Official Site of The State of New Jersey

TRENTON—In a ruling Monday, the Appellate Division affirmed the Office of the State Comptroller’s findings that Hudson County violated the law in awarding a $13.5 million prison services contract.

The three-judge panel unanimously ruled that Hudson County repeatedly improperly bypassed public bidding and competitive contracting rules when it awarded the multimillion-dollar prison services contract for the Hudson County Correctional Center without public notice or open competition, as required by law.

“The Appellate Division’s decision affirms OSC’s authority to ensure major public contracts are handled fairly, openly, and in compliance with the law,” said Acting State Comptroller Kevin Walsh. “These are fundamental protections for taxpayers and essential safeguards against favoritism, cronyism, and misuse of public funds."

By law, local governments are required to submit major proposed contracts to OSC for review and approval at least 30 days before beginning the procurement process. Hudson County submitted the procurement in November 2023, two months after proposals had already been received. OSC repeatedly directed the County not to proceed, saying that the County had circumvented transparency and public bidding requirements when it didn’t advertise the opportunity, invited a few hand-picked firms to apply, and improperly entered into private negotiations with the preferred vendor.

After the County defied OSC’s directive and awarded the contract in 2024, OSC sued to enforce its directives to the County. The County appealed.

On Monday, the Appellate Division affirmed that Hudson County had repeatedly failed to provide adequate notice to OSC, restricted competition to select vendors, and illegally relied on a narrow “professional services” exception that did not apply in order to avoid a competitive, public process.

The Court also noted that Hudson County used the same improper process in 2018 when it procured services from the prison healthcare company. The County renewed that contract year after year, without advertising, resulting in an expenditure of over $39.5 million during a five-year period.

Read the court ruling.

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