Council schedules joint meeting with its EDA as it ponders the costs of FREDA’s continued existence

“To be or not to be” – that seems to be a Shakespearean question looming regarding the continued existence of the unilateral Front Royal Economic Development Authority (FREDA). At its work session of Tuesday, October 11, under the watchful eye of FREDA Board of Directors Vice-Chairman Mark Tapsak, the Front Royal Town Council discussed implications of a yet-to-be established FREDA budget, among other procedural issues. The staff agenda summary even noted the ability of towns to control development, including economic development, through zoning parameters and central utility extension decisions, without the assistance of an EDA.

Now Interim Town Manager Kathleen Leidich summarized the staff report on issues raised by council during August and September work sessions, leading to Tuesday’s October 11th discussion. Following that presentation and discussion, a joint meeting of council and the FREDA Board of Directors was tentatively set for Monday, October 17, at 7 p.m. at Town Hall.

As noted in the staff agenda summary of October 11:

“The Town, as enabled by the Code of Virginia and governed by the Town Code, has control of its land use, water, sewer, and electric utilities. As such, it has the means to guide community development, including economic development, within its boundaries.

“The Town’s ability to guide, control or encourage development within its boundaries is not reliant on the establishment of an economic development authority. In 2021, the Town began the process of establishing an economic development authority. As a result, the Front Royal Economic Development Authority was established and began meeting in January 2022.

“Current concerns with the Town’s EDA include:

• “Setup is incomplete – No Federal Tax ID established; accounts not set up
• “Differences between EDA Bylaws and Chapter 16 of the Town Code-Role of Executive Director not established or defined; staff support for meetings; Legal review
• “Staff Support – staff is currently providing support for six boards and commissions in addition to the EDA. This includes preparing agenda packets, advertisements, minutes, and video for each meeting, in addition to related work products generated by each board or commission.

“Recent events provide Council the opportunity to review its concerns and establish consensus regarding the Town’s Economic Development Authority.”

And finally, “Staff Recommendation: – Staff requests Town Council direction regarding the set up/support of the Town’s EDA.”

FREDA Vice-Chairman Mark Tapsak, seated top left in blue shirt, listens on Oct. 11 as council discusses operational issues surrounding the Town’s unilateral EDA created early this year. A joint Town Council-FREDA meeting is being called for Monday, Oct. 17, at Town Hall at 7 p.m. to discuss the ‘powers, duties, and limitations’ of FREDA moving forward.

Background

It might be noted that as reported by Royal Examiner in February 2021 (After year-and-a-half gap, town council catches up on EDA activity, in and out of town), after initial joint meetings targeting corrections to processes that allowed the FR-WC EDA financial scandal to fester between 2014/15 and 2018 “… over the objection of then Mayor Gene Tewalt, who unsuccessfully recommended a policy of cooperation and rebuilding with the EDA and County, as opposed to a litigious one supported by council and pushed forward through the office of the former interim mayor and interim town manager” council began moving toward the hostile civil litigation path. That path was chosen despite offers from then FR-WC EDA Executive Director Doug Parsons for “good-faith negotiations to see exactly who is owed what” related to what is said to have been the unauthorized movement of EDA, County, and Town assets by former EDA Executive Director Jennifer McDonald.

It is a path that continues to rack up contract attorney costs to the Damiani-Damiani law firm of Alexandria recommended to council by the former Interim Town Manager/Mayor as the Town sues the Front Royal-Warren County EDA and the County over disputed losses and liabilities. And with its launch of civil litigation claims the Town withdrew from participation in the re-building of the half-century-old joint municipal EDA. It is an EDA for which by mutual agreement in recent years the Town had no operational cost responsibilities for, only payment of its debt service for EDA-overseen Town projects like construction of the new police headquarters.

Back to the Future

Which brings us back to today as the current council ponders the cost of the economic development path it and its predecessors have chosen. Following Acting Town Manager Leidich’s summary of the above-cited issues, Councilwoman Letasha Thompson questioned the FREDA board’s awareness of council’s concerns moving forward. Leidich replied that FREDA Board Chairman Rick Novak had been informed of the scheduled discussion that evening, but was unavailable, leading to Vice-Chairman Tapsak’s presence.

Mayor Holloway then suggested a joint meeting with the FREDA board, “So we can all get together and discuss our options,” adding, “It took some time to set this up. I’d hate to just sort of do away with it.”

A council consensus was quickly reached and with turnaround time on advertising a Special Joint Meeting and scheduling availability “as soon as possible” as Councilman Gary Gillispie suggested, as noted above a tentative joint meeting date of Monday evening, October 17, at 7 p.m. at the Town Hall main meeting room was set.

Councilwoman Amber Morris cited past closed session council discussion of FREDA’s future, noting that the discussion was now a matter of open session, public record – “It’s out there,” she observed, adding, “The set-up of FREDA is incomplete, or wasn’t completed, and we began operating. FREDA pre-dates my time on council. I’m excited for them, I was excited for them and I think they’ll bring forward great opportunities to the community for economic development within the town – it’s been not developed for over a decade. All the development goes into the county,” Morris asserted of a perhaps perceived past economic development imbalance. However, whether such larger scale commercial or industrial development flowing outside established town limits reflects a developmental imbalance or a natural outcome of the relative availability of undeveloped stretches of somewhat isolated land, is certainly debatable. And one might note that the one 147-acre space earmarked for commercial economic redevelopment inside the town limits, the former Avtex, federal Superfund, Royal Phoenix Business Park, “Brownfield” site, is owned for that redevelopment by the FR-WC EDA, more commonly referenced as the WC EDA since the Town’s withdrawal from participation circa 2020/21.

Morris continued, reviewing above-cited staff concerns in the agenda summary including the lack of a federal tax ID and a lack of accounts being set up: “And the huge concern that applies to that is that we voted to allocate money to FREDA and a budget. We had discussions … We literally cannot fund them to let them run,” Morris said. She compared the situation to the initial experience with the joint Town-County Tourism Committee’s work to create a 501-C6 organization to run that promotional operation, of which she pointed out, “We hired them, then held them hostage” for some time as parameters and details were ironed out.

Morris also noted the Chapter 16 Town Code/FREDA Bylaw conflict with an Executive Director’s position not being established or defined. That despite recently terminated Town Manager Steven Hicks having been appointed by council to fill that EDA staff role prior to his August 8 departure.

It seems council and its new FREDA Board of Directors will have a lot to talk about on Monday in the hope of establishing a workable path forward with all necessary legal parameters and financing in place. Or upon further exploration of the numbers, might council choose as Mayor Holloway said, “to just sort of do away with it” and rely on “control of its land use, water, sewer, and electric utilities … as the means to guide community development, including economic development, within its boundaries.”

It might be noted that one of two topics on the agenda of a Closed Meeting at the work session’s conclusion was discussion with legal counsel regarding “the establishment, powers, duties and limitations of the Front Royal EDA, pursuant to §2.2-3711(A)(8) of the Code of Virginia” with the additional notation that “Council may take further action in open session.” No action was taken following the closed session. But that might not be the case this coming Monday. Stay tuned as this process moves forward. The other closed meeting topic was the status of the Town Manager, Town Attorney, and Council Clerk’s positions.

Planning Director Lauren Kopishke, standing upper right, addresses citizen feedback on the Comp Plan review. Below, closer look at White Board summary of Comprehensive Plan Review feedback utilized by Planning Director Kopishke during her update on citizen feedback on the Comp Plan update process.

The FREDA discussion begins at the 42:00-minute mark of the Town video, concluding at the 52:24 mark. See that, and other topics including staff updates on other key projects, including the Town Comprehensive Plan review; pending ordinance amendments including residential snow and ice removal on Town right of ways in front of those properties; Special Use Permitting requests; and Redundant North Corridor Water Line financing variables. As noted at the end of our related story on the vacant(?) council seat appointment of Skip Rogers, financial variables on that latter topic among others, has reduced the Town reserve funds to six budgetary months, just three months above the code-mandated three-month minimum. Also, at the outset of the Special Meeting preceding the work session, see council approve a Resolution committing to fund-sharing projects with VDOT, and granting signature authority on VDOT projects in town to Interim Town Manager Leidich.

Click here to watch the meeting.

Local military veterans advocate Skip Rogers edges out vet Joe McFadden for next year of McFadden’s vacated(?) council seat – But is that the story’s end?