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Acting state Comptroller Marc Larkins, pictured here in a 2011 file photo, today issued a new report finding improper overtime and compensatory time payments by several municipalities throughout New Jersey.

(Tony Kurdzuk/The Star-Ledger)

TRENTON — A handful of municipalities in New Jersey improperly padded the salaries of their top executives by paying overtime and compensatory time without passing an ordinance, a new report released today by the state comptroller found.

The investigation examined 14 municipalities and found that six has paid more than $195,000 in overtime to high-level employees in 2010 and 2011 without passing a public ordinance, which requires public comment and a public vote, the report said.

Several executives approved their own overtime payments, the report said, while in two cases executives padded their salary with an overtime rate of pay for working regular hours during Hurricane Irene, which struck the state in 2011.

The comptroller's review also found that 10 of the municipalities examined awarded their executives more than 4,000 hours of compensatory time during the same two-year period without an ordinance, which is also in violation of state law.

"Granting overtime and comp time to executive employees goes above and beyond what is legally required,” acting state Comptroller Marc Larkins said. “If municipalities choose to extend these benefits to their executives they must do so in a way that is transparent and adheres to the law.”

In Wallington, the report found, the administrator was paid nearly $20,000 in overtime he calculated himself based on an inapplicable union contract for public works employees.

"The administrator claimed that he incurred the overtime by driving a snow plow during storms and responding to water emergencies by 'going into a hole' to make repairs when an insufficient number of DPW workers were available for the emergency," the report said, adding that local records "contained minimal justification, if any."

The borough's part-time code official, who worked for two other municipalities, received $10,683, sometimes at a rate of two and a half times his pay, for work during Hurricane Irene the report said. The official told the Comptroller's Office he was encouraged to apply for overtime because the federal government would reimburse Wallington for 75 percent of all costs relating to the storm cleanup.

In Paterson, non-union employees were granted more than $65,000 in overtime despite no approvals from the city council, the report said. After the council became aware of the payments related to Irene, it ordered employees to repay the city.

"The mayor did not cash the check he received and his cabinet has since reimbursed the city for overtime related to Hurricane Irene," the report said. "Only the business administrator has agreed to reimburse the city for non-hurricane-related overtime."

Other municipalities found to be improperly awarding overtime by the comptroller were Hunterdon County, Elmwood Park, Rahway and Pemberton.

And in Toms River, four department heads were awarded hundreds of hours of compensatory time in a manner that violated the township's own policies, the report said.

The awarding of compensatory time often resulted in lucrative severance payments for local officials who were able to cash out more unused sick and vacation time than would have otherwise been possible, the comptroller's report said.

For example, the report found, the administrator of the Towaco Fire District in Morris County awarded himself 222 days of compensatory time and was able to bank more than 380 unused vacation and sick days. The district ultimately paid him $100,000 upon retirement, the report said.

Other municipalities found to be improperly awarding compensatory time were Huntderdon County, Elmwood Park, Fairfield (Cumberland County), Garfield, Northfield, Paterson, Pemberton, Rahway and Wallington.

Many of the municipalities reviewed by the Comptroller's Office said in response to the report they will now implement appropriate procedures for awarding overtime and compensatory time.

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