The Local Government Ethics Law and Super Storm Sandy

Mondsini v. Local Finance Board, 458 N.J. Super. 290 (App. Div. 2019).  This opinion by Judge Messano deals with an issue under the Local Government Ethics Law, N.J.S.A. 40A:9-22.1 to -22.5 (“LGEL”) that was occasioned by Super Storm Sandy in 2012.  Plaintiff was the Executive Director of the Rockaway Valley Regional Sewerage Authority.  “The Authority lost electrical power during the storm and maintained operations by using diesel generators.  If the generators failed, millions of gallons of untreated sewage would discharge into the Rockaway River.”

As the situation grew more dire, including a statewide gasoline shortage, plaintiff allowed essential employees of the Authority to fuel their personal automobiles from Authority gasoline pumps.  She also permitted Bruce MacNeal, a member of the Authority’s Board of Commissioners, but not an essential employee, to fuel his personal vehicle from an Authority gas pump.  Plaintiff asked MacNeal whether he could “commandeer” a gasoline station to get fuel for the Authority, and whether he could obtain food from restaurants for the Authority’s essential personnel.

Plaintiff reported her actions to the Authority’s Board at its next meeting, within a few days of taking those actions.  Unbeknownst to plaintiff, however, MacNeal had fueled two of his personal vehicles with the Authority’s gasoline.

An unknown informant complained about plaintiff’s decision to allow Authority employees to use Authority gasoline for personal use during Sandy.  The Local Finance Board (“LFB”) opened an investigation, and concluded that plaintiff had violated N.J.S.A. 40A:9-22.5(c).  That provision states that “No local government officer or employee shall use or attempt to use his official position to secure unwarranted privileges or advantages for himself or others.”  The LFB fined plaintiff $100, and simultaneously waived that fine.  (MacNeal was fined $200, though that was not the subject of this appeal).

Plaintiff appealed, and the matter went to the Office of Administrative Law as a contested case.  An Administrative Law Judge ruled that subsection (c) requires intent, which the ALJ found lacking here, since plaintiff’s “sole intent was to keep the plant up and running.”  The ALJ also rejected the LFB’s finding that plaintiff had obtained an “unwarranted” privilege for MacNeal because he was not an essential employee.

The LFB’s final agency decision accepted the ALJ’s findings of fact, but rejected the legal conclusion that subsection (c) did not require intent.  Plaintiff appealed, and the Appellate Division ruled in her favor.

Judge Messano recognized that the standard of review of administrative agency action is a limited one, and that an agency’s decision will be upheld unless arbitrary, capricious, unreasonable, or unsupported by the record.  But reviewing courts owe no deference to agencies’ rulings on questions of law, he observed.  The panel then had to analyze the language of the LGEL to determine whether the final agency decision comported with legislative intent.  Judge Messano stated that “[t]he best indicator of that intent is the statutory language.”

After an extensive review of LGEL and other relevant caselaw, including the only two prior opinions addressing N.J.S.A. 40A:9-22.5(c), Judge Messano rejected the idea that “the mere public perception that an official used his office to secure an unwarranted privilege or advantage is sufficient proof he or she violated subsection (c).”  He then held that “based on subsection (c)’s plain and unambiguous language, … a public official or employee only violates this provision of the LGEL if she uses or attempts to use her official position with the intent to secure unwarranted advantages or privileges for herself or another.  In this case, the ALJ found as a fact that Mondsini lacked such a purpose, and that her only purpose in allowing MacNeal to use the Authority’s gasoline was to keep the Authority operating during the crisis.  The LFB accepted these factual findings.”  The panel therefore reversed the LFB’s decision.

Judge Messano went on to rule that plaintiff had not secured an “unwarranted privilege or advantage” for MacNeal.  “Unwarranted,” he said, means “unjustified or unauthorized.”  Here, because plaintiff asked MacNeal to try to obtain food and fuel for essential Authority needs, in an emergency, her action was not improper.  The LFB’s assertion that plaintiff had other options was “Monday morning quarterbacking.”  Quoting a Supreme Court case, Judge Messano reminded everyone that though ethical considerations are important, statutes regarding ethical obligations “must be applied with caution, as [l]ocal governments would be seriously handicapped if every possible interest, no matter how remote and speculative, would serve as a disqualification of an official.”

The result here appears to be the correct one.  This opinion is also an example of effective writing, in that, by the time one finishes reading the summary of the facts in the first few pages of this decision, it is difficult to resist the conclusion (which comes only many pages later) that plaintiff should not have been penalized.