More than halfway through 2014, Duxbury is still sorting out finances from the prior year as well as its finances from 2011.
Duxbury will hold a second special Town Meeting on July 28 asking residents to weigh in on the following article: “Shall the town of Duxbury rescind the action taken at the May 10, 2014, special meeting whereby the voters authorized the town of Duxbury to appropriate the sum of $70,000 to be applied to the outstanding debt of the town.”
The article resulted from a petition taxpayers circulated after the first special Town Meeting in May, at which the Duxbury Select Board fielded questions from residents inquiring as to whether the town was or was not $338,000 in debt and eventually approved the borrowing of $70,000 a year for five years to pay it off.
According to the select board, the town’s $338,000 debt consists of an unpaid $228,000 line of credit and a $110,000 2013 end-of-the-year budget deficit. According to former town auditor Bill Yacavoni, however, the $228,000 line of credit is already included in the 2013 budget deficit, and Duxbury has only $110,000 in debt—or even less because the town received a refund of $40,000 from Washington West Supervisory Union.
Bonnie Batchelder of Batchelder Associates performed Duxbury’s 2013 financial audit. Regarding the need to repay the line of credit, she said, “You don’t have the money and you need to make a decision to remedy it,” earlier this June. At that meeting she explained that the town’s financial situation stems from a long history of accounting problems that were brought to the forefront following Tropical Storm Irene in August of 2011.
After sustaining large amounts of damage due to flooding from the storm, Duxbury took out a $1.5 million line of credit with Merchants Bank to pay for repairs to town roads and bridges until it was reimbursed by the Federal Emergency Management Association (FEMA).
In the end, Duxbury was fully reimbursed by FEMA, but as the reimbursement checks came in they were used to pay for the town’s operating expenses rather than repaying the line of credit, which currently stands at $228,000.
Simply put, “We, as a board, did not appropriate the money properly,” select board member Mo LaVanway said at a meeting on June 9. In addition to failing to use FEMA funds for repaying the line of credit, the board also overspent its budget by $110,000 in 2013, which includes a $40,000 deficit carried over from 2012.
The line of credit became due on June 30, and due to the petition asking voters to rescind the $70,000 over five years the town had planned to borrow to pay it back, Duxbury paid off Merchants Bank with funds from Community National Bank in the amount of $230,371.04, to be paid back with an interest rate of 1.675 percent over five years. The select board accepted the refinancing plan at its meeting on June 24.
In preparation for the second special Town Meeting at the end of the month, the select board plans to further discuss the budget deficit at its next meeting on Monday, July 14.
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