Should Zoffinger Consider Stepping Down?

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By: Michael M. Shapiro
During his tenure as the president and CEO of the New Jersey Sports and Exposition Authority (NJSEA), George Zoffinger streamlined operations, eliminating waste, fraud and abuse. As former chairman of the New Brunswick Development Corporation, he played an integral role in the revitalization of New Brunswick.

Unfortunately, his tenure on the Rutgers Board of Governors (BOG) has been marred by allegations of conflicts of interest and ethical dilemmas outside the board room, as well. Given these issues and Mr. Zoffinger’s professional work and commitment to the many other boards on which he serves, it may be wise for him to consider stepping down from the Rutgers BOG, at least temporarily.

In 2004, then-Governor James E. McGreevey nominated George Zoffinger to the Rutgers University Board of Governors as one of the board’s “public governors,” for a six-year term. While his nomination was pending, he was confronted with allegations of a conflict of interest because, at the time, he was Chairman of the New Brunswick Development Corporation (Devco), a real estate development company that is based in New Brunswick (the home of Rutgers University) and does a great deal of work for both Rutgers and the City of New Brunswick.

Devco was involved with such projects as the new Rockoff Hall University Apartments and the Rutgers Public Safety Building. In November 2004, Mr. Zoffinger held a meeting with students regarding the issue and told them that there would be no conflict if he served on the BOG and that he would eliminate any appearance of a conflict of interest by not being involved in any real estate or sports matters that come before the board.

When his appeal to the students did not succeed in eliminating concerns regarding a possible conflict, Zoffinger resigned as chairman of the New Brunswick Development Corporation, seemingly putting to rest the concerns raised. However, he remained on Devco’s board and continues to sit on the board to this day. Whether a conflict of interest exists would be determined only by knowing the powers and responsibilities of the board members, whether Mr. Zoffinger is compensated, and if so, how his compensation is determined, among many other factors.

However, the fact that a member of the BOG is on the Board of Directors of a real estate development company that has extensive dealings with Rutgers raises concerns. After all, his duties on the BOG are such that he owes his loyalties to Rutgers and to protecting the interests of the University. Meanwhile, his duties as a director of Devco include putting Devco’s interests before all others. Therefore, there is at least the potential for a conflict of interest.

Mr. Zoffinger retired from the NJSEA soon after it came to light that his son works for a law firm that represented the NJSEA and that this fact was allegedly never disclosed. A state ethics investigation was launched against Mr. Zoffinger to look into whether state conflict of interest laws were violated in the process. At the same time, since leaving the employ of the NJSEA, Mr. Zoffinger has moved to Pennsylvania. It is questionable whether a “public governor” should reside out of the State of New Jersey.

Mr. Zoffinger is a successful businessman and has done many good things for New Brunswick, Rutgers, and the residents of New Jersey. However, because there is at least the potential for a conflict of interest regarding his relationship to Devco and because he no longer resides in New Jersey, he should consider leaving the BOG, at least temporarily. The university’s interests cannot best be served by having a member of the BOG confronted with conflict of interest issues that are marring his tenure on the Board.

Michael M. Shapiro, founder of ShapTalk.com, is an attorney who resides in New Providence. He currently serves as the editor of The Alternative Press, www.thealternativepress.com. Contact Mike at mike@shaptalk.com.


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