EDGEWATER, N.J. (PIX11) — Edgewater, a New Jersey town on the Hudson River, has transformed since the late 1990s from being home to a large collection of abandoned riverfront industrial sites to becoming a residential and retail hub. In fact, its population has nearly tripled over that time period. It’s had among the fastest growth in New Jersey, but it’s come at a price ethically and criminally, according to a recently released state investigative report. 

New Jersey’s Commission of Investigation carried out a years-long probe into how town business gets done in Edgewater, and the report it issued on Tuesday found “evidence of the reasonable possibility of criminal wrongdoing,” and “unspecified payments to organized crime associates or their relatives,” among other conclusions. 

The report said that the biggest developer in the borough of 15,000 people, Fred Daibes, cut significant deals with city officials, including Mayor Michael McPartland.

Kathy Riley, who’s the Commission of Investigation’s deputy communications director, said that the commission found that Mayor McPartland “was able to get a discounted rent for an apartment in a building that the developer owned.”

“In fact, when he first got that arrangement,” she continued, “he didn’t pay for it for about 18 months. He didn’t pay rent whatsoever, and then, over time, he did pay that back-owed rent, but he still received rent at a substantially discounted rate.”

For his part, Mayor McPartland told PIX11 News that his response is the same one he provided to the commission that wrote the report. The statement, which is at the end of the appendix to the report, says, in part:

“…in my capacity as mayor I have never provided Mr. Daibes with any benefit he was not otherwise entitled to and take serious offense at the innuendo that I have.”

The report also said that a town council member who’s also a flooring contractor received $2.6 million in business through Daibes. Also of note from the report is evidence it cites that Daibes wrote $100,000 in personal checks to relatives of a senior member of the Genovese Crime Family. 

Payments, favors, and gifts are not required to be disclosed publicly, according to the commission. It’s calling on that to change. 

Agreeing with that call was Peter Woolley, a political science professor at Fairleigh Dickinson University. He said that the reason that reform is needed is very clear. 

“There are a lot of people who hold public office, elected or otherwise, who also have real estate interests” in New Jersey, Woolley said. “To get in on the inside of conversations on how to develop [properties] can translate directly into money.” 

The Commission of Investigation recommended in its report that Gov. Phil Murphy and the state legislature strengthen New Jersey’s Local Government Ethics Law. It deals with disclosures and transparency in municipal governments across New Jersey.

The commission called for the law to require more disclosures of interactions with entities that have business that gets decided by local officials. It also called for strong consequences when disclosures aren’t made. 

“We recommend that penalties be more in line with the ethics laws that apply to state employees and state officials,” Riley said, “which are much higher.”

Fred Daibes was not available for an interview, according to his attorney, Lawrence Lustberg. Daibes is awaiting sentencing in a federal bank crimes case that’s unrelated to the Commission of Investigation report. In that case, Lustberg has said in public statements, he and Daibes are expecting him to be sentenced to probation.