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HILLSVILLE — It looks like Nehemiah Engineering may be able to go back to providing inspections on the Fancy Gap utility projects, after the Carroll Public Service Authority drafted a letter to Rural Development.
Rural Development is expected to ask for a refund from the authority for construction inspection services on the Fancy Gap water and sewer project from the beginning of 2012, according to a letter from the authority to the federal funding agency.
Rural Development provided funding for the Fancy Gap utility work, but stopped paying for construction inspection services in April.
This happened when Rural Development raised questions about a conflict of interest for Joshua Hendrick, who was at the time an employee of the firm doing the inspections and a Carroll County supervisor representing the Laurel Fork district.
The PSA met early Tuesday to put the final touches on the letter to Rural Development, asking that Nehemiah Engineering be put back to work because any conflict had been resolved after Joshua Hendrick resigned from the company.
The four-page letter, read to the authority and more than a dozen people in the audience by Chairman Tom Littrell, cited the opinion of Timothy Allen, Franklin County’s commonwealth’s attorney, in finding that there had been a conflict of interest in inspection services on the Fancy Gap project from January until their suspension.
The authority wrote some language into its letter that acknowledges that the Franklin County’s commonwealth’s attorney opinion may be reversed.
“We understand Mr. Allen’s opinion may be appealed to the attorney general of Virginia as provided by statute,” the letter to Rural Development said. “Should Mr. Allen’s opinion be reversed or Mr. Allen determines that an exception to the Virginia Conflict of Interest Act applies or the attorney general opine[s] that no conflict existed, the authority reserves the right to reconsider and reverse this determination.”
Authority member James Light asked that the PSA make it clear whether certain exceptions under the conflict of interest law may have applied to Joshua Hendrick’s case.
“Answer that question: what is the exception?” Light said. “Give it an opportunity to find out what that exception is before it gets into a court battle, to the attorney general, all the way through there and this thing just gets uglier, more time-consuming….
“I’d like to know what the exceptions are before it has to go that far… Nobody’s had no backbone that’s had this thing put to them to say just what they are.”
(Allen had included in his opinion that there are certain exceptions to the state conflict of interest code section, but added that he didn’t have enough information on whether they apply to Hendrick.)
Nothing in Allen’s opinion addressed the assertion by Jeremy Hendrick — Nehemiah Engineering’s owner and Joshua’s brother — and his attorney’s opinion that there has not been a violation of federal regulations that apply to the Fancy Gap project funding, the letter noted.
A copy of Hendrick’s letter has been included with the PSA other correspondence to Rural Development.
The authority’s letter then turned to the matter of what to do about inspection services for the Fancy Gap project in the future.
“It is the authority’s opinion… that the conflict of interest has been resolved as a result of Joshua Hendrick’s resignation as an employee and officer of Nehemiah,” the letter said. “Provided Rural Development concurs… the authority would request that Rural Development advise it, in writing, that Nehemiah may return to providing inspection services on the above projects and that Rural Development will hereafter honor invoices submitted by Nehemiah for services performed hereafter.”
Nehemiah returning to work depends on “certain contractual matters” being resolved between the company and the authority, the letter added.
Officials note in the letter that Rural Development officials said in an earlier conference call that the federal agency wants a refund for all work performed by Nehemiah, starting Jan. 1. That amount is estimated at $33,000.
This is based on federal regulations and not the Virginia Conflict of Interest Act, the letter adds.
“You further advised us in the second telephone call that if the attorney general’s office reverses Mr. Allen’s opinion and the authority reverses its determination accordingly, Rural Development would consider payment of the amount refunded as well as the invoices for work performed by Nehemiah on the project prior to suspension and which have not been previously invoiced to Rural Development.”
The authority approved this letter unanimously after a motion by member David Hutchins. He wanted the letter to be sent to Rural Development as quickly as possible.
After the meeting, Jeremy Hendrick told The Gazette that Joshua has begun the process of appealing the Franklin County commonwealth’s attorney’s opinion to the state attorney general.
Right now, the refund payment is not an issue, as Hendrick said an authority member told him after Tuesday’s meeting. “The intent is to get us back to work.”
Jeremy Hendrick added he feels disappointed that the PSA did not consider his attorney’s advice that there has been no breach of federal regulations for the Fancy Gap project.
No employee of Nehemiah has ever been “involved with the selection, award or administration of the contract,” under the federal law, Jeremy Hendrick and his attorney have argued.
“They had an opportunity today to take a stand on the federal code and they didn’t even address it,” Jeremy Hendrick said of the PSA. “That puts us in a state of uncertainty.
Meanwhile, he said he will continue to hope that the attorney general’s opinion overturns the advisory opinion that has been shared and continue to hope for a positive outcome.