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Manassas EDA explores legal options to recoup $5,000

The Manassas Economic Development Authority is prepared to pay $1,500 to recoup $5,000 in public funds.

A $10,000 city grant to the now-closed “The NEW School” stipulated the non-profit had to remain open for five years or pay back the funds.

The now-defunct after-school program for children paid back half of the money. The full grant was meant to be used for scholarships for city children to attend the center’s science, technology, engineering, and mathematics program. 

The NEW School closed last fall after six months in operation in a shopping center on Liberia Avenue. Representatives from the closed business did not return requests for comment.

The EDA ordered the Manassas City attorney to explore legal options and costs — up to $1,500 — to recoup the funds, according to EDA Chairman Board member Holmes Smith who voted against pursuing a lawsuit.

The majority of the board voted to proceed with a 4-2 vote.

“The EDA signs these performance agreements with the company, and the performance agreements state that if the company does what is says it’s going to do, that we are obligated to pay them and, in some cases depending upon how the agreement is written, there are recapture provisions that if the company does not stay in business or does not meet its obligation, they’re obligated to pay us back,” said Manassas Economic Development Director Patrick Small.

The agreement differed from others, like retail shop “Totally Vintage” in Downtown Manassas, where the business agreed to move to a new corner location, invest in new store fixtures to improve the business, and then afterward be rewarded with a $6,000 EDA grant for which the business applied.

The city attorney is expected to return to the EDA if the cost to pursue a lawsuit exceeds $1,500. If it does, the EDA will take a second vote on the matter, said Holmes.

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