CAPE MAY – The City Council has approved two payment plans to end a bonus checks controversy that has plagued the city since January 2020.

At that time the council was reorganizing following a 2019 election that brought a new mayor to city hall. The new administration discovered that bonus checks totaling around $100,000 had been issued by outgoing City Manager Jerry Inderwies Jr. to seven employees, including himself.

The checks were issued without governing body approval and were drawn on monies in the restricted Affordable Housing Trust Fund.

So began a three-year saga in which the city sought to recover the funds without taking anyone to court. One by one, five of the recipients of the bonus checks, under city pressure, made arrangements to repay the money.

At the council meeting Tuesday, Dec. 19, two resolutions were passed accepting down payments and subsequent payment plans from the remaining two individuals, one still a city employee who was not named and the other, Daniel Shustack, a past employee who is now on staff in Middle Township.

Shustack and the city had previously been unable to come to an agreement, and he had sued the city. His settlement agreement with Cape May and the approval of his repayment plan calls for his withdrawing the litigation.

Mayor Zack Mullock issued a statement in which he recounted what he termed the “inherited” problem in 2020, the efforts of the city to work with other local and state agencies that all confirmed the monies had been accessed inappropriately, and the work by the city on behalf of its taxpayers and the trust fund to recover the monies.

Mullock said, “The city won every court battle, while not going to the legal expense of filing lawsuits.” He added: “Ultimately the fund is being restored, those involved have all made a plan for repayment.”

The resolution comes as the city was urged by past Councilman Chris Bezaire at the Dec. 19 meeting to press ahead with affordable housing goals to help meet the need for housing accessible to city employees.

Mullock concluded his statement by saying, “The city hopes that now we can continue to move forward in a positive direction and finally get on to what the Affordable Housing Trust Fund is actually for, building much needed affordable housing.”

Contact the author, Vince Conti, at vconti@cmcherald.com.