HILLSIDE, NJ — Strife within Hillside has deepened the division between the Township Council and the Hillside administration, due to longstanding budget problems, so much so that the state Department of Local Government Services recently stepped in to address the problem.
“We have an administration that does not function,” said Hillside Council President Gerald Pateesh Freedman on Friday, Dec. 18. “Basically, they do what they want to do, and they disregard the council. One of the functions of the council, under the Faulkner Act, is to oversee expenditures. We’ve caught misappropriations, and they’ve overspent some of the money they were told not to spend. We didn’t approve a lot of their payments of bills to different vendors. They did not pay different people that we demanded that they pay that were owed money.”
“This is a matter in litigation; therefore, the township has no comment,” township attorney Ellen Harris said on Friday, Dec. 18. Other officials in the administration declined to comment, deferring to Harris.
According to Freedman, the administration’s claim that some of these problems are politically motivated is false; he says that he is neither a Democrat nor a Republican. Freedman said he is concerned the alleged misappropriations will become the taxpayers’ burden. He said the council has gone to the state to complain and now a court case is being heard.
“We’ve had budget problems for the last couple of years,” Freedman said. “We had a relatively new chief financial officer come in, and we sort of gave him a pass the first year. But last year, 2019, the budget didn’t get finalized until the end of October. … The mayor had requested a 13-percent tax increase.”
Freedman said the council fought the mayor’s tax increase, then went to the state and showed areas that were fraudulent. Finally, he said, the state said it would accept a 10-percent tax increase and didn’t want to get involved. He said when the council asked the state what its intention was regarding $600,000 of misappropriation, the state responded, “We don’t get involved with personalities,” but it would come in, this year, and see that this doesn’t happen again. But it did happen again in 2020.
“The CFO has made several expenditures not authorized by the council, totaling close to $60,000,” he continued. “The CFO has submitted several temporary budgets in 2019 and 2020 as a backhanded way to raise property taxes. In 2019, the council authorized that a significant portion of our financial surplus be used to offset the increase to save our taxpayers. The CFO attempted the exact same backhanded way in 2020. The state Division of Local Government Services was notified in writing in 2019 and 2020 and has done nothing except schedule two meetings that totally disregarded the overwhelming facts of this situation.”
Freedman said the council had gone to the state a number of times for an intervention — three times in 2020 alone. He said they sent in documentation and met with the state three different times, only to be told this year: “If you pass a resolution asking for our intervention, we’ll come in and oversee the budget process.” So the council passed the resolution.
“In 2019, we’ve bailed out the taxpayer by using our reserves to pick up that 10 percent,” Freedman said. “The taxpayer did not feel an increase, because we covered it with our reserves. Going into 2020, the mayor was requesting a 7-percent increase on top of the 10 percent. That’s quite a tax hike in two years. The administration and council agreed finally to a 3.7-percent increase, which means over two years, taxpayers were hit with a 13.7-percent tax increase. We didn’t have the reserves to bail them out this year.
“The same plan that they used in 2019 was the same plan for 2020. We just approved the budget, which was mandated. The state came down on us and said that if we didn’t approve it by October, they would assess us a $25 fine per day,” he continued. “We went ahead and passed our own budget. It was not legal to pass a council budget, but here we were. We’ve been asking for information and important numbers so that the budget could be prepared. We’ve called in accountants and accounting firms to try to assist our CFO, and we’ve hit roadblocks. So here we were, faced with a dilemma. So the council passed its own budget, which the state would not accept.”
The state mandated that Hillside must pass a budget, and a budget agreed upon by both the council and administration was ultimately passed.
According to Freedman, the council passed a resolution asking for the state to come in and oversee the process for the 2021 budget, which the state is now doing. He said the thrust of the state’s involvement, however, seems to be to train everyone in the budgetary process. But Freedman insists they don’t need training; they know where the problem lies: with Mayor Dahlia Vertreese and CFO Glynn Jones, according to Freedman. Despite all the substantial documentation the council has presented to the state, Freedman said, Hillside is going into 2021 in bad shape.
“The CFO should lose his credentials,” Freedman said. “He knows right from wrong, and this is so blatantly wrong. He’s probably doing the bidding of the mayor, who’s directing him at the threat of losing his job. The mayor is spewing that the council doesn’t have the right to oversee this. This is Faulkner 101. It’s as clear as clear can be. … She hires who she wants to hire. She fires who she wants to fire. We understand that. But to create positions, the council has the right, after 60 days, to confirm or deny appointments. Those were completely disregarded. The town’s in a mess. The council is holding it together as best as we can.”
The council has passed resolutions that certain firms are not to be paid, and they’ve been paid regularly, Freedman said. He complained that Hillside’s township attorney, Ellen Harris, is in the position illegally, as she has not been confirmed by the council. He said her firm, Norris McLaughlin P.A., has been getting regular payments that were not approved.
“The council voted against the recommendation of Norris McLaughlin P.A.,” Freedman said. “The mayor disregarded the council’s authority, and the individual is being paid as a vendor by our CFO as director of our Law Department. The council’s understanding is that a vendor can not be a director in a Faulkner form of government. The New Jersey Division of Local Government Services, Department of Community Affairs, has been notified in writing in 2019 and 2020 and has done nothing.
“The Civil Service Commission issued a list and a current employee is not on the list. The mayor has disregarded the list and refused to comply with civil service mandates and written guidance to implement the list. The employee continues to be paid, in spite of not being on the civil service list, denial of an appeal and they continue to maneuver to circumvent and disregard the testing process,” he continued. “This has been going on since March 2020. Council has been communicating with the Civil Service Commission since September 2020, asking why the commission is not enforcing their own rules and regulations. Again, nothing.”
During the Hillside Council meeting on Tuesday, Dec. 15, Freedman’s feelings about the issue were summarized in his year-end statement.
“I see my role as council president as a facilitator. I have not used my position as a bully pulpit and have remained relatively quiet, even though personally attacked and my council blamed for this administration’s failures,” the statement read. “At the conclusion of the last administration, we said things can’t go on like this — and they didn’t; they got worse. If at first you weren’t confused, you didn’t understand the situation. The council has tried to educate the public. We’ve put it before your eyes, jammed it in your ears, passed it under your nose, rammed it down your throats.
“If you’re not outraged with this administration, with the backing and support of the state, you’re not paying attention. The taxpayer is being exploited,” the statement continued. “The mayor’s ability to delude herself may be an important survival tool for her. She has delusions of adequacy. She denounces the council in revenge for a complete lack of success as mayor.”
The Hillside Council recently filed suit against Vertreese and Jones, seeking injunctive relief, which was denied in its entirety on Friday, Dec. 11.
According to Jones’ certification, a statement submitted to the court detailing his responsibilities and actions as CFO, which was dated Nov. 20, he became the township’s CFO in April 2018. The certification then detailed the process the township followed for paying for goods or services. It stated that the township received the required purchase orders and invoices for services rendered by attorneys O’Toole Scrivo and Joseph Depa, in connection with recent lawsuits. The respective purchase orders were signed by Harris.
According to the certification, “The Jan. 28, 2020, Bills List includes an invoice for Joseph Depa, Esq., on page 3 and an invoice for O’Toole Scrivo on page 12. The Township Council did not express any concerns over the payments to the law firms listed on page 8 of the Bills List, which is dated Nov. 16, 2019, but the council stated it did not want the invoices of O’Toole Scrivo to be paid. The Township Council did not express any concerns over the payment to Joseph Depa. The Township Council has stated that it does not want the invoices of Ellen Harris, for services rendered as township attorney, to be paid.
“Notwithstanding the Township Council’s statements regarding the invoices of Ellen Harris and O’Toole Scrivo, I caused the invoices to be paid in accordance with the foregoing process and applicable law, including the Prompt Payment Act. On Monday, Aug. 3, 2020, I received a copy of July 31, 2020, Open Public Records Request from the law firm of Ruderman & Roth LLC requesting invoices from O’Toole Scrivo LLC; Norris McLaughlin, P.A, and Ellen Harris, Esq.,” the certification read. “By email, dated Wednesday, Aug. 12, 2020, the township’s finance department provided the township Clerk’s Office with copies of documents responsive to the Ruderman & Roth LLC’s July 31, 2020, OPRA request.”
“I was actually happy about the state getting involved,” said Nancy Mondella, chairperson of the Finance Committee, on Friday, Dec. 18. “This has been a long time coming. I know the council and council president, on behalf of the council, have reached out multiple times to the state to ask for some help and guidance or intervention, and we finally have it. So, I think it’s welcomed for the majority of the council. Our issues are financial issues. When council approves things and they’re not paid, and then we don’t approve things and those get paid, it just raises a red flag. So I’m just happy that they’re coming. They’re here and they’re working with all of us. They’re not taking over the township; they’re just coming in to look at what’s transpired and to make some recommendations on both sides and how things can be improved.
“I want them to look into things and do their due diligence. I think a lot of the council’s issues that we’ve brought up multiple times will be validated, and then action can be taken,” she continued. “If they look into a lot of the complaints and issues that we’ve raised, in public and in writing, I feel comfortable that they will uncover and address some of the issues.”
Council Vice President George L. Cook III said the council had met with the state in late July and early August, and the state had wanted the council’s permission to come in, something which was mutually agreed upon between the council and administration. He said the state had wanted to make sure Hillside officials knew the proper budgeting process, the council’s function as a council and the mayor’s function as mayor. He stressed that it was not a state takeover; the state was just helping them get things in order. Cook did, however, place most of the blame on the CFO.
“He’s lost the faith and confidence of the majority of the council,” Cook said on Friday, Dec. 18. “As I told the state, I believe the CFO is incompetent. When you take the politics out of it, I believe he’s hurting the township. His inability to use a document known as the AFS caused us to get our budget in late, and, instead of telling us he couldn’t do it, he let it linger for months, which is why our budget was turned in so late to the state.
“For myself, I’d like to see another CFO. I have no faith in the current CFO we have,” Cook added.
Cook said the mayor was in charge of the CFO, and, as such, she should have “lit a fire under him, telling him to hurry up and get this done.” According to Cook, the mayor needs to stop blaming the council and communicate better.
“We can work together,” Cook said. “We’ve just worked together on a bond ordinance to get some equipment and things for the community, such as police vehicles and things for the fire department. Anyone who says that we can’t, that’s a bit of an exaggeration. I just want to see things get back to normal. I’d like for us to get back on course. But I don’t think it can be done with the current CFO. There’s just no trust there anymore between him and the council.
“It’s embarrassing, but I think the good thing is that the council shows that we’re willing to do the right thing by Hillside,” he continued. “No one wants the state to come in. It sounds worse than it is, but we felt it was necessary for the township and the taxpayers to get things right.”