The New River Service Authority board announced Thursday that a settlement has been reached with 18 former employees who filed claims against the board for unused vacation pay last year.

The meeting was convened to settle affairs of the former mental health service agency, which dissolved last year following a fatal financial crisis. The board had not met since June 2012.

Board Chairman Nathan Miller said the former employees had agreed to dismiss their claims in exchange for a lump payment of $25,000.

“We were able to work with these 18 employees because their demands were reasonable,” Miller said. The employees would determine how to divide the settlement among themselves, he said.

A second lawsuit filed against the board by another group of former employees was thrown out of federal court last week, Miller announced.

The federal suit made “outrageous claims” and sought “an absurd amount of money,” he said. Judge Richard Voorhees of the U.S. District Court dismissed the case, finding that the board had not violated any federal law, he said.

Harris said the board was “very pleased with the well-reasoned decision.”

“It’s been a year and a half since things went south,” Miller said, “and we are now sitting here lawsuit-free.”

Harris also informed the board that attempts to complete an audit of their finances had been unsuccessful. A firm had been contracted for $35,000, but “our records were not what the auditors want to see,” he said.

While the audit could not be performed, the auditors had determined that an audit was not required by the state. “We will not be getting an audit,” he said.

The bulk of the funds allocated for the audit had been returned to the board, Miller said.

Board members from Ashe and Alleghany counties were unable to attend the meeting due to inclement weather, but to the members from Avery, Watauga and Wilkes, Miller said, “I appreciate the work of all five counties, their commissioners and their managers.”