I found out the answer to my own question so I thought I would post the answer for others with this setup. There are actually 2 valves, the one circled in the picture above, and one on the fitting coming out of the top of the tank. For normal operation, both valves should be in line with the fitting going into the tank. With both valves in this position, all is operating properly. If winterizing the hot water tank, you put both valves perpendicular to the tank fitting and it keeps antifreeze out of the hot water tank.
2001 E-350 V10 EB50 Penthouse