FRONT ROYAL – The Warren County Board of Building Code Appeals ruled Thursday partially in favor of Bentonville homeowner Kristie Atwood, who maintained that officials failed to identify all of the construction issues at home.
Atwood, whose home burned down in a 2015 fire, signed a contract with Buracker Construction LLC to clear the site of debris and rebuild the family’s home. An occupancy certificate was issued in July 2016, despite what Atwood said were a number of issues with construction, including the fact that no water test had been conducted, an outdoor furnace had not been installed, nor had a water softener system been installed. Since issuing that certificate, Building Official David Beahm has acknowledged that there were five building code violations that the county previously failed to cite.
Atwood’s attorney, David Silek, said an independent building inspector found at least 60 other items that also should have been found in violation of the building code. He told the board, regarding Beahm, “He missed… by coming back (to reinspect) he acknowledged he missed some.” Silek then told the board that Atwood was requesting that the county provide an outside, impartial inspector to reinspect her home.
In addition to the five violations found after the occupancy certificate was issued, the appeals board identified seven additional violations and voted in Atwood’s favor, 4-1. George Cline was the dissenting vote; Dave Buracker recused himself from the proceedings because he and his wife, Martha Buracker, are the builders against whom Ms. Atwood has lodged the complaint.
Beahm said after the meeting that he believes the board’s decision was illegal because specific code sections were not cited in identifying the seven additional violations.
During a May 22 hearing, Silek outlined several other issues regarding the contractor, Martha Buracker:
A building permit application designating Buracker Construction LLC, which is an unlicensed entity, as the contractor. The state contractor’s license on that application, however, belonged to Buracker Construction. The building permit was issued to Buracker Construction. The contract for the job was between Kristie Atwood and Buracker Construction LLC.
Because Buracker Construction LLC was not licensed, the Department of Professional and Occupational Regulation (DPOR) has indicated that Atwood is ineligible for the recovery funding, which “provides relief to eligible consumers who have incurred losses through the improper and dishonest conduct of a licensed contractor or real estate professional,” according to the DPOR website.
Silek said that those funds, were Atwood be able to collect them, would be used to correct the violations found by the appeals board.
Appeals board members commented several times throughout the hearing that it is not within their purview to rule on any issues relating to the permit or the unlicensed contractor. Member Wendell Hatcher said, before making a motion to accept Atwood’s appeal request, “She is asking us to recognize Warren County’s errors in inspection; she has a valid complaint.”
Atwood said after the meeting she would consult with Silek before making a decision regarding her next step in resolving the issues with her home.
Council ponders Town Hall purchase options, downtown revitalization & cable franchise agreement
At its Monday, May 20 work session the Front Royal Town Council was briefed on progress with downtown revitalization related to its $700,000 matching State Community Development Block Grant (CDBG) funding; options in extending a first right to match a sales price on the old Town Hall building; and future goals including positive movement on initial enforcement options on a Property Maintenance Code and the status of continuing a lapsed cable franchise agreement with Comcast.
On that last front Town Manager Joe Waltz told council Comcast was holding fast to its plan to close its customer service center on the first block of North Royal Avenue – “They won’t give us any more relief on the customer service center,” Waltz said in response to a question about the Town’s desire to keep the center open to facilitate the amount of cash and face-to-face business done there locally.
Waltz also noted that the Town’s franchise agreement with Comcast was “dead” leaving options to negotiate with another provider. Coincidentally perhaps, a franchise agreement was on the agenda for a closed session at the end of the work session.
During discussion of progress on downtown revitalization with CDBG funding it was noted that parking statistics included in a report on downtown business indicated that available public parking downtown, other than during festival street closings, was virtually never above 70% of capacity.
After initial expressions of skepticism on extending the first right to match a purchase price on the old Town Hall, it was decided to inquire of owner Afton Inn LLC (former Afton Inn owner Frank Barros’s company) about that extension.
It was noted that while the current listed purchase price of $759,000 was higher than the Town would ever pay, that price could come down significantly in the future. Asked how much it would cost to pursue an extension of the Town’s first option right which expires in June, Town Attorney Doug Napier replied, “The cost of a postage stamp.”
That price was good enough to turn council around on at least an inquiry on the extension from the reclusive owner.
Councilwoman Letasha Thompson also asked her colleagues to resurrect discussion with the County about providing some building department support to initiate at least first stage Property Maintenance Code complaints on dilapidated or other structures.
See those work session discussions on the Royal Examiner video:
Council moves toward mayoral appointment at next meeting
Following a relatively brief, half-hour open meeting work session review of the status of Downtown Business District revitalization utilizing State Community Development Block Grant funding, the approaching expiration of a five-year option on exercising a first right of refusal on a sale of the old Town Hall building, and other goals the Front Royal Town Council adjourned to closed session on a variety of topics.
Prominent among topics discussed during the one-hour closed session were the potential awarding of a franchise agreement and council’s appointment of an interim mayor within the required 45 days to serve until a special election to fill out the term of resigned Mayor Hollis Tharpe is held.
In the wake of an April 15 grand jury indictment on solicitation of prostitution, Tharpe resigned effective May 2, while proclaiming his innocence and intention of fighting the charge in court.
The Town has petitioned the court to allow a special election to be held with the November County elections. The Town’s next election is not until November 2020. The court could order a special election prior to the next municipal election but with that election just over five months away chances are the Town request will be allowed and an appointed mayor will be allowed to serve until the next elected mayor is chosen by town citizens.
While no announcements were made following the May 20th closed session, Vice-Mayor William Sealock did address council’s plans on moving toward the mayoral appointment he has expressed no interest in. Sealock, who has chaired council meetings and work sessions since Tharpe’s resignation went into effect, said he prefers to remain vice mayor in order to retain his vote on all matters before council. The mayor only votes to break ties.
Sealock said that council approached six candidates, three of whom said they would accept the appointment if offered to them. Council will vote on selecting one of those final three candidates, who the vice mayor declined to name, at the next council meeting on Tuesday, May 28. Council’s second meeting of May is moved from Monday due to the Memorial Day holiday.
“I promised you May 28, and that’s when you’re going to get it,” Sealock said of the mayoral selection date.
Pressed by media present on clues as to who those final three candidates might be, Sealock laughed and said, “No, that’s why I erased the board,” the board being the white board on the wall next to him. As media closed on the board for residual clues, the vice mayor did a quick additional wipe down to assure no clues remained.
Sealock did, however, verify that none of the three remaining candidates were current council members. Asked if there were former council members or perhaps mayors on the list, Sealock deadpanned, “I can’t remember,” adding of former elected town officials, “Some were considered.”
Asked if he felt the vote on a new mayor would be unanimous or split, Sealock said he believed it could be a split vote.
And the drama continues.
Some conjecture “on the street” has placed Chris Morrison, who lost his council seat in last year’s election but has allies remaining on council, in the running. Some citizens informed this reporter they had seen sample ballots for mayor in 2018 with Morrison listed as a write-in candidate. Tharpe ran unopposed in 2018 and no mayoral write-in got more than 10% of the vote resulting in no specification of those write-ins by the Voter Registrar’s Office.
See the vice mayor’s conversation with reporters in the Royal Examiner video:
Massage parlor defense counsel cites ‘retaliation’ over targeting of Tharpe
In a weekend press release tied to defense motions filed on Friday, May 17, attorney David Downes alleges retaliatory police and prosecutorial actions against his client Cynthia Atkinson Bailey regarding the investigation into since-resigned Front Royal Mayor Hollis Tharpe. As reported in Royal Examiner’s related story on Bailey defense motions regarding charges of offering sexual services out of an unlicensed massage parlor, Tharpe announced his resignation as mayor effective May 2, on April 19, four days after a Warren County Grand Jury handed down a single count of solicitation of prostitution against him. See Related Story:
While Tharpe has maintained his innocence, he has admitted visiting the massage parlor operated by Bailey at 312 Biggs Drive. The 67-year-old Tharpe told this reporter he visited Biggs Drive for legitimate massages on his aging and aching body. However the criminal complaint attached to warrants against Cynthia Bailey and three other individuals filed May 15, 2019 allege massages of a sexual nature were a prominent part of the services “menu” being offered at the unlicensed massage parlor operating at the business address of Blue Valley Services.
Downes said he has never previously issued this type of public release regarding a client’s prosecution but felt it warranted from the circumstance surrounding Bailey’s initial 2018 prostitution charge, eventual non-prosecution of that charge and subsequent re-prosecution.
The indictment against Tharpe cites an incident believed to have occurred at the Biggs Drive massage parlor on May 31, 2018. Cynthia Atkinson Bailey was first arrested on a prostitution charge from an FRPD undercover operation. That operation occurred at 312 Biggs Drive on June 7, 2018, ending with Bailey’s arrest after a price of $150 was agreed upon for massage services including hand and oral sexual stimulation. That initial charge was “nol prossed” (non-prosecuted) by the Commonwealth on October 2, 2018.
In his press release on his client’s legal situation Downes points to an “unannounced” April 3, 2019, visit to Bailey by Front Royal Police Investigator David Fogle and Tharpe’s Winchester-based Special Prosecutor Heather Hovermale.
“Notwithstanding Ms. Bailey’s continued representation by another attorney on the subject matter she was questioned by the special prosecutor. Fogle and Hovermale were only interested in one suspect, the Mayor of Front Royal, Hollis L. Tharpe, and asked her questions only about him,” Downes writes.
Downes points to Tharpe’s grand jury indictment 12 days later, on April 15 adding, “On the same date, Special Prosecutor Hovermale was placed on written notice that Cynthia Bailey’s representation by counsel was continuing because she was still subject to prosecution for the underlying offense of prostitution. Hovermale was also advised that Bailey intended to exercise her Fifth Amendment privilege (not to self-incriminate) based on threats of multiple criminal charges.”
Those multiple criminal charges came a month later, May 15, when Cynthia Atkinson Bailey, Jesse Thomas Atkinson, Brandy Nicole Atkinson and Joshua Allan Stamper were charged on multiple counts related to the massage parlor operation’s alleged “bawdy house” or prostitution-related services. According to Downes, Jesse Atkinson, Brandy Atkinson and Joshua Stamper are his client’s son, daughter and son-in-law, respectively.
Blue Valley Services was originally licensed as a handyman/landscaping company by Jesse Atkinson at some point after Bailey’s late husband James P. Bailey III purchased 312 Biggs Drive in 2013. However according to the criminal complaint attached to warrants that license expired in 2017 leading to reports of an unlicensed massage parlor operating out of the Front Royal address.
In his concluding paragraph Bailey’s defense attorney asks “Anyone who has further information” against what he terms “retaliatory police prosecution or selective criminal charges” to contact either him or the Special Grand Jury commissioned on May 17, 2019, “to investigate the misconduct of the Warren County EDA.”
Tharpe is former EDA Executive Director Jennifer McDonald’s cousin. Under increased scrutiny by her board of directors as a result of a forensic audit of EDA finances begun in September 2018 McDonald resigned on December 20, 2018.
Asked at the time about Warren County Commonwealth’s Attorney Brian Madden’s August 30, 2018 recusal petition to the court regarding a criminal investigation in which he was named, then-Mayor Tharpe expressed frustration at the lack of information available to him about the nature of the investigation or how he was tied to it.
“It’s just baffling – I’m absolutely clueless,” Tharpe told Royal Examiner at the time, observing, “I haven’t had any dealing with the EDA and Jennifer McDonald – I don’t have any loans with the EDA,” in listing a variety of things he said he did NOT do that might attract police attention, including committing murder, writing bad checks, shoplifting or involvement with drugs. See Related Story:
Tharpe’s early September inclusion of McDonald and EDA business in that list came on the heels of Town Finance Director B. J. Wilson’s discovery of nine years of Town debt service overpayments to the EDA totaling over $291,000. Town officials met with McDonald and then-EDA Board Chairman Greg Drescher on August 23, 2018 about the discovery. Dresher resigned as chairman the following day; and the now three-quarters of a million dollar, eight-month-and-counting forensic audit of the EDA by Atlanta-based CPA Cherry Bekaert began the following month, in mid-September 2018.
Royal Examiner sought a response to Downes allegation of a “retaliatory prosecution” regarding his client’s intention not to testify in the Tharpe case from FRPD on Saturday, May 18, and from Special Prosecutor Hovermale on Monday, May 20. But as of publication of this story we had yet to receive those replies. This story will be updated and/or linked to those replies when available.
Town Planning Commission Meeting May 15, 2019: Dog kennel, daycare & new subdivision
At the May 15th Town of Front Royal Planning Commission meeting, one public hearing on a special use permit, submitted by Fianna Litvok, for a dog training facility, with a kennel, at 650 W. 11th Street, Ste A in Front Royal. The Commission also reviewed a preliminary plan application, submitted by Ramsey, Inc. for a 33 lot subdivision within the R-1 district.
The proposed dog training facility/dog kennel would be called Tip Top K9. It would offer obedience training for dogs. The applicant Fianna Litvok states that most training would be done off-site at the pet owner’s house or other location. However, there would be “doggie bootcamps” on-site. Commercial kennels are described as secondary and relate only to the “doggie bootcamps”, where pet owners would leave their dogs at the facility for 2-4 weeks. Litvok says initially hopes to be able to have 1-4 dogs housed at the site, but with a potential for up to 10 dogs. Click here to download complete application and photos.
Chris Ramsey of Ramsey, Inc submitted a preliminary plan for a 33 lot subdivision at the end of Ewall Street and and the end of Happy Ridge Drive to be called Happy Creek Knolls.
The daycare application was extended to the next Planning Commission meeting in June.
Jeremy Camp, Town Planning and Zoning Director gave his report to the Commission.
The Royal Examiner‘s camera was there:
Town of Front Royal Receives Certificate of Achievement for Excellence in Financial Reporting
The Certificate of Achievement for Excellence in Financial Reporting has been awarded to the Town of Front Royal by the Government Finance Officers Association of the United States and Canada (GFOA) for its Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30, 2018. The Certificate of Achievement is the highest form of recognition in the area of governmental accounting and financial reporting, and its attainment represents a significant accomplishment by a government and its management. The Town has received this award consecutively for 32 years.
An award of Financial Reporting Achievement has been awarded to the designated by the Town of Front Royal as primarily responsible for preparing the award-winning CAFR.
The CAFR has been judged by an impartial panel to meet the high standards of the program, which includes demonstrating a constructive “spirit of full disclosure” to clearly communicate its financial story and motivate potential users and user groups to read the CAFR.
Tran defense motions echo earlier filings, cite vague summary of allegations
On May 2, the attorney for ITFederal and its CEO Truc “Curt” Tran followed attorneys for the other seven defendants in the EDA civil suit of March 26 in filing defense motions attacking the style and substance of the case against their clients.
In the demurrer seeking dismissal of five of the six counts (1-4 and 6) in the EDA Civil Complaint it is asserted that the filing by attorney Cullen Seltzer of the Richmond law firm of Sand-Anderson lacks the legally-required specificity and factual basis to support its oft-stated conclusion that the defendants have acted to improperly divert EDA assets based “on information and belief”.
“And many of the Plaintiff’s allegations being made solely ‘on information and belief’ is fatal under the heightened pleading requirement for fraud,” Tran/ITFederal attorney Brandon H. Elledge writes citing case history, adding of such wording, “and thus to avoid dismissal, a fraud plaintiff must supplement such allegations with ‘a statement of facts on which the belief is founded’ and also ‘must delineate at least the nature and scope of plaintiff’s efforts to obtain, before filing the complaint, the information needed to plead with particularity’.”
As to the sixth count omitted from the Tran/ITFederal request for dismissal, Count 5 – “Breach of Fiduciary Duty of Loyalty” – the demurrer notes that it “does not purport to state a claim against Mr. Tran and ITFederal” but rather asserts actual claims “only against Defendant McDonald” – which does appear to be the case as it would impact all defendants other than McDonald. See Related Story:
“As an employee of the Warren EDA, Defendant McDonald owed the Warren EDA a fiduciary loyalty,” Count 5 begins in recounting the obligations of McDonald’s role as the executive director of the EDA.
And it is in the absence of the detail of the preceding 160 paragraphs leading to the $17.6 million-plus civil suit’s call for compensation in six counts against all nine defendants upon which defense attorneys have focused their arguments for dismissal.
The six counts seeking a judgment of “not less than $17,640,446.16” against “the Defendants jointly and severally” are: 1/ Fraud and Fraud in the Inducement; 2/ Conversion; 3/ Conspiracy; 4/ Unjust Enrichment; 5/ Breach of Fiduciary Duty of Loyalty; and 6/ Ultra Vires (improper) Transactions and Agreements.
And other than that one mention of the minimum of $17.6-million-and-change of allegedly misdirected or embezzled EDA assets there is no other reference to specific amounts of money tied to any defendant in the plaintiff presentation of the resultant civil “Counts” against those defendants. In fact, only “Defendant McDonald” and “Defendant Earthright Energy LLC” are cited in the six counts – McDonald in the aforementioned Count 5 “Breach of Fiduciary Loyalty” that does appear focused on her alone; and Earthright Energy LLC in Count 6 “Ultra Vires Transactions and Agreements” related to work arrangements or contracts engaged in with Earthright Energy through McDonald without approval of the EDA Board of Directors “in the manner required by law.”
However as alluded to above and noted in previous stories on the EDA complaint and defense motions against it, there is detail concerning specific amounts of money involved in specific transactions involving specific defendants throughout the first 160 paragraphs of the complaint. Those 160 graphs appear to present the basis of fact and finance leading to the final 39 paragraphs stating of the more generalized summary of offenses described in Counts 1 through 6 of the EDA civil suit. See Related Story:
However for Tran/ITFederal attorney Elledge that detail too, is lacking.
“While the Complaint is long on allegations as to McDonald’s misconduct, it offers very little as to Defendants … Tran … and ITFederal except for conclusory recitations or vague statements made only ‘on information and belief’,” Elledge asserts, adding, “Mr. Tran and ITFederal expressly deny the meritless claims asserted against them and any alleged wrongdoing in this matter.”
Of the summary nature of the stating of the Counts against the defendants, the Tran/ITFederal defense memorandum of support of the demurrer for dismissal states, “… the group pleading method employed by the Warren EDA in its Complaint is improper and fails to fairly inform Mr. Tran and ITFederal of the nature of the claims levied against them …”
However, is that true of the first 160 paragraphs of the 199-graph complaint – well 209-graphs if you include the 10 paragraph “Prayer for Relief” seeking return of EDA assets, attorneys fees and “punitive damages (of at least one million dollars) jointly and severally against the Defendants”?
The complaint devotes many paragraphs to the securing of a $10-million bank loan for Tran/ITFederal through the EDA, citing the involvement of McDonald and then-U.S. Congressman Robert Goodlatte, R-6th, along with Tran. It is noted that loan was made at Goodlatte’s request despite repeated assertions by “Tran and Defendant McDonald …that Tran did not need the financial support of the Town and Warren EDA”.
However that “unnecessary” $10 million dollars of financial support was acquired, along with the gift of a 30-acre parcel at the Royal Phoenix site publicly valued by the EDA at $2 million for a one dollar price. Conditions were attached to that gift, including completion of the project by an eventually extended completion date of mid-2020; and a reduction of the scope of the project from an approximate 40,000 s.f. in a three-building complex alleged by Goodlatte to produce over 600 high-paying tech jobs through ITFederal to the community, to a 10,000 square-foot building producing at least 10 jobs of indeterminate wage.
And while the complaint notes that far less than $10 million appears to have been spent to date on the ITFederal Project here, the Tran/ITFederal motion for dismissal asserts Tran did nothing wrong and has worked within the parameters of his agreement with the EDA, both on the loan and a Memorandum of Understanding (MOU) regarding nearly $1.5 million in what is described as “Subsequent Payments to ITFederal” alleged to have been unauthorized by the EDA.
Regarding the Count of “Conversion” of EDA assets to Tran’s personal benefit, Elledge writes on behalf of his clients, “The only Warren EDA funds allegedly retained by ITFederal are a $10 million loan pursuant to a promissory note and a deed of trust and some $1.5 million pursuant to a Memorandum of Understanding. Thus, ITFederal received those funds in accordance with such agreements. Plaintiff does not – and cannot – allege a breach of such agreements, and it, therefore, alleges no right to immediate possession of the funds. Rather, it lawfully controls them subject to the terms of the loan documents and the MOU …
“The only payments due to Plaintiff is the repayment terms of the promissory note, and it has not – and cannot – allege that ITFederal has breached or defaulted on any of its contractual obligations,” the Tran/ITFederal filing in support of its motion for dismissal states.
But at issue for the EDA as plaintiff is an alleged fraud perpetrated by Tran in conjunction with McDonald in her role as EDA executive director and possibly others, to acquire the loan, gift of property and “Subsequent Payments to ITFederal”. That fraud is alleged to involve a $140 million in purported ITFederal government contract the plaintiff found no evidence exists – though Elledge asserts it does – as well as websites said to create a false impression of financial viability of Tran companies the plaintiff asserts there is no discovered substantive support of, and false representations of Tran’s personal worth and intentions of investment in this community.
“Plaintiff does not allege any cohesive fraudulent scheme here, but rather a series of independent transactions connected only by the involvement of Defendant McDonald … In the portions of the Complaint referencing Mr. Tran and ITFederal, Plaintiff obscures who actually made what representations at issue by repeating the phrase ‘Tran and Defendant McDonald represented, through McDonald (emphasis in context) … Such vague construction fails to establish Mr. Tran’s connection to the alleged misrepresentations by omitting how Mr. Tran managed to represent anything ‘through McDonald’,” the Tran/ITF filing states, adding, “By lumping Mr. Tran together with Defendant McDonald and referencing ‘multiple occasions,’ Plaintiff unsuccessfully tries to create an impression of wrongdoing without articulating who made what statement to whom on which occasion.”
From a different angle, Tran/ITFederal attorney Elledge echoes Jennifer McDonald attorney Lee Berlik’s argument that his client is being villainized for the alleged actions of other defendants and/or bad decisions by past EDA boards.
“Plaintiff suggests every statement by every counterparty it now regrets crediting was a false statement by Ms. McDonald … instead of a false statement to Ms. McDonald (emphasis in context),” Berlik wrote in his April 16 filing on his client’s behalf, adding, “The Warren EDA is looking for someone to blame for every decision it now regrets since new leadership has taken over – and Ms. McDonald is it.”
From Tran’s legal perspective he has simply taken advantage of a series of sweetheart deals offered by the EDA Board of Directors at the urging of friends in high places, including Congressman Goodlatte and the EDA’s then executive director.
What could possibly be wrong with that?
At issue in the wake of the filing of the series of defense demurrers for dismissal of the cases against their clients is will that question in regard to all defendants ever be argued in front of a jury in a Warren County or any other courtroom?