Hudson lawmaker under new scrutiny
State looking at funding for child care facility with tie to Stack

March 04, 2007  Star-Ledger

A top Hudson County legislator, already the focus of an ongoing federal corruption probe, has come into the cross hairs of a separate state criminal investigation involving a publicly subsidized day care program operated by his wife.

The Attorney General's office subpoenaed records in connection with $200,000 in state funding earmarked by the Legislature for the child care facility in Union City, where Assemblyman Brian Stack (D-Hudson) also serves as mayor.

U.S. Attorney Christopher Christie also is examining those grants as part of his own investigation of nearly $1 billion in so-called "Christmas tree" items approved by the Legislature during the past three years.

As part of that investigation, federal prosecutors have been specifically looking at a number of lawmakers, including Sen. Wayne Bryant (D-Camden), who once headed the powerful appropriations committee, as well as Stack, according to several sources with knowledge of the investigation.

Prosecutors are exploring whether any lawmakers sought to give money to organizations that would have directly benefited them or their families, those sources say.

Officials in the state Attorney General's office declined comment, but Union City officials confirmed they received a separate state subpoena in December related to the operations of the day care center.

"It asked for information related to grants to Union City and to the day care center," said city spokesman Joe Lauro. "We complied with it."

Though a nonprofit organization, the Union City Day Care program is considered an autonomous city agency. Its trustees are all appointed by the city, which provides substantial financial support, Lauro said.

It is not known what specifically led to the subpoena by the Attorney General, but the program's executive director is the mayor's wife, Katia Stack, who receives a $100,096 annual salary, according to the organization's most recent tax return.

Stack said the two have been estranged for years, although she was listed as treasurer of his civic association as recently as May. He filed a divorce complaint four months ago, however court records show it was never served on his wife and will soon be dismissed because of inaction.

The day care program, which operates four centers in Union City and can serve up to 403 children, is almost entirely supported by $5.6 million in public funds -- including $1.7 million in federal awards last year, records show.

The program also has been the beneficiary of several supplemental state grants inserted into the budget by legislators. Those grants, known as Christmas tree items, typically have included pet projects and favored causes of legislators, or those with political connections.

The Christmas tree appropriations are secretively and anonymously added by lawmakers at the last minute, so that there is little record to indicate the actual sponsors of individual grants.

Amid growing outcry and partisan criticism over the grants, Gov. Jon Corzine on Friday said he will end the practice, and legislative leaders -- who have all been subpoenaed in connection with the federal probe -- have pledged reform.

State Treasury Department records show Union City overall received more than $1.2 million in Christmas tree grants in the last two years. The Union City Day Care program was awarded separate $100,000 grants in 2003 and 2005. The initial grant was used to upgrade a city playground behind the center. A subsequent grant was earmarked for the purpose of repairing water damage caused by heavy rains.

Stack said last week that the money was used for "capital purposes" and didn't go toward payroll. As for the park, he said it was not solely for the use of the day care center, although he acknowledged that it is off-limits to the general public for security reasons while the facility is open.

State campaign finance records, meanwhile, show that the architects and contractors on the projects contributed thousands to Union City First, a municipal campaign committee controlled by Stack.

Ron Dario, the attorney for the day care program, referred questions to Stack's spokesman, saying, "I've got no comment."

Little known outside his district, Stack has been a growing force in Hudson County -- a gritty political landscape of rapidly shifting alliances and abandoned loyalties.

A one-time legislative aide who has served as a county freeholder, Stack became mayor of Union City when his predecessor -- Raul "Rudy" Garcia -- ran afoul of county Democratic leaders. He subsequently took Garcia's seat in the Assembly.

While he has little political base outside Union City, the 40-year-old lawmaker has built support in his hometown through a local civic association and other organizations, boasting of handing out free turkeys each year at Thanksgiving and toys and gifts at Christmas.

Meanwhile, he recently announced that he planned to challenge Senate Majority Leader Bernard Kenny (D-Hudson) for the Senate seat he has held since 1993. Kenny also is the chairman of the Hudson County Democratic Organization.

"I welcome the investigation," Stack said Friday. "I'm very confident ... that it will reveal, at the end of the day, that all of these grants, not only the day care but every grant I sought for the district, was well-used and well-needed by our city."