Town counsel Ronald H. Rappaport met with Oak Bluffs selectmen on Tuesday to answer lingering questions about a report he co-authored last month in which he concluded the town did not have legal authority to award personal service contracts and special one-time bonuses to several town employees over the past few years.

Although a number of town officials - including several selectmen - have said they felt the report left questions about which town employees were eligible to receive personal service contracts, Mr. Rappaport explained that the state law is very clear as to who can and can't receive them.

"I don't think there is any room for ambiguity in the report. I cited specific statutes that explain what is allowed under state law," he said.

While the town has a total of 16 employees with personal service contracts, Mr. Rappaport said state law allows only four positions to hold such agreements: town administrator, town accountant/finance director, police chief and fire chief.

The town librarian can also receive a contract if it is approved by the library board of trustees, he added.

Mr. Rappaport drafted the 12-page report with the help of labor counsel Michael Gilman. Selectmen received the report late last month, although Tuesday's meeting marked the first time selectmen discussed the report in public.

The legal opinion carries a stamp of approval from Kathleen Colleary, chief of the state bureau of municipal finance law for the Massachusetts Department of Revenue.

Mr. Rappaport and Mr. Gilman reviewed some 14 personal service contracts ranging from town finance director to principal assessor.

Among other things they found that former town administrator Casey Sharpe, in her dual position as personnel administrator, had no legal authority to enter into personal service contracts with town employees. That power rests with either the selectmen or other boards with legal authority by statute, or by town meeting vote, the attorneys found.

The report also concluded that Ms. Sharpe had no legal authority to award bonuses totalling over $22,000 in July 2006 to four department heads; nor did she have legal authority to pay building inspector Jerry Wiener $13,068 in lieu of his share of health premiums for fiscal year 2006.

The report also concludes the town cannot pay 100 percent of employees health premiums as stipulated in several personal service contracts. State law prohibits the town from paying a greater share of an employee's health insurance premium than it does for other employees.

Mr. Rappaport, who answered questions from the board on Tuesday, said that in his experience the number of contracts held by town employees in Oak Bluffs was unusually high.

Mr. Rappaport repeated his recommendation from his report that five employees be taken off contracts and be paid in accordance with the town personnel bylaws. He also repeated his recommendation that the town should not try to recoup money paid to employees through perks in contracts, bonuses or health insurance contributions.

Mr. Rappaport said that many of the contracts in question were not fully vetted by the board of selectmen.

Only in the instances of the fire chief and wastewater treatment manager did a quorum of selectmen sign the contract, Mr. Rapport said. Although he and Mr. Gilman asked for additional documentation establishing that the contracts were authorized by a majority of selectmen, additional information was never provided, he said.

When selectmen asked what could be done to prevent unauthorized contracts in the future, Mr. Rapport said the town only needed to follow state law to avoid future problems. All contracts should be discussed and voted on during public meetings by a full quorum of the board, he said.

"The [Massachusetts] open meeting law, in and of itself, is a cleansing process," he said.

After hearing Mr. Rappaport's presentation, selectman Gregory Coogan said that after reading the report the question of who could receive a contract was still unclear.

"The law isn't black and white on some of the specifics. It says that some people can receive contracts, but then it's silent in some ways [about other positions]," Mr. Coogan said.

Mr. Rappaport said that state statutes are concise and clear about which employees can hold personal service contracts.

"I don't see anything else [in my report] that isn't cut and dry," he said.

The discussion then turned to the differences between the terms illegal and unauthorized. Mr. Rappaport said he and Mr. Gilman were careful in choosing the language in the report. When making recommendations in the report, Mr. Rappaport said they chose the term unauthorized for a reason.

"Illegal is a charged term because it implies something criminal took place," he said, but later added: "But if someone were to say this happened outside of the law, I wouldn't quibble with that."

At the end of the meeting, several residents and town officials in the packed audience advocated for the town to take steps to avoid questionable employment practices in the future.

Linda Marinelli, a former selectman, was moved to tears when she addressed selectmen.

"I'm confused and I'm upset. Now how do we deal with the taxpayers who have to foot the bill? What can we do to make sure this isn't all going to be swept under the rug? The least we can do is get this money back," Mrs. Marinelli said.

Peter Palches, chairman of the town finance advisory board, asked Mr. Rappaport if he had been asked to provide legal counsel on these matters prior to last month.

The answer was no, and Mr. Rappaport explained that he can only offer a legal opinion when he is asked by selectmen.

"Obviously questions about these contracts should have been brought to town counsel, and they weren't. And I cannot volunteer my services," he said.

Selectmen agreed they should hold another meeting to discuss the findings in Mr. Rappaport's report in the near future.