Precinct's legal budget cut weeks before launch of latest investigation

By David Carkhuff

North Conway Water Precinct voters may have picked the wrong year to cut the precinct's legal budget.Past experience indicates that internal reviews like the one now under way probing the conduct of Superintendent David Bernier can rack up costs quickly. Voters didn't know, of course, that a comment at the annual meeting would escalate into a full-blown investigation.Prior to any of this uproar, at March 28 annual meeting, voters agreed to reduce the precinct's legal budget from $60,000 to $40,000, making the $20,000 cut to the commissioners' $129,496 budget line where legal expenses are included.Actual legal spending in 2006 was $41,546, according to the precinct's annual report. Commissioners had budgeted $65,000 for last year and $60,000 for this year. Although the reduction from $60,000 to $40,000 at annual meeting tracked with last year's actual legal costs, last year proved to be an anomaly.In 2005, the precinct began the year with a legal budget of $70,000, far higher than the $10,000 budget line for 2003. But the year 2003 ended up marking a record for legal spending, when the precinct paid $183,141 in legal bills, including $105,302 to McLane Graf Raulerson and Middleton law firm and an additional $10,581 to then-local general counsel Tom Dewhurst.These bills largely stemmed from a legal review into precinct operations that culminated in the firing of longtime superintendent Gary Chandler. By mid-year 2003, precinct commissioners had spent nearly $38,000 for a "legal review." They refused to answer questions at the time, although it later came to light that Chandler, who had been the superintendent for 14 years, was on the hot seat. On Aug. 15, 2003, Chandler was placed on administrative leave with pay. He stopped receiving checks in October and officially was fired on Dec. 31, 2003, with his firing to be effective Jan. 9, 2004.In 2004, legal bills totaled $83,171, exceeding that year's budget of $75,000. Commissioners voted to tap a $10,000 budget line dedicated to administrative computer software to pay for this overrun. Those bills came mainly from harassment claim investigator John Alfano, attorney Greg Smith of McLane Graf Raulerson and Middleton law firm, and attorney Kathy Peahl with Wadleigh Starr and Peters, the firm used for union negotiations.In 2005, Commissioner Michelle Seavey said, "Legal expenses are growing at a rapid pace, and something needs to be done to rein those expenses in." She vowed to discuss the problem with her fellow commissioners.The history of lawyers in the precinct reaches back to early 2003. Then, Dewhurst drafted a letter critical of the precinct that sparked the controversial consultants' legal review. In April 2003, the McLane Graf law firm formally began the review, later joined by Municipal Resources Inc., which culminated in an 11-page report about the precincts operations that alleged unethical and in some cases illegal activities. Those allegations were restated in an attorney general's report released in February 2005, but the attorney general's investigation failed to find evidence to justify criminal charges. Many precinct residents consider this finding a vindication of Chandler; others argue that the AG's report simply could not establish a level of certainty adequate to pursue a criminal case.In 2004, the precinct veered into a new controversy when an employee, later identified in the attorney general's report as Shane McKinney, alleged workplace harassment against sewer foreman Joe Smith. The allegations later were discredited, and Smith was cleared by the board. Consultants Alfano, a mediator out of Biddeford, and Hunt, an attorney from Kennebunk, compiled the Alfano-Hunt Report. Commissioners have refused to release this report, and the courts have kept it under seal except for copies given to a select few participants in the investigation.In June 2005, after a tense encounter with Bernier, Smith quit from his job as sewer foreman in the precinct. Smith said he left the precinct feeling frustrated from two years of turmoil culminating in the precinct commission's firing of Chandler. After 19 years at the precinct, Smith said he was fed up with the precinct's politics and unhappy with Bernier's performance as superintendent. Smith insisted that Bernier spurred him into leaving."I was provoked, I think would be a good way to put it," Smith said at the time.Now, Bernier says he was "provoked" into swearing about Chandler, the incident that has sparked the latest investigation.