Paul Foley is the only one on there looking out for the taxpayers and citizens of New Canaan. Everyone else has a hidden agenda.
You cannot bond a litigation award. It is not part of the cost of building the bridge (which is bondable). Even if the statute does not explicitly say this, we should not bond the arbitration cost.

Excellent article. I believe this situation is a bit more serious than a "deficiency" in oversight and I agree that Mr. Foley has every right to be exasperated by the council's defensive posture. I have yet to read any indication of accountability thus far and look forward to reading Mr. Devlin's article about the next meeting to learn more.

JL:

Wholly apart from the fact that the charter does not in fact explicitly say it cannot be bonded, common sense suggests that the position that you and Mr. Foley take is questionable. Consider a hypothetical with three different scenarios:

The town enters into a contract to have a town bridge built. The cost of the contract to build the bridge is $1 million, but as is common, there are unexpected cost overruns, and the final cost is $1.2 million.

Scenario 1: The town is happy with the bill, and pays $1.2 million, issuing a bond for the total amount. I assume you agree this is allowable under the charter.

Scenario 2: The town is seemingly happy with the bill, and pays $1.2 million, issuing a bond for the total amount. It subsequently discovers what it thinks are unjustified costs, and sues the contractor for the return of $200,000. The case goes to arbitration and the town loses. I assume you agree that the bond is allowable under the charter.

Scenario 3: The town is unhappy with the bill handed to it by the contractor and agrees to pay only $800k, issuing a bond for that amount. The contractor subsequently sues the town for an additional $400k. The case goes to arbitration and the town loses. A judge orders the town to pay the contractor the additional $400k. The town issues a bond for an additional $400k, for a total bonded amount of $1.2 million. You and Mr. Foley say this is not allowable under the charter.

(cont'd)

cont'd:

Now, as a practical matter, there is no effective difference between any of these scenarios. They each result in precisely the same cost to the town for precisely the same infrastructure project, and precisely the same bond amount. Identical outcomes. The only difference is the process by which the final outcome was arrived at. Yet you and Mr. Foley strangely think that whether the Town willingly paid the bill or was ordered to pay it is not only relevant, but determinative in deciding whether or not bonding is allowed.

That doesn't make sense to me.

I take exception to Tom O'Dea's interpretation of the Charter. The language states:

"The moneys necessary to pay such appropriation may be withdrawn for that purpose from funds in the Town treasury not otherwise appropriated, if the same be sufficient. Should the money in the Town treasury available for such purpose be insufficient, the Board of Finance may, by resolution, authorize the Treasurer to borrow the amount necessary. The sum so borrowed shall be included by the Board in the next tax levy upon the grand list of the Town last completed and the Board of Finance shall fix the rate thereof in an amount sufficient to provide the moneys necessary to pay such judgment with the interest due thereon and fix the date or dates when such tax shall be due and payable."

The language is clear in prescribing how a judgement is to be paid. It allows for the money to come from the general fund, or if we don't have that amount in the fund, we can borrow until the next mill rate. If the intent of the Charter was to allow for a legal judgement to bonded, it would have added that option to the other two. For O'Dea to suggest we have that option just because the Charter doesn't prohibit it sounds like he may be diving for cover on this one.

Here are the conclusions that I have reached: 1)there were no checks and balances in place to insure the proper review of expenditures, no checklists from bottom to top requiring signature as to approval necessary for payment at each level. 2) there was no "best financial and budgetary practices" necessitating a monthy review of "to-date" budgeted amounts compared to-date actual expenditures. 3) No municipal official was in contol of the process. 4) There was one signature on a $650,000 check. The CFO signed the check and then stamped the Town Treasurer's signature. 5)Why wasn't the lack of Internal Control and recommended procedures outlined in the auditor's management letter and the audit opinion "qualified for lack of internal contol? 6) Why weren't the required prospective corrective policies to be implemented footnoted by the auditors, as required?. 7)Why isn't there a procedural accounting manual as required in any audit program on internal control. 8) I disagree with the auditors comments pertaining to review of the legal engagement letter. As part of the internal control audit all pertinent documents, contracts, and systems need to be reviewed and deficiences noted. A legal repesentation letter is also required from each law firm outlining "quantified" potential contingent liabilities inclusive of associated "potential" legal costs. In my professional opinion not only are the town processes flawed but the creditability of the independent audit needs to be questioned.

Roger:

Interesting that you raise the idea of the "intent" of the charter. If you read the three scenarios I have outlined above, it becomes clear that your (and Mr. Foley's) reading of the charter necessarily means that the ability to bond an infrastructure project is entirely dependent upon the Town's willingness to pay a contractor what he is legally owed. If the town is willing to pay, it can be bonded, but if the Town declines to pay for any reason, and therefore must be ordered to pay by a judge, it is suddenly not bondable. It is very difficult to imagine that such a bizarre standard was the intent of the charter when it was written. Yet, oddly, this is precisely what you and Mr. Foley would have us believe.

Even more oddly, you would have us believe that your interpretation of the charter is so obviously correct that anyone who advances a different interpretation must be "diving for cover" from some some vague and unnamed, ...well, I don't know what, actually. Just what is it that you are insinuating here?

I have to agree with Williams and Foley on this one. Scott, you are wrong. This was not a payment for an infrastructure project. If it was it would have been appropriately bonded. Instead it was a legal judgement. Read the agenda item from the May TC meeting. To save you from having to look it up, I have pasted it here:

Item 6:
To Approve a resolution appropriating $650,000 for payment of an arbitration award against the Town in the matter of Lourerio Contractors, Inc., and the Town of New Canaan and Authorizing the issuance of $650,000 Bonds of the Town to meet said appropriation and pending the issuance thereof the making of temporary borrowings for such purpose

It doesn't say we are paying a bill for an infrastructure project. It says it is an "arbitration award against the town". To suggest otherwise just to justify mistakes by the 7/8's and the Board of Finance is like that old saying where you are doing something to my shoes and trying to tell me it's raining.

James:

You say: "This was not a payment for an infrastructure project."

Of course it was. Why else would the town be told it had to pay the company that built the bridge? Your premise that the payment could only be either a legal judgment or a payment for an infrastructure project is mistaken. Quite obviously it was both.

When a legal judgment calling for financial restitution is awarded, generally speaking it is awarded for a reason. In this case, the reason was that the town had unjustifiably withheld payments owed for services rendered. What services? The building of a bridge. Hence, the payment was for an infrastructure project, enforced by a legal judgment. Really quite simple.

I could not agree with Rose Osterndorf more. The town lost a binding arbitration. To suggest that this judgement is something else that should be bonded is patently absurd. Thank you.

James/Rose:

What was the subject of the arbitration?

Scott, you seem to have difficulty in understanding factual items. Arbitration is what occurs in a court of competent jurisdiction between two parties when one has a cause of action against the other. A judgement is the rendering of a legal decision by that court. Often that judgement will include the awarding of damages. That is what happened to the town. A construction project, on the other hand is the actual building and work associated with something like the bridge project. Construction projects, if meeting certain criteria, are eligible for bonding. Legal judgements against the town are not. Hope that helps you, Scott, to understand the difference.

Too bad Roy Abramowitz CPA is not running for Treasurer. He should be drafted.

Perhaps after 46 years as Treasurer with an undistinguished record of admittedly lax check signing practice bordering on incompetence, Don should consider making way for fellow Republican Roy A. or other replacement with corporate or accounting background. Otherwise, suspect many will be voting cross party for Treasurer and should be of concern to Rebuplican TC and First Selectman candidate.

oh, and the salary at taxpayer expense as well- he needs to go...

when will Mr Dewale have to answer as to why he knowingly postponed this item form the TC agenda for several months? I hope the committtee was able to look thru his verbose fluff of 'how to do it better' next time to recognize what he did wrong this time!

TOWN COUNCIL CAN’T INVESTIGATE
Council can’t investigate themselves because their collegiality and civility conflicts with the objectives of the investigation. There should have been an independent pro tem subcommittee and chair for this matter. The fact that there was not speaks volumes.
In addition to withholding information from Council, Chairman DeWaele denied referendum voters access to important information and invalidated the referendum. This was no mandate. However, nobody seems to care very much about this travesty. Loopy Doops get more play.

Clarity: whoever you me thinks not. Just got off a flight out west and get emailed with this psuedonym cowardly nonsence. So happy that you are so intrigued by me that you scan patch as a forensic literate. However you are no scholar. God bless America, maybe it was Barrack Obama, George Bush, General Patreaus, Conde Rice. Do not they all use the phrase. No my obsessed friend I am not the only person who respects his country when he or she speaks. Why don't you stay home this weekend and try try again. Cherrio. Oh no I should not of said that now you will. Accuse me of being Prince William or Crocodile Dundee. Oh well off to be inducted into another hall of fame while do your forensic patch work. Send me a self addressed stamped envelope and I will send you a autograph. Oh I forgot then you would need to tell us who you are. Cowards do not do that do they?

Disapproval of Congress Peaks ...In the wake of the debt-ceiling debate, 82 percent of Americans disapprove of the way Congress is doing its job ... the same could be said about the New Canaan Town Council and Board of Finance. Strong majority of Republincans who voted in the recent caucus did NOT vote for the candidate that Republican TC and BOF members endorsed! Who is out of touch with their constituency?