LUDLOW, Maine — State Auditor Neria Douglass confirmed Thursday that her office is auditing the town’s finances after receiving a complaint and verifying that the state had not received several years’ worth of municipal audits.
Douglass said she was not sure when the audit of the past three years of finances would be complete.
Marybeth Foley, Ludlow’s town manager for the past 14 years, was suspended without pay earlier this month.
The suspension came after Douglass said that she subpoenaed financial records from Ludlow last October for fiscal years 2007, 2008 and 2009.
Douglass said she served the subpoena with Detective Dan Robertson of the Aroostook County Sheriff’s Department and Detective Stephanie Fields Beaulieu of the Bureau of Motor Vehicles.
Douglass now has the records and is reviewing them. Officials are looking at past motor vehicle excise tax records, property tax payments and more. Douglass said she made Virginia McCain, a member of Ludlow’s Board of Selectmen, aware of the situation after the audit began.
Ludlow, an Aroostook County town of about 420 people, is seven miles west of Houlton.
McCain said during a special town meeting on Monday evening that the board recently asked Foley for financial records and a copy of the town’s audit. Foley never gave the board the material it asked for, McCain added, and she was subsequently suspended without pay.
Along with the audit conducted by the state, the board has authorized a private audit on behalf of the town to look at Ludlow’s finances for the past two years. It will be conducted later this month.
During the special meeting, Ludlow residents learned that the last audit of town finances was done five years ago. Douglass said that state law mandates that a town conduct an audit each year. The penalty for failure to do an audit is $100.
“I have been reviewing the records since October, and I have a lot of questions, but I have not come to any conclusions yet,” Douglass said.
She said the financial records “are not in very good shape.”
McCain has been a selectman for approximately two years. Greg Dow, another member of the board, was elected last April. Ted Ivey, the first selectman, also has been on the board for several years, according to residents who attended the meeting. Ivey was sick and could not attend the special town meeting.
Before Monday evening’s meeting, Dow combed through available financial records at the office. 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 for which each check was written. Dow presented those de-tails using financial information from December 2006 to December 2009.
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.
Residents also raised concerns about the $5,576 in taxpayer money that was allocated for the Ludlow Food Pantry during that time period. The pantry is inside the town office. Ivey is president of the volunteer-run pantry. Last year, Foley served as treasurer of the food pantry.
Neither Ivey nor Foley could be reached for comment Thursday.
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.” Residents said that Ivey often drove to locations such as Bangor and Portland to pick up food for the pantry and was reimbursed for the mileage. According to the figures, checks written specifically to Ivey during that three-year period amounted to just under $25,000.
Residents at the meeting wanted to question Ivey about some checks that he reportedly received from the town, as Dow’s statement showed that there were a number of checks issued to Ivey that did not detail why he was allocated the money.
Several people at the meeting speculated that the town’s finances had become commingled with the finances of the food pantry.
The town office has been closed since Foley was suspended. It will remain closed until the private audit is conducted later this month.
Douglass said Thursday that she is glad that the town has asked that a private audit be done.
“There are so many records, and I want to be sure that there is as detailed a view as possible,” she said. “We have limited resources here, as the primary responsibility of our office is to audit the financial statements of the state and expenditures of federal programs.”
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.