Probe into ex-Milo town manager, missing $45,000 continues

By Nick Sambides Jr., BDN Staff
Posted May 04, 2012, at 2:44 p.m.

MILO, Maine — Auditors have finished examining the town’s financial records in response to the resignation early last month of Town Manager Jeffrey Gahagan amid an investigation into allegations that $45,000 was missing from a local club for whom he was treasurer, officials said Friday.

Auditors from the firm of James Wadman CPA of Ellsworth visited the town office the week of April 18 and should report their findings to the Board of Selectmen any day now, interim Town Manager Roger Raymond said.

Wadman’s auditors so far have found nothing amiss, Wadman said.

“I had a couple of accountants in there for a day performing fieldwork and we needed to get some copies of some checks we had some questions on,” Wadman said Friday. “They just came through a few days ago.”

Wadman said he expects his firm to finish its work and submit a report to selectmen within the next week or so.

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.

“We continue to gather information,” Almy said Friday.

Selectmen ordered the audit as a precautionary measure on April 17 despite Gahagan’s lack of access as town manager to the town’s finances. They also hired a firm to conduct a search for a town manager. That search is continuing, said Raymond, the retired town manager of Bucksport who began working for Milo the week of April 24 as a temporary replacement for Gahagan.

A message left with Waldman wasn’t immediately returned on Friday. Town Treasurer Robin Larson referred comment on the matter to Police Chief Damien Pickel, who did not immediately return a message left Friday.

Raymond said he has seen no indication of problems in the wake of Gahagan’s resignation except the work that accumulated with Gahagan’s absence.

“I think it [town government] was being run well,” Raymond said.

Selectmen will meet at 6 p.m. Monday to review the situation and hold a public hearing on the town’s application for a $60,000 Community Development Block Grant to redevelop a portion of East Main Street devastated by arson in September 2008.

The grant would be used to buy professional kitchen equipment that would be installed in a new building for Elaine’s Basket Cafe and Gift Shop on East Main Street in exchange for the restaurant’s commitment to hire two full-time employees, including one earning more than $30,000, for at least two years. The new kitchen would streamline restaurant operations and make room for wholesale food production, officials have said.

As part of the revitalization, the 3,300-square-foot building near the intersection of East and West Main, Elm and Water streets also would house a fitness center operated by Charles Lawrence, who owns a convenience store in town. The fitness center would be about 1,500 square feet.

If Elaine’s owner Elaine Poulin fails to meet the conditions of the grant, the town would have to pay it back. Selectmen will hold a town meeting on the grant application on May 15, Raymond said.

Selectmen probably will hire a permanent replacement for Gahagan in late June or early July, Raymond said, with advertisements for the town manager’s position going out next week and interviews occurring late this month or in early June.

Raymond’s will be a caretaker administration, with no great initiatives planned during his tenure, he said.

http://bangordailynews.com/2012/05/04/news/piscataquis/probe-into-ex-milo-town-manager-missing-45000-continues/ printed on August 28, 2014