Township approved $1.3 million for country club against purchasing rules, comptroller finds

Acting State Comptroller Kevin Walsh found Parsippany-Troy Hills awarded emergency contracts for golf club improvements without an emergency. (Dana DiFilippo | New Jersey Monitor)

A Morris County township skirted procurement laws by awarding nearly $1.3 million in emergency contracts that do not require public bidding to repair a municipally owned country club where no emergency existed, the Office of the State Comptroller announced Tuesday.

Parsippany-Troy Hills in late March 2020 awarded contracts to remediate mold and water damage under an exception to the Local Public Contracts Law that allows no-bid contracts to address pressing health and safety risks, but because the Knoll Country Club was shuttered by pandemic restrictions when the initial contract was awarded, no emergency existed, the comptroller said in a new report released Tuesday .

“Procurement laws were enacted to safeguard public funds by fostering competition and reducing the risk of wasteful spending,” acting State Comptroller Kevin Walsh said. “Circumventing these requirements increases the risks of fraud, waste and abuse and undermines the public’s trust in government.”

With some exceptions, state law requires public bids for contracts worth at least $17,500 — or $44,000 for governments that employ a qualified purchasing agent, as Parsippany does.

The club’s then-general manager approved the work immediately on March 22, 2020, one day after Gov. Phil Murphy issued a stay-at-home order that shuttered a broad range of businesses.

Then in June, the contractor began renovating other portions of the club. They were paid $661,098 under a no-bid contract for emergency work that began nearly three months after mold issues were first identified and while the club was still closed to the public.

Then in August, the contractor began to remodel the clubhouse’s bar and grill room, though a lack of building permits stalled that work for months, and it was not completed until April 2021.

The comptroller’s office said the delays belied the existence of an emergency, noting township officials could have put the contract out to bid without holding up the project.

“A pandemic, a hurricane, or any other disaster cannot be used as a catch-all excuse to avoid competition and requirements that protect taxpayer funds,” Walsh said.

Township officials could not provide documentation authorizing the work and did not approve resolutions permitting payments for the emergency contracts, as required by state and local laws.

In a response to the comptroller, Parsippany acknowledged the purchasing breakdowns and said a range of high-ranking officials — including its mayor, business administrator, and chief financial officer, among others — involved in awarding the no-bid contracts were no longer with the township.

“We are correcting these issues by ensuring there is a team in place who understands that public confidence in the integrity of local government is of paramount importance,” said Parsippany Mayor James Barberio, who took office after the period in question.

Its response added Parsippany was updating purchasing rules to boost internal controls and would require additional procurement training for department and division heads..