Town moves Valley Health’s new hospital proffer package forward

On March 5, Valley Health VP of Facilities Management Mark Baker addresses council concerns over infrastructure proffers tied to new hospital project. On March 19 he returned with reinforcements. File Photo/Roger Bianchini

FRONT ROYAL – At a Monday evening, March 19 work session the Front Royal Town Council appeared to accept the gist of proffer changes or elaborations made by Valley Health officials in the wake of work session discussion two week earlier.

The primary change was elimination of a $300,000 cap on installation costs of a traffic signal at the new Front Royal hospital’s main entrance; the primary elaboration was explanation of how utility hook ups to existing infrastructure would occur, and backup systems would be achieved. 

On March 5, Councilman Eugene Tewalt asked for a commitment on some necessary road and utility infrastructure before voting to approve a change from current RS (Residential Suburban) and A-1 (Agricultural) zoning to MCD (Mixed Commercial Development) for Valley Health’s 147-acre parcel. 

At that earlier work session town planning staff noted that a proffer condition that a main entrance traffic light not be required until the traffic count on Leach Run Parkway indicated it necessary within a five-year period after the hospital opens, made the cost unknowable.  On March 19, Town Planning Director Jeremy Camp said Valley Health officials had removed the $300,000 cap in revised proffers presented on March 14.  The new language states the hospital will “pay for 100% of required costs for the traffic signal.”  However, the wording of a “caveat” to that change ran afoul of Councilman Tewalt. 

“I don’t like that wording ‘to minimum requirement,’ ” Tewalt told a team of four Valley Health officials including Vice President for Facilities Management Mark Baker and local real estate attorney Joseph Silek Jr.  The wording in question was, “The Applicant will only pay for the costs that are necessary to meet minimum requirements for a traffic signal.” 

During the subsequent discussion Baker said the hospital would be willing to adjust the language.  However, he asked that it remain understood that add-ons like state-of-the-art camera systems that would not be considered necessary to the primary function of a traffic signal were not Valley Health’s responsibility.

The compromise removing “minimum requirement” from the legal verbiage did not appear to be a stretch for either side.  The town staff summary of the Valley Health proffer revision stated that the hospital not be held responsible for “expensive upgrades that are not required by Town or VDOT standards”. 

A promise by Valley Health to achieve backup power requirements with on-site generators and to pay for the cost of connecting its facility to existing Town electrical services appeared satisfactory on the electrical front.  Water and Sewer hook ups to existing lines, 12-inch and 10-inch for water; and 8-inch for sewer also appeared satisfactory to ease council’s mind on the hospital’s utility infrastructure.  As for backup water, multiple connections to the 12-inch water line, one at the main and one at the secondary entrance, was posed as the solution. 

Jacob Meza did not have to repeat his March 5 recusal from the discussion due to his position with Valley Health, due to his absence from the work session. 

Tax rate 

If the revised Valley Health proffers were agreed to with minimal difficulty by council Monday night, it appeared that the impasse at last week’s meeting over the possibility of adding a penny to the Town Real Estate Tax rate of 13.5-cents per $100 of assessed value will get the same result despite paring one-tenth of a penny off the re-advertisement of a tax rate for FY2019 – that result is NO. 

As Royal Examiner reported last week, despite a 3-2 majority (Tewalt, Sealock, Meza for; Morrison, Gillespie against, Connolly absent) voting for the first reading vote on March 12, the measure failed due to the necessity of a four-vote “supermajority” to pass a high-budget item like a tax increase that would produce $110,000 of budget revenue. 

Tewalt led the majority argument that to provide necessary revenue in smaller increments before the annual bond payment bills for the new Front Royal Police headquarters actually become due was preferable to a four or five-cent increase down the road when annual payments begin.  However, Morrison argued that a combination of general fund revenue, higher real estate assessments on the horizon in a process already underway, and a bill not yet due combined to make a tax increase this year unnecessary. 

Polled after Monday’s work session, Connolly indicated he agreed in principal, as well as philosophically that a tax rate was not necessary this year.  That would appear to doom the newly-proposed tax hike to the same fate met on March 12. 

However, it was noted that the matter had to be revisited because in all the debate and negotiating of March 12, council failed to vote to set any tax rate for the coming fiscal year.  That situation left uncorrected would leave the Town with no real estate tax rate for FY19 and a sudden revenue deficit for which even council’s most fiscally conservative members would have no creative solution.