Hasbrouck Heights pauses Swim Club lease talks after audit finds steep cash declines, missing records

The Borough of Hasbrouck Heights on May 13, 2025 said it will not move forward with negotiations to extend the Hasbrouck Heights Swim Clublease after an auditor's report found substantial financial shortfalls and missing records.

Borough Attorney Mark A. DiPisa read the auditor's findings to the mayor and council, saying the borough had pursued audit documentation since February and that "a significant number" of requested documents remain outstanding. "Based upon the information contained in the attached report . . . the Borough cannot move forward with negotiations to extend the Swim Club lease at this time," DiPisa read.

The agreed-upon procedures report from Lerch, Vinci & Bliss, LLP, which the borough submitted with DiPisa's letter, summarized the largest findings: cash on hand fell from $419,340 on Sept. 30, 2022, to $41,091 on March 31, 2025 (a decline of $378,249, or about 90%); the firm estimated member bond certificates outstanding of about $154,000 and reported a shortfall of $112,909 to meet those obligations; and auditors were unable to complete audits for fiscal years 2023 and 2024 because required financial records were not provided.

The report also flagged unsupported spending: of 51 sampled disbursements, 42 lacked vendor invoices or receipts, representing $110,823 of the $141,144 sampled. The auditors noted net losses in operations of $101,537 (2023) and $107,663 (2024) and a steady decline in revenue since 2021.

"Sufficient financial reports and records were not provided by the Swim Club in order to complete an audit of the financial statements for the fiscal years ended September 30, 2023 and 2024," the Lerch, Vinci & Bliss report concluded, which DiPisa summarized for the council.

At the meeting, Jennifer Ober, who identified herself as the new president of the Hasbrouck Heights Swim Club, said the club has begun restructuring its executive board and had taken steps to strengthen financial controls. "I ask all who love the pool to not panic," Ober said. "We already have about two-thirds of our memberships for this year paid in full. Please give the new administration the time to bring back the days of financial stability. I am proactively offering to provide the Mayor and Council mid-year 2025 financial statements as of July 2025 and all supporting documents in an effort to renegotiate the lease." The council did not schedule a lease renegotiation that night.

A resident who identified himself as a former Swim Club president, Mike Davis, urged the borough to pursue further accounting or investigation, saying the pattern of missing records and declining cash "suggests" funds are unaccounted for. Davis said the borough should determine who had access to club accounts and records. The council did not vote on or authorize an investigation during the meeting.

Mayor Ronald Kistner and members of the council said the Swim Club may continue to operate under its existing lease through its March 31, 2026 expiration, and that if the club provides additional documentation showing improved finances, the borough could revisit lease discussions.

Next steps noted by borough officials: the borough will keep the auditor's report and related correspondence on record; the Swim Club leadership said it would supply mid-year financial statements and supporting documents by July 2025; and the borough will reassess whether to begin formal negotiations after review of those materials. No formal enforcement action, criminal referral or council authorization of a third-party forensic audit was announced at the May 13 meeting.

The auditor's report and the borough attorney's letter are attached to the council minutes and were read aloud at the meeting.