THE FRIENDS AND THE "WATERLINE FUND"

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​​The “Waterline Fund” was first exposed to Guilford Residents after the Town Administrator, Peder Rude, received a call from the Vermont Bond Bank. The bank stated that there was one payment remaining on a loan for $195,000 that Guilford had not used.

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​​Peder notified Wizansky and Wagner of the unused funds and the three met with the VT bond bank to see how they could allocate all $195,000 to the 1.3 million Library Expansion Project. When the library vote failed, those funds would not be used for the library.

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Following the library vote, Peder was suddenly diagnosed with a "Grave Health Issue" and shortly thereafter, resigned to "Explore Other Opportunities." So, Sheila Morse was appointed Town Administrator. At this time, Sheila was also acting as Guilford’s Finance Advisory Committee (FAC) Chair and the Treasurer/Principal Officer to the Friends of Algiers Village.

 

Sheila, acting as Town Administrator/FAC Chairwoman and Zon as the Selectboard Chair, convinced the selectboard that the final payment for the loan was not budgeted for and therefore they should use the principal of the loan to make the final payment.

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This is explained on 10/12/2022 beginning at 40:40 of this Selectboard Meeting where Zon claims that this payment was not budgeted for and Sheila Morse confirms Zon’s statement.

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Zon Eastes: The first issue we are going to talk about is this Vermont Bond Bank loan. Which is the $195K (…) we discovered was sitting in a bank a couple of years ago. That loan final payment is due. Unfortunately, (…) there were no funds budgeted to pay this final loan payment. That payment is $19,793.28.

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So, while we have the funds to pay for that, the selectboard, um is not a budgeted item. So, we need to consider the reallocation of some funds in order to pay for that, um, that a, that loan. (…) Now, we understand and are looking at this. Sheila and I, Sheila’s done all the work on this, uh thank you very much Sheila.

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At the 47:00 mark, Sheila Morse states: So, as of last November there was one final payment owed to complete the principal payment. The Budget, which was also created last November neglected to include that payment for the town vote. So, the payment was going to be due this November. So, (…), the 19 thousand and something was not included in the budget (…).

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Dolores Clark asks: Why was that?

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Zon: Oversight.

 

Fastforward. The selectboard authorized the final payment using the principal of the loan. They justified this option because the final payment wasn’t budgeted for.

 

However, residents pointed out it was clearly budgeted for in the Town Report. Zon and Sheila supply the information that the Elected Auditors put in the Report. So, Zon and Sheila had to change their story.

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On 02/13/23 at 43:00 Morse states: The $195k has always been available to the town, it just wasn’t identified properly. (…) How we had paid for it, again it was in the budget it just wasn’t named properly so people didn’t understand where the debt was going.

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Morse changed from stating that the payment wasn’t budgeted for too, it wasn’t identified properly.

 

Tammy Sargent, who will later petition the selectboard for the “Appointment Of Auditor” to fill the sudden vacancy of a Guilford elected auditor, asks a seemingly harmless question at the 56:00-minute mark.

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Tammy: Fairly recently you guys decided to take money from the bond to make the last bond payment.

 

Zon: Right

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Tammy: Because you said the last bond payment hadn’t been budgeted for, but it had been budgeted for.

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Zon: I don’t think we said it hadn’t been budgeted for. We knew it was budgeted for; we knew it was budgeted.

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Remember, Zon said: “there were no funds budgeted for, to pay this final loan payment” and then said this “is not a budgeted item.”  Now he is saying it had been budgeted and they "knew it was."

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Tammy still wants an answer so she says: OK, so why did we make the last payment with money from the bond, why didn’t we make the last payment from the money we budgeted?

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Zon became hostile and replied to Tammy by stating:

 

Yeah, I don’t know the answer to that right now Tammy. I will have to go back and find it, I’m sorry. A, a, a, that’s the kind of question that… this is the kind of question that, I know there is an interest in trying to make the selectboard look like as if we don’t know what we are talking about. This kind of question is precisely the kind of question that you could send to me, and I could research and get you a very good answer. Right now, I’m caught with my pants down and I don’t know if that makes people satisfied to see me with my pants down, but they are down and I’m willing to admit that.

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What I would like to do is have an opportunity to answer this question and get a good answer for you that will be the right answer, I believe, because there was decision making in the process. So, we need to, I need to go back and figure out what that is and answer you and then, rather than have you, or anyone in the community, feel that we’re trying to somehow do the wrong thing, we’re not trying to do the wrong thing. We are Sooo trying to do the right thing and get Guilford onto a better standing from a financial point of view. So please all of these questions that some of you have, about what dollars have, aim those at me in emails and I’ll be glad to take them. We are not going to spend any more time here talking about those questions. I’ll call on Anne Rider.

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This is when Anne explains why the waterline fund was established and not used.

 

Remember, Anne Rider was a selectboard member when this fund was established. Anne is the President of the Friends of Algiers Village and Sheila Morse is the Principal Officer/Treasurer of the Friends of Algiers and Guilford's Finance Advisory Committee Chair.