Legal Fees and Solid Waste Combined For Overspending

Town resolution looks for voter approval over past (already paid) bills

Apr 03, 2024

BAR HARBOR—No public comment. No new business. No town manager comments and only half of the councilors speaking during their time at the end of business, made for a quick Town Council meeting on April 2, with the councilors finishing up business in less than 40 minutes.

Despite the quick feel, the Town Council delved into multiple topics and moved several items forward and learned of a potential hiccup that came out in the town audit, which was received on Friday. The hiccup is thanks to over expenditures in the town’s legal and solid waste lines for Fiscal Year 2023, which runs from July 1. 2022 through June 30, 2023.

Fiscal Year 2023 actuals. Via town website. Click to enlarge.

The town councilor’s packet memo from Town Manager James Smith reads,

“The FY23 audit revealed than that in FY23 the expenditures exceeded the sum total of the appropriations for all department budgets (driven primarily by being over budget in legal and solid waste).
“In FY23, these expenditures were satisfied by an overall net draw of $198,752 from the Unassigned Fund Balance. Over the course of FY23, the Council approved this net draw. The purpose of this resolution is to memorialize a record of actions by the Town Council to be ratified by the Town meeting. It is not authorizing an additional withdrawal from the Unassigned Fund Balance.”

“The bills are paid. The resolution is making a more official record that it happened,” Town Clerk Liz Graves explained to councilors. The warrant order is just to make sure the voters are on the same page.

Charles Sidman asked what would happen if voters rejected the resolution at the upcoming June town meeting.

Town Attorney Stephen Wagner said that the situation of an overdraft is not a terribly uncommon scenario, but the town needs town meeting authorization of the unassigned funds. If it was voted down, there could be an argument that the Town Council exceeded its authority in authorizing the bills were paid.

“Someone could make a claim against you individually for exceeding your authority,” he said.

“It’s not money that’s going to come up new out of anyone’s pocket,” Councilor Earl Brechlin said.

During many Town Council meetings, Finance Director Sarah Gilbert gives a financial report which discusses the town’s expenditures and revenues. During this she details what line items are over expending or under expending. This is also part of the Council’s packet. They also give the staff the ability to pay bills at meeting after meeting.

The overdraft of expenditures was because of legal, which was over budget by $251,000 and solid waste, which was over budget by $220,000.

“That’s a little over $471,000,” Gilbert said.

This meant that the net of all departments came in over drafted. Fortunately, revenues also came in over budget by more than $600,000.

“Since the voters approved the expenditures, we have to go back to the voters to approve that overdraft,” Gilbert said.

Gilbert said that when the budget process started in 2022, staff working on the budget had no idea that there was going to be a major lawsuit, which would drive those expenditures up. The town was the defendant in a federal lawsuit about cruise ship disembarkation limits approved by voters. The town won the lawsuit, which was appealed last week.

SHELLFISH ORDINANCE

The Council unanimously moved to schedule a public hearing on an amendment to the Shellfish Conservation Ordinance to add oysters, quahogs, razor, and hen clams to the shellfish species under co-management.

EMPLOYEE LIVING QUARTERS

Councilors and Town Manager James Smith during workshop before meeting. From left: Peacock, Shank, Friedmann, Brechlin, Smith, Caines, Hochman, Minutolo. Photo: Shaun Farrar

When employee living quarters was first added to the land use ordinance, they created policy and a licensing ordinance that is outside the land use ordinance. If voters adopt potential changes to the employee living quarters at town meeting this June, that language would have to be tweaked outside the land use ordinance as well and contingent on the adoption of the proposed changes at the town meeting. That tweak was scheduled for a public hearing.

CONSENT AGENDA

Councilors unanimously appointed election clerks; approved the renewal of a taxi license for Coastal Compass Taxi; recommended adoption of FY25 education budget articles in 2024 Annual Town Meeting warrant; recommended adoption of FY25 Municipal Budget articles in 2024 Annual Town Meeting warrant.

SPECIAL AMUSEMENT PERMITS

Special amusement permits were granted for both the Siam Orchid and Sand Bar Cottage Inn.

No members of the public spoke against or for either permit. Both were approved unanimously.

COUNCILOR COMMENTS

Brechlin said there are new signs on a road by the fire department near Fiori that says ‘do not enter,’ which isn’t in the ordinance. Smith said he’d look into it and make sure it’s done properly. Brechlin also spoke about an email about transient accommodation definitions sent by Cara Ryan.

Councilor Kyle Shank referenced an email he sent to councilors about sustainable tourism plans and said he’d like to talk about it at an upcoming meeting, referencing that it’s been months since the Council disbanded the Cruise Ship Committee, saying that they’d instead focus on sustainable tourism.

Council Chair Valerie Peacock said that will be the focus of an upcoming workshop. She also said it was nice to have the local options tax discussion at the Jesup Memorial Library the week before.

Councilor Matthew Hochman thanked the Jesup Memorial Library for hosting that forum. “I think it was a very productive meeting. It was done in a very nonpartisan way.” He called the discussion cordial and would like to see more.

Council Vice Chair Gary Friedmann and Councilor Joe Minutolo and Councilor Maya Caines had no comments.