Report faults excessive legal payments by Medford, other towns

Until a new council took office, Medford Township paid a law firm hourly fees for services that "appeared to be covered" by its monthly retainer, the state comptroller said in a report released Tuesday that warned local governments to carefully look for overbilling of legal costs.

"Public officials need to scrutinize their legal bills as if they were paying for them out of their own pocket - otherwise taxpayers are going to get ripped off," A. Matthew Boxer said in a statement after issuing his 38-page report that criticized "excessive and improper" legal payments.

Medford, a town in Burlington County whose legal costs were nearly $700,000 in 2010, was among three townships and two school districts that Boxer singled out because of "significant outside counsel costs," which the report warned "presented a higher risk for billing abuses."

The other towns were North Bergen, where an attorney was paid $18,000 a year but given no work for years, and West New York, where a law firm was paid the attorney rate of $150 per hour for secretarial work, including "taking messages" and photocopying documents, the report said.

He also studied the Freehold Regional and Plainfield School Districts.

Medford paid Parker McCay, its longtime legal firm, $579,000 in 2010.

The politically influential firm over the years has had numerous South Jersey municipal contracts. The amount Medford paid included hourly bills for services that "appeared to be covered by the retainer," the report said.

The $8,000-a-month retainer was supposed to include attending town meetings, drafting ordinances, and holding discussions with the town manager, but the town was billed $50,000 in hourly fees even for these services, the report said.

In 2012, a new town council was sworn in after several members resigned, and it decided to get rid of retainers and hire a new law firm to be paid by the hour.

Last year, its legal bills were less than half what Parker McCay had charged, said Township Manager Chris Schultz. "Unless a retainer is crystal-clear, black and white, it's open to interpretation," he said.

Boxer's report recommends that townships review legal bills with an eye toward curbing duplicative and unauthorized services and overbilling.

"There was some ambiguity as to the scope of the retainer agreement . . . which may have led to overpayments for legal services," Boxer said in an interview.

A call to Parker McCay for comment resulted in an e-mailed statement from its public relations agency.

"Over the last 16 years we have helped the township achieve significant savings by providing strong and consistent guidance in a variety of complex legal matters," it said. "The OSC [Office of the State Comptroller] declined to use this information in its final report. We have asked the OSC to reevaluate its findings."

Councilman James "Randy" Pace said that before he was elected in 2011, he had filed numerous open records requests to find out how much the lawyers were being paid and then discovered they were also charging an hourly rate to review his queries. That, too, was supposed to be included in the $8,000 retainer, he said.

"There are no surprises for me here," he said, referring to Boxer's report.

Boxer said that he referred the case of a lawyer for North Bergen, who was paid a salary and received health benefits and a pension but did no work, to the Attorney General's Office for a possible criminal probe. He declined to name the lawyer, who he said has resigned.

The report also said the midsize township paid another attorney, its solicitor, the highest full-time salary for a municipal official in the state - $208,000.

Gov. Christie took the opportunity to criticize North Bergen's mayor, Nicholas Sacco, a Democratic rival who is also a state senator, for paying so much money to its lawyer.

Speaking at a news conference in Mount Laurel on Tuesday, Christie called the scenario "outrageous."