The little 7,997 person town of Charlestown, RI has settled its issues with Marcum after “furious” town officials received an unitemized $55,992 bill for out of scope services on the town’s 2022 audit.
Reports The Sun, council members received the out of scope services bills dated January 18 and February 15, on top of the agreed upon $69,500 for 450 hours worked in the original contract with Marcum. The contract included a breakdown of billable hours from partners down to staff, whereas the surprise out of scope bills had none. The contract stated that fees “will be rendered as the work progresses, and are due and payable upon presentation.” The bill dated February 15 arrived after the town’s audit was submitted to the state, said Council President Deborah Carney.
Marcum was slow to respond to inquiries about the additional fees, say officials, and the firm reportedly told the town they’d have to wait until busy season ends to work out the billing issue.
Charlestown Town Solicitor Peter Ruggiero tried to negotiate a reduced fee, and on March 15 acting Town Administrator Jeffrey Allen and Treasurer Irina Gorman had a Zoom meeting with Marcum partners. At that meeting, Marcum promised to send over an itemized bill within a couple days. It seems that didn’t arrive.
They could have gone to court to resolve the issue but the contract required any litigation to take place in Marcum’s hometown of New York, where the town lawyer is not licensed to practice. After a couple meetings among themselves, the council voted to make a $18,000 payment to Marcum on April 24 and obviously severed their relationship with the firm at the same time. The Sun article doesn’t explain where that figure came from but it seems the issue is resolved.
As for the town finances, Charlestown is in good shape. Total revenues were about $406k above budget, the town brought in $268k more in taxes than expected, and it has a total fund balance of about $10.9 million. Marcum’s report included several recommendations for improvement.
450 hrs for a $69,500 fee seems very low to start out @ $154/hr.
Marcum was trying to get fired from this one.