Last Thursday, the Richmond Times-Dispatch published a story with the headline, “State cuts off money to agency supporting halfway homes for recovering addicts.”
Reporter Luca Powell wrote:
Language in this year’s budget takes nearly $2 million away from the Virginia Association of Recovery Residences, or VARR. The organization certifies group homes, of which there are more than 100 in Richmond and Henrico. It also monitors those homes, investigates complaints and sets standards of care.
VARR Board President Sarah Scarbrough said the group believed it would still be eligible for $1.6 million in funding. But on Friday, it was notified that funding for the upcoming year would be cut entirely.
“I’m writing to inform you that now that the FY26 budget has been signed into law, VARR will not be receiving state dollars in the upcoming fiscal year,” an employee with the Department of Behavioral Health and Development Services told VARR.
“The General Assembly has removed VARR as the named entity for Recovery Residences (RR) funding and has instead directed that these funds be allocated directly to operators,” the email went on.
As the email suggests, the work of certifying recovery homes appears set to become the responsibility of the Department of Behavioral Health and Development Services. New budget language states that money will now flow directly to recovery residences from the state, removing VARR from the equation.
Scarbrough said the organization was “completely blindsided.” The group was aware of a new reform bill passed this year — the bill created a working group to study recovery residences — but didn’t foresee a budget cut. Without the funds, VARR will shut down, she said.
There’s a lot to unpack here.
First, the redirection of funding from VARR to recovery house operators wasn’t a last-minute change. As I reported on Jan. 2, the amendment was written into GOP Gov. Glenn Youngkin’s proposed budget. The information was available to the public and widely disseminated more than five months ago.
In a Feb. 11 House committee hearing, VARR Executive Director Anthony Grimes also acknowledged the anticipated budget change, while expressing his concerns about it.
Shortly after the RTD story was published, state Sen. Schuyler VanValkenburg (D-Henrico), who sponsored the reform bill Powell referenced, relayed his disappointment on X:
Scarbrough told me VARR leaders were “blindsided” earlier this year when they first found out about the budget change — not that they just learned about it from DBHDS’ May 30 email, as the RTD story implied.
Scarbrough indicated that they were, however, caught off guard to read that all state funding would be removed from VARR.
In recent years, VARR’s operational budget — which enables the organization to accredit recovery homes — came from a mix of state and federal funding that flowed to VARR through DBHDS. While DBHDS indicated VARR was still eligible for federal funding via State Opioid Response dollars, Scarbrough was concerned that wouldn’t be enough for VARR to continue in its role as an accrediting organization — which could force dozens of operators to either close or risk being charged with a Class 1 misdemeanor when mandatory certification becomes effective July 1.
Starting July 1 [Correction below], VARR plans to increase its annual accreditation fees to $750 per organization plus $10 per bed, Scarbrough told me. Based on VARR’s April tally of operators and bed counts, those fees only amount to $41,950.
“So they won’t adjust to (the) new system and figure out how operator/accreditation fees work to ensure compliance? That’s pretty wild to me,” VanValkenburg told me Saturday. “It’s literally just a different way of sorting the money. That ensures (the) government has a little more control over citizen tax dollars.”
“(VARR leaders) want to control the money,” he said. “With (the) budget change they no longer do.”
Historically, VARR’s revenue far exceeded its operational expenses. The organization was also the conduit for state grant money earmarked for accredited recovery house operators. But this year’s budget language, consistent with Youngkin’s proposal, removed VARR as the controller of that money, placing DBHDS in charge of distributing the grants:
L.1. Out of this appropriation, $1,950,000 the first year and $1,950,000 the second year is provided to make grants to
membersoftheVirginiaAssociationofRecoveryResidences(VARR)recovery residences certified by the Department of Behavioral Health and Developmental Services for recovery support services.TheassociationmustensurethatmembersaccreditedbytheCouncilonAccreditationofPeerRecoverySupportServices(CAPRSS)receiveashareofthesefunds.VARRGrantees of these funds will comply in a timely manner with all requirements of the agreement entered intobetweenVARRandwith the Department of Behavioral Health and Developmental Services as a result of this appropriation. …
Though not included in the RTD story, the change followed two years of detailed reporting that showed how VARR used its annual allotment largely to the advantage of VARR leaders’ organizations, while smaller operators often struggled to access the funds.
Despite the new budget language, Scarbrough believed that VARR was still going to receive a large portion directly.
Around early March, Scarbrough said the VARR office submitted a budget proposal for $1.6 million, followed by a revised budget of $1.2 million in April. “DBHDS said all was going to be OK,” Scarbrough told me. “They were going to give us some money still but wanted flexibility to give to other entities like Oxford (House). So that’s what we went with.”
Responding to Scarbrough’s statement, DBHDS Communications Director Lauren Cunningham told me via email, “VARR was made aware—both through multiple emails and during regular monthly meetings—that this funding remained contingent upon the final budget language and legislative direction.”
Cunningham reiterated that DBHDS “acted in accordance with the legislative process” and added:
The revised structure maintains funding but directs funding for recovery housing assistance to certified recovery residence operators rather than require passing it through VARR. This change reflects a systems-level adjustment to ensure efficiency and accountability, not a reflection on the work or value of VARR. …
VARR will continue to receive State Opioid Response (SOR) grant funds, which cover the cost of the accreditation process as well as additional operations costs for VARR. This contract does not expire until September 30th, and there will be an option to re-apply. DBHDS is currently working with our procurement office to develop the most efficient process to route funding to the operators to minimize any disruption to services, and we are committed to remaining in ongoing conversation with VARR as we navigate these changes. Resources for those in recovery and efforts to prevent overdose remain the priority of DBHDS.
Powell also interpreted DBHDS’ May 30 email as suggesting VARR will no longer be involved in the certification process.
“As the email suggests,” he wrote, “the work of certifying recovery homes appears set to become the responsibility of the Department of Behavioral Health and Development Services. New budget language states that money will now flow directly to recovery residences from the state, removing VARR from the equation.”
VARR might be removed from the certification process at some point in the future, but that is not related to DBHDS’ notice of the funding changes.
Under current state regulation, VARR is the only entity authorized to accredit (non-Oxford) recovery homes on behalf of DBHDS.
Pending the workgroup’s recommendations and further legislative action, Virginia’s recovery home certification process still works as follows:
- The operator gets accredited by VARR or chartered by Oxford House.
- The operator submits minimal paperwork to DBHDS.
- DBHDS provides the operator with a formal state certification.
The only difference is that starting on July 1, certification becomes mandatory for all recovery house operators. Non-certified operators will be allowed to apply for a “conditional certification” with DBHDS that will buy them six to nine months to complete the formal process.
In the meantime, DBHDS certification remains nearly the equivalent of a rubber stamp on an operator’s membership in VARR or Oxford House — hence the establishment of a workgroup to improve oversight and protections for the people living in recovery homes.
“VanValkenburg’s law came several months after local Henrico County officials drew attention to recovery residences,” Powell wrote. “In August of 2024, Henrico Deputy Manager for Public Safety Mike Feinmel told the county’s board of supervisors that residents had concerns about a “lack of oversight” in neighborhood recovery homes.”
VanValkenburg’s bill was not merely a result of neighborhood concerns regarding lack of oversight. The bill followed multiple presentations by Feinmel, starting with a September (not August) 2024 in-depth presentation to Henrico County supervisors on the fallout of self-oversight in the recovery housing industry, which included neighborhood concerns. Feinmel’s presentation and VanValkenburg’s bill (which Feinmel helped author) addressed an array of ethical issues affecting the people recovery homes are meant to serve, such as unjust evictions and stifling residents’ rights to choose their healthcare providers.
“Another county employee, Mike Sherman, testified about unethical behavior in Henrico recovery residences before the General Assembly,” Powell continued. “Scarbrough said the county officials shared misinformation about incidents that hadn’t been reported to VARR executives.”
Feinmel and Schnurman (not “Sherman”) told me that no one made contact with them for the story.
Nearing the end of the story, Powell included comments from Stephanie Bellanger:
Stephanie Bellanger, a former board member with VARR and chief wellness officer of Starfish Recovery, described the budget cut as an attack on Richmond’s recovering addicts.
“The bottom line is, one, what they’re doing will end up reducing the number of beds, and two, they’re really trying to cripple the recovery-led, grassroots, lived-experience operators and movement here in Richmond,” said Bellanger.
Starfish Recovery & Wellness has been covered extensively in this series regarding forced treatment, alleged sexual misconduct and other abuses of power — with more to come.
Powell ended the story on the following sentiment:
The change-up comes at a time of record-breaking success in the state’s fight against the opioid epidemic. In April, Virginia achieved a 44% drop in deaths from fentanyl, the powerful street drug that can be fatal in the smallest doses.
Virginia outpaced much of the country in curbing opioid overdoses. Youngkin credited several efforts, including his administration’s distribution of over 380,000 doses of Naloxone, alongside a crackdown on drug traffickers led by his administration.
Although not mentioned, recovery residence operators believe they, too, played their part in Virginia’s success story.
“Many places have peer support, many places have suboxone and methadone and all the medical interventions. But what’s the difference in the Richmond metro area?” asked David Rook, former president of VARR.
“The only difference that you can really point to out of all those places is the access to recovery residence beds,” said Rook. “The access to those, that’s the difference.”
The story didn’t include recent data from the Virginia Hospital and Healthcare Association, which shows a four-year increase in drug-related hospital visits.
As reported in April by WRIC:
Although recent data from the Centers for Disease Control and Prevention (CDC) indicates a national decline of nearly 24% in overdose deaths, hospitalizations for drug-related issues in Virginia are on the rise — suggesting a shift, rather than a resolution, in the ongoing substance use crisis.
Richmond and Henrico County — Virginia’s mecca for recovery housing — had the first- and third-highest percent increase, respectively.
***
This afternoon, Scarbrough met with DBHDS Commissioner Nelson Smith to carve a path forward. “While the exact details and logistics still need to be determined, Nelson made it clear that DBHDS is committed to ensuring that VARR remains intact and continues its work,” Scarbrough said in an email to VARR operators. “This means we will proceed with the certification process, which includes accreditation, training, education, and support for recovery residences.”
While VARR’s long-term role remains uncertain, its leadership is rapidly changing.
In April, VARR announced Grimes’ resignation, effective this month. VARR employee Robert de Triquet is taking over as the interim executive director. If funding permits, Scarbrough said the board will determine steps for onboarding a permanent executive director.
The board is also undergoing a shakeup.
Scarbrough informed me that Jimmy Christmas resigned from the VARR board in April. At last week’s board meeting, four new board members were added: Charles Wilcox (who is also on VanValkenburg’s workgroup), Cheryl Robinette, Morris Bayton and Deborah Piland.
Three days after I published this story, Charles Wilcox and VARR board members jointly decided to suspend Wilcox’s onboarding to avoid the appearance of a conflict of interest.
Wilcox provided the following statement, which Scarbrough confirmed.
After the VARR Board of Directors’ action appointing Mr. Wilcox to the VARR Board, VARR and Mr. Wilcox met to discuss the right way to move ahead. VARR and Mr. Wilcox both expressed concerns related to any potential conflicts of interest, either actual or the appearance of conflict at the current time. Mr. Wilcox’s (sic) is a long standing member of the Board of Directors of the Virginia Association of Addiction Professionals (VAAP, the NAADAC affiliate in Virginia) where he serves as the Advocacy Chair. Additionally, Mr. Wilcox is VAAP’s representative on the SB838 Working Group examining the certification and oversight of recovery residences. VARR is also represented on that Working Group. VARR and Mr. Wilcox agreed that, while there were no current actual conflicts of interest, because of the SB838 Working Group activity and the desire of both parties to avoid any appearance of a conflict of interest or any possible future conflict, Mr. Wilcox would not now become a member of the VARR Board of Directors.
Meanwhile, Grimes is still vice president of the National Alliance for Recovery Residences (NARR) — VARR’s parent organization — and Scarbrough joined the NARR board this year.
VanValkenburg’s recovery housing workgroup met for the first time May 29. The meeting included an overview of the workgroup’s purpose, presentations from VARR and the DBHDS Office of Recovery Services, and open discussion.
“I left that meeting with a lot of optimism,” VanValkenburg told me. “It really feels like we have a bunch of people that want to roll up their sleeves and get to work and do something.”
The list of workgroup members, provided by the Office of the Secretary of Health and Human Resources on June 2, is as follows:
- Sen. VanValkenburg
- Sen. Barbara Favola (D-Arlington)
- Hallie Pence, Right Help Right Now
- Paul Stevens, Oxford House
- Charles Wilcox, Virginia Association of Addiction Professionals (VAAP)
- Bob de Triquet, VARR
- Nicole Riley, Blue Ridge Public Affairs
- Wesley Russ, Deputy City Attorney, City of Harrisonburg
- Jody Rogish, Henrico County Supervisor
- Bailey Hilliard, Chesterfield County Sheriff’s Office
- Stacey Lawson, Fairfax-Falls Church Community Services Board
- Victor McKenzie, SAARA of Virginia
- Benjamin Carr, Caritas
- Mike Schnurman, Henrico County
- Michael Feinmel, Henrico County
- Nicole Gore, DBHDS
- Dev Nair, DBHDS
- Alethia Lambert, DBHDS
- Tiffani Wells, DBHDS
- Candace Roney, DBHDS
- Honesty Liller, The McShin Foundation
- Jason Lowe, Virginia Department of Medical Assistance Services
- Dr. Colin Greene, Virginia Department of Health
- Tony McDowell, Opioid Abatement Authority
- Martin Hawes, Sally’s House
- Nick Yacoub, Old Dominion Men’s Recovery Center
I was unable to make it to the first meeting, but one of the attendees provided an audio recording, which is available here.
Future workgroup meetings will also be open to the public. Please subscribe for updates.
Correction: The initial story incorrectly cited VARR’s new membership fees, effective July 1, as the organization’s current membership fees. Return to article.
Have a correction, update or tip? Email christa@investigate-rva.com
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This is the best news I have read in a long time . Thankful for all the people who have seen the need for change and made it happen . Christa you are the catalyst and job well done .
I’m on the committee. VARR was NOT blindsided. They KNEW what was coming. The entire town of Richmond along with the village idiot knew what was coming.
What was really happening was VARR kept trying to control the narrative with the people they could manipulate. Those people cried when things fell into place. VARR tried to spin it. No Sarah, you can’t spin this.
My big disappointment is now knowing Grimes is with NARR as VP. That tells me the corruption is now at a national level. I wonder how long before you hear talk of RICO with NARR.
I owe you lunch sometime at the boat House thank you
Christa could teach Luca a thing or two about investigative reporting.