Town announces bank deal on FRPD headquarters debt service payments

In a Wednesday evening press conference the Front Royal Town Council and the Town’s mayor weighed in from varying perspectives in announcing a Town financing agreement with United Bank to assume the debt service on the principal and an undisclosed, but favorable, interest rate on payments for construction of the new Front Royal Police headquarters.

Statements indicated that the lower interest rate acquired, as opposed to the EDA’s 3% rate with United Bank on the FRPD debt service, would save the Town at least a million dollars. Town officials declined to discuss details such as the interest rate or amount of the loan at this point in the loan process.

While a summary of the loan agreement announcement read into the record by Interim Town Manager Matt Tederick and elaborated on by the town’s elected officials, was a welcome update on what has become an increasingly contentious finger-pointing exercise in municipal government dysfunction, the tone of that update maintained and perhaps upped the ante on the accusatory finger-pointing.

Above, Matt Tederick reads the opening statement on the Town’s debt service agreement with United Bank into the press conference record; below, County Supervisors Delores Oates, left background, and Supervisor’s Chair Walt Mabe and EDA Board Chair Jeff Browne, listen as they are vilified for the past impasse on FRPD debt service negotiations. Royal Examiner Photos by Roger Bianchini – Royal Examiner Video by Mark Williams

In fact, following the full council comments Mayor Eugene Tewalt observed that he did not agree with a lot of what was said by council in lauding their bank financing deal. Since his November 2019 Special Election elevation to mayor, Tewalt has repeatedly butted heads with his former council colleagues over trying to negotiate, rather than litigate with the EDA.

When this reporter and other media present asked for details of the loan agreement and support for the accusatory nature of the announcement alleging belligerent intransience by both the county government and the re-tooled in the wake of financial scandal Economic Development Authority Board of Directors, there were few direct, substantive answers forthcoming. In fact, the interim town manager cautioned council on answers regarding support of its stated legal stance, noting the Town remained in civil litigation with the EDA.

One of three local reporters, yours truly, attempting to gain clarity on council’s allegations about County and EDA intransience in past FRPD debt service discussions.

The media was added to the negative stereotyping in past reporting on the Town’s year-and-a-half or so refusal to assume liability for undisputed principal and partial interest payments on the EDA-enabled financing for its new police headquarters. Councilman Holloway disputed what he termed “tabloid media” reports that have “beaten up” the Town in reporting the evolution of the Town-EDA financial impasse and what has evolved into dueling civil litigations. Wednesday’s announcement does not appear to impact the Town’s $20-million civil suit against the EDA.

Several county official present, including Board of Supervisors Chairman Walt Mabe, Vice-Chair Cheryl Cullers, and North River Supervisor Delores Oates, indicated possible future comments after having time to absorb what they heard Wednesday evening. However, EDA Board Chairman Jeff Browne did give Royal Examiner an on-the-record comment.

“Well, the main thing that I want to leave you with tonight is that we’re excited that the Town is finally paying the principal that they’ve owed on the police station. And that’s really what tonight’s about. We can get into some other details some other time,” Browne told us after the press conference, adding, “It’s a positive and I’m hopeful that we can start to work together. I hope that it’s a start of something good because we ought to be working together.”

United Bank is the same bank the EDA financed construction of the police headquarters through. The EDA, recently with County help, has been making monthly interest-only payments of about $21,000 on its FRPD debt service. However, the EDA announced last week that it and the County would stop covering those payments as of October. The EDA United Bank loan was slated to go to interest and principal payments of about $50,000 monthly on November 1. Thus far the EDA or County has paid about $500,000 on interest on the FRPD construction project, which appeared to cause some confusion on the EDA’s claim against the Town in its recently filed civil suit to hold the Town liable for FRPD construction costs.

But as for working together in the wake of Wednesday’s press conference, several council comments critical of the past and existing EDA board justified the Town’s move toward creation of a second, unilateral EDA, pointing away, rather than toward cooperation with the existing, half-century-old joint Town-County EDA.

Above, County Board Chair Walt Mabe and Councilwoman Lori Cockrell chat following the adjournment of council press conference. Below, delays on the renovation of the Afton Inn to the left of Town Hall were laid directly on the EDA by Councilman Gillespie.

In fact, Councilman Gary Gillespie took direct aim at the current EDA staff and board of directors for delays in renovation of the dilapidated Afton Inn across Crescent Street from Town Hall.

Go to the below-linked Royal Examiner video to see exactly what was said, alleged, asked, and answered, or not, at the approximate 45-minute Wednesday evening Front Royal Town Council press conference: