County violated state law in awarding of $80M contract, N.J. Supreme Court rules - NJ.com
Bergen County circumvented public bidding laws when it awarded an $80 million contract to renovate the county’s historic courthouse through a no-bid contract, the New Jersey Supreme Court ruled Thursday.
The decision, which will stop the massive project from going forward for now, could have wider implications. A similar dispute continues in Union County over claims that officials there also skirted public bidding laws in the proposed construction of a $123.8 million government complex in Elizabeth.
“Governmental entities and contractors must know that end-runs around the Local Public Contracts Law are not permissible or enforceable,” wrote Justice Barry Albin.
Bergen County officials did not immediately respond to requests for comment.
Attorney Greg Trif of Morristown, who represents Dobco, the Wayne-based construction and development company that brought the lawsuit against the county, said they were pleased with the ruling affirming the Bergen county could not evade public bidding laws, and that “no county can do so in the future.”
The legal fight began more than a year ago after Dobco filed lawsuits in both Bergen and Union counties after the firm was passed over for consideration for the lucrative deals before the contracts were awarded.
Lawyers for Dobco charged that the two counties used their respective improvement authorities to get around New Jersey’s Local Public Contracts Law, which requires public bidding for projects that utilize public funding.
In Bergen, the county’s improvement authority set up a selection committee to review and evaluate the proposals submitted and recommend a “short list” of no more than four redevelopment teams to compete for a redevelopment contract for the project.
That short list of respondents were then invited to submit proposals and scored on a number of benchmarks, including experience as well as cost s— rather than the awarding contracts to the lowest bidder.
Dobco, which had submitted a proposal, nevertheless argued in its filings that the process was illegal. It said state law calls for every contract awarded by counties — and their improvement authorities, with few exceptions — be awarded “to the lowest responsible bidder, after public advertising.”
The company claimed that Bergen and Union sought to evade that requirement by weaving “a tangled weblike transaction that involved reshuffling ownership of public land and monies.”
In both cases, a county improvement authority was used as the vehicle to redevelop the properties and the projects went through the state’s alternative Local Redevelopment and Housing Law to solicit requests for the design and construction of the projects.
Both counties defended the process, with Bergen asserting that bidding was not required under the Local Redevelopment and Housing Law. It said going that route enabled public entities to construct “important and inherently beneficial redevelopment projects in an expedited fashion.”
In Bergen, the project involves a multi-year renovation and rehabilitation of the county’s court complex.
The Appellate Division, in an earlier ruling on the challenge to Bergen’s awarding of a contract for the project, said a county improvement authority “cannot avoid the requirements of public bidding for goods or services covered by the Local Public Contracts Law simply by cloaking itself in the rubric of a redevelopment entity.”
The Supreme Court in its opinion on Thursday agreed with the Appellate Division, finding that the Bergen County Improvement Authority was required to comply with the public bidding requirements.
Like the Appellate Division, the high court said it found no evidence that the Legislature intended to create an exception to the mandate to comply with those bidding requirements, even when a county improvement authority, as in the case of Bergen, acts as a redevelopment entity and contracts with a redeveloper.
That would presumably also impact on the Union County project, which was not referenced in the opinion.
Union’s long-planned government complex that Dobco and others claimed had similarly skirted state public bidding laws illegally was halted by a state appeals court earlier this year, which rejected arguments that any delay in that construction project would only incur more costs to taxpayers.
The three-judge panel also determined that the procurement process used by Union County violated New Jersey’s Local Public Contracts Law, and the next phase of the project had to be publicly bid.
The state Supreme Court has yet to agree to take up the Union County case. However, a lower court judge has scheduled hearings to determine the financial harm of halting a project that has already been approved by the county.
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source: https://www.nj.com/politics/2022/04/county-violated-state-law-in-awarding-of-80m-contract-nj-supreme-court-rules.html
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