FRONT ROYAL – Invoices for the canceled Skyline Criminal Justice Academy state that the Front Royal-Warren County Economic Development Authority spent $540,269 on the project.

Plans for the academy, which was to be funded through a private investor, were announced in March 2016 with an expected July 2017 completion.

That investor, whom officials declined to identify, agreed to pay up to $8 million through the EDA for construction costs on an as-needed basis. EDA Attorney Dan Whitten said the project died because rising construction costs went above that offer.

He noted that before construction could begin, engineering and architectural plans and permits had to be obtained. While waiting for those processes to be completed, he said construction costs increased.

Freedom of Information Act requests seeking a contract between the investor and the EDA were unsuccessful. John Anzivino, interim EDA executive director, stated in a letter that he could not provide a contract because “the requested records could not be found or do not exist.”

He said having no contract is interesting, and that “there’s a lot of interesting things here.”

Anzivino noted: “there are a number of actions” for which there is “not a lot of documentation,” and “we’re piecing everything together right now.”

EDA reshuffling

Anzivino was appointed in January as interim EDA director in the midst of intensifying questions about the organization’s finances. He replaced Jennifer McDonald, who resigned after 10 years on the job.

In August, Greg Drescher stepped down as the EDA’s chairman, but remained on the board.

In October, William Biggs, EDA treasurer of 30 years, retired citing health issues. Josie Rickard, the EDA’s bookkeeper of 20 years, also retired that month. It was revealed that month that the EDA owes the town at least $291,000 stemming from overpayments related to debt service.

The county has since paid a financial consultant $160,000 — for work completed over five months — to examine EDA finances. More payments are imminent as the firm continues working.

The county also approved a $100,000 cap for the Sands Anderson law firm for potential work with the EDA. The county additionally contracted attorney Robert T. Mitchell, who will be paid $275 per hour, to prevent conflicts of interest for Whitten, who is also the county’s attorney.

Academy files stolen

On May 18, 2017, a break-in at the EDA’s Kendrick Lane office was reported to the Front Royal Police Department.

Police reports regarding the incident state there was no forced entry and the only office keys were held by McDonald, former director of marketing Marla Jones and administrative assistant Missy Henry. A spare key was also kept in a lockbox to which only the three EDA employees knew the code.

The reports state McDonald initially said nothing was stolen. Vandalism that occurred included a photo of McDonald’s face pinned to a chair with a knife and other defiled photographs. No charges were filed.

On May 24, McDonald said she noticed missing confidential files regarding the academy and its investor, the ITFederal project at the Avtex Superfund site and a workforce housing project, according to the reports.

The police reports state that local reporter Norma Jean Shaw inquired whether Curt Tran, ITFederal developer, was the private investor.

The reports state that McDonald told police on June 14 that “no one else knows who the investor is” unless they have the stolen file.

The next day, McDonald was interviewed at the police department regarding the break-in. That night, a rock was thrown threw through the front door of her home. A typed note was found at the scene with statements including “she is already on the edge because of the photos” and that "Norma Jean" “will be waiting” for “the files.”

Local reporter Roger Bianchini told police that McDonald told him details of the incident before it occurred. She was charged on a misdemeanor count of filing a false police report and found not guilty.

Regarding the missing records, Whitten said: “Some things aren’t really explainable.”

“I don’t know how you explain that. I mean, I don’t know where the files are in her office...so I guess someone either took the time to look through and find them or they knew where they were. I’m not sure,” Whitten said.

Tran said over the phone Tuesday that the idea of him investing in the academy was discussed but the deal was never finalized, and he never made any payments.

Whitten declined to identify the investor, noting the EDA board never publicly revealed them. He said anyone who identified the investor may have breached closed session rules.

Whitten said he became county attorney in May 2016, after the deal with the outside investor, and he does not know why there is no contract. He said the financial consultant “is looking at any connections...it will all come out in the final report if there is any correlation between these different projects...they’re looking at all of those avenues.”

Money spent

The $540,269 spent on the academy between 2015 and 2018 was for items including schematic designs, construction administration, furnishing design, storm water permits, access road design and more, according to invoices.

Whitten said the EDA’s audit for the fiscal year 2017-2018, which has not been publicly revealed, states that $542,754 was spent on the academy.

He said the financial consultant is working to “see who paid what and making sure all of the invoices match up to the amounts that were paid.”

The invoices show that the EDA received $200,000 in reimbursements for money spent on the academy, which Whitten said came from the private investor.

Upon hearing of the $200,000 reimbursement, Tran said “that’s the first I’ve heard of it” and that he did not invest in the project.

Plans for Avtex site

Ground broke on ITFederal, a data center, in October 2015. It was announced as a $40 million project that would bring 600 jobs. McDonald previously said the groundbreaking was the idea of former U.S. Rep.Bob Goodlatte, R-Roanoke.

The Town Council in September 2015 provided the EDA a short-term $10 million loan for the project. That was repaid two months later when the EDA obtained a loan through First Bank and Trust Co.

Town Finance Director B.J. Wilson said over the phone that the loan was paid back from the Michael L. Bryan Real Estate Trust Account and the firm Bryan & Coleman. He said that was before his appointment as director.

Whitten explained that the EDA gave that $10 million loan to Tran and ITFederal and it must be repaid over 30 years.

Wilson added that he does not know why the EDA asked for a short-term loan to spearhead the project when it has not been completed over three years later.

While the original deed of trust for the site required a $5 million investment and a 28,500-square-foot building, that has been reduced to a $2 million investment and $10,000-square foot building. ITFederal bought the land from the EDA for $1 with the stipulation that those requirements be met.

Tran confirmed that construction is an EB5-Visa project, which provides green cards to private foreign investors who invest between $500,000 and $1 million on certain projects that provide at least 10 jobs.

Tran said that ITFederal will not open due to difficulties in attracting investors. He said there are plans to bring another business into the building, which remains under construction, but difficulties remain in finding an investor due to negative feedback.

Tran said plans are outlined on royal-phoenix.com, which details a potential e-commerce import-export business tied to the United States and Asia. He added that he hopes other businesses would be attracted, and “I’m just trying to develop that Avtex site.”

If the building is not complete by September 2020, the deed states the developer must pay the EDA $2 million minus what has been invested in construction.

CORRECTION: The note left at the scene of a crime did not state a last name for "Norma Jean."

Contact Josh Gully at jgully@nvdaily.com