Oct. 19 (Bloomberg) -- The New Jersey Turnpike Authority paid employees inappropriate bonuses that included $227,000 for working on birthdays and $3.8 million for unused sick days, state Comptroller Matthew Boxer said.
The toll-road operator, which collects $1.1 billion in annual revenue and plans to issue $2.5 billion in bonds by year-end, paid $12,000 to sponsor an employee bowling league, according to a report released today by Boxer’s office. The agency also gave employees $430,000 of free rides on the New Jersey Turnpike and Garden State Parkway and overpaid a law firm $224,000 last year, the audit found. The authority wasted $43 million in all, the report said.
The bonuses enabled at least five of the agency’s senior managers to earn more last year than the $141,000 paid to New Jersey Cabinet members, including Transportation Commissioner James Simpson, according to the report. The authority increased tolls in December 2008 and plans to raise them again in 2012, Boxer said.
“While tolls are going up, the Turnpike Authority is overpaying its employees, overpaying its management, overpaying for its health plan and overpaying for legal services,” Boxer said in a statement.
No Free Rides
Some of the bonuses and perks cited by the comptroller, such as annual bonuses for employees on the job for more than 10 years and free toll passes for employees, have been eliminated, Veronique Hakim, executive director of the Turnpike Authority, said in a written response to the report.
“There is no evidence to support a finding that the authority’s executive management negotiators did not always negotiate in a manner that was in the best interests of the authority,” the response says.
The authority will eliminate the bonuses highlighted in the comptroller’s report as contracts are negotiated next year, Simpson said in a statement today.
“We’re taking critical and long overdue steps to end waste at the Turnpike Authority and implement real reform,” said Simpson, who by virtue of his office is chairman of the authority.
The authority collected $950 million in tolls last year. Its operating expenses were $481 million, with the remaining revenue allocated to debt-service payments and reserves, the report says.
The authority is scheduled to sell $2 billion in taxable Build America Bonds and $538 million in refunding bonds before Dec. 31 as part of a seven-year, $7 billion capital program.
Each of the Turnpike Authority’s 10 labor contracts is due to expire next year, according to the report.
The benefits Boxer highlighted are trade-offs reached during contract negotiations in return for concessions on pay and work terms, said Frank Forst, assistant to the president of International Federation of Professional & Technical Engineers Local 194, which represents about 1,500 Turnpike toll collectors, clerical employees and maintenance workers.
“Our people consistently are at about the average earnings of middle class Americans, and they work for what they get,” said Forst. “To nitpick one thing after another is easy for a guy looking from the outside.”
Boxer, 40, was named New Jersey’s first comptroller by former Governor Jon Corzine in January 2008. Before joining the Corzine administration, Boxer had worked in the U.S. Attorney’s Office under now-governor Chris Christie, overseeing public corruption investigations.
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