Lebanon Rescue Department has yet to pay back more than $200,000 it borrowed from town fund

Posted Dec. 14, 2013, at 10:05 a.m.

LEBANON, Maine — After spending money from the town’s general fund, The Lebanon Rescue Department has racked up roughly $208,600 in debt. But it has yet to pay that amount back.

During the last three years, the department has borrowed money from an enterprise account to pay for various items ranging from stipends for the volunteer personnel and fuel for the ambulances to a new ambulance.

The debt began building up in fiscal year 2011 when the department was just over $67,000 in debt to the town. A year later the debt had increased to more than $85,000. By the end of fiscal year 2013, the department’s debt totaled more than $167,000. As of Dec. 2, the debt is calculated at more than $208,600.

Assistant Rescue Chief Jason Cole, who has announced his resignation from the department effective Dec. 31, said Wednesday that funding for the department was set up through an enterprise account. He explained the account allowed the department to spend one dollar for every dollar billed.

However, according to the 2010 referendum that established the enterprise fund, the Rescue Department is allowed to spend one dollar for every dollar collected.

The referendum states, “There is no taxpayer appropriation to this referendum question.”

The department has more than $171,200 outstanding in collections, $97,400 of which is unlikely to be collected.

Each time money was taken from the town’s General Fund, it required approval from the Board of Selectmen. Cole, currently a selectman, has announced his resignation from that post, also to be effective Dec. 31.

Over the past three years, selectmen approved the spending for the rescue department, not realizing how far the debt was growing. According to Selectman Ben Thompson, the board was not alerted to the department’s debt until recently hired treasurer Jeanette Lemay raised the issue.

Lemay was hired in July, just a month after Thompson began serving on the board. Before her hire, Thompson said the town had two treasurers and an interim treasurer over the last three years. He said Selectwoman Karen Gerrish also reported that none of the information regarding the department’s debt had been brought to light in her years on the board.

“Once it was brought to our attention, we stopped approving spending,” Thompson said Friday.

Lemay presented calculations, which were confirmed by an outside third party auditor, that show the more than $208,000 debt that has compiled over the past three years. Of that, she calculates $171,200 is owed to the department from other sources. This would include billing that could be collected from the state, federal government, and insurance companies.

Cole had estimated the department would be able to recoup about $210,000, but Lemay’s calculations show the remaining $97,400 that is owed to the department is not collectible due to a variety of reasons, including no response to collections, bad address, deceased, uninsured, and hardship request, among others.

The most common reason for bills unable to be collected is listed as “no response to collections,” which accounts for nearly $70,000 of the bills deemed not collectible.

Cole’s wife, Samantha, is chief of the rescue department and has also announced her resignation, effective Dec. 31. The couple said they are resigning to spend time with family and focus on their full-time jobs. Cole said he and his wife are committed to remaining active in solving the debt issue.

While the problem has been identified and spending has come to a halt, Thompson said the town is still actively researching the debt and the spending.

When asked if there was any legal issue regarding the debt, Thompson said “nothing is off the table at this point.” He said selectmen were instructed by the town’s attorneys, Bourque and Clegg, not to comment on the issue.

Thompson added that with the recent media attention the town is receiving, all town employees have been asked to direct all communication through selectmen.

Distributed by MCT Information Services

 

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