WELLFLEET — Several capital projects listed on the warrant will need to be delayed because the town still has no free cash going into Saturday’s special town meeting. It starts at 10 a.m. at the elementary school.
This marks the third consecutive town meeting at which free cash — unspent funds from previous years — cannot be used to help pay bills because the accounting errors from fiscal 2020 are still unresolved. It has taken two temporary accountants more than one year to correct thousands of errors so the state Dept. of Revenue can certify the town’s free cash account. They are not there yet.
Town Administrator Rich Waldo told the Independent on Sept. 3 that the fiscal 2020 books remain with auditors Powers & Sullivan, who are reviewing the corrections made by accountants Mary McIsaac and Lisa Souve.
Fiscal year 2020 — July 1, 2019 to June 30, 2020 — was the year everything fell apart. That was former Town Administrator Dan Hoort’s last year on the job. Gene Ferrari served as the town accountant from September 2019 to September 2020, when he was fired by the new town administrator, Maria Broadbent.
Powers & Sullivan’s 2021 review of the 2020 books found a $765,000 “unknown variance,” that is, money that could not be reconciled. While finding no evidence of theft, Souve and McIsaac painstakingly tracked about $665,000 in entries that were not recorded properly. Waldo said that around $100,000 is still unaccounted for, but the town has decided simply to write off that amount.
“At some point we just have to carry the error,” Waldo said. Thousands of incorrect small entries become harder to track the farther you go back, and eventually it’s not worth the time and effort, he said.
Once the auditors sign off on the 2020 corrections, they can do an audit for fiscal 2021 and approve the balance sheet for fiscal 2022. Waldo said 2021 and 2022 should be in good shape once the town is able to transfer the correct fund balances from 2020. Fully audited records for 2020 and 2021 and the balance sheet for 2022 must go to the Dept. of Revenue for free cash to be certified.
“One of the more annoying things is I think it will be certified a couple of weeks after town meeting,” Waldo said. “But one thing I have learned is to under-promise. We know we will have it certified at the spring town meeting.”
Waldo said he does not know how much free cash Wellfleet might have, but he estimated it at between $1 million and $3 million.
Without any free cash, voters on Sept. 10 will be asked to delay three capital projects on the 19-article warrant: $15,000 to replace bulletproof vests for the police; $20,000 for water refill stations; and $75,000 to replace a culvert on Briar Lane. All of the requests were deferred from the June town meeting with the expectation that they could be funded in September.
Article 3, a proposed transfer of $639,000 to the depleted stabilization fund from free cash, is obviously not going to happen. And the $75,000 Wellfleet Harbor Flora and Fauna study, which was first delayed due to the lack of free cash at the 2021 annual town meeting, must be put on hold again.
Aside from the major reason to attend town meeting — the possible purchase of Maurice’s Campground (see article on page A4) — there are three zoning bylaw amendments on the warrant. Article 16 would change the law to allow year-round occupancy of cottage colonies. Article 17 would clarify the bylaw definitions of affordable dwellings. And Article 18 would add two buildable-lot categories for the construction of deed-restricted affordable homes.
The first new category would allow a single-family home to be built by right — without a special permit — on lots with at least 10,000 square feet of upland.
The second category would allow a single-family dwelling to be built on a lot smaller than 10,000 square feet, but only with a special permit from the zoning board of appeals.
Select board Chair Ryan Curley said there are 18 lots of more than 10,000 square feet that would be affected by the change; another 26 lots may be able to meet the requirements, he said.