Town Talk is a series on the Royal Examiner where we will introduce you to local entrepreneurs, businesses, non-profit leaders and political figures who influence Warren County. Topics will be varied but hopefully interesting. If you have an idea, topic or want to hear from someone in our community, let us know. Send your request to news@RoyalExaminer.com

In this Town Talk, we’ll have a conversation with Gary Kushner. Gary has been outspoken at the Board of Supervisor meetings, as well as, Town Council meetings. Gary comes prepared with researched data and presents reasonable solutions to issues facing local government. With time restraints imposed by our governing bodies, the Royal Examiner offered some additional time to Gary to present some solutions to be considered, or at least serious thought to be given.

Here is a planned presentation Gary planned to give to the Town Council on February 19, 2020. As Gary mentions in the video, he had requested time to present, but 4 out of 6 councilmembers declined to hear his remarks.

Planned Presentation at the February 19, Special Council Meeting:

Few were satisfied with the February 10 Council session where frustration and emotions were on display by many in attendance. I believe some of the rudeness and criticisms leveled in the public presentations prevented a cohesive communication from being received by Council.

I’m attempting to provide a more organized and effective communication to the Council on some relevant issues and offer suggestions that may help in the development of the 20/21 budget. Also, I heard Council comments that they’ve listened to the silent majority in contrast to most of the Feb 10 in-person citizen opinions. However, I believe there’s the silent majority that supports much of the in-person testimony the Council heard as well.

Also, I’m known as a straight shooter and generally not inclined to sugar coat things. So, to ensure there’s no misunderstanding with my perspective, I try to be very direct. However, I intend that these comments will be taken constructively.

Regardless of the criticism heard at Council meetings, I think the majority of the public is appreciative of their efforts and that members sincerely try to represent the interests of the citizens.

I believe there is much common ground between the citizens and the Council.

– I think there’s consensus that having a fiscally conservative Govt is the right direction.

– Having Operational expenses grow 35% over the past ten years when the population has only grown 4% indicates things have gotten a bit off-course, and Right-Sizing efforts are needed.

– There’s a limited appetite for increases in taxes and fees.

– Virtually everyone agrees that Maintenance of Infrastructure is essential, and ‘kicking the can down the road’ isn’t a responsible position.

– Maintenance needs to involve quality and permanent solutions, not temporary ones. Most agree that applying a slurry solution to roads instead of using asphalt is penny wise and pound foolish, and curbs and gutters are valuable.

– Aggressively addressing the waste/water Inflow and Infiltration (I&I) is preferable to having undesirable consequences imposed by outside authorities.

– That is, having citizens involved with their government is a necessary thing. Citizens want to be represented, not ruled. The government is a shared responsibility. Getting feedback from citizens should create better solutions and distribute accountability between the Council and the public. A collaborative approach ensures that all sides of an issue are analyzed and avoids having a limited perspective.

So lets’ address some specific issues;

You heard significant opposition to the proposed reorganization that would have Community development and Tourism outsourced.

Some of the key arguments presented included:

– AppalachianTrail Committee Co-chairman Susan Tschirhart highlighted that Front Royal had achieved an ‘Appalachian Trail Community’ designation that was special and created a better promotion for our community.

– She noted steady tourism revenue growth in the last 5 years.

– There were 5 new recreational based businesses, 3 being on the main street.

– The Front Royal Visitor Ctr was rated Second only to Skyline Caverns as a top attraction site.

– Virginia Tourism Corp reported that in 2018 Warren County received $151 mil from tourism and there were 1,700 jobs with a $23 mil payroll

– She confirmed that Town staff were motivated and had been effective in their efforts to promote tourism.

– and The Joint Town/County Tourism Advisory Board was an effective organization.

The bottom line here is that evidence exists that the previous organization and staff were achieving good results. So, what was the justification in not observing the principle of ‘if it’s not broke, don’t fix it’?

Explicit statements were made by the Interim Manager that there were no negative performance issues related to the fired employees, and the proposed reorganization was solely to expand Tourism results. Considering that the firings occurred so quickly and that positions were funded through the end of the year, there is reasonable public concern that other factors were at play here that was not honestly reported. That being said, public trust is a very important element, so all efforts are warranted to maintain that trust.

There was opposition not only to the proposed re-organization but to its implementation as well.

– The ‘midnight massacre firings’ was anything but compassionate and not well thought out.

– No consultation occurred with the Joint Tourism Advisory committee

– No plan was immediately available to address the responsibilities of staff that was fired just before the beginning of the Spring/Summer tourism season.

– And regardless of the HR legal opinion that the firings met muster, some believe the Town may have subjected themselves to legal jeopardy because of other personnel issues.

There were also several negative factors relevant to outsourcing being proposed as the solution.

– The Town had previous experience with outsourcing that did not produce good results.

– Other Valley jurisdictions had bad outsourcing experiences as well.

– The employees of a contracting business would not have a personal investment as do staff who live in our area.

– Having Town staff conducting tourism promotion provides a continuity year to year that would not be guaranteed with contractor employees. Such personal relationships between local staff and business interests is an important element and should not be undervalued.

– Contracting tourism support would not be as ‘agile’ as having local staff. Contracts are for specific tasks, to get well-defined deliverables, in a specified time frame. Tourism is a dynamic area, and outsourcing would not provide the flexibility available with using in-house resources.

With all that said, subsequent comments from Council has me hopeful that they will be re-visiting the proposed outsourcing plan.

Next, let’s address the EDA:

Everyone references the organization as the EDA, but the formal name is; The Industrial Development Authority of the Town of Front Royal, Va. And the County of Warren, Virginia. Its purpose is to represent the interests of both jurisdictions.

In a Memorandum of Agreement for the New Market Tax Credit Program signed by Mayor Tharpe, Manager Waltz and the Town Attorney May 2017, Paragraph 1. says: “ It is anticipated that loan funding would be acquired by the EDA from the Program at 1.5% interest annually for the first seven (7) years of financing, at which time the Town will have to secure refinancing for the unpaid outstanding principal balance on the Town projects from another source”. With the operative word being ‘anticipated’.

Paragraph 3. states; “ The Town will fund, to the extent legally permissible, one hundred percent (100%) of the EDA’s debt service through an annual appropriation and expenditure from the Town’s adopted budget associated with the a) Police Dept HQ on Kendrick Lane: …..”. This evidences Town liability in my mind that goes beyond the moral one.

Thereafter, the Town was encouraged by Brian Phillips of PEOPLE Inc. (who managed the New Mkt Tax Credit program) to take a 2.65 % loan rate but the Town elected to ‘roll the dice’ for the 1.5% rate that they never qualified for.

A loan for 3% was eventually obtained for the Town’s Police Dept. construction. The EDA recently offered an interest rate of 2.25% but the Town continues to think they deserve the 1.5% rate and have authorized $45k for accounting services and $200K for legal services supposedly to get it!

The difference between the 1.5% interest rate the Town wants and the 2.25% rate EDA offered is only $87,240! The EDA is eating the difference between the offered rate and the actual 3% rate on the loan. What sense does it make to budget $245K to address a possible $87k loss? Let’s look further.

The Town originally filed suit against EDA for $3 million, supposedly to guard against being affected by a statute of limitations. However, no specific evidence was ever advertised to support that justification. Later, the Town increased the amount to $15 million but without any documented specification of damages. Now the suit is being amended again to who knows how much!

The EDA owned properties are now assessed at $31.5 million, but they have $40.8 million in debt. There’s no surplus to get! And if the Town thinks they’re going to get a property as a possible court-ordered payoff, that’s a pipe dream. Is it reasonable to consider that the courts would give the Town precedent over the loan holders?

Jennifer McDonald and the prior EDA Board, who were allegedly responsible for the misdeeds and losses, are GONE. The new Exec. Director and Board have been working diligently to clean up the mess and get back to producing good results for the Town and County.

It’s been alleged that the EDA was mostly focused on County projects but the truth is just the opposite. They’re working on the Happy Creek Technology Park, and they did the Leech Run Project, they’re actively marketing the Avtex property and many others. On February 19, they hosted an event with the Blueridge Assoc. of Realtors and visited 28 sites, 21 of which were in the Town.

Plus, the Town is not without fault in this whole affair, in my opinion.

– They gambled with the PD loan rate with the New Market Tax Credit program.

– They virtually abandoned involvement with the EDA Board well before the skulduggery was discovered.

– When a Council member first raised a red flag years ago, they were not only ignored but were seriously criticized.

– Now, the Town is withholding even the principal payment on the PD loan making EDA’s financial situation more precarious.

The Town’s continued adversarial behavior is damaging the organization that is presently, and has been, trying to support it! The past EDA embezzlement and misdeeds are enough of a black eye itself. Still, the contentious environment the Town is promoting is making things worse and further damaging our community’s reputation. What business wants to make a serious investment where there is so much chaos, drama, and uncertainty?

In Conclusion,

To promote improved communications between the Council and the public, to promote Economic Development activities and to address having a balanced 20/21 budget, the following suggestions are offered.

Communications:

– Increase the public presentation time at Council meetings to 4 or 5 minutes per citizen but be less lenient with speakers who cannot observe that limit. This would enable citizens to communicate w/ Council better and demonstrate an honest desire by the Council to encourage citizen participation in their government.

– Institute a provision for public interaction at the work sessions. This could be limited to just questions and be controlled either by a time boundary (30-60 min?) or limit it to a specific # of issues. Or consider having written questions submitted to the Mayor when the work session items are finished, and a short break is taken. Then have the Mayor choose which issues are most relevant to address when the work session is reconvened.

– Implement the ‘town hall’ sessions previously identified in the prior Communications proposal, with only the Mayor representing the Council positions. Try them monthly, to begin with, and then evaluate and adjust based on experience. I believe the Mayor is addressing this already.

– Support the creation of public committees on specific issues such as infrastructure, finance/budget, etc.). I believe the Mayor may be considering this already.

– When significant issues or organizational changes are being considered, produce a documented analysis, and advertise it to the public, before final decisions are made. Now, some in the public think why show up at Council meetings and provide feedback since decisions are being advertised rather than being proposed?

– Since there seems to be meaningful animosity and distrust between the Interim Mgr and the public, consider having a special town hall session where concerns can be honestly expressed, and explanations can be offered to dispel any rumors and misunderstandings.

Anyone who doesn’t see the disconnect between the public now and the Council maybe has their head in the sand. Simply continuing business, as usual, will not create different results and is the definition of ‘stupidity’.

Tourism:

– Re-establish the in-house Community Development/tourism structure that was so effective previously and abandon the outsourcing plan that’s been emphatically opposed by much of the public

– Encourage engagement with the Joint Town/County Tourism Advisory Board.

EDA:

– Direct the Town’s finance representative to meet with the EDA accountant so available records can be reviewed to arrive at an overpayment figure such that options can be developed to resolve that matter without unnecessary attorney involvement.

– Accept the EDA offered an interest rate of 2.25% on the Police Dept loan and begin making full payments. If this option is not pursued, at least begin making principal payments that the Town is moral, if not legally, obligated to which is not in question.

– Withdraw the litigation against the EDA.

– Use the remainder of the budgeted $245K planned for EDA accounting and attorney services for other 20/21 needs.

– Withdraw the Virginia legislation proposal to permit a separate Town EDA. That proposal sends the wrong message.

– Begin a fully cooperative engagement with the EDA Board.

– Engage more fully with the Town/County Liason Committee.

20/21 Budget:

– Eliminate the proposed Asst. Town Mgr position for a savings of well over $100K in salary and benefits. This proposed new position is a permanent solution to a temporary problem. Include this responsibility in the Finance Director’s position in that they are most knowledgable about all Town issues. When you’re looking to down-size government, creating new positions is counterproductive.

– Evaluate eliminating the 12 existing vacant positions referenced at the February 3rd work session that may not be critical.

– Apply the ‘last in, first out’ policy on the positions that were expanded in the preceding several years and eliminate positions and operational programs that are not critical.

– Abandon the proposal to obtain a Landscape Architect and hire a well-qualified replacement for the landscape person who recently retired. In-house staff will be more nimble and should cost less than outsourcing. Plus, you get what you pay for.

– Consider adjusting the employee benefits package to get a rate that does not exceed the budgeted 3% increase from last year. My understanding is that the existing benefits package is very generous.

– Instead of providing the third full traunch of the compensation study this year, split the balance in half and extend it to 4 yrs rather than finish it in 3 years. This would have a minimal effect in that a COLA is also shown in the budget.

– Direct the Interim Manager to document any possible government improvements that may be identified henceforth but leave them for the permanent Town Manager to consider for possible implementation.

That concludes the presentation I would have made to the Council had I been permitted to address them at the Feb 19 work session.