FAIRFAX, Va.– Multiple traffic stoppages are planned for I-66 East and West on Wednesday, July 10, between 11 p.m. and 4 a.m. so that Dominion Energy can pull cable across I-66 east of the Route 28 interchange. Both directions of traffic on I-66 will be stopped simultaneously for up to 15 minutes each to accommodate the work, which is needed for the Transform 66 Outside the Beltway Project.
All work is weather dependent. Thursday, July 11, is planned as a rain date if inclement conditions occur.
Samuels Public Library’s own mini Comic-Con celebrates reading and technology literacy at the library, in our community, and beyond through comics, graphic novels, manga, anime, gaming, and computer technology. This is the culminating event of Library Card Sign-up month.
This year’s theme was Lord of the Rings! Cosplayers, programs gaming, crafts, maker space, scavenger hunt, inside vendor fair, local talent, costume contest – there was something for everybody.
The Royal Examiner was there too. Watch as we traveled around the Library and spoke to vendors, cosplayers and don’t miss the costume contest at the end. Congratulations to Kelly Clark for First Place in the costume contest.
The community came out and supported this event. To name a few:
Shenandoah Valley Discovery Museum
Boy Scout Troop 53
Samuels Library S.T.E.M.
C & C Frozen Treats
Mama Lucie’s Kitchen
Batman & Friends
Front Royal Joker & Harley Quinn
BattleGrounds Fitness / Crossfit Front Royal
Digital Bookmobile by OverDrive
Front Royal / Warren County Tree Stewards
Historical Miniature Gaming Society
The Kiln Doctor
Northern Virginia Academy of Ballet
River & Peak Outfitter
Simply Stitched Crochet
Smithsonian Conservation Biology Institute
Steven Reinagel, Author & Game Designer
Strokes of Creativity
Warren County Fire & Rescue
Wild World Designs
EDA Reform Committee receives audit update; reviews properties
FRONT ROYAL — The Reform Committee of the Front Royal-Warren County Economic Development Authority (EDA) learned during its September 12 meeting that the Fiscal Year (FY) 2018 audit of the authority’s financials — which currently are at the center of a major fraud and embezzlement scandal — should be ready by year’s end.
EDA Executive Director Doug Parsons told committee members that in-house accountants are finished reviewing the proposed adjusted journal entries on the asset side of the balance sheet done by investigative public accounting firm Cherry Bekaert, and now are working to finish the adjusted entries for debt on the capital side of the balance sheet.
“It’s going to be their best effort to represent what has happened,” Parsons said. “We are hopeful by September 27 that they’ll have everything ready to go … for the audit,” which will be completed by the EDA’s auditing firm, Yount Hyde and Barbour (YHB).
The EDA Board of Directors first will need to sign off on what gets submitted by the accountants to YHB, which will conduct the audit and inform the EDA about its current financial standing.
Fork District Supervisor and EDA Reform Committee Chairman Archie Fox asked whether, at the end of the audit, the members would know if the EDA was solvent. “Is that a fair question?” he asked.
“We have cash,” answered EDA Board Chairman Ed Daley, “but we’re like the federal government. If somebody called the federal government and said, ‘We want you to pay all of your bills today,’ the federal government’s in trouble; they can’t do it. We’re in that type of a position where what we owe, our liabilities, exceed our assets, but we have cash.”
In fact, according to Parsons, the EDA is $41.9 million in debt with roughly $1.8 million in the bank.
Front Royal Town Councilman Jacob Meza, another reform committee member, asked what the plan is for getting the EDA back to a normal operating level.
Parsons said EDA properties will be sold in order to recover as much taxpayer money as possible, and funds should be recouped through lawsuits. He said most of the EDA’s debt is covered.
“The First Bank and Trust IT Federal Loan, for example, is covered by Mr. Tran’s payment. From cash flow we’re covered on that loan and that’s big; that’s a pretty good-sized loan and that’s a huge payment. Thank goodness he’s making his payments faithfully,” said Parsons.
Going forward, Daley said that one of the future conversations to be had by the EDA Reform Committee must regard the role the EDA should play in the acquisition of properties “and how speculative, if you will, we should be.”
He suggested that the EDA, Town Council and Warren County Board of Supervisors come up with a recommendation around that idea.
During his updates, Parsons also provided committee members the status of several EDA properties, including 404 Fairground Road.
“We’ve been marketing that property and we have a fully signed and executed letter of intent to sell that property and we’re working with the client on a sales contract,” Parsons said, adding that the buyer wishes to remain anonymous until the contract and subsequent sale are finalized.
A potential buyer also exists for the EDA’s warehouse at 426 Baugh Drive, where Parsons said, “We have a very interested party that we are in negotiations with at this time.”
It’s an entirely different situation for the EDA’s properties at 506 and 514 E. Main Street, which are the old Stokes Mart and nearby apartment building, which remain on the market.
“We thought we had a buyer, but they backed out,” said Parsons. “We will continue to market those two properties.”
Meza asked if there’s a strategy that the EDA has adopted to select certain properties for sale and for what reasons.
“If I had a magic wand,” Parsons said, “the ones I’d want to sell first and foremost would be Stokes Mart and the apartment building, which the EDA has no business owning, in my opinion.”
And while 404 Fairground Road is a fine property, Parsons explained it also isn’t in the realm “of what EDA should be owning and marketing in an effort to create new jobs and bring in a new tax base.”
Comparatively, Parsons said that the EDA’s 426 Baugh Drive is “exactly the kind of property the EDA should own and I’m glad that we do; of course the idea there is to bring in a major employer to make a significant contribution to the tax base so we’re actively marketing that property. We have the ability to be a little discerning about who we sell it to and make sure we get the most bang for our buck.”
Daley added that it’s very important to the EDA Board that the Baugh Drive property is bought for its intended use, which should be “some type that’s going to develop jobs and the tax base.”
Meza said it seems that the EDA has put its properties into two categories — to get rid of the ones that it shouldn’t hold on to and to identify the most strategic properties to market to companies. He also asked if there’s another category, like one that’s designed to maintain EDA solvency by just selling off properties and keeping the monies.
While that is part of the overall strategy, Parsons said “it’s not a desperate fire sale for all of the properties.” Instead, there’s a “sliding scale” of priorities or more of a willingness to be more discerning about who buys the properties. “You can only sell them once,” he said.
Other EDA Reform Committee members present Thursday were Town Attorney Doug Napier, County and EDA Attorney Dan Whitten, County Administrator Doug Stanley and Council Clerk Jennifer Berry.
Watch the Royal Examiner video to hear the discussion between Whitten and Meza about whether the EDA can be dissolved or file for bankruptcy. Hint: Bankruptcy for such an authority as the EDA isn’t legally permitted, according to Whitten.
Exploring Warren County’s EDA financial scandal – How did it happen?
As the final weeks of the summer of 2019 arrive in the northwestern Shenandoah Valley, one small-town, rural community remains conflicted, perhaps even collectively traumatized by a financial scandal that has carried the names Front Royal and Warren County across Virginia and occasionally beyond into major media markets across the country.
In September, less than six months after civil litigation was filed seeking recovery of millions of dollars of allegedly misdirected economic development assets there have been:
– forty-one criminal indictments served against five defendants related to alleged financial fraud within the local Economic Development Authority;
– a long-time, generally well-thought-of sheriff is dead, possibly on the eve of himself being criminally indicted after being named one of the EDA civil suit defendants;
– the Town of Front Royal has filed a civil suit against the EDA and its former executive director that has climbed from an initial $3 million figure to as much as $15 million;
– a Special Grand Jury looking into potential criminality surrounding all of this has asked for a six-month extension to March 31, 2020, to continue its work begun in early April.
We must remember that everyone who has been charged civilly and/or criminally will have their day in court with an opportunity to give their side of the story and claim misunderstanding or innocence. But human nature being what it is, fingers have been pointed – sometimes rationally, sometimes not – and an ongoing, collective query remains on the lips of a community – whoever and however, how and why did it happen?
“We’re here tonight because there was a catastrophic failure that allowed criminal embezzlement and rampant mismanagement to flourish,” recently-elected EDA Board of Directors Vice-Chairman Jeff Browne said on behalf of the EDA to open the August 27 joint meeting of County, Town and EDA boards and staffs.
That is the short answer.
“None of us ever want to see that happen again. The failures can be grouped into two categories … failed procedures and failed oversight,” Browne added of the outline for a path forward.
What led to those catastrophic failures of people and processes will take a bit longer to unravel.
While ultimate legal responsibility will be the province of the civil and criminal court systems, likely even at the federal level on the criminal side, there can be little doubt that large amounts of money designated for public use related to economic development in Front Royal and Warren County were moved haphazardly with little, if any consideration to due diligence. LINK-Criminal and non-criminal dereliction of public duty: Where might they apply in the EDA financial scandal?
One can only wonder where the pertinent question that might have prevented it all was from a total of 19 elected and appointed board members from the Town, County and EDA over the past five-plus years. It wasn’t a difficult question – “Is what I’ve been told to justify a large investment of public funding, let’s say $10 million, verifiably true?”
Oh, that’s right – that question WAS asked three years ago.
However when first posed in mid-2016 by a lone municipal voice, Town Councilwoman Bébhinn Egger, as well as the Royal Examiner news staff, it was initially ignored and/or vilified by every other involved public official.
The vilification was that “negative press” was threatening the successful conduct of EDA business, particularly ITFederal business. It is a business now asserted in court filings as having fraudulently received the largest single chunk, $10 million, of EDA assets being sought for recovery in the EDA civil litigation.
But three years ago then Councilman Bret Hrbek, a recent if unsuccessful applicant for a seat on the EDA board of directors, seemed to speak for a distinct town council majority of five and the mayor when he suggested that the question about the truth of what was being presented to this community about ITFederal was counterproductive.
Because that “negative press” being generated by Bébhinn Egger and Royal Examiner about the ability of Truc “Curt” Tran and his ITFederal LLC to live up to the promised $40 million investment creating 600 high-paying tech industry jobs in this community had led the ITFed CEO to consider taking his ball and going home – or rather to take his LLC trumpeted as the first commercial redevelopment client at the Avtex Brownfield site, and go elsewhere.
But would that have been such a tragedy – particularly before the Town offered its initial one-month, twice-extended $10-million “bridge loan” that enabled the EDA to finalize its $10-million
loan to ITFederal through First Bank & Trust?
According to documentation in the Cherry Bekaert EDA financial fraud investigation, Tran listed ITFederal assets of $2,020,000 as collateral for the $10-million bank loan facilitated through the EDA. But $2,000,000 of that amount was the value of the 30-acre property at the Avtex site/Royal Phoenix Business Park which the EDA “gifted” behind closed doors to Tran for $1 – yes, one dollar American – after public discussion of a $2-million dollar sale price.
Royal Examiner thought so in its first month of existence when it broke the news of that one-dollar, 30-acre gift to ITFederal leading to a year’s delay in approving the transaction by federal oversight authorities.
As noted in the linked October 27, 2016, Royal Examiner story, approval from the U.S. Justice Department to remove the ITFederal parcel from a bankruptcy court-ordered $2.06 million lien on the Royal Phoenix/Avtex property came on September 23, 2016. That was just over a year after the request to allow the one-dollar sale was sent out by then EDA/County Attorney Blair Mitchell on September 18, 2015. The stated rationale was that facilitating the ITFederal project with a give-away of land valued at $67,000 an acre would jump start other full-price purchases at the site.
“This 30 acres has been sold for $1.00 in order to get a developer to come in and begin the process of other buyers,” Mitchell wrote, adding, “The EDA already has a buyer for a 3-acre parcel to sell at $67,000 per acre, so selling this parcel as a way of breaking the ice will pay off in the long run. While the $1 will not be used to pay down the $2,060,000 lien, sales proceeds from future sales will be applied toward the paydown of the secured debt.”
Three years later we see how that plan worked out:
1/ no three-acre sale to CBM Mortgage at Royal Phoenix;
2/ no other land sales at Royal Phoenix;
3/ no $40 million investment or any jobs created by ITFed at the Royal Phoenix site.
In fact per the ongoing sweetheart agreements he was dealt by the EDA, it appears Tran may invest about $2 million to create an unoccupied 10,000 s.f. building at his “get the redevelopment ball rolling” gifted acreage with no further obligations other than that he have a certificate of occupancy issued by the middle of 2020 and continue to make monthly payments for the balance of 30 years on that $10 million bank loan through the EDA.
And the Cherry Bekaert investigation verifies what Royal Examiner and Bébhinn Egger were saying at the time – that there was no evidence the $140-million dollar federal government contract ballyhooed by Tran, his D.C. political sponsor Robert Goodlatte and EDA Executive Director Jennifer McDonald as the basis for ITFederal’s investment here ever existed.
How did it happen – not just the ITFederal and Workforce Housing debacles that first attracted this media outlet and Councilwoman Egger’s attention – but all of it, the 16 specific project allegations cited in the Cherry Bekaert working papers report and summary?
Those projects in order of their listing in the Cherry Bekaert summary are: Workforce Housing Project/Royal Lane Property; Afton Inn Property Improvements; Criminal Justice Training Academy; Bargain Land Sale and Issuance of $10,000,000 Loan to ITFederal; Payments to or on Behalf of ITFederal; Payments to Earth Right Energy; New Market Tax Credit Projects; Leach Run Parkway Easements; Wetland Credits; New Hope Bible Church; 999 Shenandoah Shores Road; Payments to (McDonald) Relatives; USDA Intermediary Relending Program; Stokes Mart/B&G Goods; Payments to Known and Suspected (McDonald) Business Partners; USDA Rural Business Enterprise Loans.
How could personal and procedural checks and balances collapse so catastrophically for such a length of time, in so many directions?
“I had no reason not to trust her,”
“I had no reason not to trust her,” is a comment offered by more than one EDA or municipal official in explanation of the lack of due diligence performed on project proposals and financing or the purchase and sale of properties through the EDA on the word of its former executive director. LINK-Hitting it BIG at Charles Town’s Hollywood Casino – a local success story
Perhaps it is that personal comfort and familiarity – “I had no reason not to trust her” – born of long-time social, professional and organizational ties that gives us a clue at a root cause of that “catastrophic failure” of procedures and oversight cited at this story’s outset.
It is a familiarity born of business and legal transactions, organizational memberships, not to mention in many cases political party affiliations. In Warren County those political affiliations are almost exclusively on the Republican side of the political aisle, from local to state and federal levels. And that is not to point a finger at one party or the other, but rather just to acknowledge the local political landscape.
Were there to be only Democrats in electoral and judicial office here, the situation would be the same – “I know you; we have common interest and cause, why would I not trust you?”
It is such personal or professional familiarity that has forced the eventual recusal of all the county’s circuit court judges from hearing EDA legal matters at an evidentiary level. Chief 26th Judicial District Judge Bruce D. Albertson, now hearing EDA civil and criminal cases in place of Judge Clifford L. Athey Jr., has indicated he will soon appoint another judge from outside the county to take over the EDA Special Grand Jury bench as Athey heads to the Virginia State Appeals Court.
It is that small town “everyone knows everyone” personally, organizationally, professionally and politically that can contribute to that apathy toward fundamental organizational due diligence, if not worse.
Why would anyone in local elected or appointed office here not trust then-U.S. Sixth District of Virginia Republican Congressman Robert Goodlatte’s 2014-15 assertion that ITFederal would invest $40 million dollars and create 600-plus high-paying jobs here based on a $140-million federal government contract there was no evidence existed?
Rollback of Wetlands Protections undermines Chesapeake Bay Cleanup
The non-partisan, environmental watchdog group that alerted the public to dangerous levels of E Coli contamination in the Shenandoah River in 2017 has released a critical appraisal of new Trump Administration roll back of one aspect of Chesapeake Bay watershed protections.
The Town of Front Royal’s work in recent years on improving its wastewater treatment facility and processes was mandated in part by the Shenandoah River Basin being included in the Chesapeake Bay Watershed impacted by regulatory protections at federal and state levels. In addition to helping clean up local waterways, the end result of those regulations is protection of the Chesapeake Bay and its billion dollar annual fishing industry.
So, while yesterday’s release doesn’t involve wetlands in the Shenandoah Valley, we are connected in the end result of negative impacts on regulatory protections of the Chesapeake Bay and consequent negative impacts on the seafood we, the nation, and likely a good bit of the world, eat from it.
On Thursday, September 12, Environmental Integrity Project Executive Director Eric Schaeffer issued the following statement regarding the Trump Administration’s new “Waters of the U.S. Rule,” which was finalized Thursday, September 12:
“This regulatory rollback by the Trump Administration is a clear setback for the Chesapeake Bay cleanup because it threatens to strip federal protections from some wetlands in our region that provide important water pollution filtration services. Specifically, the change could eliminate federal protections from 34,560 acres of scattered wetlands called ‘Delmarva Potholes’ on the Eastern Shore that help reduce the runoff of farm fertilizer into the Bay.”
The press release continues to explain and map out the so-called “Delmarva Pothole” wetlands and their role in providing watershed protections to the Chesapeake Bay.
“A December 2018 report by the Environmental Integrity Project, titled ‘Undermining Protections for Wetlands and Streams’ mapped the location of these Chesapeake wetlands at risk in the Trump Administration rollback. Although seldom discussed, 4,950 “Delmarva Potholes” wetlands cover 34,560 acres of Eastern Shore farmland in Maryland and Virginia. That acreage is the equivalent of 54 square miles of wetlands – a landmass almost the size of Washington, D.C. – that provide important habitat for amphibians, birds, and other wildlife and perform filtration services to keep farm runoff pollution out of the Chesapeake Bay.
“Delmarva Potholes are non-tidal wetlands in low-lying areas that are not usually connected on the surface to rivers or streams. Their waters often connect beneath the ground, or through ditches, to nearby streams and waterways, especially in rainy seasons. In appearance and formation, Delmarva potholes are often oval-shaped depressions carved out by the wind in past centuries. Historically, 119,000 acres of these ‘Delmarva potholes’ existed on the Delmarva Peninsula. But over the last three centuries, farmers drained more than two thirds of them to convert them to cropland. The remaining patches of Delmarva pothole wetlands — an endangered species, of sorts — are now usually wooded patches with wet soil surrounded by acres of corn and soybean fields.”
Schaeffer is a former Director of Civil Enforcement at the U.S. Environmental Protection Agency.
For more information on EPA’s action today, visit EPA’s “Waters of the US” webpage here: https://www.epa.gov/newsreleases/epa-us-army-repeal-2015-rule-defining-waters-united-states-ending-regulatory-patchwork
For a copy of EIP’s analysis of the impact of the rollback on the Chesapeake Bay region, visit: https://www.environmentalintegrity.org/news/report-details-impact-on-the-chesapeake-bay-of-trumps-proposed-rollback-of-wetlands-regulations/
(The Environmental Integrity Project is a nonprofit, nonpartisan organization based in Washington, D.C., and Austin, Texas, that protects public health and the environment by investigating polluters, holding them accountable under the law, and strengthening public policy.)
Community game center comes online – InfoTech’s new tournament center
On September 12th, which was also coincidentally “National Gaming Day,” Front Royal’s Community Gaming center opened its doors.
Announced at last week’s regular Town Council Meeting by Interim Mayor Matt Tederick, the center is an example of the entrepreneuring spirit here in Front Royal. Kevin and Trudy Rogers, who some may know as the owners of the InfoTech Cellphone Repair store on Main street, started down the road of this project when they hosted a game tournament for fun in their store earlier this summer. When asked what gave them the idea to host this game tournament, Trudy responded “I decided when I was playing games with my son, something we like to do in our free time, and he told me about these Fortnite tournaments and it intrigued me. I just thought the idea of people coming together to have fun playing games was really cool.”
The success of this tournament, which brought out more than a dozen kids, inspired the couple to expand it into a business. Trudy’s love for gaming and the social experience it can offer moved her to create a tournament center in the backroom of the InfoTech store. After completely remodeling the room to encompass dozens of monitors and a top-of-the-line WIFI station, she dedicated the room to her grandmother who loved gaming as much as Trudy does; calling it the EMR Cave. They finished construction at the end of August, only a few months after the first successful tournament.
Some people would question the usefulness of this center, such as concerned parents who worry that their kids play to many video games. Trudy responded to these objections by reminding those at the open house that the center exists to bring the kids out of their rooms to meet and make friends with others. “Wouldn’t it be better to see the people you play with face to face? The answer is a resounding yes! It’s good for the kids.”
The EMR Cave will be open for use to any group that wants to use it. Tourney Gaming will be hosting monthly tournaments with a $20 buy in. Players can also rent out the room for 2 hours for $140 and bring friends or even throw a party. The first tournament will be a Fortnite tournament held September 21st at 2 P.M. with a free trial for a solo Apex Legends match afterwards.
Tournament’s will work as a “bring your own console” because Trudy want’s to let players play with their own settings. However, if a player for some reason can’t bring their own, they do have Xbox’s available for use. The center also has rental headsets and controllers, everything a gamer would need to play well.
Trudy’s long-term goals for the center include installing Virtual Reality (VR) consoles, as well as expanding tournament games to any competitive shooter out there. Businesses can also sponsor tournaments, bringing in the kids and advertising directly to them.
If you want to learn more about the Tourney Gaming Center, visit their website at www.tourneygamer.com
A Place to Be
On the Saturday of the 5th annual Appaloosa Festival an organization called “A Place to Be” presented the healing power of music. This is not just some good feeling, soul-searching activity.
Music therapy is a medical and psychological science based on the clinical use of music interventions. It helps clients to carry out goals within a therapeutic relationship between a them and the therapist. “A Place to Be” uses music to treat anything and everything, from stroke survivors to those on the autistic spectrum. Having started in Middleburg and expanded to four Inova hospitals, they are well credited in their treatments. Music Therapy is now accepted as a discipline alongside other paramedic professions such as physiotherapy, occupational therapy, speech therapy and psychology in paramedic services and special education services provided by health and education authorities.
At an interview with Music Therapist Brad Hassan, he explained exactly how music is used in some treatments. “In music there is tension and release, so we create tension with rhythm which motivates the patient. Rhythmic music helps people move more fluidly, singing supports speech recovery, preferred music can change affective states, associations can engage memory, all to help patients overcome their obstacles.” The effects of the treatment are incredible. Just one example was Ms. Dionna who suffers from a stuttering speech impediment, but after treatment was able to confidently stand on stage and sing beautifully.
Another example of music therapy’s treatment is the artist Daniel Derrico. Daniel suffered from a speech impediment most of his life, and it had started to become crippling when it prevented him from going to school or even communicating simple ideas. However, after participating with “A Place to Be,” not only did he overcome his impediment in simple tasks, Daniel also became a successful singer and songwriter. At Appaloosa he sang on stage in front of thousands without a single stuttered word. He still partners with and advocates for “A Place to Be” to help support others in overcoming their struggles.
To learn more about “A Place to Be” and what music therapy can do, visit their homepage at: http://www.aplacetobeva.org/music-therapy.