The Local Source for News and Information Since 1980
FEDERALSBURG – Following months of discussion, the Federalsburg town council held public hearings and adopted budgets and fee schedules for fiscal year 2025-2026 Monday evening, June 16, at the town office.
However, because the budget isn’t balanced as required by law, the council will meet Sept. 15 to try modifying it and find more cost savings or creative ways to raise revenue, or both.
Mayor Kim Abner and the four council members attended, with Brandy James attending remotely.
The newly adopted Town Hall Streams livestreaming service experienced a glitch, and for the first 15 minutes the system manager tried to find a solution. At the same time, the council was able to activate its Zoom platform to comply with the need to provide a required forum for the public hearings.
Abner announced that former Mayor William Beall, 80, passed away June 13. Beall served as mayor from 2011 to 2015.
With no public comment or council debate, the five council members adopted Ordinance 2025-01, amending Article 2 of the Federalsburg Town Charter to change the date of the September 2025 election to November 2026 and establishing elections every two years thereafter.
Ordinance 2025-02, set a general budget and enterprise budget for fiscal year beginning July 1, 2025 and ending June 30, 2026, established a tax rate of .89 per $100 of assessed real property value and a tax rate of $1.65 per $100 on all commercial or business personal property and all railroad and utility property.
The ordinance established the same service and administrative fee for semi-annual billing as adopted by Caroline County, and established a quarterly waste collection fee of $53.94 per quarter for commercial properties which receive waste collection services and for all residential properties located within the corporate town boundaries, as well as a charge for extra waste collection items.
With only one person weighing in remotely with a question about the ordinance, the public hearing became a brainstorming session about how to potentially provide a pickup or collection site service for residents with large trash items.
James voiced concern about signing off on a budget that was not balanced and questioned the legality of doing so.
Town Attorney Lyndsey Ryan said, “You're passing a budget that is not consistent with an environmental article related to the self-sustaining enterprise fund. But if you can't cut anywhere else, and you don't have any other revenues, I don't know what else you can do, … because if you don't approve anything, I don't know how you go into the next fiscal year.” The town’s waste water treatment plant comprises the town’s enterprise fund.
The enterprise fund budget deficit is over $450,000, something Council Member Ian Ferguson said is “an albatross around the town’s neck.”
Shifting funds from the general fund was not possible, according to the town’s accounting firm, interim Town Manager Mercedes Moyer said.
“In a perfect world, it would be a completely balanced budget,” Ryan said. “If you feel that you can get there between now and July 1, then you should undertake more efforts to try to do so. And if you feel like you can't, then you have to adopt a budget.”
“I know you've all done a lot of work to try to find a way to do this, but you've got to find ways to cut the expenses and bring up the revenue,” Ryan said. She suggested the way to become self-sustaining was to “grow your population, and it's easier said than done, but being able to annex an area or getting a development … has a substantial impact on your revenues.”
After more discussion about ideas for reducing debt, including James’ suggestion of exploring the possibility of the Caroline County Sheriff’s Office providing town law enforcement, the council eventually adopted the budget with a possible modification to be considered at the council’s Sept. 15 workshop.
The fee schedule in Ordinance 2025-03 was adopted without debate, as was Ordinance 2025-05, authorizing the council to acquire 24,446 square feet of open land for zero dollars at Benjamin Haynes Court, owned by Tuckahoe Habitat for Humanity, Inc.
The council heard five requests for proposal (RFP) to conduct a forensic audit, possibly going back five years. Despite the expense, which the RFPs projected between $56,400 and over $144,000, the council agreed the forensic audit was needed.
“It sets the tone for what we as a council are trying to do as far as transparency and accountability within the town,” James said.
The council will review the RFPs and discuss them at the July 7 meeting.
The council pursued a topic that caused some spirited discussion. At issue was the need for clarity in the personnel manual about town employees’ leave rollover, and especially the unbudgeted possibility of about $50,000 in accrued payouts to employees with at least 10 years employment with the town.
James was adamant that she would not approve employee leave and vacation rollover payments, especially since the council approved raises effective July 1. Ferguson echoed her concerns.
James said that she emailed Moyer that morning “to do an analysis today as to what it would cost the town if we were to lose these employees who were requesting rollover of their vacation time” that was “never accounted for in this budget.” Moyer said she wasn’t able to gather all the information in time for the 6 p.m. meeting.
“We definitely need to re-evaluate the whole entire leave process, because I think it should be accrued, not all front-loaded,” Abner said. “If it gets front-loaded, and (employees) take it and then they leave, they've never really earned it.”
Abner said she was concerned about giving people time to use their leave time, “not pay it out.”
James said her concern was communication she received claiming that some employees had been denied their requests for time off by supervisors.
“When you're in a position to be a supervisor, a department head, you need to take an account of the budget when you do things like this,” James said, “That should have been something that you were thinking about throughout the fiscal year, not waiting until the end of the fiscal year to say, ‘Hey, roll my people’s time over.’ No, that's not what the council's here for. We're not here to save your face. We are expecting you to act in a professional and in a supervisory manner where you're taking into account all of this. I'm sorry. We cannot keep punishing the residents of Federalsburg for the mismanagement that these department heads are doing. I'm sorry, and I'll say it on the record.”
Moyer explained that the personnel manual states that “No personal time rolls over, and then sick time is only paid out if they are here over 10 years. You only have two employees … that have been here over 10 years.”
After more debate, Ryan said the analysis would need to broken down further, with sick and vacation leave time considered separately before July 1 in a virtual closed session, adding later that while some information related to employee benefits were appropriate for discussing in closed session, the final decision would be debated in public session.
James brought the discussion back to the larger questions about the budget process with pointed questions directed to the council.
“Y'all are driving this train wreck, because y'all already know what the situation is,” she said. “Because truthfully, everything has not been presented in an honest fashion to the council. And I'm sure the council knows this themselves. We've had discussions about the untruthfulness that has been presented to us. So where are y'all headed with this train wreck? Because before I waste another minute of my time talking about this, knowing we don't have no money, knowing we just said our wastewater treatment plant is sinking …”
Ferguson quickly agreed. “At the end of the day, on my end the answer is no, because we don’t have the money … so why roll it over?”
During the public comment period, Harry Purdham, on behalf of entrepreneur Muhammad Ullah, asked that the council consider grandfathering in current plans for a restroom in a convenience store and Exxon gas station Ullah is trying to open at 312 Bloomingdale Avenue.
Purdham said every inspection had been passed since Ullah bought the property in 2019, but a last-minute ADA-compliant modification order wasn’t feasible. Abner said the request would be considered in a subsequent meeting.
The council approved a poster for the second annual Unity Day, set for noon to 4 p.m., Saturday, Sept. 27, at Federalsburg Marina and Playground.
Mercedes Moyer will be leaving the town’s employment shortly. On Feb. 19, she was announced as interim town manager and acting town treasurer, following a shake-up in town staffing.
