Tesei, Mason clash over authority on loan forgiveness

Debate over forgiveness of a loan between the town and Parsonage Cottage has been drawn into a larger question: Who has the authority in this case, the Board of Selectmen or the Board of Estimate and Taxation (BET)?

Possible forgiveness of the $396,000 loan, which was granted to help improve the senior housing complex 15 years ago through the Community Development Block Grant program, is being pushed forward by the town’s Housing Authority and has the support of the Community Development Block Grant Committee and the Board of Selectmen. Advocates of it have said forgiveness of the loan would give the Housing Authority more financial flexibility toward improving Parsonage Cottage.

However, the BET, saying that it didn’t have enough information to make a decision, unanimously deferred a decision at its Sept. 24 meeting and will take it up again in October. Instead it will form a working group to seek answers to board questions and have answers by no later than the BET’s Oct. 29 meeting.

At the Board of Selectmen’s Sept. 26 meeting, First Selectman Peter Tesei spoke about the BET’s deferral and criticized both town Community Development Administrator Princess Erfe and BET Chairman Michael Mason, saying he found it “most troubling” in terms of the broader sense of Greenwich’s governmental structure. He said Ms. Erfe should have come to him before speaking out against the loan forgiveness at the BET’s Sept. 24 meeting and said Mr. Mason shouldn’t have put her in that position.

“We have a number of well-qualified and well-intentioned people, but there are lines of accountability,” Mr. Tesei said. “Everybody who works for the town reports to someone. We, ultimately, report to the voters. In this particular issue the BET, through its chair, really put the community development block grant administrator, who reports to the first selectman, on the spot to get her opinion about whether the loan should be forgiven. Up unto this point, she had never given any indication to the committee chair, to me or to anyone that she did not think this was the best course of action, but she did so Monday night. It was not, in my opinion, a proper use of her discretion. Her discretion should have been to tell us if she didn’t think this was a prudent course of action. She never uttered a word but did so at this time.”

While forgiveness of the loan is not expected to have any kind of direct impact on Greenwich taxpayers, Ms. Erfe told the Post that she gave her personal recommendation against it due to new information she had received from the federal department of Housing and Urban Development (HUD) on Sept. 20 about how the loan could be modified, instead of being forgiven, to benefit both Parsonage Cottage and the town by not putting future funding from the federal Community Development Block Grant program at risk.

“I thought that was very important for the BET to know before they voted,” Ms. Erfe said.

Ms. Erfe said this was all very rushed and that she did not have the chance to speak to Mr. Tesei before the Sept. 24  BET meeting. She said she finished drafting her comments to the BET that day after working but could not reach Mr. Tesei before the meeting began. She said she was told the morning of the meeting that Mr. Mason wanted her to speak that night.

Mr. Tesei said he believed her speaking at the meeting without talking to him or the committee first “undermines the trust and relationship between her and the advisory committee” as well as the “trust and confidence we have going forward” because he felt the existing structure had not been adhered to where divergent opinions are offered “in the proper context.” However, he did praise Ms. Erfe’s performance in the job and saved his heavier criticism for Mr. Mason.

“I think the BET chairman and I have a very different view of the role of accountability in this governmental structure, and we’re going to be debating that going forward,” Mr. Tesei said. “The BET is a financial control board. It has two departments that report to it. Yes, they have, under the charter, responsibility to proper financial administration of the town, but day-to-day administration of the town is left to the office of the first selectman and all of the various appointing boards we nominate [people] to. … The moment those lines of authority are blurred, you end up with chaos.”

Mr. Tesei said this was something that had to be respected and that the BET does “not have that full breadth of responsibility.”

“I think this issue illustrated this [problem] in spades to me because it was not handled properly and frankly put a good person in a very uncomfortable and untenable position and really created issues for her as she has to go forward and work with the committee after she essentially contradicted their entire decision-making process,” Mr. Tesei said. “This is something that I feel has to be said, otherwise we’re going to end up with further consternation. We’re not going to get things done in a timely fashion. There has to be an understanding from the departments who they report to.”

In an interview with the Post, Mr. Mason said this was not something meant to be taken personally, but rather the BET acting in its role as an oversight board of a financial transaction involving a town property. He said there are too many questions about the initial deal for the loan, which took place before he was on the BET, for there not to be more scrutiny before a vote is taken. Mr. Mason added this didn’t mean the board was against forgiving the loan, the members just wanted more information first, especially since it will have to go to the Representative Town Meeting (RTM) for a vote.

“I don’t want to see an item voted down,” Mr. Mason said. “I have a responsibility to the RTM. If we don’t understand this, then how are we going to then explain it to the RTM membership?”

He said that there were questions on the exact nature of the deal, whether it was in the best interests of the town to forgive the loan or find alternate means of providing relief to the Housing Authority through modifications to the loan and even issues of insurance at the property. Mr. Mason said the more the matter is discussed, the more information they’re getting.

“We’re getting answers as we go,” Mr. Mason said “There’s no one interested in saying no to forgiving the loan.”

When asked about Ms. Erfe, Mr. Mason said he didn’t believe any inappropriate questions were asked and that he simply wanted to get the department’s perspective. He said he thought her remarks “took courage” and that he had not intended to put her in a difficult position.

“The BET benefited from hearing from her,” Mr. Mason said.

Mr. Mason said he understood Mr. Tesei was “frustrated” and that he agreed the first selectman had the authority in day-to-day operations of the town, but that he considered this “out of the routine.” He added he understood there were some time constraints and that he was willing to schedule a special meeting in October to consider this.

Selectman David Theis added at the Sept. 26 meeting that he considered this a “chain of command” in Greenwich government that had to be respected. He said it was “very disappointing” to him that proper policy didn’t appear to have been followed in this case.

“It was not a fine hour,” Mr. Tesei said.

Mr. Tesei said he believed this was a conversation that was going to go forward among him, Mr. Mason and their respective boards.

“We’re not telling them they don’t have their responsibility, but reporting lines are reporting lines and staff is advisory,” Mr. Tesei said. “They can have their opinion and offer it, but when we’re making policy, it’s up to the folks that the citizens of Greenwich elect or are appointed.”

Mr. Tesei later said it was fine for the BET to “ask as many questions as it wanted” because it was its job to do so, but he didn’t want to see professional staff, like Ms. Erfe, being used to “undermine the people they report to.”

“I don’t think that’s a good way to do business,” Mr. Tesei said.

 

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