The Middlesex County Improvement Authority provided "questionable bonuses" to top managers over the past five years, according to an Office of the State Comptroller audit.
The authority paid its four top managers a total of more than $100,000 annually in bonuses that were not provided for in their employee contracts, according to a report issued on Wednesday by the comptroller. No other authority employees received the payments.
"Even at the height of the economic recession, the MCIA awarded its top officials not only their contractual salary increase, but additional unsubstantiated bonuses worth 10, 15, even 30 percent of their salary," comptroller Matthew Boxer said.
The audit also questioned whether the authority needed to hire both an "insurance consultant" and "insurance producer," listing identical qualifications for both jobs. The comptroller's office confirmed that the insurance consultant was Joseph C. Valenti, of Milltown, and the insurance producer was Federal Hill Risk Management LLC, based in Towson, Md.
In addition, the audit found the authority's contracting practices didn't comply with state procurement law, because MCIA failed to solicit required price quotations from prospective vendors. The audit also reviewed authority professional service contracts and found that eight of nine contracts did not follow appropriate vendor-selection guidelines. Two vendors were disqualified by the authority due to "lack of knowledge of the authority," according to the report.
The comptroller's office confirmed that the bonuses were received by Richard Pucci, executive director of the authority; Frank Damiani, Roosevelt Care Center administrator; Lory L. Cattano, the authority's chief financial officer; and Jane Leal, director of administration for the authority. In addition, authority counsel Daria Anne Venezia had improperly received authority-funded health benefits, and was referred to the state Division of Pensions and Benefits for a review of pension credits received through the MCIA.
The audit only turned up the bonuses through a review of individual authority payroll records, according to the comptroller's office.
The executive director received an "incentive bonus" of $55,617 in 2010, in addition to a $185,384 base salary, $4,800 car allowance and $3,565 payment for unused sick time, for a total compensation of $249,366.
Authority officials told the comptroller's office that the bonuses were based on performance evaluations, although the executive director didn't receive a written evaluation and the other officials' written evaluations "did not reflect any measurable performance criteria tied to MCIA's goals," according to the report. The evaluations included basic criteria, such as "understands and follows instructions" and "maintains a proper appearance."
"Criteria like 'interacts well with others' and 'understands and follows instructions' are not sufficient justification for the payment of more than $100,000 in yearly bonuses to the upper management of a government agency," Boxer said.
The authority receives more than $8 million in subsidies from Middlesex County government.
Authority officials did not immediately return a call seeking comment. In its response to the comptroller's audit, MCIA noted that its policies comply with local public contracting law and state statute, and said that its cash management and accounts payable practices are fiscally sound. The agency also said it had implemented some of the recommended procedures in the audit report, and touted its programs, saying the agency has saved taxpayers millions.
MCIA also provided praise for the employees receiving bonuses. The authority credited Pucci with growing MCIA from one employee and a balance sheet of $37,000 when it was created in 1991 to an agency with 641 employees and a balance sheet of $615 million in 2010. "The executive director is a unique leader, who does not come along often, especially in the public sector," MCIA's response stated in a passage labeled as Chairman Leonard J. Roseman's opinion of Pucci's performance.
Contributing: Sharon Waters