Admitting the mistakes of the past and pledging a new future of transparency in their financial affairs, leaders of the Island Affordable Housing Fund took the floor at the Vineyard Haven library on Wednesday night and faced the public over what one member of the audience called a breach of public trust, when the fund defaulted on its payments to the county rental assistance program early this fall.

“How could you do this? There are single mothers using this rental program,” declared Penelope Dickens, a renter who also uses the program.

“This has caused a lack of trust, no question,” said Harvey Beth, an Oak Bluffs resident and chairman of the Dukes County Regional Housing Authority, the agency that administers the rental assistance program and now is scrambling to come up with money to cover the subsidies for some 45 landlords through the end of the fiscal year. More than 75 people attended the two-hour forum, which for the most part avoided substantive discussion about the current financial affairs at the fund. A financial summary was circulated which reports income and expenses for the past four months, but the summary added little to what already was known through audited financial statements for the fund: that fund-raising fell far short of expectations this year and that there is an increasing reliance by the fund on public money through the Community Preservation Act accounts in Island towns.

Board member Kim Angell, who is also an accountant, said the fund had experienced a “perfect storm” with declining donations, the economic downturn and the sudden departure of former executive director Patrick Manning in August. “If only one of those things had happened we would have recovered quickly,” she said.

Questioned later in the meeting by West Tisbury selectman Richard Knabel, board copresident Robert Wheeler said donors were not told that Mr. Manning was collecting a five per cent commission on donations once $1 million was pledged. Mr. Wheeler also admitted that taxpayer-funded Community Preservation Act money collected by the nonprofit fund was included in gross calculations for establishing Mr. Manning’s commission threshold, but that no commissions were paid from CPA funds. “The [commission] money came from donations,” Mr. Wheeler said.

The exact amount of Mr. Manning’s compensation has not been disclosed.

“We’re here tonight to answer your questions,” said fund executive director T. Ewell Hopkins at the outset of the forum. But first board members consumed a full hour by introducing themselves and telling personal stories about why they had decided to join the board.

“There was no mechanism for raising private money,” recalled longtime board member and current treasurer Jeremy Henderson, a lifelong seasonal resident of Edgartown and the only seasonal resident on the board. He recalled another forum 10 years ago where “people preservation” was the theme and which led to the formation of the housing fund.

Board copresident Candy daRosa also recounted the early history of the fund, including the innovative summer fundraiser Houses on the Move, which was conceived by Kitty Burke of Edgartown and which helped launch the housing fund. There were accolades for Ms. Burke, who attended the meeting, but she later issued a stern reminder to the board about the need to set aside money for a rainy day. “The perfect storm could happen again,” she said, urging the board to commit to setting aside five per cent of donations as a reserve.

The early part of the meeting also included a series of accolades for outgoing board member John Abrams, who has come under scrutiny for the fact that his West Tisbury build and design firm South Mountain Company was awarded construction contracts for affordable housing projects of the fund.

“John is a visionary but also the guy who goes out in the community and rolls up his sleeves . . . All of us on the board and in this community owe him a huge debt of gratitude,” Mrs. daRosa said.

“I have watched South Mountain over the decades and they have been leaders in energy conservation and in socially responsible building,” said John Early, a fund board member and longtime Island contractor and politician. “John could have directed his energy toward the luxury market but he stayed with affordable,” he added.

“I am humbled,” Mr. Abrams said in a preface to his own remarks. Mr. Abrams said he will step down from the board on Dec. 31 but will remain on the board of the Island Housing Trust, a sister organization to the fund. Mrs. daRosa emphasized that Mr. Abrams’s resignation has been long planned and not linked to recent events around the fund.

Mr. Hopkins outlined his own list of topics for discussion that included the rental assistance program, the financially strained Bradley Square affordable housing project in Oak Bluffs and the Jenney Way project in Edgartown.

Mr. Hopkins called Jenney Way, the 10-unit project in Edgartown where the last unit remains unsold, “an albatross.”

And in a report on Bradley Square, Patrick Ahearn, an Edgartown architect and fund board member, described the events that led to the purchase of a dilapidated building at a high price during a peak market that has since crashed.

“The world looked rosy [when the fund bought the Bradley property] . . . and at the time it seemed liked a logical risk to take. But today the economics of that project are in question,” Mr. Ahearn said.

But the central theme of the evening was the shattering news that the fund can no longer pay for the rental assistance program which it has funded to the tune of some $2.6 million in recent years.

“It was Black Friday for us the day we got the news,” said Mr. Beth.

Mr. Knabel asked if the fund expects the towns now to assume the obligation for rental assistance. “We are in budget season, and we need to know, if we are going to budget for this,” the West Tisbury selectman said.

Mr. Hopkins said yes, that is the expectation. He said the fund hopes in the future to “grow” the rental assistance program by raising money to contribute to it. But he reiterated comments he has made in recent weeks that the practice of making monthly payments was not sound.

“We were not under the impression that it was month to month, we thought there was a commitment through the end of the [fiscal] year,” returned Richard Skidmore, a member of the Aquinnah housing committee. He pressed the board to show support for a memorandum of understanding that he had drafted and discussed with Mr. Wheeler, but Mr. Hopkins said the board had not had time to discuss the memorandum.

More than once discussion strayed into the subject of zoning; several fund board members said there is a critical need to relax zoning rules in order to facilitate more affordable housing. “It’s all about density,” said Mr. Ahearn, calling Island zoning rules archaic. Oak Bluffs selectman Kerry Scott cited the Camp Ground as a perfect model for affordable housing, and Mr. Ahearn seized the moment to turn the subject back to zoning. “You have the power to change things,” he said.

But Rachel Orr of Vineyard Haven had another view.

“The thought of putting 325 houses over our Island aquifer makes me nervous,” she said. “We don’t need more houses; we have plenty of houses. I would encourage property owners to . . . put your generosity first and offer people places to live.”