MAHOPAC, N.Y. - Town Supervisor Ken Schmitt said there will be more oversight by town officials over future fire department contracts and budgets after more than $5 million was allegedly embezzled from the Mahopac Volunteer Fire Department treasury.

Schmitt’s remarks came during a forum held last week at the Mahopac Library for residents and public officials to discuss how to safeguard against future crimes. The forum was moderated by David McKay Wilson, a Mahopac resident and reporter for The Journal News. Panelists included Bill Young, an attorney for the New York State Association of Fire Districts; Nancy Montgomery, a member of the Philipstown Town Board; Bob Cullen, deputy supervisor for the town of Southeast; and Bob Buckley, a longtime Mahopac resident, who is also chair of the town’s Recreation and Parks Advisory Committee.

The thrust of the meeting was a discussion on the difference between a fire district and a fire protection district and how town governments interact with them. A fire protection district, which is what the Mahopac Fire Department is, is an independent vendor that creates its own budgets and provides services to a municipality via a contract. On the other hand, a fire district is a special district (such as water and sewer) within a municipality and has a budget that is overseen by a town board.

Sign Up for E-News

In the wake of the embezzlement investigation, there has been some discussion about transitioning the local fire departments from protection districts to fire districts so that the Town Board would have more control and oversight into the department’s finances. However, it was pointed out during the course of last week’s meeting that even under the parameters of a fire protection district, town boards still have some control over their fire departments and their budgets, and Schmitt said the Town Board would ratchet up its vigilance moving forward.

“There is always a triggering event that brings about change,” he said. “If it weren’t [for the embezzlement investigation] we wouldn’t be here tonight. I think there will be some positive change.”

Part of that change, the supervisor said, would be for the Town Board to create contracts with the fire departments that include more checks and balances. Schmitt did not detail those strategies specifically, but said they would be discussed during a public hearing that will be held on the contracts next month.

“There will be more oversight,” he said. “[The fire departments] are willing to work with us and we will come up with a plan on how to resolve this matter.”

Young explained in detail the differences between the two types of districts.

“A fire district is a political subdivision and subjected to all laws that town boards are subjected to,” he said. “They have commissioners who are elected and who must reside in that district.”

The commissioners, he said, must undergo periodic training.

A fire district with a budget of $300,000 or larger must also have an annual external audit and its budgets must stay within the state-mandated 2 percent tax cap. Apparatus purchases of more than $20,000 must go through a competitive bidding process. Additionally, such districts must sign on to follow a code of ethics. They also must adhere to specific spending limits and they are subject to open meeting laws, just like a town board.

However, a fire protection district such as Mahopac, Young noted, operates differently.

“They negotiate contracts with town governments and are not subjected to tax caps,” he said. “The town does have some oversight, though. They can ask how the money is being spent and these districts also have to have external audits when the budget is more than $300,000. But the oversight is only as effective as those charged with doing it. Are they asking the tough questions?”

Changing from a protection district to a fire district, Young said, must be done collaboratively with a town board.

Montgomery said that Philipstown just went through such a transition and she called it a “long and difficult process.”

“We couldn’t sustain [the fire department] and morale was going down the tubes because of all the criticism on the spending,” she said. “The town board wanted more oversight.”

She said the town has four fire districts within a town of about 10,000 people, which was unwieldy, and officials wanted to consolidate them.

The fire departments didn’t look favorably on the idea of converting from a protection district to a fire district, the councilwoman said, and took offense to the idea. They were somewhat reluctant to relinquish control.

The town eventually received a grant to examine the districts and determine the feasibility of such a conversion and consolidation

“But the fire departments didn’t want to cooperate,” Montgomery said. “There were a lot of issues and many of them didn’t want to combine with the other districts because they all had their own way of doing things.”

She said eventually the district in Garrison came forward and volunteered to form a fire district, though the other three remained steadfast in the status quo.

Buckley said that he believes that if the contracts the town creates with the fire protection districts included more checks and balances, as Schmitt promised, it could solve the problem without changing the type of district.

“The issue is where we go from here,” he said. “If the contract is shored up then maybe some of these issues go away. You just have to make things more open and transparent.”