Mayor: Greenfield and web provider trying to work it out

  • MARTIN

  • Greenfield town councilman, Isaac Mass. Recorder Staff/Matt Burkhartt

  • Daniel Kelley, GCET general manager

Recorder Staff
Published: 8/24/2017 7:50:23 PM

GREENFIELD — Mayor William Martin has responded to concerns about the relationship between the town and its new municipal internet provider, saying the two entities are in the process of developing a memorandum of understanding to resolve financial disputes and other issues.

Last week, Town Council Vice President Isaac Mass sent a letter to State Auditor Suzanne Bump requesting an investigation into Greenfield Community Energy and Technology’s (GCET) financial administration and its relationship with the town, including alleged mismanagement of money and salary disputes.

The organization, which was established last year, is in the midst of a townwide fiber optic build-out, which, once complete, will leave Greenfield bathed in a Wi-Fi network.

Mass raised a number of concerns in his letter, including potential problems with GCET procurement procedures, mismanagement of funds, fear by town employees of retaliation by the mayor, salary disputes involving GCET’s director, and the organization’s financial stability.

In a response to Mass, Martin wrote that statements in Mass’ letter are troubling because they make assertions that reflect an incomplete knowledge of disagreements between the town accountant, treasurer-collector and GCET management.

He wrote he will cooperate with any investigation or inquiry from the State Auditor’s Office, but will not respond at this time to the allegations in Mass’ letter. Martin wrote those allegations include inaccurate characterizations of past events.

According to Martin, the town and GCET are hoping to finalize a memorandum of understanding that will address issues including the appropriate process for paying GCET bills.

During this month’s Town Council meeting, council leadership expressed concern about an email in which GCET General Manager Daniel Kelley states his organization was taking legal action against the town, the mayor, auditor and treasurer for unauthorized deductions from GCET’s bank account — which Kelley characterized as “theft.”

In the email, which was leaked to Town Council President Brickett Allis, Kelley wrote that he was suspending interest payments from GCET’s account to the town in July, as is GCET’s option. An attached notice from the Office of the Treasurer-Collector showed that $603.01 in interest accrued during July was scheduled to be transferred out of GCET’s account.

Martin previously said the issue was over whether a withdrawal from GCET’s account without the general manager’s permission is a violation of the law. According to Kelley, GCET suspended interest transfers in June, but those earnings continued to be withdrawn. Martin said once he found out, the money was immediately returned to GCET’s account.

Both Kelley and Martin have said GCET is not taking legal action against the town.

According to Mass’ letter to the State Auditor, Greenfield’s town accountant has also rejected a number of GCET expenditures, including handwritten notes without any back-up, Christmas decorations and meal reimbursement expenses, including receipts for coffee.

Kelley said there are more than a dozen outstanding expenditures that haven’t been paid, but contends they are all appropriate. He said they have been verified by GCET’s attorney and confirmed by the town’s attorney.

In his letter to Mass, Martin wrote that GCET bills have been paid by the city with taxpayer funds. The town’s Finance Department has then reimbursed those payments by debiting the GCET account.

Martin said in May, former Finance Director Marjorie “Lane” Kelly said her department would look into changing GCET’s bill payment process by having GCET bills paid directly from its own account through a warrant process.

“She and the town accountant have indicated that there are accounting software issues that pose an obstacle to this,” Martin wrote.

Because the issue was not resolved before Kelly retired, Martin said, he is convening meetings with the GCET manager, town finance personnel and others with expertise who can help explore how to best solve the problem in a proper, legal and cost effective way.

Martin wrote the future memorandum of understanding will also address the issue of interest on the bond that kickstarted GCET.

Last year, Town Council provided GCET with upfront money in the form of a $5 million bond, which was appropriated for the creation of its municipal broadband network.

“Your letter to Auditor Bump suggests that I agreed that (the state Department of Revenue) has orally given an opinion that such interest over GCET’s objection can be transferred from the GCET account to other city accounts,” Martin wrote in his letter to Mass. “Let me be clear, I have no first-hand knowledge of the city being provided with a DOR opinion, oral or otherwise, to that effect.”

GCET was established under Chapter 164 of Massachusetts General Laws, which originally allowed for “municipal light plants” to provide electricity, and in modern times is being used to run municipal broadband operations. Town Council has submitted special legislation to the state to allow the creation of a five-member board of commissioners to oversee GCET. In the meantime, the mayor is serving as the organization’s sole commissioner.

Martin said a provision of the law that regulates GCET specifically says that income from the investment or deposit of bond proceeds issued for municipal light plant purposes can only be used for such purposes.

According to Martin, Kelly said before she retired that the town would not debit GCET’s account for the interest earnings.

“The Finance Department’s subsequent debiting of the GCET account for such payments was made without the GCET manager’s approval and triggered the emails that were discussed at the Aug. 16 council meeting,” Martin wrote.

In the letter, Martin wrote that he believes Kelley should not have used the word “theft” in his email about the Finance Department’s debiting of the GCET account, but also said it’s clear that Finance Department personnel must ensure that their handling of money in the GCET account is legal.

In addition to the development of a memorandum of understanding and meetings to resolve the issues between GCET and the town, Martin wrote that he is seeking a detailed written advisory opinion from the Department of Revenue.


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