WILLIAMSTOWN, Mass. — Members of the town's Finance Committee Wednesday complained about being blindsided by the price tags associated with a pair of severance agreements negotiated by the Select Board and the former town manager in 2020 and ‘21.
The committee convened a special session to consider four allocations totaling $139,617 from the $150,000 reserve the Fin Comm maintains in each budget year to cover unforeseen expenses.
One transfer, $53,224 to cover snow and ice removal is typical; the town routinely under budgets for the expense because its true magnitude is unknown during budget season.
The other three were unique.
Interim Town Manager Charlie Blanchard requested $38,845 to cover extraordinary legal expenses, $27,248 to help cover increased costs at the Williamstown Police Department and $20,300 for the town manager budget.
The legal expense line item was self-explanatory. The town had significantly more legal bills in FY21 (July 1, 2020 through June 30, 2021) in the wake of a federal lawsuit against the town, town manager and police chief that was filed in August of last year.
Blanchard said the shortfalls in the police and town manager budgets were related to the impact of the severance agreements that facilitated the departures of former Police Chief Kyle Johnson and former Town Manager Jason Hoch and the current paid leave of another WPD officer.
"The police department is short one person, the chief, and Sgt. [Scott] McGowan is out since they put him on paid administrative leave," Blanchard said. "In the police department, there certainly isn't anything to do with mismanagement or problems with the interim chief. He has to cover those positions with overtime."
"With Jason leaving, he's still being paid that salary this year."
Finance Committee member Dan Caplinger asked for clarification.
"Since the town manager left early, we have overfunded for his salary," Caplinger said. "Correct me if I'm wrong, but if I understand correctly, what will eventually happen is we need to make this transfer from the reserve fund because we can't directly transfer from what I'll call the Jason town manager salary line to the Charlie town manager salary line. But won't the overage fall into free cash at the end of the year?"
Blanchard explained again that that is not the case given the terms of Hoch's departure.
"I wish that was the case, but it really isn't," Blanchard said. "Jason receives his full salary through the end of the fiscal year, and his salary for next year as part of the settlement agreement. … These transfers are real money needed from the Fin Comm reserve fund to balance the budget."
After asking whether the Fin Comm ever saw a copy of Hoch's severance agreement and learning it did not, Caplinger moved on to the shortfall in the WPD budget.
"My guess is your answer will be similar here, but if the former chief left, maybe we would get credit from that to go against the interim chief's stipend and overtime?" Caplinger said. "It sounds to me like that's already accounted for. Is that right?"
As he expected, Blanchard gave the same answer.
"There really are no savings," Blanchard said. "With the severance agreement, payment was made for the contract and so forth. And when I mentioned the sergeant on paid leave, it's money in the budget going to him, and then additional money has to be found."
Johnson's departure as chief of police was announced in December, 2020; his severance was negotiated by his then-supervisor, Hoch. The severance agreement with Hoch was finalized by the Select Board at its Feb. 22, 2021 meeting. McGowan was placed on paid administrative leave in early March.
"Our concern isn't really with [Blanchard or the town accountant]," Finance Committee Chair Stephen Sheppard said. "It's with the Select Board that negotiated these things and neglected to let us know about them, and now we're expected to approve the transfer, and we don't really have a choice. It seems like if we're going to be asked to approve something, we kind of need to be informed about it beforehand.
"All of these severance agreements may have been negotiated late in the year, but they weren't negotiated after town meeting. There's no reason we couldn't have been informed before town meeting so we were at least prepared. Every year, we expect unexpected snow and ice. … It would be nice if the Select Board didn't generate unexpected expenses unnecessarily."
Paula Consolini signed on to the concerns raised by Caplinger, Sheppard and Melissa Cragg but pointed out that, normally, the Select Board would rely on the town manager to pass along information like this, and, in this case, the town manager was at the center of the added expense.
"This is a good lesson in this situation to have protocols and be more transparent," Consolini said. "Having been on the School Committee, where there are all kinds of negotiations and people are leaving, there are situations where you're not allowed to say publicly."
Cragg pressed Blanchard on what other unbudgeted expenses -- like the final year's worth of payout on Hoch's salary -- will impact the budget going forward and might require expenditures from the Fin Comm's FY23 reserve.
"Maybe what we could ask is next time Fin Comm meets, if we could ask for a report from Charlie and [Town Accountant Anna Osborne] on any other obligations into which the town has entered," Cragg said. "What other obligations does the town have that have not been budgeted? What else is out there so we can make sure we have funds adequate to cover it?
"I'm sure we've got the cash. I'm not worrying about the cash. I'm worried about the budget."
Just five members of the nine-member Finance Committee -- Caplinger, Cragg, Consolini, Sheppard and Michael Sussman -- participated in Wednesday's meeting. They voted 4-1, with Caplinger voting against, to approve the four transfers from the committee's reserve.
In other business on Wednesday, Cragg was elected the committee's chair for 2021-22. Sheppard recommended waiting on votes for other officers until the full committee was together.
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