Tensions grow between state watchdog and the pols under his scrutiny

Acting State Comptroller Kevin D. Walsh, pictured testifying during a legislative hearing on March 9, 2024, in Trenton, has irritated public officials from Camden to Hudson County with his investigations into governmental fraud, waste, and abuse. (Dana DiFilippo | New Jersey Monitor)

New Jersey’s acting state comptroller, who’s been under fire since the spring from politicians piqued after becoming targets of his watchdog investigations, is battling two new court fights.

The Delaware River Port Authority filed a federal complaint last week against Kevin D. Walsh, who has headed the state comptroller’s office since early 2020, after he sent authority officials subpoenas and ordered them to answer questions at his Trenton office for an ongoing investigation. The authority’s attorneys say it operates under a bistate compact and isn’t subject to comptroller oversight.

Then on Monday, Walsh sued Hudson County in state Superior Court after county officials ignored his orders to put a $13.5 million jail contract out for public bidding, as state procurement laws require. County officials contend they did nothing wrong .

The two court filings come as politicians elsewhere have also pushed back on Walsh, who investigates public fraud, waste, and abuse as one of a dwindling cadre of government watchdogs. Activists who have joined Walsh to fight governmental corruption and secrecy say his work is needed now more than ever.

“He plays a vital role that serves the public interest,” said Marleina Ubel, a senior policy analyst with progressive think tank New Jersey Policy Perspective.

But John Donnadio, who heads the New Jersey Association of Counties, called Walsh’s recent actions “further evidence of that office’s overreach.”

“It seems to be beyond the purview of the comptroller’s office to file complaints to enforce their interpretation of the law. It’s alarming to me that they’re carrying on this way,” Donnadio said.

In April, Donnadio’s group asked state lawmakers to investigate Walsh’s office, hold a public hearing to review Walsh’s practices, and check his power. That request came soon after Essex County Executive Joe DiVincenzo accused Walsh of being unfair and inaccurate in a “gotcha” report that revealed deficiencies in the oversight of the county’s $40 million COVID-19 vaccination program.

Walsh has come under fire not just from public officials: A police training firm, Street Cop, has filed state and federal lawsuits against Walsh to evade his scrutiny.

Walsh has not ignored the backlash and resistance to his reports. Besides the Hudson County lawsuit filed this week, he wrote last month to Gov. Phil Murphy and legislative leaders to urge them to withhold state funds from Union County because officials there ignored recommendations in his December report that the county improperly awarded pay for top officials.

You need a strong comptroller to say to people in power at all levels that they will be held accountable.

– Antoinette Miles, state director of New Jersey Working Families

Walsh declined through a spokeswoman to comment on Thursday. But in recent comments, Walsh has almost welcomed the backlash, saying it shows his work is impactful.

“We are proud of the work we’ve done protecting taxpayers. We do that work knowing that we will upset powerful people, and that is why this office is independent. And that’s why I’m committed to keeping this office independent, so that we can do our important work,” Walsh told the New Jersey Monitor in April.

The Hudson County case

Walsh is asking a state judge to block Hudson County from renewing the contract it awarded to Wellpath, a Tennessee-based for-profit prison health care provider, to provide medical care at the county jail.

Walsh first told the county last December not to move forward with the Wellpath contract, and revealed his findings in a March report . But county officials proceeded with an illegal “informal process” of inviting several hand-picked firms to apply and then negotiating a contract with their preferred vendor, Walsh said.

State law requires such contracts to be publicly bid in a competitive, publicly advertised process, and Hudson County officials did not do that “in blatant disregard” of his directives, Walsh said.

“A court order is necessary in order to protect taxpayers, who expect public officials to comply with the law — not take shortcuts that limit competition, allow for favoritism, and often increase costs,” Walsh said in a statement earlier this week.

Hudson County Commissioner Anthony Romano told the New Jersey Monitor Thursday that the county “followed the legal process” when it awarded the contract but declined further comment.

County spokesman Mark Cygan accused Walsh’s office of “imposing an overly restrictive and narrow interpretation of the vendor selection process.” County officials picked Wellpath after a competitive, rigorous selection process , he added .

“For the past 5 years, we have urged the Comptroller to join the County in seeking a judicial determination of the important issue: whether the medical services contract may be awarded as a professional services contract, as the County has contended,” Cygan said in an email to the New Jersey Monitor. “The Comptroller’s Office has rejected this request and, instead, has filed a lawsuit to seek headlines and to enforce its unilateral position, at the cost of a vital county service.”

The port authority’s lawsuit

In the Delaware River Port Authority’s lawsuit, attorneys want a federal judge to invalidate the comptroller’s subpoenas and declare that New Jersey’s comptroller and inspector general have no power over the Camden-based authority.

The authority, which develops and maintains the bridges and port facilities between New Jersey and Pennsylvania, was created almost a century ago under an interstate compact that’s not subject to regulation by either New Jersey or Pennsylvania, authority attorney Christopher R. Gibson wrote. The comptroller’s investigation “infringes upon the DRPA’s sovereign authority under the Compact and deprives the DRPA of its liberty, rights and privileges secured under the United States Constitution and federal law,” Gibson said.

The authority self-audits its operational effectiveness, and the comptroller’s investigation is “improper, illegal, and invalid,” he added.

“There is a genuine and bona fide dispute and actual controversy and disagreement between the DRPA and the NJ Comptroller regarding the enforceability of certain New Jersey laws against the DRPA,” Gibson wrote.

It’s unclear what the comptroller is investigating at the authority.

The New Jersey Working Families Party in 2020 called for a state investigation into the authority for its “long and sorry history of spending millions of dollars in supposed economic development projects on the backs of tollpayers,” many of which were tied to South Jersey political boss George Norcross III. The state attorney general indicted Norcross, a Democratic power broker based in Camden County, in June for racketeering.

A ‘last line’ of defense

Ubel noted that state lawmakers have acted over the past year to weaken watchdogs and oversight of public officials.

Last year, Murphy signed a controversial campaign finance law that critics said limited oversight powers of the state Election Law Enforcement Commission. In June, Murphy signed another law that transparency advocates say gutted the state’s public records law and makes it harder for citizen watchdogs and the public to access government records.

At the same time, Walsh remains acting comptroller nearly five years after he started the job. Lawmakers have failed to ensure his job security by confirming him in the post, with senators blocking his confirmation through a controversial unwritten rule called senatorial courtesy , which gives state senators virtual veto powers over gubernatorial nominees.

“ Absolutely, we should be concerned,” Ubel said. “Without the comptroller, there would be no one watching these agencies. He’s like one of the last lines of defense at this point. The public should be paying attention and make sure that (lawmakers) protect his office.”

Antoinette Miles is state director of the New Jersey Working Families Party. She called Walsh’s “dogged pursuit of the facts and transparency,” despite his delayed confirmation and mounting backlash, “a breath of fresh air.”

“In a state like New Jersey, where government transparency and good governance, unfortunately, is not always the norm, you need a strong comptroller to say to people in power at all levels that they will be held accountable,” Miles said. “It’s not a surprise to me that Trenton and beyond does not quite like that.”

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