Published: November 03, 2009 10:38 pm      

Delinquent loan adds to VFD’s woes

RONCEVERTE — Damaged by a financial scandal that has yielded three criminal indictments and four additional arrests, the city’s volunteer fire department is now further burdened by a delinquent loan.

The loan was left dangling when city officials seized control of the VFD in February in the wake of the alleged embezzlement by officers and members of the department. With a $35,000 principal payment due at the end of the month, the fire department is now trying to refinance the loan to get a more favorable interest rate, VFD attorney Mark Moreland told city council Monday evening.

In order to obtain refinancing, however, the VFD must certify to the lender that either the litigation over control of the department is complete or outline the steps necessary to remove the department from its current receivership, Moreland said.

“Critical to the fire department, and therefore the city, is refinancing the loan,” he said.

Negotiations are continuing between the city and the VFD, Mayor Gail White confirmed.

The offer now on the table from the VFD involves “complete transparency” of the department’s finances, according to Moreland. Under the proposal, the city would receive copies of all bank statements directly from the bank and a city representative would be afforded access every month to the VFD’s checkbook and invoices to reconcile with the statement.

“The checks and balances are very important,” Moreland said. “We believe all persons ... will be protected (by this proposal).”

The attorney pointed out none of the individuals facing criminal charges in connection with alleged financial irregularities now holds membership in the VFD. State Police have said the investigation is now complete.

Following a 35-minute executive session, White announced City Attorney Aaron Ambler would continue negotiating with the VFD on behalf of the city.



Councilman David Smith reported from the finance committee that the budget deficit had been cut from the $258,000 reported at last month’s council meeting to $197,000.

At the same time, though, the city’s debt to the county landfill has risen, from $23,000 last month to $29,000.

Much of the deficit is still due to the delinquency of Public Service District No. 1, which owes the city at least $130,000 in sewage treatment charges and penalties imposed by the state Public Service Commission, according to Smith.

He also reported city employees are logging large amounts of overtime, further straining the budget. To ease that ongoing problem, new City Administrator Pamela Stevens will assume responsibility for taking minutes at city agency meetings, many of which are held after business hours, Smith said.

“We are looking at ways we can save money,” he commented.

In other business:

Stevens announced a recent auction of excess city property raised $4,274. Another auction is planned for spring, she said.

A report from the city’s parks and recreation committee estimated the cost of bringing the municipal pool into compliance with safety regulations at $900,000.

Council unanimously approved the second and final reading of an ordinance establishing penalties for people who do not clean up after their pets in public areas.

Each offense is a misdemeanor, punishable by 30 days of public service and/or a fine of $300 to $500.

— E-mail: talvey@register-herald.com