As you already found your problem, just another observation:
your code puts vfp probably through some unneccessary gyrations.
I'd code as

SELECT tmpData
SET ORDER TO ID

outputFileName=outputPath + SUBSTR(DTOS(RunDate), 5) + "_" + "BOGUSTEST.TXT"
ERASE (outputFileName)
fh=FCREATE(outputFileName)	&& Default is Read/Write in FCREATE().
IF fh > 0
	* File creation succeeded! Now, write the header to the text file.
	=FPUTS(fh, lcHeader)	&& The Header string, lcHeader, was created earlier.
	*  GO TOP  believe in vfp Docs!
	SCAN
		* Assemble the text data.
		lc = m.GrpID ;
		    + m.GrpNum ;
		    + PADR(m.FirstName, 15) ;
		    + IIF(EMPTY(m.Initial), " ", m.Initial) ;
		    + PADR(m.LastName, 20)

and not use the vfp textmerge, as this way is still optimized but also
as easy to translate into almost any language as the original, if asked for.

my 0.02 €

thomas