EDA passes series of motions following 3-hour, virtual closed session

County Emergency vehicle in a nearly empty WCGC parking lot during the recent Emergency Management team meeting. Royal Examiner File Photos/Roger Bianchini

One day after the Warren County-Front Royal COVID-19 Coronavirus Emergency Management team held its first briefing available to the public live only by remote video link-up, the Town-County Economic Development Authority followed suit at its monthly meeting of Friday, March 27.

However, the EDA took additional steps on the pandemic response social distancing frontier and the enabling of live remote participation and viewing. Only EDA Executive Director Doug Parsons and Administrative Assistant Gretchen Henderson were at the EDA Kendrick Lane office where board meetings are normally held. The six EDA Board of Directors members, as well as media, public and county board representatives were all linked in remotely by home or office audio-video computer hook up.

Or as the meeting notice colorfully stated, “Due to the state and local state of emergency declarations, this meeting will be conducted virtually, as will all EDA board meetings until further notice during the emergency. The EDA sincerely welcomes public access to this unprecedented event. The EDA will be using the web conferencing platform Zoom”.
Access was also available by telephone link-up.

A tally of those connected virtually included two members of the public (Linda Allen, James Wolfe), one county board member (Oates), two media (Royal Examiner, NVD), three attorneys (Pandak, Seltzer, Seigel), the six EDA board members and two EDA staff – may be only a couple supervisors short of normal 8 a.m. in-house attendance.

After virtual meeting moderator and EDA Board Vice-Chairman Jeff Browne helped participants through their connections, the board adjourned to closed session to discuss four primary topics:

1 – legal advice on the “disposition of … 2 East Main Street/Afton Inn”;

2 – a prospective business or industry client at the 426 Baugh Drive warehouse;

3 – legal consultation on the Town of Front Royal’s civil litigation against the EDA and the EDA’s civil litigation against its former Executive Director Jennifer McDonald et al; and

4 – auditor contracts with Yount, Hyde & Barbour P.C. and RFO auditor services regarding small business loan debt collection.

Afton Inn ownership isn’t the only thing the FR Town Council and EDA Board of Directors aren’t seeing eye to eye on these days.

As noted above, three attorneys were involved in the meeting’s virtual hook up, the EDA’s contracted attorney Sharon Pandak and Sands Anderson attorneys Cullen Seltzer and Dan Siegel, the latter two who have been involved from the March 26, 2019 filing in the EDA’s now $21.3 million civil actions against McDonald and 14 co-defendants alleging embezzlement, fraud, and misdirection of EDA assets. Hired as independent EDA counsel in the wake of Dan Whitten’s resignation as County and EDA attorney, Pandak has been the EDA’s legal adviser in response to the Town’s now-amended $20-million-plus litigation against the EDA.

With that full plate of closed session business, the estimate of an hour behind virtual closed doors coming shortly after 8 a.m. fell about two hours short.

And while there were no announcements or motions regarding the two civil litigations or the now apparently disputed by the Town of Front Royal status of Afton Inn ownership, a series of resolutions and motions were approved by 6-0 votes prior to the meeting’s 11:10 a.m. adjournment.

However, as to the status of the Afton Inn, in the written monthly Asset Committee Report it is noted that “There is no public report on the Afton Inn status other than the Town of Front Royal has listed the Inn in their revised complaint in the Town of Front Royal vs. FR-WC EDA. This simply provides a new dynamic that we have to deal with in our continuing efforts to re-position this property. We continue to discuss the dynamics of this with 2 East Main (LLC, the proposed redeveloper of the property under contract with the EDA as current owner).”

The 2 E. Main St. LLC plans for Afton redevelopment have been halted by the EDA financial scandal and its monetary consequences, including the Town’s reluctance to pay an $8.4-million principal debt to the EDA on the construction of its new police headquarters.

Virtual Business
As for the series of approved motions and resolutions, they included:

1 – a resolution to return the $5,000 deposit of William Huck after the failure to close a contract with the EDA on the old Stokes Mart building at 506 East Main Street;

2 – a resolution to approve a contract on a backup offer to sell the 506 East Main building to an alternate buyer at a price of $190,000;

3 – a resolution to amend EDA bylaws to facilitate the electronic meetings during the COVID-19 Coronavirus state of emergency declarations;

4 – an amendment extending the deadline on the removal of the solar panels from the EDA Kendrick Lane Office Complex from the original April 30 date. The new deadline will be 30 days after the Governor of Virginia lifts the COVID-19 state of Emergency.

That contract with Sunshine Properties LLC will pay the EDA $40,500 for the two-building solar panel array originally installed during McDonald’s executive directorship in an arrangement with Earth Right Energy. McDonald, ERE and ERE principal Donnie Poe were all named as defendants in the EDA’s March 2019 civil litigation. Consequently, the plan for the provision of solar power to the EDA office complex went south with the filing of that litigation and other technical complications;

It appears the EDA will recoup over $40,000 of its solar panel installation costs upon the pending sale of those panels.

5 – a motion authorizing the reacquisition of the 3.5-acre Royal Lane parcel from the Cornerstone LLC branch of the Aikens Group at cost of $26,776.54. The difference in the EDA’s sale price of ten dollars to Cornerstone LLC reflects pre-construction work and planning services done by the Aikens Group for work it will not now be able to achieve after resolving the situation on the somewhat inexplicable late November 2018 EDA transfer of a property it paid $440,000 for. That price was agreed upon by the McDonald-led EDA board Chaired by Patty Wines after an initial $10 gift by McDonald’s relatives was negated by a missed tax rebate deadline.

Serving as EDA attorney on that sale in the wake of then EDA-attorney Dan Whitten’s recusal, Joe Silek Jr. said the deed of sale was sent to Cornerstone attorneys without a price on it. Then EDA Board Chairman Gray Blanton, who signed the deed of sale, said he only saw the signature page. At the time the sale situation became public in early 2019, the Winchester-based Cornerstone attorneys’ group never responded to three messages left seeking information on how the $10 purchase price was established.

While the Royal Lane parcel was intended for the development of a workforce housing apartment complex under EDA direction, Parsons told Royal Examiner after the Friday’s meeting adjournment that the EDA will likely seek to sell the parcel to the private sector for residential development, which as he has previously noted, is not a normal undertaking for EDA’s.

The $10, $445,000, $10, $26,776 ‘magical mystery tour’ of the Royal Ln. workforce housing parcel continues as property returns to EDA hands – for a while.

6 – a motion to amend the loan agreement with First Bank on a $3.59 million note covering several older projects to illustrate the County’s support of the EDA on the issue as it grapples with the aftermath of the financial scandal the above-referenced civil litigations revolve around;

7 – a motion on a monthly payment agreement on a rural business enterprise loan with Ontiveros;

And 8 – Due to the governor’s COVID-19 emergency declaration closing “non-essential” businesses, the EDA will offer rent/loan payment forbearance “to all clients in good standing”. The plan is to temporarily waive April payments and then offer quarter payments on a monthly basis until there is some resolution to the emergency declaration allowing businesses to reopen.

And so it goes on the Front Royal, Warren County Economic Development front as the retooled EDA Board of Directors, staff and County officials try to navigate the turbulent waters, increasingly stirred to a boiling point by the Town of Front Royal’s hostile litigious stance, amidst the COVID-19 pandemic emergency declarations wreaking havoc with small businesses across the town, county, commonwealth, and nation.

And ‘The Doors’ Jim Morrison thought ‘Strange Days’ were here in the late 1960’s. Jim, you wouldn’t believe the end of the second decade of the 21st century – we’re sure a lot of small business owners don’t. They are, indeed, ‘Riders on the Storm’ …