WELLFLEET — Because of the ongoing mess in the town’s accounting department, property tax bills will be sent out late again this year.
The fall bills will probably get mailed in November, which is better than Christmas Eve, as happened last year, said Lisa Souve, one of two accountants brought in to repair the deficiencies in the town’s books dating back at least two years.
In an update for the select board on Sept. 14, interim Town Administrator Charlie Sumner said that the town’s accounts containing trust funds, such as those used to pay other post-employment benefits, had more than 60 posting errors. Repairing them is time-consuming, Souve said, because there were small amounts that were taken from one fund or credited to another. The trusts were comingled.
Although fall tax bills will go out late, Sumner said this week that the state will not put the town into receivership, which can happen when a community cannot pay its bills. It occurred in Chelsea in 1991.
In Wellfleet’s case, the problem is not a lack of money, just poor bookkeeping. Still the books are bad enough that the state “probably would have had to do something” if temporary accountants Mary McIsaac and Souve were not working here, Sumner said.
The accounting problems became impossible to ignore just about this time last year, when Town Accountant Gene Ferrari was let go on the last day of his contract by Maria Broadbent, the new town administrator. After his departure, the situation did not improve. In April, the new accountant, Heather Michaud, resigned. At the same time, Broadbent offered her own resignation.
Wellfleet found itself without its free cash certified by the state. This is the unspent money from the prior fiscal year, which, once the amount has been approved by the state Dept. of Revenue, can be used to pay bills. Wellfleet did not have the accounting records to satisfy the state’s review.
Now, free cash certification and setting the tax rate are the priorities of the interim team.
Souve explained some of the problems she faces. One relates to coding. Town staff did not record their expenditures with consistent codes. For example, when buying a new printer, one should use a code for “office expense,” while the cost of gasoline should be coded as “travel.” But it appears that employees did not code their expenses and instead left it to be done by the town accountant’s office — which didn’t happen.
Also, links for accounts were not set up correctly, Souve said. Taxation aid grants, given to residents who are having trouble paying their taxes, was taken out of the account that is supposed to be used for home owners who receive abatements, Souve said. It should have come out of the fund created by people who donated money to help residents in need.
The water department, which handles the town’s small public water system with about 285 customers, has also been plagued by staff turnover and delays in billing, Sumner said. Many customers had not been sent their $500 annual bills on the loans for their water hook-ups. Since Souve, Sumner, and McIsaac arrived, those bills have gone out and brought in $30,000 of the $50,000 to $60,000 that is in arrears.
Sumner said he is still planning to hold a special town meeting in December to correct errors in the 2022 fiscal year budget.
Sumner said the town’s books should be good enough by January, when he, Souve, and McIsaac plan to leave. By then, it is hoped, a new permanent team can be hired. Sumner recommended that the select board hire a new accountant and administrator only after the books are close to being in order, existing staff are trained, and systems are in place to prevent another disaster.