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Community Advocacy Group Wants Formation of Citizens’ Committee on Tetra Purchase

by Dave Emke — March 13, 2017 at 2:45 pm 20 Comments

Lake House

Community group Reston 20/20 is calling for an independent committee of RA members to be formed to delve deeper into the circumstances surround Reston Association’s controversial Tetra/Lake House deal.

The group made the recommendation Monday as part of a 10-page analysis of StoneTurn Group’s review of the transaction and subsequent cost overrun, which was completed in February.

According to Reston 20/20’s recommendation, the committee should be formed after the board’s elections have completed in April. At that time, four new members will join the nine-person board.

“In light of the fact that the current Board majority was immersed in all the events described here and in StoneTurn’s report, it has no credibility in conducting any further actions on Tetra,” said Terry Maynard, co-chair of Reston 20/20. “The new RA Board, installed next month with a majority not involved in Tetra, should tackle the issues we raise here and any others it finds in a deep dive effort by a committee of Restonians.”

The majority of which Maynard speaks will be made up of the four new members plus director Sherri Hebert (Lake Anne/Tall Oaks District) who was elected in 2016, following the conclusion of the transaction and renovations. Hebert has also recently called for more community involvement in the analysis of the report. (Two other continuing board members, Julie Bitzer and Ray Wedell, were elected in April 2015 — after the purchase proposal had been drawn up and scheduled for referendum, which passed with 53 percent of the vote in May 2015.)

In its analysis, Reston 20/20 says StoneTurn’s report provides “important new information on the timeline of actions leading to the excessive price paid for the property and its huge repair costs,” which it says is “a vital first step in understanding fully what transpired in this unfortunate venture for RA and its members.” The analysis goes on to ask numerous followup questions, many related to personal responsibility for decisions made during the process, including:

  • “Did RA agree on the price prior to Board approval in January 2015? If so, why? Who made that decision and why?”
  • “Who altered the appraisal instructions to assume Tetra was in good repair and the hypothetical restaurant use was large and extended into the lake?”
  • Why wasn’t conflict of interest specifically discussed in the StoneTurn report?”

Reston 20/20 says it wants the citizens’ committee to have “unlimited access to all RA records relating to Tetra; the authority to interview RA employees, contractors and others with possible knowledge about Tetra; and the authority to request records from contractors who worked [with] RA on the Tetra purchase and renovation.”

A group of Reston Association members, working under the name Mediaworld Ventures LLC, had been selected in September 2016 by the Board of Directors to complete a review of the purchase and cost overrun at a cost of $1. The parties could not agree on the terms of a contract, however, and negotiations were terminated in January. The board agreed later that month to have StoneTurn complete the review at a cost of $45,000.

StoneTurn’s review provided 15 recommendations to the RA board for how to avoid a similar situation from happening in the future. Reston 20/20 members say without rooting out more specifics of the transaction, changes to procedure may have minimal effect.

“We believe it is vital to understand the full details of what transpired, including identifying any violations of policy, procedure or the law and the persons involved in those activities. If we do not dig out these details, RA runs a serious risk of repeating many of the same errors in the future no matter what process changes are added.”

The RA Board of Directors has a special meeting scheduled for Tuesday at 6:30 p.m. (weather-permitting) to discuss the results of StoneTurn’s report and the recommendations for the board that were provided within.

  • LC

    My question is why? Why do we need another group to do a report on the Tetra purchase when this STG group just did one? What is the expected outcome?? Everyone can see the purchase was ill-advised and a complete debacle. The purchase price was insane. What do people think another group meeting about it is going to turn up?! I’m not being snarky – I just don’t get it. I feel like this horse has been beaten to death.

    • cRAzy

      The article seems to give several good reasons if you read it. So does the report itself.

      The same argument could be used for not pursuing a bank robber. Even if you do catch him, you’re most likely not going to get the money back. But then again, it may discourage someone else from robbing banks if the first guy spends a few years in jail.

      Or we could just do away with all police forces and never find criminals or punish them.

      • LC

        I did read it and I just don’t see it. I also don’t see the correlation between bank robbers and this. I don’t think RA is ever going to make a purchase like this again. I think the Board has learned their lesson and I don’t think anyone in the community would vote for another referendum after seeing everything that has come out. I think mission has been accomplished on discouraging further purchases.

        • Conservative Senior

          The RA Board will continue to coerce members to do what the board wants by lying or telling half truths. This is supposed to be a HOA not a cradle to grave venture.

        • Reston2000

          Not sure the Board learned its lesson at all – at the last meeting, another huge project was proposed – soccer field upgrades that would cost a pretty penny – if I were a Board member, I would never have allowed it on the agenda given the fact that we were not even through the last debacle – there needs to be a halt on all projects until they institute some strict project management methods…so while your theory is rational, LC, it does not appear that they have learned any lessons at all…

          • Conservative Senior

            Don’t forget the Pony Barn & the facilities/storage building next to the YMCA. Stop the insanity.

    • Reston2000

      Agree LC – time to move on but with significant changes to protect members’ interests…tired of seeing folks step up to caution Board on business deals like this and the Board doesn’t listen at all…they act like we are telling them “The sky is blue” – nothing registers…the members aren’t taken seriously…we need significant changes in culture, structure, and processes to ensure our collective interests are protected first, above all else…

  • Perhaps alll the board members who participated in the dumb idea should resign. Start fresh instead of talking about a mess that has already happened. Look t othe future with a fresh board.

    • Moon Lotus

      Stepping down would be a lot easier than being subpoeaned and being held in contempt of court.

      I think the community understands…

      • John Farrell

        Stepping down would not avoid a subpoena

  • Conservative Senior

    It would make sense to question the appraiser to find out who requested that the imaginary facts be used that altered the value & also the bank, Access…This is very unusual. Also, the appraiser should have known that the easements would not allow a restaurant to be located at the property.
    This whole deal is fraudulent.
    Do away with executive sessions.

    • Reston2000

      The bank had no need to worry – the loan was secured against our steady stream of our assessments not the property itself so it looks like no appraisal was needed by the bank. Totally agree with you Conservative Senior, executive session has to go.

  • Moon Lotus

    I once called my district representative upset over the fact that it was impossible to write off losses on my 401K plan. Basically the answer was that unless the government has offsetting transactions to record there wont be a way to declare your losses on your tax return or elsewhere.

    Sames goes for Tetra. Unless we see us recouping our losses by reporting this as a crime and follow up with a civil lawsuit holding individuals personally responsible, there is no way to get our money back. The fact that we already spent 45K on StoneChurn is bad enough, but other than that what is the expected outcome of yet another fault-finding investigation?

    Everyone including myself is pretty upset but how can we get our money back?

    As for preventing this in the future I think we have recommendations in place. Also, by strictly following the budgeting process and common business practices this should have never happened. So again, I think we have to deal with the fact that we allowed a corrupt board to take advantage of our community, crimes however must be proven before a court of law. A lack of evidence can also be investigated as a crime,,, however this cannot be pursued through a committee.

    • cRAzy

      As I say waaaay down below, we may not get our money back, but we can root out those who made really bad decisions so they are not in a position to do so again.

      I like the recommendations, but they are based on only half the story and so may be half wrong. We won’t know until we complete a full investigation.

      Just sayin’

      • Moon Lotus

        By method of deduction you already know who the guilty parties are. So by calling in a committee you are basically shielding them from being held responsible. That is ok by me, I only have myself to blame for voting yes.

        In turn, if you think it was a criminal act we have additional options compared to just going public with names. Coming up with a feel good report that points fingers could also result in RA / commitee becoming involved in a lawsuit, eg slander.

  • 30yearsinreston

    We know who pushed the Lake White Elephant and who benefits from the purchase
    We also know who pushed the purchase on behalf of the beneficial through RA

    It’s not that difficult, just follow the money

    • SamIAm

      Who? I don’t think this is obvious at all!

  • Sick of RA

    We need to keep beating the drum on this because nobody has paid a price yet. Nobody has lost their job, nobody has been brought up on charges. This was far more than a few “process failures”. I’d like to see names, I’d like to see them loose their jobs, I’d like to see charges filed.

    • I’d rather post as a guest

      I’d like to see a refund of my dues. If that doesn’t happen , then any additional expense is a waste of more of my dues.

  • Terry Maynard

    Good discussion. Reston 20/20’s bottom line is, I think, that we will not prevent this kind of thing in the future unless we identify and correct only faulty processes, but the people who made faulty decisions–inadvertently or intentionally. That will take more work.
    Thanks for your thoughts.

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