Ethics questions abound for turnpike chief


Bergen Record, Tuesday, October 17, 2006

By TOM DAVIS
STAFF WRITER

Turnpike Chairman Joseph Simunovich once boasted that his integrity during decades of government service was beyond reproach.

Now, however, that integrity is being questioned by the state Ethics Commission as it probes the relationship between Simunovich and New Jersey Turnpike contractor Joseph Sanzari. The two men acknowledge they are close friends.

For years, Simunovich has held leadership positions on powerful boards both public and private. Critics charge that those close to Simunovich have received contracts, lofty appointments or other assistance from the boards and agencies on which he has served during the past six years.

The turnpike chief said he is prepared to defend his integrity and believes he will be treated fairly by the six-member ethics panel. A commission hearing has not yet been scheduled.

"When it is clearly pointed out what my actions were, things will work out OK," said Simunovich. "I think I have nothing to be ashamed of."

Critics say otherwise and point to these examples:

* A company run by Simunovich's son-in-law landed a contract last year to renovate a thrift shop run by the Auxiliary of the Hackensack University Medical Center Foundation, according to state records. Simunovich is vice chairman of the foundation.

* The same son-in-law received a loan in 2000 from the state Economic Development Authority while Simunovich served as vice chairman of the agency, according to state records. Simunovich did not vote on approving the loan.

*  Simunovich appointed Sanzari head of the Garden State Arts Foundation's board of trustees in 2004. The foundation falls under the auspices of the New Jersey Turnpike Authority.

*  Sanzari received more than $52 million in contracts from the Turnpike Authority since 2004 that Simunovich voted for as chairman, according to turnpike records. Simunovich now recuses himself from votes involving Sanzari.

State ethics laws require public officials to reveal potential financial conflicts involving their spouses and dependent children. A state official, however, must also recuse himself from a vote if he has any personal interest in the outcome.

The state Ethics Commission is investigating whether Simunovich violated ethics laws when he voted on Sanzari's contracts. Investigators also are checking into flights Simunovich received from Sanzari between 2003 and 2005. Simunovich reimbursed Sanzari $7,125 for the flights aboard a jet co-owned by the contractor. The commission is expected to review the matter shortly.

The matter also is the subject of a criminal probe by a federal grand jury in Newark. Earlier this year, the grand jury subpoenaed all records and correspondence between Simunovich and Sanzari from the Turnpike Authority.

The New Jersey Public Interest Research Group, a government and consumer monitoring group, called on the Ethics Commission to conduct a thorough investigation of Simunovich's connections.

"We believe the allegations of him doing special favors for friends [are] extremely troubling," said Abigail C. Field, legislative advocate for NJPIRG. "Public servants owe their highest duty to the public they are supposed to serve."

Republicans, pointing out that Simunovich also has served as state finance chairman for Sen. Bob Menendez's reelection campaign, have called on Governor Corzine to remove Simunovich from his position as chairman of the Turnpike Authority.

"It continues a very disturbing pattern as it relates to Bob Menendez," said Tom Wilson, state GOP chairman.

A Menendez spokesman said Simunovich resigned from the finance position in August, though Simunovich said he's merely "not very active" in the campaign because his wife is ill. He declined to say whether he quit.

Corzine spokesman Anthony Coley would only say: "We have referred this matter to the state Ethics Commission and are awaiting their review."

Fund-raising team

Sanzari, who has given more than $113,575 to the Garden State Arts Foundation, which raises money for programs at the PNC Bank Arts Center, did not seek reappointment this year -- just as Simunovich became mired in the ethics controversy.

The funds were given as gifts through various golf and concert outings, among other events. Sanzari hasn't donated anything, however, since leaving the foundation. He did not return messages left for him at both home and work.

Sanzari still enjoys a strong personal relationship with Simunovich. Both, along with J. Fletcher Creamer Jr., another turnpike contractor, sit on the medical center's Board of Governors.

All three have formed a powerful fund-raising team, said Robert Torre, vice president of the medical center's foundation.

"If I'm going to raise money, I'm going to pick these three guys," he said.

Simunovich, who built a successful career as a marketing executive in the telecommunications industry, has developed a reputation as a prolific fund-raiser.

Menendez even paid tribute to Simunovich on the floor of Congress on Nov. 15, 2001, citing his "extensive corporate, governmental and entrepreneurial genius and expertise."

"I've known Joe Simunovich for 20 years," said George Zoffinger, president of the New Jersey Sports and Exposition Authority. "He is an honorable man of very high integrity, and I believe that this whole incident [involving the Ethics Commission] is very unfortunate."

With his humble demeanor and can-do spirit, Simunovich is known for his ability to marshal his friends -- Democrat and Republican alike -- to support his various interests.

"Nine years ago, when I got here, they [the Hackensack University Medical Center Foundation] raised $4 million in a year," Torre said. "Now we raise $25 million a year."

Help for family

Sometimes, the interests that Simunovich has served have hired or helped his family.

A company run by Simunovich's son-in-law, Stephen Martinez, was chosen to renovate a thrift shop run by the Auxiliary of the Hackensack University Medical Center Foundation.

Torre said he did not know why Martinez's company, ST Construction, was chosen for the job. But he did say that Simunovich "had nothing to do with it," though he didn't have additional information on the hiring.

"They [the auxiliary] wanted help, they got his name [Martinez] from someone and that was it," Torre said.

Although Torre praised the work, the project incurred a $500 fine because permits to do the renovation were not obtained.

The fine was reduced from $4,000 because the company and the auxiliary got the proper permits in the fall of 2005. Work resumed and a certificate of occupancy was issued, said Susan Abbey, a Department of Community Affairs spokeswoman.

Martinez's companies also received a five-year, $43,875 loan from the Economic Development Authority in 2000, when Simunovich served as vice chairman. The money was for the purchase of office and warehouse space for $165,000 at 206 West St. in South Hackensack.

The loan was paid off last year, and the property was sold for $301,000, according to electronic deed records.

Simunovich didn't vote, and didn't participate in discussions, said Caren Franzini, chief executive officer of the EDA.

"I was aware of it," Franzini said of the loan. "He [Simunovich] disclosed it to me, but it still had to pass financial muster and the [necessary] criteria on its own."

Efforts to obtain comment from Martinez were unsuccessful. Simunovich, meanwhile, condemned any attempt to connect his family to his ethics troubles, saying he has done much to avoid conflicts not just in this case, but in all in his business dealings.

"I've given my time and energy to charitable organizations," he said. "There was never the slightest hint of an allegation."

Staff Writer John Brennan contributed to this article. E-mail: davist@northjersey.com