Town Information Technology (IT) Director Todd Jones presented an outline of his credentials and ideas for development of a Town of Front Royal Communications policy at the Monday, November 18, Town Council work session at the Warren County Government Center.
The initiative of a communications director to oversee Council and Town staff interactions with the public on processes of Town services and other questions was brought forward by Matt Tederick during his Interim Mayor’s term. Now as Interim Town Manager, Tederick introduced Jones to brief council on his media and community background and ideas for development of a more effective communications strategy between Town officials and the public.
Jones traced past work with several cable companies and two television stations in promotions and production during which time he worked on “thousands and thousands and thousands of television commercials”. He also cited his 34 years in the community and marriage to a local girl “born in Warren Memorial Hospital” – something that future generations may not be able to say for some time after the Town, County and EDA approved a $60-million dollar bond issue for a new Valley Health hospital in town without a Maternity Ward – and a desire to assist in helping “the community heal a little bit” in the wake of public outrage surrounding the $21.3 million dollar Front Royal-Warren County Economic Development Authority financial scandal.
“So, I’m really excited about the opportunity to … help the Town communicate with its citizens, and really let the citizens have a better communications level with the Town Council and the Town staff,” Jones said in prefacing his outline of a communications plan.
Jones described a four-pronged approach addressing 1/ dialogue with citizens, including utilization of social media accounts – though not in a combative manner with any social media outlet communications that might be thrown the Town’s way Jones explained in response to a question; 2/ communications with the press featuring pre-submitted questions to Town officials; 3/ implementation of regular “Town Hall meetings” in which the public can engage in direct back and forth with Town officials, including department heads; and 4/ a 90-day review process between the communications officer, council, mayor and town manager on what is working and not working in the process.
About Number 2
On press row the immediate reaction was that pre-submitted questions, particularly to the Town’s elected officials, by the media would definitely not work, and would in fact be counterproductive to a number of crucial aspects of the press’s role in covering governmental affairs. Those aspects include acquiring elaboration on the thought process of individual council members and the mayor in presenting or rejecting policy initiatives and rationales for those policy and voting decision; as well as establishing that individual elected officials are doing their homework in reviewing staff agenda item summaries of the issues before them.
Contacted the following day about that aspect of his presentation, Jones said his goal in the pre-submitted media question aspect of his communications plan summary was “not to be restrictive” but rather to see that the Town was “speaking with a single voice, rather than hundreds of voices”.
When it was suggested that such a policy might be justified in communicating established departmental policies regarding Town services and the process of those services to the public, but not in media questioning of seven elected officials who often approach policy initiatives from different perspectives for differing reasons, Jones admitted, “There not the same thing, you’re right.”
He added that the developmental process of overall improved communications between the Town and the public was “all in the early stages – we’ll see how it ends up”.
And Jones stressed again that the goal was to improve the Town’s communications line with its citizens and make those citizens aware that the Town government is there for them; and to clarify how they can get answers to questions that impact their daily lives as residents of the Town of Front Royal – “to build a bridge between the people and the Town,” he said by phone Tuesday afternoon.
Just don’t let it end up like that John Lennon song “Walls and Bridges” from the media perspective, Todd, and we’ll be good.
As for the bridge of regular “Town Hall Meetings” during which citizens could get direct information from department heads on services, as well as council on issues, Jones suggested every 90 days.
However Mayor-Elect Gene Tewalt, who was chairing the work session in the temporary absence of Vice-Mayor Bill Sealock, suggested holding the Town Hall’s on a monthly basis after the turn of the year.
Jones suggested that another aspect of a Communications or Public Information Office or Officer would be to “coordinate with law enforcement on mass casualty drills and things like that … to make sure that the Town is aware of how to do that, so that you as council members know how to handle those types of things to prepare you for those types of mass casualty events and make sure the information gets out to the public accordingly”.
After the presentation Interim Town Manager Tederick added some comments on how he envisions the process proceeding.
“Just so I can lay out my vision as to how we are going to crawl, walk, run with this, we’re still trying to develop the system and the processees … of a public information office. I’d like for Todd to spearhead it, develop this as we go. It’s going to take several months of getting it up and running.
“And my idea is not to necessarily to make it a permanent position in our budget because I want to make sure if a new town manager comes in and then he gets his opportunity to flush it out and determine whether we want to make it a position, or maybe we want officers, that’s still an option as well,” Tederick told council.
See the entire discussion about the future of the Town of Front Royal’s communications with its citizens and the media in this exclusive Royal Examiner video:
Warren County Board of Zoning Appeals Meeting – December 5, 2019
At the December 5th Warren County Board of Zoning Appeals Meeting, a public hearing was held on a request from Franklin and Sherry Barb, for a variance to Warren County Code 180-23(I)(1) to allow a forty (40) foot front yard setback for an accessory structure in lieu of the required fifty (50) foot setback. A ten (10) foot variance was sought. Variance was approved.
Watch the meeting here on this exclusive Royal Examiner video:
Local resident warns School Board; extra special ed teacher approved
FRONT ROYAL — Local resident James Harper asked Warren County School Board members during their December 4 meeting to reconsider policy that prohibits them from responding to citizens who make public comments at regular meetings.
“Miss Bower,” said Harper, referring to School Board Chairwoman Catherine Bower, “it is my hope that you’ll change your opening statement and have a dialogue or discussion with folks who take the time to appear instead of saying, ‘Members will not comment.’”
Prior to each community participation portion of every School Board meeting, the chair reads a statement that says: “Community Participation is a time intended for the public to give input on relevant school issues and not intended to be a question and answer period as this may be the first time the Board has heard this information. Please do not expect individual responses or any comment by the Board at this time but be assured that any concerns will be reviewed. Please print your name on the sheet at the podium, state your name and address, and limit your comments to three minutes.”
Following that longstanding criteria, the School Board members did not respond to Harper’s request.
Nevertheless, the Rockland Road resident continued with a few more comments.
For example, Harper said he plans to ask the Warren County Board of Supervisors to take control of spending for Warren County Public Schools (WCPS) or to, at the least, sign off on it.
“In my opinion, your spending needs oversight,” Harper told School Board members. “I’m still flabbergasted that this board paid someone a $12,000 cost-of-living raise and paid this person for another six months when he resigns.”
Harper was referring to outgoing WCPS Superintendent Greg Drescher, who resigned in September citing his wife’s illness as part of the reason for deciding to leave early.
In October, the School Board placed Drescher, who pulls down a six-figure salary at WCPS, on paid administrative leave following a now-rescinded indictment related to the Front Royal-Warren County Economic Development Authority (EDA) financial scandal. Drescher had served on the EDA Board of Directors for 12 years — five while also serving as superintendent of schools — and resigned in August 2018 as the EDA board’s chairman.
Since the School Board’s October decision, the paid-administrative-leave designation has allowed Drescher to collect his regular paychecks until year’s end despite not having to conduct WCPS superintendent duties.
“I challenge you to find one other person in Warren County who got that deal,” Harper said.
Also in October, the School Board approved additional funds totaling $3,250 a month in extra stipends to cover the superintendent position Drescher vacated. The stipends will be paid to three WCPS employees until a new superintendent is hired next year.
Harper, who is not a stranger to School Board members and regularly comments during community participation segments of their meetings, also questioned Drescher’s compensation, which is set by the School Board.
It’s a question that Harper also asked earlier this year of Bower when he wondered why Drescher’s salary wasn’t comparable with those of other superintendents in the area. Bower had responded that the School Board didn’t collect such data.
“I was shocked and wondered how you decide how much to pay someone,” Harper recalled on Wednesday.
“Just so you know,” he added, “Warren County paid Greg Drescher $45,000 more than the superintendent of Shenandoah County schools,” which Harper said has more schools, a larger student population, and where the superintendent has a PhD.
The School Board must have thought it was a good idea to give Drescher a $12,000 cost-of-living raise coupled with approval for paid administrative leave “at taxpayers’ expense” after he resigned, said Harper, noting that the board “must think this County has unlimited money to spend.”
Harper also suggested that if the School Board instead had used both the $12,000 and the $45,000, it could have given $1,000 raises to some 40 WCPS teachers. “That’s just a thought off the top of my head,” he said.
Another community participant who spoke at the School Board’s December 4 meeting was Phillip Hong, the sexual assault prevention specialist for the Winchester, Va.-based Laurel Center, who presented an opportunity to work cooperatively with WCPS on prevention programming to reduce violence and empower youth resilience.
Hong cited a report showing an uptick in Warren County sexual assault reporting during this year. “Any number, regardless of what it is, is something we hope to reduce,” he said.
The Laurel Center provides numerous free workshops and classes, including Teenage Prevention Programming that is school- and group-based, said Hong.
Likewise, the center’s Sexual Violence Prevention Program is free and confidential for residents in Warren County, Frederick County, Winchester City, and Clarke County, and includes multiple school-based prevention programs designed for middle and high school students.
In other presentations — including resolutions recognizing the service of retiring School Board members Donna McEathron and C. Douglas Rosen, as well as Drescher — the board also heard from Warren County Administrator Doug Stanley, who as president of the Warren County Educational Endowment announced the group’s award of 10 grants totaling $44,411.74 to several local projects throughout the WCPS system.
Additionally, the School Board voted on several items during its action agenda portion of the meeting.
For instance, board members unanimously approved an additional Early Childhood Special Education (ECSE) teacher for the current school year at an estimated cost of $65,423 in salary and benefits.
“As our preschool programs … increase in numbers, the need for an additional ECSE is evident,” WCPS Director of Special Services Michael Hirsch told School Board members. “This additional resource will also allow our Family Engagement coordinator to lighten her caseload and expand family engagement activities.”
According to a report that Hirsch also submitted to the board, the additional teacher will be utilized as a resource teacher to students with disabilities in both classroom and community settings throughout the ECSE programs during morning hours and will provide classroom-based services to newly eligible students in the afternoon in the preschool classroom at Skyline High School.
The high school’s classroom does not currently have students there in the afternoon, so utilizing that space will alleviate the addition of a new physical classroom, according to Hirsch’s report.
Warren County School Board members present and voting at the December 4 meeting included Chairwoman Catherine Bower; Vice Chairman C. Douglas Rosen; and members Donna McEathron, James Wells, and Arnold Williams Jr.
Watch the entire Warren County School Board meeting in the exclusive Royal Examiner video:
Tederick addresses Financial Disclosure submission and tie to law firm hired in Town’s EDA lawsuit
In a December 2nd telephone interview Interim Front Royal Town Manager Matt Tederick dismissed questions about seeming gaps in his State-required “Virginia Conflict of Interest and Ethics Advisory Council STATE AND LOCAL STATEMENT OF ECONOMIC INTERESTS” form submitted to the Town for his Interim Mayor’s appointment as the work of political enemies.
“I’m a political figure and politics is what it is … and political enemies will get their pound of flesh. I’m used to it,” Tederick said of increased public scrutiny of his business interests during his tenure as, first Interim Mayor and now Interim Town Manager. Much of that scrutiny has come in two Letters to the Editor of Royal Examiner by Simon Mays.
The former Warren County supervisor and long-time county Republican Committee chairman said his perception of those letters published under the titles “Words Do Matter” and “Matthew Tederick’s Peyton Places”, the latter a reference to the 100 Peyton Street Front Royal address of some businesses with apparent Tederick ties, as an attempt to drag him or those businesses entities “into the EDA thing”. Tederick explained some of those business ties as simply being the landlord and picking up mail for absent tenants, leading to some “Registered Agent” designations.
We told Tederick we didn’t read Mays’ letters as an attempt to tie anyone, including him, to the EDA financial scandal, but rather as a call for an over-abundance of care in both public statements and due diligence regarding such financial disclosure filings by any municipal official at this point in time while public mistrust of municipal leadership is at such a peak due to the EDA financial scandal.
Of the appearance of David Damiani of the Damiani & Damiani law firm as the Registered Agent of not only the Alexandria law firm bearing his family name, but for 1839 Capital LLC which lists Tederick as “President”, Tederick said that if not in his financial disclosure and conflict of interest statement where 1839 Capital is not listed, the connection – in addition to Damiani’s Registered Agent designation the two companies share the same 604 Cameron Street address in Alexandria – was extensively discussed with the Town Attorney and Council as the law firm was considered to help represent the Town in its civil suit against the EDA.
On November 25, Damiani & Damiani PC was approved by Council for up to $200,000 in legal fees related to the Town’s civil suit against the EDA. In fact, Tederick said that while still serving as Interim Mayor in October, he recalled handing the mayor’s gavel over to Vice Mayor Bill Sealock when the hiring of Damiani & Damiani was discussed.
As for 1839 Capital’s exclusion from his financial disclosure form, Tederick explained that as a new start-up company – its website indicates an “active” SEC filing process stretching from May 17 to August 9 while Tederick was emerging as a candidate for, and then serving as Interim Front Royal Mayor – the company has yet to generate any income. That lack of income precluded the company needing to be added to Tederick’s State financial disclosure and conflict of interest form, he said in the December 2 phone interview.
In fact, Tederick said he contacted the State’s Ethics and Advisory Council to help in his preparation of the financial disclosure and conflict of interest form. He cited Ethics Committee staffer Stuart Petoe as the person who helped “walk me through” that preparation – “I’ve disclosed everything I get income from,” Tederick said.
And Tederick added that he had conversations with Town Attorney Doug Napier regarding the potential hiring of Damiani & Damiani to assist in the Town civil action against the EDA. In fact, Tederick said he had asked David Damiani, whom he had recently met, if he could recommend a law firm that was experienced in handling civil municipal litigation as the Town was looking for such a company regarding its EDA civil suit.
“You don’t know what we do,” was Damiani’s reply Tederick said. Damiani then informed Tederick of the company’s background in “class action lawsuits for and against municipal entities”.
Tederick took that information to Town Attorney Napier, who participated in the vetting process and agreed that Damiani & Damiani “was absolutely the right law firm” to assist in the Town’s civil case against the EDA seeking recovery of an as-yet-to-be-determined amount of Town financial assets.
Tederick said he was able to negotiate a favorable rate with Damiani & Damiani related to travel expenses because one of its members had moved out this way.
As reported in our story “Town skirts EDA request for FRPD construction back payments”, up to $200,000 in legal expenses was authorized for payment to Damiani & Damiani in one of three November 25th motions related to the Town litigation against the EDA. In addition to the $200,000 in legal expenses, council authorized $45,000 to Mitchell & Company PC for “auditing services to support litigation in the Town’s civil lawsuit against …the EDA”.
In a third motion council authorized a budget amendment transferring $282,000 in scheduled debt service payments to the EDA to cover legal and auditing expenses in its EDA civil action. Contacted later in the week, Town Finance Director B. J. Wilson confirmed that those transfers do relate to the Town debt service overpayments he discovered in the spring of 2018. It was that discovery and a subsequent August 23 confrontation between Town staff and auditors and then EDA Executive Director Jennifer McDonald and then EDA Board Chairman Greg Drescher that began the dominoes of the EDA financial scandal tumbling into motion.
All motions were approved by 5-0 votes with now Mayor Tewalt’s council seat vacant.
Front Royal poised to lobby for State Code change to allow 2nd EDA
Despite unresolved legal complications the Front Royal Town Council plans to move forward with approval of a Resolution seeking State General Assembly authority to create its own Economic Development Authority (EDA) despite the continued existence of the EDA it co-created with Warren County in the mid-1960’s.
“I’m all for it,” Gary Gillespie exuded after a five-minute work session briefing by Town Attorney Doug Napier Monday night, December 2.
“I agree with you,” Gillespie’s council colleague Letasha Thompson added, with no opposition opinion being expressed.
Mayor Gene Tewalt then instructed staff to include a vote on the Resolution at the next scheduled meeting agenda, Monday, December 9. That is council’s only meeting of December’s holiday season.
However, what appears to be council’s preferred path of distance from the existing EDA and creation of its own alternate Economic Development Authority may not be such an easy task, with or without the legislative sponsorship Interim Town Manager Matt Tederick says he has been promised, without citing a name.
Existing State Code 15.2-4905 forbids the creation of a second EDA or IDA (Industrial Development Authority) in a locality without the concurrence of “the governing body of such locality” to the “inducement resolution” of the second EDA or IDA. The fact that the Town and County co-created the existing EDA could present a legal hurdle to the Town’s planned move away from the now largely retooled EDA Board and totally revamped Executive staff.
The work session agenda summary prepared by the Town Attorney notes that, “The Town no longer appoints any of the members of the Board of Directors of the existing EDA (an apparent voluntary abdication of appointment authority), nor does it fund the existing EDA” (an operational funding consequence of County compensation to the Town for its 1998 agreement to extend Town central water-sewer into the County North Corridor without annexation).
The legal staff summary continues, “However, under current State Code, even if the Town rescinds its EDA creation ordinance, because the existing EDA was jointly created by the Town with the County, the Town will be unable to create a separate Town EDA which can finance facilities outside the Town, unless the County concurs with this financing by a Board of Supervisors’ resolution.”
But that isn’t all, as Town Attorney Napier points out in his agenda summary of the Town’s options.
“In fact, as the next paragraph will show, there may well be an argument that as long as there are outstanding EDA bonds whether the Town can even rescind its ordinance co-creating the existing EDA at all, in which case the Town would not even be able to create a separate Town EDA which could fund Town EDA facilities in Town,” Napier wrote.
The referenced legislative code paragraph cites the potential of an EDA Board of Directors stating its mission accomplished, with all debts paid, leading to its own initiative to dissolve itself. At that point, “the title to all funds and properties owned by the authority at the time of such dissolution shall vest in the locality creating the authority and possession of such funds and properties shall forthwith be delivered to such locality.” (bold in agenda text context)
Of this language Napier writes, “A strong argument can be made that until all the debts and bonds of the existing EDA are paid, the existing EDA must remain in existence. Additionally, even if the Town could rescind its ordinance which created its part of the existing EDA, would the Town wish to give up its rights to its legal one-half of the EDA property and other assets? … That potentially could be a lot for the Town to consider walking away from.”
Prior to the mayor’s polling of council on a preferred course of action, Jacob Meza asked Town Attorney Napier if proceeding with his suggested effort to alter State law to allow the Town of Front Royal alone to create a second, functioning EDA within the community wouldn’t produce the same complication in giving up the Town’s claim on half of the existing EDA’s assets.
When Napier responded that it would not, Meza began the expression of support for the town attorney’s recommended option on a path forward if council’s desire is to create its own EDA while its civil litigation against the existing co-created EDA proceeds. As Napier confirmed to us the following day, that recommended path is toward a legislative exception for the Town of Front Royal to create a second EDA independent of the County without withdrawing from its legal interest in the existing, co-created EDA.
Interim Town Manager Matt Tederick told council that it must move quickly to get its request for a State Code change on the floor during the next session of the General Assembly or face waiting another year for the opportunity. Tederick also said he had made contact with a member of the state legislature who would be willing to sponsor the Town legislative exemption request, though he did not publicly name that state representative. Warren County and the Town have three State House representatives, the 15th (Todd Gilbert), 29th (Chris Collins) and 18th (Mike Webert), as well as 26th District State Senator Mark Obenshain, in the Virginia General Assembly. The smart money is on one of those four.
However, it remains to be seen how such a legislative move toward a singular exception for the Town to create a second EDA while suing the existing one it co-created with the County over a half century ago will play in Richmond, or for that matter across town at the Warren County Government Center.
Napier’s independent, Town-created EDA situation agenda summary observes that there may be times that it would be advantageous for the Town to consider economic development financing of “facilities outside its boundaries”. Such times could relate to the expansion of “water or waste disposal facilities … the addition of facilities of higher education … the expansion of additional medical facilities” or if the Town “wanted to expand its tax base” Napier observed.
However, these are things the Town could only accomplish in a joint Town-County EDA or with a Resolution of Support from the County Supervisors related to actions of an independent Town-controlled EDA. And the latter is contingent on a General Assembly majority granting the Town its desired exemption to the existing State Code.
Is this writer the only one who sees irony in the Town’s coming initiative to seek a one-of-a-kind State legislative exemption to facilitate creation of an independent EDA? After all, wasn’t it a first-of-its-kind State exemption, though judicially approved in 1999, that allowed Warren County to receive the economic development benefit of Town of Front Royal water-sewer utilities in its North Corridor without the established process of annexation by the municipality controlling those utilities preceding that extension?
Perhaps in a clue of things to come, toward the work session’s end Councilman Chris Holloway suggested Town staff explore the pros and cons of revisiting Town annexation of the North Corridor “out to Rockland Road”. Mayor Tewalt observed that a Memorandum of Understanding between the Town and County that may be attached to the Town’s water policy, prohibits Town annexation in the North Corridor for as much as 20 years from its inception.
Wonder if the Town could get a one-of-a-kind exception, perhaps from the State Executive branch this time, to rescind that MOU while they’re at it?
Following work session Town poised to move on several key initiatives
It was a varied and potentially far-reaching Front Royal Town Council work session that followed Monday evening’s dedication of the Town Hall foyer placement of a Memorial Plaque to Dr. Joseph Warren, the Revolutionary War figure for whom Warren County is named. Period-costumed re-enactors Larry Johnson and Ned Farenholtz keynoted the dedication, citing the Massachusetts physician’s pivotal role in galvanizing support for American independence and his early death as a martyr to that cause.
Following a closed session to interview candidates for the Board of Architectural Review and Mayor Tewalt’s now-vacated council seat, Town officials, minus Vice-Mayor Sealock reportedly cited out west in Oklahoma, launched into several key topics surrounding the Town’s future on several fronts.
Primary among those (not in chronological order) were:
A/ what will be necessary to facilitate an apparently growing majority consensus to create an independent Town Economic Development Authority (EDA) – hint, it won’t be easy and will require a change in State Codes and the cooperation of the County;
B/ facilitation of the long-brewing “Blighted Building” aspect of a Town Property Maintenance Code, as well as developing a report from the Subdivision Committee anticipated by the end of January;
C/ hiring of a professional facilitator at a cost of $2,000 dollars to try and reach a consensus among downtown business owners on how best to proceed on parking, street closings and other issues revolving around special events in the Gazebo/Downtown Commons area at the intersection of East Main and Chester Streets;
D/ funding at a cost of $45,000 dollars, a council-requested “detailed review” of Town water-sewer rates, connection and other service fees.
On that latter front there appeared to be a council consensus to re-enact Town staff handling of utility Tap and Connection hook ups. Discussion indicated that an administrative decision was made in 2008 “somehow, somewhere” as Town Attorney Doug Napier put it, to withdraw the Town from providing that service.
See these discussions, as well as other “Open Discussion” and related topics touching on items ranging from providing volunteers to help financially-strapped people perform major property cleanups to improve the overall appearance of the town; exploring the Town-County Memorandum of Understanding regarding possible Town annexation of the North Commercial Corridor; and writing off the uncollected bad debt owed the Town for over five years.
As Interim Town Manager Matt Tederick pointed out, that $11,141.46 number representing 34 unpaid utility accounts being written off the books represents .3% (point-3 percent) of the Town’s public accounts – and a 99.7% collection rate isn’t bad, as Tederick told council. In fact, later discussion indicated an initiative, at least on the commercial side, to prevent Town utility clients from being hit with unreasonable deposits due to minor delinquent accounts.
Tederick cited the example of one customer with a $42 delinquent commercial rental bill that resulted in a $500 deposit being tacked on to that $42 back bill payment – okay guys, let’s add residential utility customers who may have had a day or two late utility payment on their records into that equation and we might be on to something.
See all these discussions impacting the Town and its citizens’ futures in this exclusive Royal Examiner video:
Town skirts EDA request for FRPD construction back payments
The Front Royal Town Council passed a series of four motions Monday, November 25, authorizing expenditures totaling $1.02 million dollars related to its civil litigation against the Economic Development Authority, as well as payments to contractors regarding construction of the new Front Royal Police headquarters across Kendrick Lane from the EDA office complex.
Of that million dollars plus total, $527,800 approved in a series of three motions is for legal and auditing fees related to the Town’s civil suit against the EDA. The $492,284.34 approved in the last of the four motions is for vendor (contractor) payments recently come due on the FRPD construction project.
The motions were all approved by 5-0 votes, with Mayor-Elect Gene Tewalt not voting as Mayor Pro Tempore as he was declared at the meeting’s outset. As noted above, over half of the authorized payments are for attorney and auditing fees for services related to the Town’s attempt to recover “as much as $15 million” from the EDA. The $492,284 was approved to cover direct payments to contractors on the Front Royal Police Headquarters construction project.
However with its litigation still pending as the EDA struggles to right its financial situation, the Town did not make good on an EDA request for back payments totaling over $8 million dollars for vendor/contractor payments it has made on the FRPD headquarters project on behalf of the Town.
In a letter from EDA Board of Directors Chairman Ed Daley to Town Finance Director B. J. Wilson dated November 15, 2019, included in the agenda packet on the final of the four EDA-related payment authorization requests, the EDA appears to attempt to force the Town’s hand on making up those back payments to the EDA.
After informing Wilson of the EDA’s receipt of FRPD project Requisition (invoice) “# 45” dated October 22, 2019, Daley wrote, “After speaking with our Board of Directors, I write to advise the Town that we will hold this pay requisition without paying until the Town of Front Royal pays the principal and interest due on this project.
“The principal, legal fees and draw fees paid by the EDA for the Town to date is $8,440,797.17,” Daley continues, adding, “The interest amount is $291,856.21 which covers interest on the previous 44 pay requisitions, up to October 31, 2019.” The recently-installed EDA Board Chairman closes by informing the Town, “Once we receive the past amount due on this project, we will process pay requisition # 45 accordingly.”
The Daley letter seeking reimbursement on the $8.44 million in police headquarter construction payments indicates an FRPD project payment and interest accrued history attached. But in the council motion on authorization of vendor payments there is no amount attached to Requisition # 45. However, in the “Revised Item # 15 motion made by Jacob Meza, seconded by Chris Holloway, an amount of $492,284.34 is cited to cover payments directly “to vendors Dustin Construction, Mosley Architects and JTS LLC for construction of the Police Department Project.”
The motion continues to cite the use of money “previously budgeted for the Police Department Project” and notes the Dustin Construction payment will be released “after signed waiver of lien is obtained.”
Contacted by phone on Tuesday, EDA Administrative Assistant Gretchen Henderson said that Dustin Construction ($243,843.48) and JTS LLC ($893.84) were included in payment Requisition # 45, but not the Mosley payment which may be from a separate invoice.
So it appears that the Front Royal Town Council has decided to respond to the EDA’s most recent request it make good on its $8.4-million FRPD project payment debt to the EDA by bypassing the EDA on that debt as the Town’s civil suit against the EDA moves forward; while simply making future invoice Requisition payments directly to the vendors.
The first EDA-related Council payment authorization of Monday’s meeting was $282,800 for “attorney fees and auditing services related to the Town’s civil suit against the Front Royal-Warren County Economic Development Authority (EDA)”.
The funds for that payment were requested to be transferred from scheduled FY 2019 and FY 2020 Town debt service payments to the EDA on a number of projects. Those projects and transferred amounts were cited as Success Farm ($10,370), Baugh Drive Extension ($6,535), Happy Creek ($6,845), Stephens Industrial Park ($11,725), Leach Run Parkway ($105,925), and “Appropriated Funds Forward ($141,400), totaling the $282,800 authorized for attorney and audit fees related to the Town lawsuit against the EDA.
The now $21.3-million EDA financial scandal revolving around former EDA Executive Director Jennifer McDonald began unraveling in late spring to early summer of 2018 when Town Finance Director Wilson discovered about eight years of Town debt service overpayments to the EDA. EDA officials told Royal Examiner they have not yet seen a number on those believed Town overpayments.
Might one take a guess based on that $282,800 transfer of future scheduled debt service payments to the EDA; or might one look at the fact that transfer comes within $9,056 of the disputed FRPD interest payments of $291,856.21?
Hey, guessing is always a gamble, isn’t it?
As those keeping a scorecard on the now multi-faceted EDA financial scandal and related civil and criminal litigation know, the Town Council authorized its legal department to file the aforementioned civil action against the EDA seeking recovery of “as much as $15 million dollars” of allegedly misdirected Town assets as a precaution against unknown variables, including possible statute of limitation issues. Included in the Town’s suit for recovered assets is exactly what interest rate the Town should be paying on the FRPD construction project.
The EDA is paying 3% interest on the FRPD construction project. However, the Town is holding out for a 1% rate that would coincide with what it contends was promised to it by the EDA, or at least by its then Executive Director McDonald, as part of the New Market Tax Credit Program for which the project did not qualify because it was not a job-creating economic development project.
In fact as Royal Examiner has previously reported, then Town Manager Joe Waltz and Finance Director Wilson, as well as People Inc. regional administrator of the NMTC Program Brian Phipps all advised Council against “gambling” on competing for the NMTC funding versus accepting a guaranteed, 30-year fixed 2.65% interest rate offered to the Town in late 2017 through a private sector bank.
Contacted Tuesday, Town Attorney Doug Napier said that after Phipps’ early January 2018 work session appearance before council, Town officials contacted McDonald, who assured them Phipps “didn’t know what he was talking about” and that the NMTC bond issue had been achieved to include the FRPD project.
Consequently a council majority decided to take that gamble on the best case scenario of nine years of interest-free payments significantly reducing the total interest due on a project bond issue.
The other two EDA-related payment authorizations unanimously approved by council Monday evening were “up to $45,000 to Mitchell & Company PC for auditing services to support litigation in the Town’s civil suit against … (the EDA)” and “payment not to exceed $200,000 to Damiani & Damiani for legal services related to the Town’s civil suit against the …(EDA).”
Contacted Tuesday for a reaction to the Town Council’s response to the EDA board’s request the Town make good on its FRPD payment debt, current EDA Executive Director Doug Parsons said,
“What the Town does is their business, what they chose to pay, what they chose not to pay it’s entirely up to them. We feel confident in the figures we provided on the invoice for the Front Royal Police Department. We would love to work out this difference of opinion with them; and we’re always ready to work with them on other projects while we work out our differences.”
Watch the entire Front Royal Town Council meeting of November 25th here: