FRONT ROYAL – The Front Royal-Warren County Economic Development Authority has appointed a task force to assist outside legal counsel with an ongoing investigation into an unidentified matter.
The EDA at its Wednesday meeting appointed board member Edwin Daley to serve with Interim Executive Director John Anzivino on the task force that will act as a liaison to the Sands Anderson law firm.
The county hired Sands Anderson in January to represent the EDA on unspecified legal matters. The Board of Supervisors put a $50,000 cap on those services.
County and EDA Attorney Dan Whitten said the task force will work with Sands Anderson in “trying to wrap everything up” and “complete any investigation that is necessary.” He said the firm is “representing the EDA’s interest” so he can go back to representing the county full time.
The EDA contracted another outside representative on Sept. 11, when a $10,000 down payment was given to an unidentified financial consultant. Whitten said the EDA chairman can approve any operating expense of $10,000 or less without needing EDA Board approval in open session.
While the hire was revealed Dec. 21 when the county – on the EDA’s behalf – paid the consultant $90,000 for three months of work, the firm’s identity remains unrevealed.
Approval of that payment came a day after Jennifer McDonald resigned as the EDA’s executive director, a position she held for about a decade. The resignation came just over a month after the Front Royal Town Council publicly acknowledged it is owed an estimated $291,000 by the EDA, a product of overpayments relating to debt service.
EDA Chairman Gray Blanton previously said that McDonald told him that money would be easily accounted for and is not missing, but when asked if paying the town back would be as simple as writing a check, he said “it won’t be as simple as that.”
Blanton said Wednesday that the EDA continues trying to correct its QuickBooks computer accounting program and that attempting to remedy that issue has been “a rough road.”
When asked about any potential wrongdoing that may have been found during the ongoing investigation, Whitten said he could not reveal anything because “that’s all attorney-client privilege.”
“All I can say is there’s an investigation, and we’re hoping to wrap it up in the near future. But I can’t comment on anything they’ve discovered or what they’re working on,” he said.
The board appointed the task force after going into closed session for over an hour.
Freedom of Information Act exemptions cited as reasons for going into closed session included: consultation with legal counsel regarding EDA loan programs, accounting and debt service issues and related matters; consultation with legal counsel regarding the contract termination of a property in the Shenandoah magisterial district; and discussion of a prospective business or industry or the expansion of an existing business or industry.
Before adjourning to closed session, Blanton said the board would be receiving new information from consultants who would provide direction on how to proceed “as we work toward better understanding the actions of our former director in operating the authority.”
Blanton added that to ensure a clear understanding of that information and what the best decisions are going forward, the closed session was limited to outside counsel, select employees and board members.
He said that in the “near future,” when the board is certain all of its questions are answered, those findings will be presented to the Warren County Board of Supervisors and Front Royal Town Council.
Meanwhile, Whitten said the board’s unidentified outside financial consultant is working with the EDA’s regular auditing firm — the Winchester-based Yount, Hyde and Barbour — on “finishing up the audit so the EDA can approve it.”