The mayor hanged himself because he was wrongly accused
Gracie's disappearance marked a turning point in Abe's career; namely, a bad one. Abe did what he could to solve it, but his investigation ended up in an accusation of murder - namely, one committed by Gracie's father. He hanged himself before he could face any jail time - only after that was it made clear that he had no involvement in Gracie's disappearance. That was the thing that brought Abe down in the eyes of the rest of the town.- If Abe had been responsible for the mayor's death, you'd think that would be one of his primary regrets in life. He only seems to feel guilty about failing to save Gracie and has no problem keeping a picture of the mayor in his office. The mayor's suicide seems instead to simply be part of the town's degradation after Gracie's death and Abe's fall from grace.
- Agreed with the above. Also, the mayor's widow still seems to like Abe in the present day, as she seems to be his only regular customer (with her constantly missing cat). I doubt she would want anything to do with Abe if he had falsely accused her husband of Gracie's kidnapping especially after the mayor went on to kill himself.
- It is possible that Abe didn't accuse Gracie's father, but someone else, like an overzealous police detective or conspiracy theorist, did.
Caroline will become Abe's secretary or partner
There will be a sequel to the film
