MILO, Maine — Town leaders opted Tuesday to pay former Town Manager Jeffrey Gahagan 60 days of severance pay after he abruptly resigned on Friday, April 6, amidst an investigation into allegations that $45,000 was missing from a local club for whom he was treasurer.
The Board of Selectmen voted 5-0 during a meeting Tuesday to give Gahagan the severance pay — about $9,600, town Treasurer Robin Larson said — despite questions from several residents about the propriety of the move.
Gahagan resigned as the treasurer of the Three Rivers Kiwanis club on April 5, a day before resigning as town manager, in the midst of an investigation by the Piscataquis County Sheriff’s Department, according to Piscataquis County District Attorney R. Christopher Almy. The investigation continues.
Gahagan told town leaders that he was resigning from the town manager position for health reasons. No allegations about any missing town money have surfaced, but selectmen said they will have an auditor review town finances beginning April 23 as a precaution.
The board praised Gahagan for what they described as his superb work as town manager, saying that when he took the job, the town was in heavy debt and now carries a $500,000 balance.
“I would hire him back. He did a damn good job for us,” Selectwoman Lois Wagner said. “I don’t think many people realize how many hours he put in for us. It was more like 60 hours a week or 80 hours for us.”
“Jeff didn’t have any access to town finances,” Selectman Bob Ade said, calling the $500,000 balance “not just [the work of] Jeff, but as a whole they [town staff] worked together and we are in the best position we have ever been in.”
Selectmen also voted 5-0 to hire the Bangor law firm Rudman Winchell to do the search for a permanent replacement for Gahagan for $4,000 plus job advertising costs and to hire Roger Raymond, the town manager of Bucksport for 27 years, as Gahagan’s interim or temporary replacement.
The law firm of Eaton Peabody bid $4,500 to do the search, while Maine Municipal Association bid $4,000.
The selectmen’s meeting was attended by about 70 residents, far more than the usual number. Many questioned how the search process would go and said they hoped an interim town manager would be named quickly.
Ade expressed satisfaction with the hiring of Raymond.
“He comes highly recommended and this is something he does on an as-needed basis,” Ade said. “Picking somebody outside keeps us transparent,” he said, adding that an outsider isn’t “going to be pulled into our politics here.”
The town’s attorney, Eric Stumpfel of Rudman Winchell, said he expected the search for a permanent town manager would go quickly.
An early version of this story requires clarification. Former Milo Town Manager Jeffrey Gahagan resigned Friday, April 6, 2012.