Salins spearheads questions on Town, EDA favoritism toward Valley Health

On March 25, 2019, Birth Local advocate Melanie Salins was back to make her case that tax-exempt Warren Memorial Hospital owner Valley Health share local tax burden through a PILOT (Payment In Lieu Of Taxes) program. Royal Examiner File Photos/Roger Bianchini

The day before the EDA financial corruption story began dominating last week’s news cycle several citizens confronted the Front Royal Town Council on the proposed solution of a 3.9-cent real estate tax hike to make up a capital improvements annual debt service revenue shortfall.

And surprise – another EDA-enabled loan, this time to tax-exempt, high executive-salaried Valley Health, made its way into the discussion. With support from Krista Adanitsch, Melanie Salins took the point in urging council to explore the use of a PILOT (Payment In Lieu Of Taxes) fee on Valley Health to place at least some of the proposed tax burden to cover a steadily climbing annual debt service to pay for the new police headquarters on the regional medical goliath.

“You have given the gift of a free pass to Valley Health up until now. But seeing the state of crisis this community is currently in – NOW is the time to ask Valley Health to finally step up and start paying their fair share,” Salins told the town’s elected officials of their support of EDA-enabled financing of up to $60 million to help fund construction of a physically-new but services-reduced hospital.

“Valley Health has ignored the needs of this community by shrinking the new hospital to a mere 36 beds and getting rid of women’s care and the ICU, thereby placing further burden and expense upon the citizens of this town.  The EDA, comprised of three people working with Valley Health (Baker, Patteson and indirectly Llewellyn prior to his resignation), gifted away millions of dollars in bond fees – and most of you voted to allow them to do it,” Salins told council.

On Feb. 28, 2018, ‘Birth Local’ supporters made their case against closing the community’s birthing, OB-GYN unit at WMH. That Valley Health decision went into effect with the May 1, 2018 closing of the existing hospital’s maternity unit and will continue in the planned new $100-million hospital.

Speaking initially during the public correspondence portion of the council meeting, Salins noted, “This untapped revenue source could bring in hundreds of thousands of dollars annually. Money that could help ease the burden of tax increases on the citizens of this town… Valley Health has been paying Winchester a PILOT in the amount of $750,000 per year. As I stand here today, Valley Health pays Front Royal, zero dollars in PILOT payments… As our taxpaying citizens are facing being hit with another increase in their tax payments, I ask HOW IS THIS FAIR?”

Salins noted that the Town, County and EDA’s bending to the economic will of its largest and tax-exempt medical provider has put, not only an added tax burden on citizens and small businesses, but has positioned Valley Health favorably in the medical services marketplace.

“Valley Health occupies large amounts of property: the old hospital, the new hundred-million-dollar hospital, doctors’ offices, urgent cares, and the many other future items they say they plan to build – properties that would otherwise provide our community with income from taxes.” Of those Valley Health-owned properties and business housed on or planned for them, Salins observed, “Future buildings, which by the way, will be in direct competition with other local tax-paying businesses.”

In fact one of the councilmen listening to her, Valley Health-employed Jacob Meza, once told local media outlet the Northern Virginia Daily of his role in the decision to obtain the North Corridor Riverton Commons parcel Valley Health moved its in-town Urgent Care Center to, as a move to block potential health care competitors from building there.

In later comments during the tax rate public hearing Salins was critical, not only of Meza for his decision not to recuse himself from the June 11, 2018 vote on the Valley Health bond issue as he had at times earlier in the process, but again toward council as a whole.

“I begged all of you guys to look at this bum deal that the EDA was giving you on this hospital bond, waiving millions of dollars in fees. And if you already knew the EDA wasn’t being truthful, why was I ignored?” Salins asked before turning her attention toward Meza.

“Why did you not recuse yourself for the first time all year and make that tiebreaking vote in their (Valley Health’s) favor when you knew that the EDA couldn’t be trusted for weeks leading up to that vote?” Salins asked the Valley Health-employed councilman.

Valley Health critics Melanie Salins and Amber Poe Morris chat with Valley Health employee/Councilman Jacob Meza following June 11, 2018 council vote approving EDA bond issue with only a $240,000 fee and closing costs to Valley Health attached to it.

“Morale in this town is pretty low right now because we’re being punished after we didn’t make the mistakes; we weren’t listened to; and we’re left footing the bill here.

“I ask you to delay any decisions to raise taxes until you investigate the PILOT,” Salins reiterated of earlier comments. She noted that when she first brought the Valley Health PILOT fee idea to council and staff she was told, “There’s a surplus, there’s plenty there, we don’t need to do that.”

But even in recent weeks after the believed surplus evaporated and as the FRPD construction debt service estimates continued climbing due to a council majority’s ongoing 2018 faith in the New Market Tax Credit gamble, Salins said the lack of enthusiasm for the PILOT fee charge to Valley Health has continued.

“I thought you would have been excited about that; and it seems like, ‘Oh maybe we’ll just take the easy way and raise everybody’s taxes instead because it might be a little work and it might be hard to make Valley Health pay their fair share’ after they have just trampled upon this town over and over and over again for the last year,” Salins asserted.

On June 11, 2018 as ‘Birth Local’ co-founder Melanie Salins reiterated criticism of perceived profit over community health criteria for new hospital plan, WMH President Floyd Heater, flanked by two Valley Health officials, listened.

Pointing to multiple economic variables facing citizens from a proposed six-cent County real estate tax hike, a significant jump in Town electric rates in the past year and the 3.9-cent hike on the table, Salins wondered at council’s seeming preference for the tax-exempt medical monolith over the citizens who elected them.

“I am asking you to please stop allowing our town to be taken advantage of. Each of you sitting in front of me today has the opportunity to be a hero – place some burden on the goliath and remove some of the burden from us little guys… Let’s start a new chapter in Front Royal – a time where we no longer allow our community to be taken advantage of; a time where our local government doesn’t greet citizen’s concern with deaf ears or patronizing responses. It is a time for action. Can we count on each of you to do what needs to be done to get a PILOT in place?” Salins asked.

As previously reported, by a 4-3 vote council approved the first reading of a 2.9-cent real estate tax hike following the March 25 public hearing. See Related Story:

Divided council passes first reading of 2.9-cent real estate tax hike

The mayor also assured those present that staff was now exploring the PILOT fee idea as it might apply to Valley Health.

On March 25, 2019, Mayor Tharpe, flanked by Vice-Mayor Sealock and Councilwoman Thompson, listened to extensive criticism of the Town’s history with its own EDA; and the EDA and council’s relationship to Valley Health.