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August 1, 2014, 6:25 pm

N.J. official cites abuses at DRPA

Port Authority board members deny wrongdoing

 

Accusations leveled in a new report by New Jersey’s controller claiming that board members of the Delaware River Port Authority use the agency as a “personal ATM” are unfounded, said two men named in the scathing report.

The 77-page report, released by Controller A. Matthew Boxer, accused DRPA officials from both sides of the Delaware River of funneling hundreds of millions of dollars to pet projects and friends.

“In nearly every area we looked at, we found people who treated the DRPA like a personal ATM, from DRPA commissioners to private vendors to community organizations,” Boxer said in a statement released with the report. “People with connections at the DRPA were quick to put their hand out when dealing with the agency, and they generally were not disappointed when they did.”

Officials at the Delaware River Port Authority routinely ignored financial safeguards, spending toll payers’ money on pet projects and steering funds to their cronies during years of “mismanagement and neglect,” Boxer said.

The investigation studied four broad areas of DRPA’s operations: Its dealings with insurance brokers, its economic development program, its social and civic sponsorship fund and reimbursements for business expenses.

Nearly $1.5 million was paid out in insurance commissions, the report found, “regardless of whether each of the brokers actually placed or assisted in placing DRPA insurance policies or … performed any service at all.”

The agency had a practice of “truing up” or making sure that equal funding was spent on vendors from Pennsylvania and New Jersey.

According to Boxer, the choice of a New Jersey broker was controlled by Democratic Party bigwig and insurance broker George E. Norcross III.

The controller based his charge on a 2002 email to Joseph Plumeria, CEO of the Willis Holding Group.

“Willis will be appointed as the co-broker of record … effective January 1, 2003, for the DRPA,” wrote Norcross, who did not work for the DRPA or serve on its board.

Willis then paid Norcross’s insurance company, Conner Strong and Buckelew, and another broker Michael Martucci, commissions of $455,000.

Norcross’ firm said the money was not commissions, but payments for referrals. The company denied any wrongdoing.

“The investigation has found nothing illegal, unethical, improper or in violation of any laws, statutes or regulations regarding … Mr. Norcross … or anyone associated with any of them or the agreement between Willis and [Conner Strong and Buckelew],” said company officials in a statement.

Norcross was reportedly out of town, and could not be reached for comment.

In terms of Pennsylvania business, Boxer alleges that Tribune President and CEO Robert W. Bogle, who served on the DRPA board from 1997 to 2011, steered business to an insurance company called the West Insurance Agency, a Philadelphia based minority-owned firm where Bogle served on the board. The report again quotes an email, this one from William Graham of the Graham Company, the Pennsylvania broker of record to Willis, its New Jersey counterpart.

“Bob Bogle … and the Board of the DRPA expects these commissions to be paid to the West Agency, or another select MBE (Minority Business Enterprise).”

Bogle pointed to the report, quoting it “or another select MBE” and adding, “Bogle never said a word about West.”

The company received $684,254 in commissions, but Boxer’s office was unable to determine what, if any, services it provided.

Boxer also examined projects that received funding from the DRPA’s "social and civic sponsorship fund” set because “the vast majority of this funding . . . went to organizations linked to DRPA officials, or to organizations that provided a personal benefit to DRPA officials in exchange for the contribution.”

Bogle again drew Boxer’s attention.

According to the report, DRPA made 13 payments totaling $59,180 to the Tribune for half-page advertisements to congratulate local high school graduates, commemorate Black History Month and in honor of Martin Luther King Day.

“DRPA did not purchase similar advertisements in any other newspaper concerning these events,” wrote Boxer in the report, adding that the requests were not accompanied by a Community Giving Fund Application, which was required by DRPA rules.

“I did not, at any time, ask anyone at the port authority to do business with the Philadelphia Tribune,” responded Bogle, adding that DRPA did buy ads, but through the newspaper’s sales representatives.

There was nothing underhanded about the transactions, he said.

“I don’t consider the fact that they did business with the Philadelphia Tribune an impropriety,” said Bogle, adding that it seemed to make sense that the agency would advertise in a Black newspaper on the occasions that it did so.

“What other publication would they use?” he asked.

In addition, the report says Bogle, who is on the board of Mann Center for the Performing Arts, requested and received $5,000 for the organization’s gala. In return, the DRPA received tickets for dinner and to the Bolshoi Ballet, an event attended by several DRPA commissioners.

Bogle said he was unaware of the deal, and didn’t attend the event.

“I didn’t even know about it,” he said, adding that the entire report was based on innuendo.

Authority spokesman Timothy Ireland said in a statement that the authority has addressed many of the problems unearthed by the report.

“We take the concerns expressed by [the report] very seriously, and we will be taking steps to evaluate and address recommendations in the report as promptly as possible,” he said.

Boxer worried that toll payers have already suffered for years, and would continue to do so until all of his concerns were addressed.

“Toll payers have borne a financial burden attributable to years of mismanagement and neglect, and continue to do so for those failings that have yet to be rectified,” wrote Boxer.

DRPA operates the four toll bridges linking Philadelphia and New Jersey as well as PATCO, a light rail line from Center City Philadelphia to southern New Jersey.

Its board is made up of eight members from Pennsylvania and eight from New Jersey and headed alternately by the governors from each state.

 

Contact staff writer Eric Mayes at (215) 893-5742 or This email address is being protected from spambots. You need JavaScript enabled to view it. .