BINGHAM — Residents Monday approved a $638,090 budget Monday including a nearly 50 percent increase in costs for the Upper Kennebec Valley Ambulance Service due to a “cash flow problem” at the ambulance service.

In 2019, Bingham will raise $85,800 from taxation for the ambulance service, up 48.7 percent from a 2018 budget of $54,494.

The cost represents about 13 percent of the town’s overall budget approved at the annual Town Meeting at Quimby Middle School.

Officials with the ambulance service attributed the problems to “overly optimistic budgeting” and a failure to accurately estimate the amount of money the nonprofit agency would take in in insurance reimbursements each of the last two years.

In a report to the town, Ian Shalit, who took over as executive director of the ambulance service about seven months ago from Michael Poirier, said shortly after he came aboard as executive director last year he discovered a “significant financial issue plaguing the service.”

Unbeknownst to the board of directors, the ambulance service was operating at a “significant financial loss,” Shalit said. Working with Patrick Dolan, finance manager for Somerset County, Shalit said they discovered close to a $70,000 loss over the past two years that had not been reported to the board.

In addition to Bingham, the UKVAS also contracts with Moscow, Caratunk, The Forks, West Forks, Pleasant Ridge Plantation and parts of Somerset County’s unorganized territories to provide ambulance services.

“After delving further into UKVAS’s finances it was clear that this loss was due to years of overly optimistic budgeting and a significantly lower level of reimbursements for ambulance runs compared to the amount listed on the budget,” Shalit wrote in the report.

In 2017, the service projected insurance reimbursements at $210,000, but they took in only $174,606. For 2018, reimbursements were projected at $210,963 but came in at $171,533.

Whatever the ambulance service doesn’t take in in insurance reimbursements is covered with subsidies charged to the towns, said Donna Dickstein, secretary and treasurer for the ambulance service.

She said it can be hard to estimate how many ambulance runs will happen in a single year and, as a result, hard to know how much money the service will be taking in.

As a result of the shortfall, Shalit said the service was forced to liquidate the capital account to cover payroll on three different pay cycles and ensure employees would get their weekly pay checks.

“In order to create a sustainable ambulance service in the coming years, we were forced to increase town subsidies by 49 percent and include a realistic number in the budget for reimbursements for ambulance transports,” Shalit said.

The service has also hired an outside accounting firm to act as a third party in overseeing and providing financial reports for UKVAS on a month-to-month basis.

“This has been put in place with the intent to ensure that the director provides the board members with the correct, timely and accurate financial reports,” Shalit said. “This will make sure the board will be completely informed on UKVAS’s true financial situation, help prevent future financial strain and to educate on proper accounting practices.”

Bingham First Selectman Steve Steward did not respond to an email late Tuesday afternoon and could not be reached for comment. He said, prior to Monday’s town meeting, the increase in ambulance costs was “just the cost of doing business.”

“It’s a lot of expense (to run an ambulance service), and they’ve been trying to get by on a shoestring budget,” he said. “Now it’s finally caught up with them.”

In other news Monday, residents approved the following amounts to be raised from taxation: $143,048 for general government; $220,822 for public safety; $54,275 for the transfer station; $94,000 for public works; $2,000 for general assistance; $64,000 for debt service; $16,000 for recreation; and $9,750 for local organizations including the Bingham Union Library, Baker Mountain ski tow and the Bingham Area Food Pantry.

In elections, Juliana Richard was re-elected as second selectman with 131 votes. Elizabeth Brochu was re-elected to the SAD 13 school board with 136 votes. Brandy Hill was re-elected to the SAD 13 school board with 116 votes. All races were uncontested.

 

Rachel Ohm — 612-2368
rohm@centralmaine.com 
Twitter: @rachel_ohm