CHELSEA — A new financial audit, released Wednesday, shows the town has spent almost $140,000 on road work beyond its budget since 2009.

Selectmen received the audit from RHR Smith & Co. in Buxton during a meeting Wednesday.

The audit shows Chelsea’s summer road account was overdrawn by $98,195 and the winter road account was over by $20,928 in 2009-10.

Town Manager Scott Tilton said selectmen also reviewed a preliminary 2010-11 report from the auditor, which found the town spent $19,000 more than residents approved for plowing and maintenance of winter roads in 2010-11.

Tilton said the accounts were overdrawn before he was hired as interim town manager June 15.

“I don’t know the cause. It must have had to do with spending practices back then,” Tilton said Thursday. “I haven’t been asked to do any research on it — it’s two years old — but those were the two major accounts that went over.”


Road contracting practices in Chelsea have been under scrutiny since the February arrest of longtime selectwoman Carole Swan, who allegedly demanded a kickback from a town snowplowing contractor in 2010.

She was indicted July 28 on four charges: aggravated forgery and attempted theft, both felonies; and two counts of improper compensation for services, a misdemeanor. Her case is pending.

Town attorney Stephen Langsdorf said the overdrawn accounts are a major concern.

“Given the issues involving Carole (Swan) and her legal problems, this is going to have to be investigated closely,” Langsdorf said Thursday. “We know that she’s the person who was basically dealing with the contractors and making those decisions. We know this from everything told to me by selectmen and other people.”

The relationship between Carole Swan and her husband’s contracting firm, Marshall Swan Construction, Inc., is also under scrutiny, after it was found that the firm has been awarded a majority of recent town road contracts.

A note included in the assessor’s audit said, “The town conducts business with the spouse of one of the members of the Board of Selectmen. The name of the company is Marshall Swan Construction, Inc. The company performs road repairs and construction for the town. For the fiscal year ended June 30, 2010, the town paid Marshal Swan Construction, Inc. $210,910.”


Officials say the town is in tough financial shape since Swan’s arrest. Tilton said there’s nothing left in the school fund balance or the town’s fund balance to offset taxes. Some of the money had been used to offset taxes.

Selectmen have had to cut expenditures, including what could be spent to repair roads this year. Selectmen and the Budget Committee jointly recommended $149,500 for summer roads and bridges at the Town Meeting in June. Last year, Chelsea appropriated $287,000 for that account.

Mechele Cooper — 621-5663

[email protected]


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