Outrage as long standing broker gets passed over for insurance contract

Locals disagree with the Casino Reinvestment Development Authority’s choice

Outrage as long standing broker gets passed over for insurance contract

Insurance News

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Robert Mulcahy, chairman, Casino Reinvestment Development Authority [CRDA], was unapologetic about the awarding of an insurance brokerage contract to a firm headed by South Jersey Democratic power broker George E. Norcross III.

The contract, which was totally granted to Conner Strong & Buckelew. In making the award, the CRDA bypassed an insurance broker with an established connection to Atlantic City that had insured CRDA for over two decades.

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“We awarded for the best proposal. We have an internal evaluation committee that evaluates these things. I don’t even get involved in the process. I didn’t even know who had the bid until it came to us,” Mulcahy said after the board’s monthly meeting.

The Inquirer reported on this month’s contract award after receiving information on both submitted bids and the executed contract through an Open Public Record Request. The bids were a response to a Request for Qualifications (RFQ), which awards more latitude than a Request for Proposals (RFP), which require bidders to provide the cost of premiums and compensation.

The contract arrived months after Gov. Chris Christie replaced the CRDA’s executive director with Chris Howard, an attorney who previously worked in the governor’s administration and at Parker McCay, a law firm headed by Philip Norcross, George’s brother.

Frank Proctor, managing director at Conner Strong, did not answer to a request for comment, yet he mentioned in a subsequent letter that the brokerage had already provided savings of $100,000 to the CRDA on its property insurance policy.

“The unanimous selection of Conner Strong as the broker has already produced dividend to CRDA,” the letter said.

Mulcahy, a former Rutgers University athletic director, was unable to present the total figure of the cost of premiums under Conner Strong to compare with prior policies, and he took offense at any suggestion that there was anything wrong with awarding the contract to Conner Strong.

“First of all, I don’t think you understand the contract. The whole issue is to have a process that results in better coverage for less money. And I think when this is all done, that’s what you will see. When you see the results, you’ll understand,” said Mulcahy, according to an article at philly.com.

The contract has also raised eyebrows locally against the backdrop of the state takeover of Atlantic City and questions surrounding the ongoing influence of Norcross and allies of Gov. Christie. The CRDA has controlled the investment of nearly $2 billion from a 1.25% tax on gross casino revenue since 1984.

Mulcahy was also unremorseful about the recent pay hikes for CRDA employees, following a 10% reduction in its staff. He stated that the lawyers told them that they can do it when asked why the insurance contract bids were solicited through an RFQ, and not by an RFP.


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