Vigorous and vocal reaction to a proposed 66% increase in the Town's real estate tax and to suggestions the Town end its $30,000 per year subsidy of the "Pink Box" information center marked the May 10 session of the Middleburg Town Council.

The Council's "regular" Thursday meeting was but one of a series of full-Council "work" sessions over the past month, with some discussions open to the public, some, especially those related to discussions with Salamander, closed.

The meetings focused on two inextricably related issues: tough budget decisions for the coming fiscal year and moving forward on the most recent version of the Salamander Inn development plan.

Once open, the new, 168-room, Salamander Inn and Spa is expected to drive roughly $100,000 per month to the town's coffers according to Council Member Trowbridge Littleton. In addition, Salamander's construction of a new, $5 million waste water treatment plant spares the town cost of either keeping the old system in repair or, inevitably, replacing it. Slowly, that process continues to move forward, with a firm majority of the voting members of Council in support.

All budget options are, however, on the table including: a raise for town employees that amounts to an inflation-adjusted pay cut; cutting or eliminating the town's marketing and economic development budgets, and transferring the administration of the Town's water and sewer system to the County.

In the midst of these discussions, problems with the Virginia Department of Transportation raised yet another old ghost: financial oversight. This time it took the form of a $50,000 check written to Emmanuel Episcopal Church on October 21, 2005. Apparently authorized by former Town Administrator Mike Casey, and signed by former Mayor Tim Dimos, to date, no formal documentation of Council review or approval of the expenditure has been forthcoming from either Church or Town.

Real Estate Taxes: Up 66%

At the public hearing on the town's "Proposed Real Estate Tax Increase on May 10," Town Administrator Jerry Schiro justified a 66% increase by citing long-discussed, documented, and irrefutable needs.

With the Salamander properties annexed, but undeveloped, Schiro chose to recommend a tax rate in which no new assessments due to new construction or improvements would be included.

As of January 1, 2007, he noted, the total assessed value of real property in the Town was roughly 5.4% higher than last year.

To generate the same amount of revenue as last year, a tax rate of nine cents per $100 of assessed value would be sufficient.

In order to balance a 1% increase in the Town's budget, however, Schiro and the Town Council proposed adoption of a rate of fifteen cents per $100 of assessed value.

It was the first CHANGE in the Town's real estate tax rate in a quarter century according to a resident who remembered it, and the first INCREASE in even longer.

"I hate to be always in the negative," Jerry Wine responded, "but we just raised water and sewer rates . . ." Noting that the increase would place "a significant burden on a number of people in town" he said, "We need to do some belt tightening somewhere else."

Wendy Duling concurred. "It can come out to be quite a bit of money," she said. "…people who may feel they have to relocate to some place less expensive because taxes are prohibitive."

A public hearing on the final draft of Schiro's first formal budget for Middleburg was scheduled to coincide with the full-council work session on May 24, with adoption possible seven days later, either at the June 11 work session, or the June 14 regular meeting of Council.

Pink Box, Red Faces

Schiro also reported that, following Council discussions on April 26, he and Claudia Dornin, Middleburg's Economic Development Director, were "exploring the feasibility" of "relocating" the public information activities currently carried out by volunteers in the "Pink Box," the town's quaintly named official "information center."

Town Attorney Liz Whiting was, he said, investigating the possibility of breaking the Town's lease of the property from the National Sporting Library. Breaking the lease appeared to be possible, according to Schiro, if the library were notified on or before June 1.

Up to $30,000 per year could be saved by moving the town's "information center" to either the Town Offices or the Town-owned "Health Center" building that currently houses, among other things, Police Headquarters.

The notion of "closing" the "Pink Box" drew immediate fire, offers of financial support from fans of the center, and unpleasant public exchanges on the floor of Town Hall.

Audrey Bergner, part of the 12-member "Pink Box Advisory Committee" read a prepared statement "on behalf of the Volunteers, the 'docents' of the 'Pink Box.'" Noting that the "hospitality, warmth and sense of history could not be duplicated in another location," Bergner said a group of more than twenty individuals and families had pledged enough money to cover the rent paid by the Town for the Pink Box for a full year.

Bergner also announced that the Middleburg Garden Club had pledged $2,500 towards maintaining the "Pink Box" gardens. "This is," she said, "a perfect example of the caring spirit which makes this town so unique."

Joanne Swift, owner of "The Shaggy Ram" on Main Street, agreed, and suggested that "anyone who has a business here should be more than willing to kick in $100 or more per month to keep the center in the 'Pink Box.'"

Unpleasantries

Kathy Ribaudo, who serves on the Town Planning Commission and as Treasurer of the Middleburg Garden Club, suggested that "Pink Box" volunteers might consider setting up a private foundation to spare the Town the expense of maintaining the property, and consider treating it as an historic site, rather than a working "visitor center."

She ran into trouble, however, when she noted, "The true cost of running the 'Pink Box' is not $4,800 a year."

She was met with catcalls from the floor when she noted that $4,800 was "just the rent" and that the "true cost to the town . . . was closer to $20 or $30 thousand a year."

Betsy Davis, for perhaps the first time in her tenure as Mayor, was compelled to call for order.

Shocked, Ribaudo spoke directly to the "Pink Box" supporters who had interrupted her.

"I have been treated abusively every month, every week," she said, noting that she'd "been coming to your meetings for eleven years."

Conceding that the fate of the "Pink Box" was an emotional issue for some, she urged that, in spite of it, "we deal with realities and the facts."

Citing rumors she'd heard, among them a tale of the center's imminent "relocation" to some out-of-the-way "basement," Ribaudo chided her detractors. "I do not wish to hear the misstatements that I hear on the street," she said. "I want to hear it from the horse's mouth in horse country."

Confirming, from personal experience, persistent rumors that even volunteers and town officials were sometimes asked to sign the "Pink Box" register of "visitors," Ribaudo noted that, as a "visitor center," the "Pink Box" was in a terrible location, hard to find, and poorly identified.

"Putting your visitors center in an area where we have no shops," she contended, was non-productive.

As for the $2,500 Middleburg Garden Club donation, Ribaudo told the council that, "When the Board . . . voted on its donation to the 'Pink Box,' none of us understood the terms of this lease [with the Sporting Library] and what happened to capital improvements."

According to Ribaudo, the Garden Club was now "holding that donation in abeyance until such time as there is a resolution, by the Town Council, of this whole issue." Ribaudo concluded by thanking the Council for its hard work in difficult times.

$50 K to Emmanuel Church?

Perhaps the most unfortunate event of the month's series of meetings and work sessions was the discovery . . . or rediscovery . . . of what appears to be an unauthorized $50,000 payment from the Town to Emmanuel Episcopal Church, and a Church request for even more.

At best, the situation can be described as an unfortunate example of good intentions gone awry. At the very least it serves, in the words of Town Council member Mark Snyder, as yet another example "of a litany of unauthorized expenditures" incurred during the administration of former Mayor Tim Dimos and former Town Manager Mike Casey. Documentation is sketchy.

Parking Lots and Storm Waters

All parties agree that the problem began in June 2005, with a genuine effort to do the right thing for both the Town and Emmanuel Church.

In the fall of the preceding year, 2004, Emmanuel Church began a renovation project and new construction on its Parish House project at 105 Washington Street.

Loudoun County regulations required that the church construct a new "Storm Water Waste Management System" designed to carry water from the Parish house site and its parking spaces, across East Federal Street, and into a stream that flows through the graveyard across from the church.

According to a letter from Jim Davis, Chairman of the Church Building Committee, construction of the system was expected to cost roughly $200,000.

In the summer of 2005, Middleburg was required to build a similar system, designed to carry storm water away from its new Liberty Street Parking lot, built directly across the street from Emmanuel Church. Estimated cost: $150,000.

Documents at Town Hall indicate that instead of constructing a new system for the Federal Street lot, former Town Manager Mike Casey and others decided to connect the Federal Street Parking Lot system to that serving Emmanuel Church.

According to Casey and other sources, connecting the Federal Street Lot to the Church system BEFORE it crossed Federal Street promised to save both money and unnecessary destruction and restoration of private property.

According to a September 2006 letter describing the combined-system plan, the new approach allowed Middleburg to avoid: having to build its own crossing of Federal Street; securing an easement to use private property near the cemetery for underground pipe; cutting down a number of old trees on the private property; installing a second pipe, parallel to the Emmanuel Church pipe, to carry water from East Federal Street to the stream; preparing a suitable outlet into the stream itself; and then restoring the landscaping of the private property right of way.

The plan, however, required that significant improvements be made to the Emmanuel Church system to handle the extra water from the Federal Street Parking lot.

These improvements were made, and, according to a September 2006 letter from Emmanuel's Jim Davis to Middleburg Town Planner David Beniamino, "In return for the use of the Emmanuel System, the Town of Middleburg agreed to pay Emmanuel Church $50,000." A check was issued on October 21, 2005.

Extra Costs

According to Emmanuel Church, however, the $50,000 check did not fully cover the costs the Town had agreed to pay.

Breaking through hard rock on East Federal Street required heavy equipment and another $23,201, and Loudoun County Inspectors required an additional $18,478 of work.

Claiming that the Town would have encountered the same problems had it built its own independent system, Emmanuel Church asked to be reimbursed for the extra expense.

According to a Jim Davis letter, former Town Administrator Mike Casey then "offered to pay Emmanuel Church a final payment of $25,000 for the Town of Middleburg work plus a contribution toward the additional costs incurred in the construction of the storm water management system."

Davis, in the same letter, asserts that he, on behalf of the Church, accepted Casey's offer, but that "this payment has not been made by the Town."

Who Really Owes What to Whom?

In late April 2007, Jerry Schiro, Middleburg's new Town Administrator, reported that the Virginia Department of Transportation was having "some issues with the work" on both the Federal Street Parking Lot system and that done for the Church. These new "issues," including storm water grates and sidewalks not meeting VDOT specifications, set off a firestorm in Council.

During the April 27, 2007, work session of the Council, Vice Mayor Darlene Kirk asserted that she remembered an earlier discussion of the matter, "including cost issues, and that 'Council's opinion was to go back to the Church and say that it [ostensibly Emmanuel's request for an extra $25,000] was not an agreed upon amount.'"

Council minutes record Mark Snyder asserting that "unless anyone could find meeting minutes or anything else that showed that Mr. Casey was authorized to enter into that agreement, there was no agreement." Snyder further noted that "he did not believe Council ever authorized that agreement."

Town Attorney Liz Whiting concurred, stating "she did not think anyone knew that agreement existed."

Mike Casey told the Eccentric, "While I don't recall the dates when the matter was discussed with Council, I do know that it was discussed as a cost saving measure, which made a lot of sense to everyone involved."

After Casey was fired by the Town Council, Emmanuel Church pressed acting Town Administrator Claudia Dornin for payment of the Town's fair share of the "extra costs" of the system.

Dornin, aggressively enforcing the Town's legal requirement that all invoices totaling more than $10,000 be approved by Council before payment, apparently asked to see the Church's contract.

Town documents indicate that Emmanuel Church's representative replied that there was nothing written, and indeed, nothing to document how the value of sharing the waste water easement was set at $50,000, other than Mike Casey's signature on the church invoice for that amount, directing former Town Treasurer Betty Wolford to pay the bill.

To date, former Mayor Tim Dimos, who signed the check, has not replied to inquiries from the Eccentric.

Snyder absolves the Church of any responsibility in the matter, noting that "from their point of view they thought they were dealing in good faith with an authorized representative of the town." To date, both authorization of the original $50,000 payment and Emmanuel Church's request for extra payments remain, legally, unresolved.