OLD ORCHARD BEACH — Old Orchard Beach’s town manager said Thursday that he and the town’s finance director have been worried about a lack of safeguards over an account for library funds since they took office in recent weeks.

The town said Thursday that it will take over management of the Edith Bell Libby Memorial Library’s money in response to the board learning this week that an undetermined amount is missing from the library’s operational account.

State and local law enforcement officials have opened an investigation.

Town Manager Mark Pearson said the library account has concerned him since he became town manager in mid-February, and the finance director told him it caught her eye after she started her job in December.

Library officials said Wednesday that the money was lost while the books for the account were being kept by Linda Jenkins, who died Saturday at age 53. Jenkins was the bookkeeper for the operational fund for about six or seven years before stepping aside about two months ago because of failing health, library officials said.

Pearson called the library account a “silo” because even though the town deposited money in it — the town is providing $225,000 during the current budget year — it was beyond the town’s control. The library is owned and funded by the town, but its board operates independently.

“Whenever you have a system set up without checks and balances, you always have that opportunity” for problems, he said, noting that the library’s books haven’t been audited for years.

Pearson declined to confirm that money is missing, but said the investigation is seeking to “determine if any funds are missing, if they were inappropriately transferred and where the funds, if missing, are now.”

Pearson said he doesn’t anticipate any interruption of library operations, but noted that much depends on the outcome of an audit of the library’s funds. He said the next quarterly deposit, of about $56,000, was due next month but will instead be held by the town and used to pay for library operations.

Pearson said he was informed of “a matter of financial concern” related to the account on March 23 and notified Saco & Biddeford Savings that no more transactions could be made in the account without his or the finance director’s authorization.

Local and state officials were notified, he said.

Brenda Kielty, a spokeswoman for the state Attorney General’s Office, said Thursday that investigators are working with town officials to review the account’s records. “We are consulting with town officials and police regarding an audit and investigation,” she said.

Pearson said the library will continue to pay bills and payroll from funds in the operational account until it is exhausted. After that, the town will stop making deposits in the account and will pay library bills and provide paychecks for workers from its own accounts.

He noted that a bond for as much as $2 million to pay for a library expansion hasn’t been sold yet, but a separate account containing donated money — which was used to pay for conceptual drawings and other preliminary work for the addition — is also being examined.

“All of the accounts are a concern because we don’t have a full accounting,” he said.

 

Staff Writer Edward D. Murphy can be contacted at 791-6465 or at:

[email protected]