffrey Chiesa, a Christie appointee, is ultimately in charge of the probe of fellow cabinet member Guadagno. Chiesa is also former chief counsel to Christie.
Christie has not publicly addressed the issue of whether an independent prosecutor should be appointed to handle the case. Spokespeople for Christie and Guadagno have declined to comment. Representatives for Chiesa have not responded to questions about the investigation.
The records battle began in March 2011 with an OPRA request by New Jersey Watchdog. When Treasury officials refused to release the documents, New Jersey Watchdog filed its complaint with GRC.
In its July 2012 decision, the Council rejected Treasury’s blanket assertion that records of the probe were exempt from review.
The GRC’s findings led to the state Treasury’s unsuccessful plea to the Appellate Division of Superior Court. The motion by the Attorney General on behalf of Treasury was opposed by briefs from New Jersey Watchdog and GRC. Last month, a state appellate court denied the motion.
Rather than enforce an order the appeals court left intact, the GRC is quitting the case.