Middle’s Municipal Judge Wins Pension Battle

COURT HOUSE – New Jersey’s Appellate Court has ruled that the state improperly stripped pension service credit from Middle Township’s former municipal prosecutor Marian Ragusa.
Ragusa currently serves as the township’s municipal court judge.
Ragusa had appealed a final agency decision denying her pension service credit retroactive to April 2010.
Late in 2009, Ragusa, then an assistant county prosecutor since 2003, was approached about the soon-to-be-vacant job as municipal prosecutor in Middle. According to court documents, Ragusa expressed interest in the transition to the municipal position “provided she could remain in PERS,” the state’s retirement system.
The facts of the case, which the court’s ruling called “essentially undisputed,” detail a timeline of questionable personnel practices prior to 2013 when Ragusa was forced to sign a professional services contract under protest.
Background
Ragusa began work as the township’s prosecutor in March 2010. In November 2009, the township had announced a fair-and-open process soliciting proposals for the prosecutor’s position. 
Ragusa eventually was selected to succeed Mary Bittner as municipal prosecutor, and a resolution appointing her to the position was adopted March 15, 2010.
Ragusa was added to the township payroll, received regular paychecks and was issued a W-2 form at the end of the year, all of which, she felt, confirmed her position as a regular employee entitled to pension service time.
The resolution had appointed Ragusa to a one-year term and in November 2010 she applied to retain her position. 
In a contract award resolution which Ragusa said she was unaware of, the township named Ragusa as a contractor for the upcoming year. She was subsequently sent a “contract for services” by the township. 
Ragusa protested stating that she was a township employee. She refused to sign the contract. The township took no action, and she remained on the payroll at her prior salary.
The situation repeated the following year. A resolution to “carry over” her term was adopted stating that the “contract is hereby awarded;” yet there was no written agreement between the parties.
The township again submitted a draft contract, Ragusa again refused to sign it and the township “did not press the matter.” She was also paid at her prior rate which was higher than the rate listed in the contract award resolution.
Reacting to a state initiative that required municipalities to review the employment status of individuals performing professional services, the township insisted in May 2013 that Ragusa sign a professional services contract and informed her that she was not considered an employee. She signed under protest.
Court documents state that the township never signed the contract, but Ragusa was removed from the payroll and required to submit vouchers for payment.
In December 2013, the state informed Ragusa she was ineligible to receive pension credit for her years as municipal prosecutor.
Ruling
The court found that Ragusa provided legal services to the township for compensation, “but she did not do so as a vendor.”
Dealing with each year in turn, the court ruling cited the lack of a written agreement, the varying nature of the annual resolutions appointing her to the position, the lack of follow-up by the township when she protested proposed contracts, and the fact that the township continued to pay Ragusa in 2012 at a rate that exceeded the rate in the appointment resolution.
The court acknowledged that the rules regarding pension eligibility were put in place to prevent abuse of the pension system by independent contractors who at one time “tacked” the system with multiple municipal appointments in order to build-up “substantial pension credits.”
In 2012, the Office of the State Comptroller issued an investigative report on the improper participation of professional service providers in the state pension system, explicitly stating that a number of local municipalities failed to perform the appropriate analysis for their professionals.
In review of Ragusa’s appeal, the court found “no resemblance” to those abuses.
Ragusa is to receive service credit for the years from 2010 through 2012.
In the ordinance adopted at this year’s township reorganization meeting, the position of municipal judge, with Ragusa as the current incumbent, is clearly listed under the heading of “Officers and Employees of the Township.”
To contact Vince Conti, email vconti@cmcherald.com.