MACHIAS — Washington County’s provisional Treasurer Grace Falzarano and Finance Manager Sondra Small have resigned, citing a hostile work environment, poor communication within the finance department and loss of what had been a team environment.
Falzarano submitted her resignation to county commissioners Sept. 28, but they did not announce it until Thursday’s regular meeting. Her resignation took effect Friday.
Small, who had worked for the county since 2017 as finance manager and deputy treasurer, resigned as deputy treasurer in a Sept. 28 letter to commissioners but remained finance manager.
On Thursday, Small resigned as finance manager, effective Oct. 22, and said she would work through her two-week notice.
Falzarano became provisional treasurer in September 2025 after longtime elected Treasurer Jill Holmes resigned.
Holmes resigned amid a financial crisis last year that brought the county close to $8 million in debt. County officials said at the time that she transferred $400,000 in two transactions from a fund designated for services in the unorganized territory to the county’s regular budget, masking the debt.
Holmes had served as the county’s elected treasurer since 1999. She cited personal reasons for her departure.
Since Holmes resigned, the county has uncovered multiple instances of long-standing financial mismanagement, but found no evidence that anyone misused taxpayer money.
In her letter of resignation, Falzarano said she had completed the specific work she was brought in to do for Washington County: help move the county’s finances through the 2025 crisis and into 2026.
“In light of current hostile working conditions,” she wrote, “I feel it is the right time to step down.”
Falzarano had offered to leave office before Oct. 9 if commissioners requested, and said she had enjoyed working with several staff members in the county building and appreciated “the collaborative spirit demonstrated by several of the commissioners.”
In Small’s Sept. 28 resignation letter, she said giving up her deputy treasurer duties would narrow her daily focus, allowing her to “dedicate my attention to the many other daily tasks on my plate.”
In her Oct. 8 letter, Small resigned as finance manager, saying that “historically, this (finance) office operated as a true team where we all routinely took on any job that needed to be done without question, regardless of whether it fell within our official job descriptions.”
She wrote that “that team environment no longer exists.”
“Communication has failed within the office and has made it extremely difficult to stay informed and effectively complete my duties,” Small wrote, adding that “continuing in this position is no longer possible.”
After the resignations, the finance office’s remaining employees were Finance Director Jenny Windsor, who began working for the county in June, and Megan Huffman, who has worked for the county since at least 2023.
Washington County Commission Chairman David Burns said commissioners consulted the county attorney during an executive session before the regular meeting about how to meet the county’s banking and financial obligations without a treasurer or deputy treasurer.
The commission voted unanimously to authorize Windsor and Commissioner Courtney Hammond to sign checks for all county bank accounts and make online bank transfers.
“We are doing our best here to make sure that we meet all the statutory and Washington County needs in order to keep things moving forward in the face of a couple of vacations,” Burns said.
Commissioners also consulted the attorney about appointing a provisional treasurer effective Friday. They appointed Windsor to the position until at least Election Day, which is Nov. 3.
The county has discussed changing the treasurer’s position from elected to appointed. No one is running for treasurer this year, so Burns said Windsor’s provisional appointment may be moot after the election.
After commissioners approved Windsor’s appointment, Commissioner Billy Howard said he deeply regretted Small’s and Falzarano’s resignations. He said both had played important roles in helping the county through last year’s serious financial difficulties.
“People say we’re righting the ship now,” Howard said, “but we had one foot on the ship and one on the boat, one foot in a lifeboat. That’s how close we were to going under.”
Howard called the work to adopt better accounting practices and reorganize budgets “serious stuff.”
He said, “I can’t applaud them enough for their help to get us through this past year.”
Burns agreed that their departure was a loss.
“But we will move ahead and we’ll find new people,” he said, “so you know those that are on board right now are going to help us through this transition. We’re thankful for that.”
Hammond extended the nautical analogy, saying the finance department faced a major workload last year.
“It was all hands on deck,” he said. “That’s for sure.”
In other matters, the commission adopted two policies. One outlines communication procedures, including public information and intergovernmental coordination. The other establishes interim financial procedures and addresses audit findings and financial priorities outlined in the 2022 and 2023 audits.
Those priorities include recording all financial transactions in a general ledger by individual fund, reconciling bank accounts monthly, keeping supporting documents for bank transfers, tracking grant applications and spending and monitoring cash flow.
Commissioners approved an early $1.5 million payment toward the 2026 tax anticipation note, or TAN, to save on interest.
Windsor said the county has enough cash to make the payment, even though it has yet to receive $5.4 million in tax revenue from municipalities.
She also said employee benefits spending could exceed the budget by as much as $500,000 by year’s end, adding to overtime overruns that commissioners were already tracking.
If the benefits overrun materializes, the county may need to borrow more through the 2026 TAN. Windsor said she was comfortable making the $1.5 million payment now.
Commissioners also discussed whether to weigh in on proposed data center projects. None supported the current proposal for an underwater data center in Eastport, but they said they might support a land-based project.
Hammond said a data center in the unorganized territory was more realistic than one in an organized municipality and suggested the commission consider a resolve on the issue at its November meeting.
This story was originally published by The Maine Monitor, a nonprofit and nonpartisan news organization. To get regular coverage from The Monitor, sign up for a free Monitor newsletter here.