Former Birdsall Executive Pleads Guilty in Pay-To-Play Scheme

A former executive for Birdsall Services Group, a Monmouth-based engineering firm that Lacey Township used for its recent feasibility study, pleaded guilty Nov. 30 for his role in a scheme in which the firm fraudulently avoided the restrictions of New Jersey’s Pay-to-Play Act, Attorney General Jeffrey S. Chiesa said.

The firm allegedly disguised illegal corporate political contributions as personal contributions of employees of the firm, Chiesa said.

Former director of marketing Philip Angarone, 40, of Hamilton (Mercer County), pleaded guilty before Superior Court Judge Wendel E. Daniels in Ocean County to an accusation charging him with third-degree tampering with public records or information and fourth-degree prohibited corporation contributions through employees.

The state recommended that Angarone be sentenced to up to 364 days in the county jail as a condition of term probation. He must forfeit $26,775 that was reimbursed to him by Birdsall Services Group for illegal contributions, as well as any contributions that are subsequently returned to him by campaigns or political organizations.

He will also be barred from public contracts for five years. His sentencing is scheduled for April 26, 2013.

In pleading guilty, Angarone admitted that beginning in 2008, when he joined the firm, he participated in a previously existing scheme to make illegal corporate political contributions. Instead of Birdsall Services Group (BSG) making corporate political contributions to campaigns and political organizations that would disqualify it from public contracts awarded by certain government agencies, Angarone admitted that he and other shareholders and employees of the firm would make personal political contributions of $300 or less, which are deemed unreportable. 

Multiple personal checks would be bundled together by Angarone or others at Birdsall and sent to the appropriate campaign or political organization. Angarone admitted that he and the other shareholders and employees would then be illegally reimbursed by BSG in the form of added bonus payments, and the firm would falsely omit the illegally reimbursed contributions in documents filed with the Election Law Enforcement Commission and with government agencies that awarded the firm contracts.

Birdsall receives millions of dollars each year in government contracts. The pay-to-pay law was created to prohibit companies from using political contributions to improperly influence the awarding of contracts, Chiesa said.

“Illegal corporate contributions like those in this case undermine the fair and open public contracting process needed to ensure that government agencies strictly serve the public interest, not the interests of politically connected firms,” he said

State investigators executed a search warrant at the offices of Birdsall Services Group in Wall on Wednesday, May 3, the Star Ledger reported. 

Lacey Township awarded a contract for $22,500 to Birdsall on May 17, with a unanimous vote, for its feasibility study for a potential new generation facility. In May, Mayor Mark Dykoff said he was unaware of the state’s investigation until after the contract was awarded.

Dykoff said the investigation did not concern him then.

“Birdsall was selected for their expertise in the area of renewable energy and their familiarity with the power plant properties,” Township Administrator Veronica Laureigh previously said.

The township was served a subpoena pertaining to its business with Birdsall on Aug. 22. The subpoena asked for all records relating Birdsall Engineering. Dykoff said then that the subpoena also did not concern him and that Lacey has always followed a "fair and open process" when awarding a contract.

“Such things as subpoenas are part of the normal course of business so it does not phase me when we get subpoenas to produce documents,” Laureigh previously said. 

According to an NJ.com story, Birdsall did more than $28 million in business with towns, counties, the state and other public agencies throughout New Jersey in 2011. The company also donated $129,700 to dozens of Democrats and Republicans last year.

Other municipalities served subpoenas for their work with Birdsall included Seaside Heights, Toms River and Brick. The Ocean County government also received the same order.

According to state records, Angarone did not make contributions to any Lacey Township candidates.

“Our investigation into alleged illegal corporate political contributions made on behalf of Birdsall Services Group is continuing,” said Stephen J. Taylor, Director of the Division of Criminal Justice. “This elaborate scheme continued for years and involved scores of purported personal contributions that were under the $300 reporting threshold. The reality was that the company was sending out bundles of checks to campaigns and political organizations.”