Largely funded through state and federal grants, the EDC is responsible for luring new business to Jersey City, assisting existing business with storefront renovations, and overseeing the Special Improvement Districts. "We detected some things that looked irregular to us," said Councilman Mariano Vega, who is the chairman of the EDC board. "We found a series of checks that just didn't make sense."
According to a police investigation led by Police Director James Carter, 17 checks were written to Elam between September 2000 to November 2001. Other charges in connection with those checks involve EDC funds that were wrongfully lent to personnel and the misuse of an official-signature stamp, qualifying as forgery. Elam was released on a $750 bail bond Thursday.
Police officials said the investigation is still ongoing.
"Any act of suspected criminality will be thoroughly investigated," Mayor Glenn Cunningham said. "I have also directed the board to seek an outside and independent auditor to conduct a full review of the financial practices at the EDC." Neither Vega nor city officials could identify the EDC's overall budget by press time. EDC Executive Director Tom Ahern did not return messages left at his office.
Before the scandal was uncovered, the EDC had drawn criticism from city officials for consistent negligence. A difficulty in getting information about the cryptic agency that oversees business development and restoration in Jersey City has long bothered city officials and the current administration.
In many caucus meetings, Council President L. Harvey Smith has requested a representative from the EDC to attend the meetings to answer questions the City Council might have about the Urban Enterprise Funds it controls. Those requests have been met with assurances from Mark Munley, director of the Department of Housing, Economic Development and Commerce, that he would micro-manage the agency.
Though it is an autonomous agency, the city appoints people to its board.
Changes in the agency began before the discovery of the scandal. Stuart Koperweis, the president, has stepped down from his position of a $75,000 annual salary and agreed to serve as a temporary consultant until the agency gets back on its feet. Koperweis, hired under former Mayor Bret Schundler's administration, drew criticism from Cunningham's administration since taking office.
Citing a cost-cutting opportunity, Cunningham said that he could replace Koperweis with a Jersey City businessman willing to take the job for $1 per year.
Michael Cunningham, no relation to the mayor, agreed to take that position as Koperweis stepped out.
"Michael Cunningham is an individual who went from a vice president in marketing to having his own international firm," Vega said. Cunningham's business, Cunningham Graphics, is located next to Liberty State Park. "The time was right to look at the corporation in a new light," Vega said.
A number could not be obtained for Elam, who lives in Rahway.