Official Site of The State of New Jersey

TRENTON—Pennsauken School District made limited progress in complying with audit recommendations made three years ago, while Berlin Township earned $380,000 in additional revenue as a result of complying with audit recommendations. That is among the findings of two follow-up reports released today by the New Jersey Office of the State Comptroller.

Of 11 recommendations made by OSC in 2021, Pennsauken partially implemented five, fully implemented one, and failed to implement the remaining five. The 2021 report found that Pennsauken could have saved $1.6 million had it participated in the State Employees’ Health Benefits Program (SEHBP). In that audit, OSC found Pennsauken relied upon an erroneous analysis by a broker and that the broker did not fully disclose the commission to be received.

In the follow-up review, OSC found that although the broker’s cost comparison of the District’s coverage to the SEHBP was accurate for fiscal year 2025, Pennsauken did not provide any evidence that its broker had conducted such cost analyses for fiscal years 2023 or 2024.

Additionally, while the broker disclosed the gross commission -- $217,000 -- as OSC recommended in 2021, OSC found that Pennsauken agreed to vague provisions in the contract that may have allowed the broker to receive additional compensation. For instance, the broker’s contract required the District to pay the broker a larger commission or separate fee if the number of enrolled employees increased by 25 percent or more. It also entitled the broker to earn from the insurance providers “profit sharing, contingencies, incentives, bonuses, trips, prizes, awards and/or other forms of compensation.” OSC urged Pennsauken to revise the broker’s contract so that compensation does not exceed the standard commission amount.

OSC’s follow-up report also found the District paid $1.35 million in stipends to 173 employees who perform extra-curricular duties, but lacked adequate controls that would ensure that these payments were proper. OSC sampled stipend payments to 10 employees and found half had been paid more than the Board of Education approved. Pennsauken also had lax oversight of food inventory and “fixed assets,” such as computers, and made accrued leave payments to some employees who were not eligible for them.

OSC’s follow-up review found Berlin Township made progress. Of 13 recommendations, six were fully implemented, six were partly implemented, and one was not implemented at all.

Notably, Berlin, as a result of OSC’s recommendations, sold 17 unused, municipally-owned properties and generated $380,000 in revenue. The Township also stopped providing insurance benefits to ineligible employees. The 2021 audit found Berlin paid $219,000 for health insurance coverage for the mayor and two council members, without determining whether they worked the minimum hours to qualify for coverage. OSC’s follow-up report found no council members were provided health benefits. (The mayor received dental coverage and was found to be eligible.)

The Township, however, incorrectly calculated health insurance waiver payments and did not follow procurement regulations when it obtained dental insurance without seeking competitive quotes.

Read the follow-up review of Berlin Township and the follow-up review of Pennsauken School District.

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To report government fraud, waste, mismanagement or corruption, file a complaint with OSC or call 1-855-OSC-TIPS.