Following lead-off batter Gary Kushner in a nearly 90-minute first-inning that saw 27 people step to the plate, 22 of 24 addressing the Front Royal Town Council and interim town manager’s fastball approach to downsizing and outsourcing several governmental functions, a number of pointed statements, questions and inquiries were made (sorry for the baseball analogy, the Astro’s World Series cheating scandal has my attention).
Second speaker Marie McDaniel introduced herself as a new resident of a year, who has fallen in love with the community and its people. She noted she had volunteered at the Town Visitors Center to learn more about her new community, observing, “That special place and the people who work there and volunteer are amazing. They all have a passion for promoting Front Royal, even with threats of unemployment hanging over their heads.”
Citing already fired Community Development Director Felicia Hart, Tourism Director Tim Smith and staff, she added, “They make the (Visitors) Center the heart and soul of this town … Don’t lose it the way we seem to lose dogs, cats, goats …” drawing applause as she concluded.
Joanne Kearney, a second Visitors Center volunteer followed, noting she had not been solicited by anyone to speak on their or the Visitors Center’s behalf. Pointing to a previous effort to outsource tourism promotion that did not work out, Kearney cited the negative impact of lost control of a key marketing tool from outsourcing.
“The town is our product, and our mission at the (Visitors) Center is to support the success of every business and attraction. New management may have a different mission … How will the town’s interests be protected and what oversight will there be on how your money is being spent? … Mr. Tederick reportedly said the government is not agile and creative enough to manage tourism, but the department staff HAS displayed creativity and agility in new outreach and initiatives … Tourism is this town’s lifeblood. The council should be INCREASING support for the department, not handing it off to an unknown quantity.”
Kearney pointed to the experience of other communities, as well as Front Royal’s, in unsuccessful efforts to outsource the tourism function in concluding, “This outsourcing stands to do more harm than good and could cost much more than it hopes to save, as many other municipalities have learned. Why repeat a course that has already been found unsuccessful … Consider the long-term ramifications and potential losses. Please reject the outsourcing plan and keep the staff and operations of tourism with the town, for the sake of the town,” again drawing wide applause at her conclusion.
Not ‘agile’ enough?
Front Royal/Warren County Appalachian Trail Community Committee Co-Chair Susan Tschirhart repeated concerns expressed in a committee co-chair letter to the mayor and town council, that as she noted was also printed in the “Opinion” section of the Royal Examiner website, in the immediate aftermath of the announced terminations and plans to outsource the Town’s tourism function.
But on February 10 she elaborated on those concerns to the council’s and its staff’s face. In that eyeball to eyeball meeting, she also presented numbers that appeared to contradict Interim Town Manager Tederick’s stated “not agile enough” rationale for sweeping changes like outsourcing, immediate terminations, and potential future firings related to the Town’s tourism function. In opening, Tschirhart pointed to momentum the community has developed related to its “AT Community” designation and the importance of the Town and County’s interrelationship in tourism marketing – an effort illustrated by the Joint Town-County Tourism Advisory Board which also met last week, though apparently also without any foreknowledge or information about the Town’s planned and partially implemented course of action on tourism.
“Our town and county were jointly designated an official AT Community by the Appalachian Trail Conservancy in 2012. Our committee of volunteers raises awareness of and support for trail-friendly local business, land-use policies that protect the trail and its views, and hiking as a healthy outdoor activity. AT Community designation has directly resulted in five new businesses, including three on Main Street, all of which are thriving. At this time, we are proud to partner with 22 businesses and organizations that have sought and earned AT Community Supporter certification …
“Not only did tourism attract $151 million in visitor expenditures to Warren County in 2018, a 4.9% increase over 2017, but, according to the Virginia Tourism Corporation, it supported 1700 jobs, a combined payroll of $23 million, and contributed $3 million to local tax coffers … Last week, based on 210 reviews, our Visitor Center was ranked second only to Skyline Caverns as top attractions in Front Royal. Do you know how unusual it is for a visitor center to rank as an attraction?” Tschirhart asked, adding pointedly, “And we’re about to fire that entire staff and change a recipe that has been steadily generating increased revenue for each of the past five years.”
And of that Town tourism budget already appropriated for the current fiscal year that runs to June 30, well into the hiking and tourist season, Tschirhart observed, “We were also puzzled to learn that the tourism budget for marketing and advertising has been frozen. This is money already allocated to the current fiscal year and critical to generating business for 170 tourism-dependent businesses in the county who count on the Visitor Center and its marketing materials and services to generate income. Eighty-five percent of Front Royal’s tourism budget is covered by lodging fees, all collected from visitors to our area. The remaining 15% comes from Front Royal promotional merchandise sold at the Visitor Center. None of our tourism department’s salaries or expenses come out of our own taxpayer dollars. Why are we cutting the tourism budget just as the tourism season is about to begin?” Tschirhart asked.
She also suggested that council and the interim town manager’s course of action flies in the face of, not only the Town’s own past experience with outsourcing tourism, but other Valley communities who have learned their lessons and are moving in exactly the opposite direction from the one five elected and two appointed town citizens have chosen to move this Appalachian Trail Community in.
“Berryville and Round Hill were designated AT Communities last year. Luray, designated just after Front Royal is now working toward moving its under-performing tourism department out from under its Chamber (of Commerce). In all of the other counties, tourism is handled by town/county government, and none are privatized,” Tschirhart told the town’s elected and appointed officials.
“Virginia’s recreation economy is booming. Roanoke is now positioning itself to compete with Asheville, North Carolina as a site for outdoor manufacturing. Damascus just broke ground for the Trail’s newest trail center. Situated between Damascus and AT headquarters in Harper’s Ferry, Warren County hosts one of the most popular section hikes along the trail’s 500-mile stretch in Virginia … The average thru-hiker along the AT will spend $5500 during the course of their hike, and another $4000 on gear. According to a 2010 survey, they’ll spend an average of $153 per town visit, a figure that has no doubt increased over the last 10 years.
“So, why all this effort to engage the outdoor industry?” Tschirhart asked rhetorically, answering her own question by noting, “Because it’s a $362 billion dollar industry driven largely by hiking, camping, and rock climbing, all of which can be found in abundance here … Nationally, revenue generated by the outdoor industry exceeds even oil and gas.
“To mix metaphors, Front Royal should be riding that wave, not starving the golden goose,” Tschirhart said in closing.
Another council gamble?
According to one councilman, Gary Gillespie’s, remarks delivered later as a justification of council actions on a number of fronts, including legally with the EDA and budgetary from year to year, “We work for the taxpayers of Front Royal first and foremost. Again, it’s our job to fight and protect your money.”
The unanswered question remains – will reducing operational costs so they can say they made capital improvements, often long-delayed ones, without raising taxes in the coming fiscal year REALLY save this community money in the long term OR simply set the stage for a huge corresponding loss of revenue from a tourism industry crucial to both the Town and County’s economic futures?
It appears this Front Royal Town Council majority continues its propensity for gambling:
1 – on “promises” of lower interest rates versus facts regarding the availability of those rates on its police headquarters construction project;
2 – on soaring taxpayer-funded legal costs to fight over whether those broken verbal “promises” from a now-indicted former EDA official hold any legal weight in the conduct of municipal and economic development business;
3 – and now, on whether reducing the town government’s operational tax revenue needs is really a money saver for the Town and the community in the long term.
Roll the dice …
Doug Stanley reflects on 25-years in Warren County government
In a statement emailed to the media at 4:30 p.m. Wednesday afternoon, Stanley reflected on his time and career in Warren County.
“I have spent the past 25 years or half of my life serving the Front Royal-Warren County community, the last 20 as County Administrator. During that time, I have worked at the pleasure of the Warren County Board of Supervisors and appreciated the Board’s confidence, trust, and support over the years …
“I have been fortunate and blessed to work with an outstanding and professional staff of talented individuals who work hard to improve the quality of life of our citizens on a daily basis.
“Without a doubt, the past year has been the most difficult and challenging in my career. That said I believe we have made strides in bringing those responsible for the EDA embezzlement to justice and to recover what has been stolen as well as supporting the current EDA Board and staff to clean up the mess.
“To the community, I sincerely appreciate the opportunity to serve you over the past 25-plus years. Warren County has been able to strike a balance between economic growth and protecting the rural character, scenic vistas, and special places that we as a community treasure. I know in my heart that I leave Warren County a better community, a stronger more resilient community that is poised to continue to flourish in the coming years,” he concluded.
During that lengthy professional tenure here Stanley noted the challenges faced by the community regarding economic redevelopment after the closing of what was for decades beginning with World War II, one of, if not the county’s largest private-sector employer.
“Over this period I have had the fortune and honor to be part of significant improvements to this community in replacing the lost jobs and tax base of the former Avtex facility with over $500 million in industrial development and the creation of over 2,000 jobs in the Route 340/522 corridor. This does not include the $1 billion invested by Dominion in the new power plant. The County has been able to attract significant retail development to the corridor which provides our residents with shopping and dining opportunities while generating revenue to reduce the County’s reliance on real estate taxes.”
And he noted the variety of capital improvement projects taken on, of particular note with the county’s public school system.
“We have also made tremendous strides in addressing the capital facility needs of our community thanks to the vision and support of the various members of the Board of Supervisors through the construction of numerous school, community, parks and recreation, and public safety facilities.
“I am proud that we have been able to make all of these improvements and additions to our community while still maintaining one of the lowest real estate tax rates in the region.”
EDA Board Chair Ed Daley will replace Doug Stanley on interim basis at month’s end
Following a 2-1/2 hour closed session convened three minutes after opening Wednesday morning’s Special Meeting, the Warren County Board of Supervisors unanimously approved a “Separation Agreement” with County Administrator Doug Stanley and the appointment of current Economic Development Authority Board of Directors Chairman Ed Daley as interim county administrator effective August 3rd.
Daley, now retired, has 35 years’ experience in the municipal/city management field, including in Winchester; Dodge City, Kansas; Fairmont, West Virginia; Hopewell and Emporia, Virginia. He will be paid at a $70 per hour rate. Daley confirmed that he will resign his EDA board position at the end of the month with the hope of returning to it upon the end of his tenure as interim county administrator.
Following adjournment of the special meeting North River Supervisor Delores Oates, who made the motion on the Separation Agreement, explained that Stanley’s final day on the job he has held since April 1, 2000, will be July 31, 2020.
Board Chairman Walt Mabe said that a press release on the departure of the only county administrator Warren County has had this century would be forthcoming, along with a copy of the “Separation Agreement” about an hour-and-a-half following the 1:36 p.m. adjournment of the July 8 special meeting. The board was in open session for a total of six minutes, three on each side of the 150-minute closed session.
In the County press release Mabe states, “We appreciate Mr. Stanley’s service to the Warren County community over the past 25 years. He has many wonderful accomplishments that have helped make Warren County a great place to live, work, and visit. We wish him the best as he continues with the next step in his career.”
Over the past year and a half Stanley has been a target of criticism on social media and by a few citizens at county board meetings as a symbol of the “business as usual” governmental scenario some hold as a causal factor in the EDA financial scandal. Whether such criticism is factually based or largely opinion rooted in the length of Stanley’s tenure with the county government or interpersonal issues remains to be seen.
As the 11 a.m. meeting time approached at the Warren County Government Center, 14 county staffers from seven county departments with no business on the one-topic meeting agenda filled a number of seats in the back rows of the public seating area. One, past and Interim Social Services Director (as of July 9) Beth Reavis held an “I Support Doug Stanley” sign.
Perhaps that county staff presence led Board Chairman Mabe to open the meeting with a notice that any “outbursts or cheers or tears” would not be tolerated and that he would have the room cleared by the two Sheriff’s Office deputies present if such behavior occurred. As the motion was made to approve Stanley’s “separation” from County employment over 2-1/2 hours later those staffers all remained, observing silently.
Resigned or shown the door?
The press release from County Human Resources Director Jodi Saffelle issued at 2:53 p.m. is titled “Doug Stanley Has Resigned as County Administrator”
The press release begins stating, “Warren County Board of Supervisors Chairman Walt Mabe announced today that Douglas P. Stanley has tendered his resignation effective July 31, 2020. Mr. Stanley has been employed with the County since December 19, 1994, and has served as the County Administrator since April 1, 2000.”
However, in the Separation Agreement added to the release, it is noted in Points 1 and 2 that:
1 – Mr. Stanley, at the request of the Warren County Board of Supervisors, agrees to resign as County Administrator effective July 31, 2020.
2 – The County Agrees that Mr. Stanley’s resignation shall be considered an involuntary separation as that term is defined in Section 51.1-155.2 of the Code of Virginia.
That Virginia Code Section states that, “Such member may retire without the reduction in retirement allowance required by subdivisions A 2 and A 3 of § 51.1-155.2 upon attaining age 50”.
During the lengthy closed session, Stanley informed the media that his 51st birthday was the previous day, July 7, 2020. – Well happy birthday a day late, Doug, looks like you won’t lose any accumulated retirement from this “involuntary separation” resignation.
Stanley began his employment with the County as Zoning Administrator in December 1994. He became both planning director and county administrator on April 1, 1996, and 2000, respectively; serving in the dual role of county administrator/planning director until June 30, 2008, when Taryn Logan was named planning director.
Logan was one of the 14 employees, including several other department heads, present to hear Wednesday’s announcement without the need of a law enforcement escort out of the building. Other department heads spotted, masked and unmasked, were Fire Chief Richard Mabie, Parks & Recreation Director Dan Lenz, Building Code Official David Beahm, and Reavis on an interim basis at DSS, along with other staff including Deputy Emergency Management Director Rick Farrall, Joe Petty, Mike Berry, semi-retired Finance Director Carolyn Stimmel, among others, including Administrative Assistant Shelley Hayes filling in as deputy board clerk.
See events unfold in this Royal Examiner video:
Supervisors majority poised to fire County Administrator Doug Stanley
According to a Warren County Board of Supervisors Special Meeting Agenda circulated at 9:18 a.m. Wednesday morning, less than two hours before the meeting’s 11 a.m. starting time, County Administrator Doug Stanley will be terminated following a closed session this morning.
Following immediate adjournment to closed session, the first action item is “Employment of the County Administrator – Action Requested”.
That is followed by “Employment of Interim County Administrator and Interim Clerk”.
The county administrator also serves as board clerk. Emily Ciarrocchi is deputy clerk.
Following his mid, late-1990’s hiring as county planning director, Stanley was appointed county administrator, initially serving in both positions before the hiring of Taryn Logan to fill the planning director’s role. Stanley has served as county administrator for 20 years.
Stay tuned for a report on this morning’s board action as it unfolds in front of the Royal Examiner camera.
Future look of Front Royal’s Historic Downtown prime work session topic
In the wake of work session discussion Monday evening, July 6, the Front Royal Town Council reached a five-member consensus, Meza absent, to commit necessary funds from the Community Development Block Grant (CDBG) Program to proceed with construction of a Pavilion building in the Village Commons area anchored by the Town Gazebo and Visitors Center.
At issue is exactly where the money to fill what the staff summary update on the status of the CDBG Downtown revitalization project cited as a $150,000 funding gap will come from. It was noted that the existing CDBG budget has $130,000 committed to the pavilion/indoor restroom project.
The balance is likely to come from a combination of a minimally discussed “Streetscape” portion of the CDBG project, with additional funding coming out of unused portions of the Façade Grant program. Exactly how much surplus will be left out of the Façade Grant’s $325,000 remains a somewhat unknown variable.
While it was noted that only $13,395 has thus far been spent of that $325,000 façade grant total, staff and project consultants indicated that number is likely to start rising quickly as the 14 active downtown business participants begin submitting bid proposals for their façade improvements. One remotely connected consultant noted that some of those participating businesses have dual façades up for improvement. That variable is likely to bring the number of façade improvement applications close to the 21 or 22 businesses originally participating when funds were being allocated on the federal, state-enabled local economic revitalization grant funding.
Interim Town Manager Matt Tederick told the council that he thought the move to materials only bidding process from the original materials and labor, had saved that aspect of the project. Original bids including labor had come in unexpectedly high, threatening to tank that portion of the project.
Vice-Mayor Bill Sealock reminded his colleagues that a downtown pavilion catering to both tourists and local downtown visitors had been on the Town’s radar for 20 years – “I think we should make that our focus,” Sealock told his colleagues.
Mayor Gene Tewalt agreed, adding that the necessary funds should be located from somewhere within the project or Town assets “to show we’re doing what we’re supposed to be doing.”
Also discussed was a downtown “Mural” aspect of the CDBG revitalization tied to the “Façade” Program. Individual murals were estimated at individual costs of $25,000 to $40,000. Artistic themes, general standards, and qualifications of applicants were discussed.
Vice-Mayor Sealock recalled the downtown mural work of the late artist Patricia Windrow as a very positive, if now largely abandoned and painted over, part of downtown’s visual history.
While the future look of downtown and the Historic Downtown Center was a prime topic of Monday’s work session, there was no mention of the future of the Visitors Center operations and staff under the announced Tourism Marketing management of the recently contracted Norfolk LLC “Strategic Solutions by Tricia”. Currently, the Visitors Center continues to be open into FY-2021 with existing staff and management, though for how long no one involved directly seems to know. An online search of “Strategic Solutions by Tricia” indicated a past focus of the newly hired consultant in non-profits fundraising activities – but that is a topic for another day.
Watch the discussion of progress toward the revitalization of Front Royal’s Historic Downtown Business District, as well as other topics including debt service variables on the cost of the I&I (Infiltration & Inflow) Abatement infrastructure improvement to the Town’s stormwater and sewer system mandated by the state; upgrades and replacement of Front Royal Police Department equipment such as body-worn and in-car cameras, the 911 radio system and radio consoles; the coming Town-County Liaison Committee agenda; FRIBA’s (Front Royal Independent Business Alliance) request for the placement of the “LOVE” letters downtown; and an expiring planning commission term in this exclusive Royal Examiner video:
Tederick contract extended through council’s town manager search
At its special meeting of June 30th the Front Royal Town Council approved a new contract extending the service of Matt Tederick beyond his previous contract’s end of the fiscal year termination date. The new contract commencing July 1 is on a month to month basis and differs from Tederick’s previous contract in that it is with him as a person, rather than a business entity.
That adjustment led Councilman Jacob Meza to comment prior to the unanimous vote of approval. Meza observed that the previous contract’s structure which did not deduct taxes or include benefits “saved” the Town what he estimated at $50,000. The new contract is at the same monthly rate of $12,500 as Tederick’s previous contract, but notes that the $12,500 “shall be paid net of any applicable withholding or deductions required by Applicable laws and Authorities.”
Without deductions Tederick’s contract equated to $150,000 take-home pay annually. Despite the lost “savings” Meza said he would support the new contractual arrangement.
The new contract observes that Tederick’s tenure will continue “until such time as a new Town Manager is appointed” and the “new Town Manager assumes his/her duties … following a suitable and appropriate transition period for the new Town Manager to familiarize himself/herself with the position …”
As previously reported, council adjourned to closed session Tuesday evening for a “personnel” matter believed to be the first of two interviews of town manager candidates scheduled this week.
Tederick’s initial interim town manager appointment was approved by a 5-1 vote, Tewalt dissenting, in October 2019, effective November 9, the day after Joe Waltz’s resignation took effect. The October majority council vote to transition Tederick from interim mayor to interim town manager coincided with its vote, also 5-1 Tewalt dissenting, to hire the Damiani & Damiani law firm that shares an Alexandria business address with Tederick, to handle the Town’s civil litigation against the Town-County Economic Development Authority (EDA).
Perhaps ironically, Tuesday’s extension of Tederick’s contract coincided with council’s unanimous approval of a “Reservation of Rights Agreement” concerning its EDA litigation and claim of no liability to compensate the existing EDA for its financing of the Town’s new $9-million police headquarters.
Legal questions surround Town offer of one-time, recoverable FRPD payment
Without accepting any responsibility for the nearly $9-million cost of its new police headquarters building, at a hastily called Tuesday evening Special Meeting to accommodate the turn of the fiscal year today, Wednesday, July 1st, the Front Royal Town Council unanimously approved a “Reservation of Rights Agreement” allowing the Town to pay a portion of the first debt service payment of Fiscal Year 2021 on that Town/EDA capital improvement project. The project was completed in October 2018 and the Town has yet to compensate the EDA for any of its costs in financing the project as will be elaborated on below.
Also approved during the eight-minute meeting prior to an adjournment to closed session for personnel matters believed to be the first of two town managers interviews scheduled this week, was an extension past June 30, and alteration to the contract payment terms of Interim Town Manager Matt Tederick. That will be covered in a separate Royal Examiner story.
As to the Reservation of Rights Agreement with Warren County, the authorized one-time payment of $10,528.95 covers half of the Front Royal-Warren County Economic Development Authority’s interest-only payment of approximately $21,102 due at the July 1st start of FY-2021.
Contacted Wednesday morning, EDA Executive Director Doug Parson explained the EDA’s loan to facilitate construction of the Town Police headquarters have thus far been interest-only payments based on a 30-day month. That will change on November 1, when the United Bank loan moves to principal and interest payments. Parsons estimated that would take the monthly payments to about $50,000 from the $21,000 interest-only range.
The United Bank’s interest rate on the loan is 3%. However, the town council has taken the legal stance that it should only have to pay a 30-year, 1.5% interest rate it asserts was verbally promised to it by former EDA Executive Director Jennifer McDonald. As previously reported by Royal Examiner, that 1.5% rate was tied to the construction project qualifying for a 30-year New Market Tax Credit Program (NMTC) loan with a nine-year waiver of interest payments. However, the NMTC program loans are for municipal capital improvement projects that create new jobs, which the FRPD project did not.
Councilwoman Lori Athey Cockrell took the opportunity of council’s passage of the agreement facilitating a one-time, half monthly payment on the FRPD debt service as an indicator that the council and its staff are working proactively with the Warren County government to resolve outstanding legal and financial issues surrounding the EDA.
Prominent among those Town-County/EDA issues is what EDA officials have called “an undisputed” $8.4 million Town “moral obligation” debt on principal to the EDA on the police headquarters construction project. With interest, the balance on that debt is $8.8 million, EDA Director Parsons told Royal Examiner Wednesday.
EDA Board of Directors Chairman Ed Daley was present to watch Tuesday’s council action unfold. Asked for a reaction prior to having a chance to read the Reservation of Rights Agreement, Daley said, “Anything that moves it forward is positive.”
However, after a closer read, exactly how far forward Tuesday’s council action takes the Town-County-EDA discussion, remains a question.
$440,000 invoice – $10,500 (recoverable) payment
The opening paragraph of the Reservation of Rights Agreement notes that the Town had received a June 2 invoice “ostensibly setting out all costs incurred by the EDA in constructing and financing the construction of the Town of Front Royal Police Department (‘Costs’), including the costs and expenses associated with the loan from United Bank obtained to finance construction (‘Loan’)” and continues to note those costs and loan “are currently the subject of dispute” in the Town’s civil action against the EDA.
It is a civil action in which the Town’s contracted Damiani & Damiani law firm appears to have mirrored much of the language in the EDA’s initial civil litigation against Jennifer McDonald and 14 civil co-defendants and which seeks essentially all ($20 million-plus) of the $21.3 million the EDA alleges was misdirected by its former executive director and her first group of co-defendants. In April the EDA filed a second civil action, adding nine defendants and “not less than” $4.45 million in recoverable assets to its litigation.
But as to that June 2 invoice from the EDA, an invoice implying a request for payment on a debt, according to numbers in that invoice what the EDA presented to the Town was a bill for slightly over $441,300 spent thus far on the $8.8 million FRPD headquarters construction loan balance.
What the County and EDA got in response was the above-cited agreement facilitating a recoverable $10,529 payment that on a closer examination appears to try and legally tie the County and EDA’s hands in future court proceedings.
Legal ties that bind?
That agreement references ongoing “discussions” between the Town and County “which may result in amending the Town’s claims in the Litigation (against the EDA)”.
Contacted Wednesday, County Administrator Doug Stanley said county staff had not been involved in those discussions. Attempts to reach Board of Supervisors Chairman Walt Mabe, Vice-Chair Cheryl Cullers, and County Attorney Jason Ham for information on the referenced discussions and council proposal were unsuccessful prior to publication.
So, referencing the “Reservation of Rights Agreement” passed 6-0 by council Monday, it states:
“WHEREAS, to facilitate the discussions, the County has asked the Town to make the disputed July 1, 2020, payment on the Loan and the Town has agreed, subject to the terms and conditions stated herein.” – As noted above, what was agreed to was a payment of $10,528.95, or half of the interest-only payment due for July, under the following conditions:
Condition 1 – “The Town denies that it owes any moral or legal obligation to repay the Loan” followed by Condition 2, noting that its payment is calculated on the unrealized New Market Tax Credit interest rate of 1.5%, rather than the actual 3% bank loan interest rate.
Condition 3 – “The County and the EDA acknowledge that this payment shall not be construed as, considered to be, or argued to be, in any forum, admission for any purpose, including but not limited to of liability of the Town for the Loan or the Costs.
Condition 4 – “The County and the EDA acknowledge that the Town’s payment is for a disputed debt, under a reservation of rights, and the Town reserves the right to continue to deny liability for the Loan or Costs and to recoup this payment should the discussions prove ultimately unsuccessful.
And drum roll, please, Condition 5 – “All parties agree that payment hereunder shall be inadmissible for any purpose except by the Town to recover this payment as damages in the Litigation.”
So, while Councilwoman Cockrell called the agreement a sign of good faith negotiations in the public interest by the Town, adding that news reports the Town is acting other than in good faith concerning the EDA as creating “a false narrative”, is she right?
Perhaps the EDA’s and County’s attorneys would be the best judge of that – hopefully prior to the signing of the “Reservation of Rights Agreement” by County and EDA officials. For at issue appears to be whose rights are being reserved, and in exactly what legal context regarding the Town’s civil litigation against the EDA and any related litigation over the Town’s responsibility to pay for its $9-million police station.
Because according to the document approved unanimously Tuesday night by the Front Royal Town Council, the Town has no “moral or legal” obligation to pay the EDA-undertaken $8.8-million loan that financed the construction of the Front Royal Police headquarters.
Is that something EDA and Warren County officials really want to sign off on in exchange for a one-time, recoverable, half monthly debt service payment?
Let’s see, a total of $20 million or more at stake versus a “recoverable” $10,500 payment – what do you think?
We asked EDA Board Chairman Daley his opinion on Wednesday after he had a chance to review the Reservation of Rights documents more closely.
“The first the EDA heard of this was last night, which seems odd in that we are asked to sign off on it. But we’ll need to consult with our attorney first,” Daley reasoned.
Of the contention on a lack of Town liability to pay for its police station included in the document, Daley observed, “The EDA was happy to facilitate a project like that. But it was their (the Town’s) contract, their design, we just helped finance it. I think they need to get their financing together and pay for their police station.”
After we read the conditions in the agreement to her over the phone, EDA Attorney Sharon Pandak lauded the opportunity for further communications on Town-EDA/County issues but was skeptical as to a recommendation on the EDA signing off on the Reservation of Rights Agreement as worded.