FRONT ROYAL – Though criminal charges have not been filed against former EDA Executive Director Jennifer McDonald, it is likely they are on the way. Officials from the Town of Front Royal say they first learned of activity that will likely result in criminal charges on August 23, 2018 and notified Virginia State Police shortly thereafter.
Finance Director B.J. Wilson wrote in a Monday, April 8 email, “August 23, 2018 marks the day that the Town felt there was significant suspicion of misrepresentation and potential fraudulent activity regarding the EDA.
“On August 23, 2018 a meeting was held between the Town & EDA to discuss information previously presented to the Town and information requested by the Town from the EDA via a FOIA request. Those in attendance of this meeting were:
- Greg Drescher – At the time, EDA Chairman
- Jennifer McDonald – EDA Executive Director
- Dan Whitten – Legal Counsel for the EDA
- B.J. Wilson – Town of Front Royal Director of Finance
- Jeff Mitchell – Mitchell & Company P.C. (Auditor for Town of Front Royal)
- Joe Waltz – Town of Front Royal Town Manager
- Hollis Tharpe – Mayor of Front Royal
- Bill Sealock – Councilman for Front Royal
- Doug Napier – Town Attorney for Front Royal
Wilson went on to explain that several documents requested from McDonald and the EDA included:
- Avtex project joint funding agreement between the Town, County, and EDA
- Virginia Department of Transportation Performance Bond documents in the amount of $1.9 million paid to V-DOT
- Original amortization schedule from the EDA’s financial institution related to all Town debt owed to the EDA and breakdown of how the Town’s debt is incorporated into loans
Wilson said he requested the Avtex project joint agreement funding documents based on previous statements made by Jennifer McDonald that the EDA was billing the Town for expenses of the Avtex project, although the Avtex project was not listed on invoices received by the Town.
The Director of Finance said McDonald had previously represented to the Town that she had a copy of the agreement and would send a copy to the Town. Neither the Town of Front Royal nor Warren County had records of the agreement described by McDonald, which caused concern.
Wilson said that during that August 23, 2018 meeting McDonald acknowledged that she was unable to locate the Avtex project joint funding agreement and that charges for the Avtex project would not be billed to the Town.
Also regarding that meeting, Wilson wrote, “Mrs. McDonald previously represented to the Town that the EDA had paid a $1.9 million performance bond to V-DOT for Leach Run Parkway and was billing the Town for a portion of the $1.9 million. During the August 23, 2018 meeting, Mrs. McDonald acknowledged that this performance bond did not exist, and charges should not be billed to the Town.”
According to Wilson, the amortization schedules provided to the Town on August 23, 2018 were different than those previously provided to the Town by Jennifer McDonald. He said that based on the events of that meeting and the improper amortization schedules, it was determined that the EDA had not previously billed the Town correctly.
Wilson’s email continued that based on calculations sent to the Town by the EDA, it had “resulted in an over billing of approximately $291,000. This figure has yet to be confirmed and remains unknown at this time.”
When this reporter asked County Attorney Dan Whitten, on April 3, face-to-face at the EDA office on Kendrick Lane, exactly when the EDA Board had suspicions of misconduct or criminal activity, he replied “Early September. I think it was September 14 when we got the consultant. The date we notified law enforcement is privileged information.”
Later that day, Whitten clarified his earlier statement via email, “I wanted to clarify my statement earlier so it is in written format.
“The EDA Board had suspicions of misconduct in early September 2018, and on September 14, 2018, the EDA Board, through legal counsel, engaged Cherry Bekaert for internal review discovery services. It was not until Cherry Bekaert found clear evidence of criminal activity that the EDA had clear suspicion of criminal activity. At such point, the EDA, through outside consultants, did notify the Department of Justice. The exact date of such notification will remain confidential.”
This reporter replied to Whitten, “Thank you for the clarification.
“However, when you, Mr. Drescher, Ms. McDonald and some town employees had a sit-down meeting on Thursday, Aug. 23, 2018 and Ms. McDonald admitted that she had fraudulently billed the Town for a fake contract and for VDOT work that had never been performed–after which Drescher stepped down as chair the next day–shouldn’t you have had a pretty good idea that criminal activity had ALREADY OCCURRED?
“Why is the date on which the alleged crime reported confidential? Is the board not legally required to report at first suspicion of wrongdoing?”
Whitten replied back on April 4, “At the meeting, Jennifer did not admit that she billed the contract for a fake contract or VDOT work that was never performed. She admitted she overbilled the town by 291k which is not evidence of criminal conduct. We needed to further investigate.
After a presentation from our consultant which showed criminal conduct, we gave permission to the consultant to report to authorities.”
Asked to weigh in regarding the situation and its impact on the community, Town Attorney Doug Napier stated via email Wednesday morning, “Town Council and Town staff had been baffled, then grew increasingly suspicious, of what was being submitted to the Town’s Finance Director in response to his questions to the EDA’s Executive Director regarding the EDA’s billing of the Town, for several months prior to the Town’s August 23 face-to-face meeting with Mrs. McDonald—the EDA’s documentation and financial numbers regarding the Town simply did not make sense to the Finance Director or to the Town’s auditor.
“The August 23 meeting showed Town staff and the Town’s auditor that something was significantly illegally wrong with the EDA’s finances, to the point that it was obvious that law enforcement needed to be brought in. Town Council was advised ASAP of what had happened, and Town Council gave the green light immediately to turn the matter over to the Virginia State Police, which is what happened.”
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COVID-19 Emergency Management Team briefing number 3: Social Services Director outlines programs available to help traverse COVID-19 financial landscape
Warren County Department of Social Services Director DeAnna Cheatham was the featured speaker at the third weekly briefing of the Warren County-Town of Front Royal COVID-19 Pandemic Emergency Management Team. Cheatham offered crucial information on available programs, and their application processes, that can help people and families hit hard by the economic repercussions of the COVID-19 pandemic and response, with financial and material assistance.
Cheatham was accompanied by Michelle Smeltzer, who added detail on the extended life of WC-DSS’s thermal shelter program for the county’s homeless population, as well as a list of additional private sector, religious and non-profit programs providing crucial food and material assistance to those struggling to survive this strange new medical, governmental and social distancing reality we have been cast into for an as-yet-undetermined amount of time.
County Board and Joint Emergency Management Team Chairman Walter Mabe opened the meeting by repeating his call for county citizens to be aware of not only their family’s needs but the needs of their neighbors, particularly more vulnerable portions of the population including the elderly, infirm and non-mobile. It is those of our neighbors who may need a little neighborly assistance in accessing supplies or the programs described by Cheatham and Smeltzer that can provide those supplies
Also, during the Thursday afternoon briefing at the Warren County Government Center’s main meeting room, Front Royal Mayor Eugene Tewalt referenced that evening’s town council budget work session. Tewalt noted that one topic would be a projected $2-million budget shortfall. During a brief question and answer with the media near the briefing’s end, the mayor indicated that the referenced shortfall was in the current FY 2020 budget, as opposed to the FY 2021 budget council is now pondering potential future revenue shortfalls from the COVID-19 pandemic.
Prior to the meeting’s outset, County COVID-19 Emergency Manager Rick Farrall told this reporter, at an appropriate social distance, that the number of confirmed COVID-19 (Coronavirus Disease 2019) in Warren County had risen to nine, with the six-jurisdiction Lord Fairfax Health District the county is a part of now having 102 cases confirmed.
See the approximate 25-minute briefing, including important information on financial and food assistance programs available to county citizens through WC-DSS and other agency programs in this exclusive Royal Examiner video:
SCC extends utility disconnection suspensions following AG Herring’s request
RICHMOND (April 9, 2020) – Attorney General Mark R. Herring issued the below statement following the SCC’s announcement that they will extend their halt on disconnections by regulated utilities for the duration of the state of emergency. On Tuesday, Attorney General Herring asked the SCC to extend their freeze on disconnections through at least June 10th when the state of emergency is currently scheduled to end.
“I asked the SCC to extend their freeze on disconnections and suspend late fees because we are still in the middle of an emergency and it is incredibly important that all Virginians have access to electricity, gas, and water when we are asking them to stay home to prevent the spread of COVID19,” said Attorney General Herring. “No one should have to worry about having their utilities disconnected during this time of uncertainty, especially those Virginians who work hourly jobs and are more likely to be impacted by social distancing and business closures. This is good news for many Virginians and a really great decision by the SCC and I’m pleased I was able to help make it happen.”
Last month, the SCC halted utility disconnections for non-payment in response to Attorney General Herring’s emergency petition requesting a freeze on disconnections.
Board considers finances, departmental needs in midst of ongoing pandemic emergency response
The Warren County Board of Supervisors navigated its way through a variety of requests for approval of financial dispersals, some routine, some a consequence of the current COVID-19 pandemic and emergency response, and others somewhere in between.
At the in-between mark seemed to be Commonwealth’s Attorney John Bell’s request for approval of $37,064 for “case management software” that would help expedite his staff’s ability to deal with a variety of caseload responsibilities. Those include some anticipated from current pandemic response delays on court proceedings, increased staff working from home restrictions, and State Supreme Court-level changes to Discovery order responses he said would “increase drastically” prosecutors’ office workloads.
Bell said the software would allow his staff to “do in minutes, rather than the massive amounts of time it now takes” the background work that precedes courtroom appearances.
“Now once the judicial emergency is over, it’s going to fall on us like a ton of bricks,” Bell told the supervisors of the eventual end of COVID-19 slowdowns on the judicial process, adding, “and if we have the appropriate technology we can handle this much, much better than we would be able to do with our current system.”
While he admitted the software package was “not cheap”, he added that it wasn’t the most expensive of its type available either. And most encouragingly for a board facing still-unknown revenue consequences of the COVID-19 (Coronavirus Disease-2019) pandemic and emergency management response, Bell said he was fairly confident he would be able to cover the total expense of the software from State Comp Board revenues available to his office. He had already been able to transfer $10,000 from Comp Board funds and said he had received an indication that the remainder would be able to be transferred from his office’s “vacancy salaries” allotment.
So, what he was seeking from the supervisors Tuesday was authorization for the purchase to allow training on the new software to begin, in the full expectation that any County revenue utilized would be fully refunded.
On a motion by Archie Fox, seconded by Cheryl Cullers, the board unanimously approved the request.
Other budgetary requests came from the Department of Social Services in the amount of $12,000 to facilitate the continuation of the homeless thermal shelter program through the COVID-19 response; authorization of appropriation of an additional $534,370 in state funding county public schools were found eligible for – the money will be used for textbook purchases in the current budget, and approval of $57,628 to the Sheriff’s Office for an updated call/radio recorder for the 911 emergency communications call center. The current system was described as outdated to current emergency response needs.
All requests were unanimously approved on roll-call votes requested by the chair due to the remote link-up of two board members.
About that bug
As with the commonwealth attorney’s office funding request somewhere between COVID-19 response recommendations and elsewhere, seemed to be where the supervisors were as they fielded a three-person board quorum (Mabe, Cullers, Fox) in the caucus room adjacent to the Warren County Government Center’s (WCGC) main meeting room, with two members (Carter, Oates) present by phone hook-up. Also physically present were County Administrator Doug Stanley, Deputy County Administrator Bob Childress, and Board Clerk Emily Ciarrocchi.
Earlier in the week during a discussion of the advisability of media presence on Tuesday morning, April 7 meeting, County Attorney Jason Ham said his advice was that the minimum amount of people necessary to chair, present and broadcast the meeting be physically present for Tuesday’s meeting.
In fact, during his report to the board by remote connection, the Harrisonburg-based Ham reiterated the importance of social distancing and work at a distance as the nation, Virginia and localities approach what has been described by U.S. Surgeon General Jerome Adams as a “Pearl Harbor moment, our 9/11 moment” regarding a potential spike in the spread of the COVID-19 Coronavirus pandemic that recently surpassed a thousand fatalities a day in the U.S.
“Hello all, I’m sorry not to be here; but it’s the best thing, I think, for all of us in these difficult times,” Ham told his County colleagues before briefing them on federal legislation that could impact the county government and its employees were they to be impacted with COVID-19 symptoms. That includes up to two weeks of fully paid leave if employees contract symptoms or were diagnosed with COVID-19.
While not recommending its enactment at this point, Ham referenced a letter to the board concerning a state code section 15.2-1200 on the “General Power of Counties to Adopt Quarantine regulations”.
“I just want you to know all the tools you have in your toolbox to try to fight this,” Ham said, noting about 3,000 COVID-19 cases in Virginia, including another 1,000 in the D.C. area 70 miles to our east, which he noted pandemic-wise is “right in our backyard.” Thus far six cases of Warren County residents have been confirmed.
Ham observed that his legal firm had been split into two teams, “So one side never sees the other and we work from home on the other days. So, I encourage everyone to be safe, and will answer any question,” of which none were forthcoming.
The Supervisors adjourned to closed session at 10:45 a.m. to discuss the EDA’s $21.3-million civil litigation against Jennifer McDonald and 14 co-defendants, as well as the Town of Front Royal’s amended $20-million-plus civil litigation against the EDA, and the appointment of a replacement for resigned EDA Board of Directors member Mark Baker. No action was taken following the closed session.
Following that closed session’s adjournment at 12:45 p.m. and a 10-minute break, the board was led through a budget work session which adjourned at 1:37 p.m. Much of that 42-minute work session featured discussion of unknown variables on the County’s tax revenues due to the COVID-19 state and local emergency declarations and the unknown duration that restrictions on travel and business openings might continue.
County Administrator Stanley led the discussion and was joined by two former County Finance Directors, Carolyn Stimmel, who has been helping with the EDA’s preparation for its 2018 and 2019 audits, and her successor, now also employed elsewhere, Andre Fletcher.
With the budget public hearing scheduled for next week, the board reviewed the process by which the public may comment remotely. That process is to submit comments in advance of the 7 p.m., April 14 meeting to board Clerk Ciarrocchi. Further information is available on the County website or by calling the County Administration number.
Future of Town central water-sewer rates and fees put on table
At the first of two virtual work sessions of the week, staff led the Front Royal Town Council through a variety of topics ranging from:
1 – whether the Town has any liability for drainage-flooding issues in the Williamsburg Estates subdivision;
2 – what a consultant’s cost of service, the fee-and-rate study has recommended for the Town’s water-sewer utility’s future relationship to customers;
3 – the adjustment or waiving of some Town service fees;
4 – and how the Town may have “lucked out” as Councilman Gary Gillespie observed, regarding an initial $104,000 fine for violation of a Virginia Department of Environmental Quality (DEQ) Consent Order for improvements to infrastructure impacting the Town’s Wastewater Treatment Plant operations;
5 – not to mention an overview of the result of the “Envision” the future of downtown Village Commons/Gazebo area events, among several other items.
Of perhaps the broadest interest across the board for town citizens might be what coast-to-coast consultant Stantec has recommended on rates and fees to facilitate the Town’s ability to continue to provide and expand when necessary, its water-sewer utilities. That ability includes maintaining the operational water-sewer utility fund balance and reserves to continue to provide quality service to customers, both existing and new.
Whether those new customers should include out-of-town residential ones was a hot-button topic of debate last year as the Crooked Run 2 developers sought Town water-sewer, not for the commercial-industrial development the Town had previously agreed to without annexation for a community-wide commercial-industrial development/tax revenue benefit, but for residential development on county land outside the town limits.
Many existing in-town customers had a hard time with that pending expansion of the Town’s water-sewer utility responsibilities outside the town limits. And while Stantec representatives didn’t address the political side of that equation, the Town’s charging of double the in-town rate for water-sewer service outside the town limits as part of their three-pronged overview of rates and fees.
“Are they appropriate?” Stantec’s David Hyder asked rhetorically of the double out-of-town rate during a PowerPoint presentation. His company’s answer was “yes” – that the Town maintains its 100% surcharge, or double the in-town rate for out of town service. That recommendation was based on several industry-standard criteria revolving around cost differentials for the provision of that service.
In fact, Hyder noted that his company’s analysis including a number of customers, miles of pipe laid, debt incurred, assets involved in providing the service, and flow rates pointed to a 121.6% water surcharge and 108.2% sewer surcharge. However, given yearly fluctuations on a “weighted” basis, Stantec reasoned that maintaining the 100% surcharge appropriate.
Back in town
As for the in-town customers, there is an increase on the table over the next five years. That increase is a 2% hike to water rates annually and a 3.5% increase in sewer rates. That averages to just under 3%, at 2.9% combined. But don’t panic, the combined annual increase for the average user of 5,500 gallons monthly on a 3/4-inch line is about 65-cents for water and $1.90 for sewer, totaling a hike of just over $2.50 annually each year between FY-2021 and FY-2025.
Stantec also recommended a reduction in “system development charges” generally known as tap fees, to reflect actual costs of new connections. That decrease for water and sewer would be from $14,090 to $9,993 (from current $4,340 water to $2,663; and current $9,750 sewer to $7,330). In comparison to 12 other area jurisdictions, those suggested reductions would take Front Royal from fifth from the highest, behind only Manassas, Culpeper, Warrenton, and Manassas Park, to third from the lowest higher than only Woodstock and Waynesboro.
Hear Stantec principals David Hyder and Andrew Burnham’s detailed explanation of Stantec’s recommendations in this Royal Examiner recording of the work session, as well as other business before the council. More on the work session in forthcoming Royal Examiner stories.
Front Royal/Warren County urge community to signup for Smart911
From the Warren County Office of Emergency Management:
As Warren County and the Town of Front Royal prepare for and respond to the spread of COVID-19, public health and safety officials are strongly encouraging the community to sign up for the Smart911 national safety profile registry, a free service that allows individuals and families to provide critical medical information to 9-1-1 and first responders.
The County and Town are launching the “Take Control, Let Us Know” campaign to empower the community to take action and provide valuable and accurate health data that increases the awareness of 9-1-1, first responders, and Emergency Management to an individual’s risk level for Coronavirus. Members of our community are looking for ways to improve the safety of their families, friends, and neighbors as Coronavirus spreads. By signing up for Smart911, individuals can help first responders get the key information they need about every person who may need assistance, not only during this outbreak but during any emergency.
Individuals can create a Smart911 Safety Profile for their household at www.smart911.com or on a mobile device through the Smart911 app that provides critical medical information for those who may be at higher risk of developing a serious COVID-19 illness. As identified by the CDC, the vulnerable population includes older adults, and those with a history of chronic medical conditions like heart disease, diabetes, lung disease, respiratory conditions, and compromised immune systems. When an individual calls 9-1-1, his/her Smart911 Safety Profile is automatically displayed, allowing public safety agencies to send emergency response teams to the right location with enhanced medical data.
Individuals can additionally self-identify if they are under quarantine, and whether it is self-imposed or directed by a health professional. The Smart911 App allows quarantined individuals to receive check-in messages on their health status. Smart911 also allows individuals to sign up for alerts from Warren County and Town of Front Royal officials to receive reliable information about the ever-changing Coronavirus situation. Individuals who sign up will also receive tailored alerts based on their specific needs and geographic location. With enhanced Coronavirus awareness, individuals and first responders have vital information to take proper precautions.
“As Coronavirus continues to be a major public health concern, we are doing everything we can to prepare, respond, and mitigate risk to those in our community who need assistance,” said Richard Mabie, Warren County Coordinator of Emergency Services. “The information provided in a Smart911 Safety Profile enables us to know who is at the greatest risk in our community. We can provide individuals with critical updates based on their location and health history. Ultimately, Smart911 gives our community the chance to be proactive and lets us know who requires our services. We urge the residents of Warren County and the Town of Front Royal to Take Control, Let Us Know. Sign up for Smart911, and help us address the Coronavirus outbreak.”
To sign up, visit www.smart911.com or download the Smart911 app to your mobile device through the Apple Store or Google Play.
This is a rapidly changing situation, and the most current information is available on the following websites: www.cdc.gov/coronavirus or www.vdh.virginia.gov/coronavirus/. Please consult www.vdh.virginia.gov/coronavirus for the latest number of COVID-19 cases in Virginia.
Additionally, you can find local information on the Warren County COVID-19 website: https://www.warrencountyva.net/coronavirus-latest-information, the County of Warren, VA Facebook page, or the Town of Front Royal COVID-19 website: https://www.frontroyalva.com/645/Covid-19-Local-Response.
COVID-19 Emergency Management Team briefing number 2: Community, patience with restrictions, and expanded Schools free-lunch program
At the second of weekly briefings, the joint Warren County-Town of Front Royal COVID-19 pandemic Emergency Management Team was joined by Lord Fairfax Health District (LFHD) Director Dr. Colin Greene and Warren County Public Schools Acting Superintendent Melody Sheppard.
County Board and Management Team Chairman Walter Mabe opened the 3:30 p.m., Thursday afternoon, April 2nd roundtable discussion and question and answer media session with a brief review of public and personal health do’s and don’ts and online sources of information, as well as a call for a community response to the threat of the pandemic.
“The other thing we’re asking you to do is to help others. Not everybody that you know has access to the Internet … They are people who are your neighbors, they’re your friends and associates that may not have the Internet. They need to be spoken to … and told what they need to do, especially for just the simple things that we’re trying to do,” Mabe said of neighbors helping neighbors at a time when social distancing is a pandemic response key phrase.
But whether it’s at the suggested 6-foot face-to-face distance, or by phone, Mabe said we can maintain our sense of community through the pandemic response period, however long it may last.
And how long, among other medical and statistical variables, were among topics touched on by Dr. Greene. The doctor pointed out that the basic recommendations of frequent hand washing and other precautionary tactics will be worth keeping beyond the first wave of COVID-19 in the nation and localities across the Commonwealth of Virginia.
Dr. Greene said there have now been four confirmed COVID-19 cases among Warren County residents, though he added that they may not have all been identified by testing at Valley Health’s station at its Commerce Avenue site in Front Royal. He also said the number of confirmed cases in the six-municipality LFHD has risen to 43, with a nearly even split between men and women.
Most of that number has been between the ages of 40 and 70, with a spectrum from “under 20 to over 80”. Thus far, none of Virginia’s 41 fatalities have been in our health district that includes the City of Winchester, Clarke, Frederick, Warren, Shenandoah and Page Counties.
Dr. Greene declined to speculate on how many actual cases in the health district or commonwealth there may be. As the State Health Department website notes, only 17,589 of Virginia’s 8.62 million population have been tested.
He also updated national statistics, including about 225,000 confirmed cases and 5200 deaths in the U.S. – about a 2% fatality rate. It is a rate the mandated restrictions many states and cities are implementing are hoped to maintain or decrease from higher numbers seen elsewhere, including Europe. Greene noted death rates from 6% to 11% in Western Europe, with Italy holding that high number, followed by Spain’s 9% fatality rate. Only Germany at about 1.2% has a lower fatality rate among western European nations than the U.S. currently has, Greene said.
Free Lunch Program expanding
Following Dr. Greene’s question-and-answer with the media, Public School Acting Superintendent Sheppard traced the free lunch distribution program schedule, stops and times. The school system is expanding its free lunch program available to students under the age of 18, out into the community through the state-mandated school closings. She also explained that while the doors are closed to the County’s bricks and mortar educational sites, education continues through online and other methods to see the county’s students are not robbed of this school semester or year.
If you missed the live stream video, or even if you didn’t, see the full COVID-19 Emergency Management Team briefing in this Royal Examiner video – there is information included that you, and your neighbors, need to know: