Ludlow manager suspended during state audit

Posted Feb. 16, 2010, at 9:54 p.m.
Last modified Jan. 30, 2011, at 11:33 a.m.

LUDLOW, Maine — The Board of Selectmen in a special town meeting Monday evening announced that the town manager has been suspended without pay and the state has stepped in to do an audit of the town’s finances over the past three years.

Virginia McCain, one of three selectmen in the town, told meeting attendees that Marybeth Foley, who McCain said has served as town manager for approximately 14 years, was suspended about two weeks ago. The town office has been closed since then.

During the meeting, selectmen said they were not sure how the situation unfolded. They said the state is conducting an audit and the board has authorized a private audit on behalf of the town looking at Ludlow’s finances for the past two years.

David Stevens, a Ludlow resident, said during the meeting that he was told “the state” had showed up at the town office with a subpoena for the town’s records so it could conduct the audit. It remains unclear what department of state government is conducting the audit.

State officials were unavailable for comment Tuesday because offices were closed for the statewide government shutdown day.

McCain said the board recently asked Foley for financial records and a copy of the town’s audit.

“We never received it,” McCain said. “Until the matter is resolved, she is under suspension.”

McCain has been on the Board of Selectmen for approximately two years. Greg Dow, another member of the board, was elected last April. Ted Ivey, another selectmen, also has been on the board for several years, according to residents who attended the meeting. Dow said Ivey was sick and could not attend the Monday evening meeting. That raised concerns for those among the approximately 70 residents at the session who wanted to ask Ivey questions.

During the meeting, which lasted more than an hour, residents learned that the last audit of town finances was done five years ago. Dow and McCain could not say for sure why five years had passed since the last audit, but Dow said it appeared that “no one ever pushed it.”

Mike Starn, communications director for the Maine Municipal Association, said Tuesday that there is no direct statute requiring a town to have an audit of its finances conducted each year. At the same time, he said Tuesday, there is a statute requiring towns to issue an annual report, and within that report there is a requirement that it contain a “post-audit report.”

“So there is an inference that an audit be done every year,” he said Tuesday.

McCain and Dow said past practice has been that during each monthly meeting, selectmen received a warrant containing a list of what bills were due and what had been paid. The selectmen had to sign the warrant to authorize it.

Dow said he has not seen very many warrants during his term, however, as board meetings frequently were canceled.

Resident David Stevens agreed, saying during the meeting that he had shown up at the town office several times to attend board meetings, only to find a sign on the door saying it had been canceled and that the canceled meetings were not immediately rescheduled.

“Not having a meeting for three or four or five or six weeks in a row is not fair to the taxpayers,” he said.

Dow said he combed through available financial records at the office before the meeting and at the meeting he handed out a written statement detailing checks issued for payment by the town and to whom they were issued. The statement also showed the amount of money each check was written for. Dow presented those details using financial information from December 2006 to December 2009. He said the state has more of the town’s financial records.

Several residents pointed out that a number of checks appeared to be missing from the appropriate sequence. Dow’s statement also showed that he could not identify why some of the checks were written. Another resident suggested the discrepancies could be explained if information about the missing checks and expenditures had been stored electronically.

A number of the questions fielded by the board revolved around the Ludlow Food Pantry. According to its Web site, the pantry is run by volunteers and is located in the Ludlow town office. Ivey is president of the food pantry. Last year, Foley served as treasurer of the food pantry. The pantry stocks food that it purchases and garners through donations.

According to the food pantry’s Web site, the pantry serves community members in Ludlow and 24 surrounding towns. In an interview with the local weekly newspaper last April that is posted on the pantry’s Web site, Foley said that Ivey “volunteers his time and truck to pick up the food from as far away as Portland.” The article noted that at the time it was costing the organization “$1,000 a month just in fuel.”

Dow’s statement showed that Ivey was reimbursed numerous times for “mileage” as well as for “labor,” “labor and mileage,” “tire repair” and “trailer or truck repairs.”

According to the figures, checks written specifically to Ivey during that three-year period amounted to just under $25,000.

The written statement showed there were a number of checks issued by the town to Ivey that do not detail why he was given the money.

Residents said during the meeting that they wanted to question Ivey about those payments, but could not because he didn’t attend the meeting.

Dow’s records also showed that the town issued $5,576 to the food pantry during that period, which concerned many town residents.

Stevens told the audience that the town had authorized the donation of approximately $3,500 for the pantry during the last town meeting.

Some residents questioned why taxpayer money was funding the food pantry.

Resident Brenda Hemingway said, “It’s time to stop funding the pantry for a while.” Her statement drew applause from the audience.

Several attendees said they believed the town’s finances had become commingled with the finances of the food pantry. Most residents were in agreement that the town and the pantry needed to have separate accounts and separate checkbooks.

Dow told those who attended the meeting that the town still has money to operate. Until the private audit is conducted later this month, the town office will remain closed.

Neither Ivey nor Foley could be reached for comment Tuesday.

During this year’s town meeting, there likely will be an article asking residents if they want to increase the number of members on the Board of Selectmen from three to five. The move is an attempt to provide for more checks and balances. The town meeting will not be held until after the audit is conducted.

Residents complimented McCain and Dow during the meeting for their work on the matter.

With the town office closed, the board has advised residents who have taxes due to mail payments to the town office and the payments will be recorded. Officials in New Limerick, Linneus and Smyrna are working with the town to help Ludlow residents register vehicles. Residents who need to register dogs, ATVs, boats or snowmobiles or to pick up hunting and fishing licenses can contact Town Clerk Karen Beaulieu at 532-9357 and leave a message.

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