FRONT ROYAL – With a new year and a new budget looming, the Front Royal-Warren County Economic Development Authority passed around its draft budget that shows it will run out of money in mid-March.
Marjorie Martin, who joined the EDA as its treasurer in July, said she had done her best to lay out a detailed budget that describes each of the revenue streams and expenses to create a transparent budget. At the top of her list was the decision to move the ITFederal payment from its previous line in income to “where it belongs” in the debt service column.
The draft budget shows the EDA has $1.7 million in debt service, spread out across eight different projects. The ITFederal line that was moved from income to debt service will cover $504,000 of that debt with the county slated to shoulder the remaining $1.2 million.
“There’s not anything we can do about debt service,” Martin said. “We have spent the last several months, as you well know, going to different banks. We have the best deals we are going to get right now. We don’t have any wiggle room at all.”
“I certainly did not prepare this budget with any kind of stock that there is any better rate out there or anything else,” she continued.
Martin said those numbers will change if the town and the authority can work out payments for the police department and the authority can sell some of its properties. Although the figures may change, Martin said her first draft is the “most conservative” number she can come up with.
To get some of the EDA properties into shape to sell, Martin budgeted $38,000 for maintenance and renovation.
The priority, she said, was to work on the EDA’s headquarters on Kendrick Lane. Most important to improving the property is removing the solar panels that Martin said was “below low hanging fruit.” It is a potential $40,000 project if the authority does not find a buyer willing to help with the expense.
Ed Daley, chairman of EDA, said there is still a pending offer from the Rappahannock-Shenandoah-Warren Regional Jail to take the solar panels but he had not heard from them by Friday morning. County Administrator Doug Stanley proposed the option of the jail purchasing the solar panels from the EDA in November. At the time, other authority members and the jail’s legal counsel said they were hesitant to get involved with the panels which, at the time, were potentially tied up in legal issues.
If the jail does not purchase the panels, Martin said the authority does have a deal lined up with an interested nonprofit that would be willing to cover the cost of removing the panels from the EDA building.
Without assuming a solution to the issue of solar panels, Martin told the EDA members that, as of Dec. 31, they had $481,995 cash-on-hand, after accounting for expenses.
“We have much more cash in the bank,” Martin said. “But what we have done is subtracted out the bills we know we have to pay.”
Actual costs to run the EDA are about $45,000 a month, Martin said, “which is not bad, to tell you the truth.”
As it stands, Martin told EDA members the authority is set to run out of money by the middle of March.
On Tuesday, authority members will attend a Board of Supervisors work session to update the new supervisors on the state of the EDA and answer any questions the supervisors have.