The executive director of the Little Egg Harbor Township Municipal Utilities Authority will earn $201,220 this year, more than any other MUA director in South Jersey.
More even than the governor of New Jersey.
David Johnson, director of the authority that provides water and sewer services in the southern Ocean County township, said his salary should not be an issue, as he earns it by filling three different jobs at the MUA and has spearheaded efforts to keep rates low for users.
Not everyone agrees.
“I’m really surprised, and this does concern me,” Mayor John P. Kehm said after reviewing MUA payroll documents obtained by The Press of Atlantic City through an Open Public Records Act request. “They have to take a look at their ratepayers and the way the economy is right now. They might have to go back and say there is going to be no more longevity pay. Contracts are contracts, but the commissioners are approving these contracts.”
Johnson, who has been employed at the MUA since 1992, also holds the titles of chief financial officer and contract administrator.
His salary as of July 1 is $155,928 for the directorship, $12,000 for his role as CFO and $15,000 for acting as contract administrator. He receives an additional $18,292 longevity pay for his years of service with the MUA.
Johnson’s newest five-year contract, which took effect in July, provides a 2 percent raise each year over the next five years. All employees at the MUA agreed to take 2 percent raises this year, Johnson said.
By June 30, 2017, Johnson’s longevity pay will be rolled into his base pay and will not increase or decrease with additional years of service, the contract states.
According to the contract, as executive director, Johnson receives 20 paid days each year to use as he sees fit. He also receives six weeks’ paid vacation time. Any unused vacation time, entitlement days or compensated days accumulated during the year will be paid in full to Johnson the third week of December.
Johnson also has a take-home vehicle from the MUA, he said, although it is not included in the current contract.
“I don’t believe he’s that far out when it comes to his salary to a comparable position in another town,” MUA Board of Commissioners Chairman Joseph Mezzina said.
But comparisons don’t support that.
Hamilton Township MUA Executive Director Stephen Blankenship receives a salary of $118,488 and a $300 stipend each pay period as a licensed operator. Hamilton’s authority serves 20,127 customers, slightly more than the 19,442 MUA ratepayers in Little Egg Harbor Township.
Egg Harbor Township’s MUA does not employ an executive director but pays an authority clerk $80,574 to oversee operations. The authority also does not handle water service in the township, only sewer service, for its 13,363 customers.
As of December 2011, public records show other Ocean County MUA executive directors are paid less than Johnson. Lacey Township MUA Director Edward Woolf is paid $101,183, and Lakewood Township MUA Executive Director Justin Flancbaum is paid $96,900.
Concerns over then-Executive Director Robert J. Sheppard’s $174,000 salary prompted Stafford Township to dissolve it’s MUA in 2001. The township took control of operations there following allegations of misuse of funds, excesses and abuses, Stafford Mayor John Spodofora said.
Stafford now manages its utilities at a “huge savings,” Spodofora said.
The Little Egg Harbor Township MUA is overseen by its own board of commissioners and is operated separately from municipal government, but those commissioners are appointed by the Township Committee.
Township Committeeman Raymond Gormley said he had “no idea” what Johnson was earning, but said that is the responsibility of the MUA’s Board of Commissioners.
MUA Chairman Mezzina acknowledged that Johnson’s salary is sizable, but said Johnson has been a “wonderful administrator” during his time there.
“We feel Dave is worth the money,” Mezzina said.
Salaries such as Johnson’s have been a target for Gov. Chris Christie since he took office in 2010, when he immediately focused on reforming state and local authorities.
In 2011, Christie highlighted the Passaic Valley Sewerage Commission in an investigaton of fraud and patronage. In February of that year, Christie fired 71 employees at the commission and forced many of the commissioners to resign or be charged with ethics violations for hiring relatives and friends.
At the time, about 85 of the commission’s 567 employees were being paid six-figure salaries, public records show. The commission’s executive director, Joseph Bella, made $197,000 in 2010, and Assistant Business Manager John Kelly was paid $195,000.
But Christie’s plea to the Legislature to give his office veto power over all independent authorities didn’t happen.
Meanwhile, legislation that would limit public employees’ salaries to $175,000, or less than what the governor is paid, stalled again last year.
Christie spokesman Michael Drewniak said the Governor’s Office is not in a position to make a judgment on Johnson’s salary because it does not have oversight of this MUA.
There are about 90 utilities authorities in New Jersey, most of which belong to the Association of Environmental Authorities of New Jersey. The association defines a utilities authority as a public entity that can be countywide, regional or created by one or additional municipalities.
Peggy Gallos, executive director of the association, said utilities authorities, now under greater scrutiny, have been moving slowly to curb some of the abuses that in the past have led to exorbitant salaries and patronage, although she declined to comment specifically on Johnson’s salary.
“We are in a transition period when what was acceptable in the past is not acceptable anymore, but the change isn’t happening across the board uniformly all in one moment,” she said.
The 40-year-old association has 163 member organizations in three membership categories: utilities authorities, municipal utilities departments/divisions and vendors in the public utility sector.
Utilities authorities formed after degradation of the environment and poor waterway conditions were brought to light in the 1960s, Gallos said.
The Little Egg Harbor MUA was created by ordinance by the Township Committee in January 1972. Its budget is $6,259,440. There hasn’t been a water rate increase in 15 years and only nominal increases in sewer charges over the past few years, Johnson said.
According to the 2010 U.S. Census, the township’s population increased to 20,065 from 15,945 over the previous 10 years.
Despite township officials’ unease over salary issues at the MUA, they’re wary of taking it over and running it as a municipal function.
“We have to think about, if we were to take that on, we would assume all the responsibility for water and sewer lines and infrastructure. Some of those lines have been around since the 1950s. We have to decide if we want to take that on,” Gormley said.
Johnson said the township is right to be cautious.
“Most times when a township absorbs an MUA, they have no idea what the water and sewer service really means because they have never dealt with it before,” Johnson said.
The state enacted utilities authorities to keep politics out of the sewer and water systems so the authorities would run like businesses and not political organizations, Johnson said.
He added that because authorities are run like businesses it makes it profitable for the users, who in turn do not overpay for services.
When a township takes over a utilities authority, there is only one reason, and that is for the money, Johnson said.
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