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CAEDC studying conversion to a traditional nonprofit

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The Cumberland Area Economic Development Corp. board is studying a conversion to a traditional nonprofit corporation, CEO Jonathan Bowser said this morning.

Techically a nonprofit, the quasi-governmental CAEDC is governed in a bit of a gray area, Bowser said. It is owned by the county, but it is incorporated with a large degree of independent operations.

"There's a consensus amongst the commissioners and CAEDC board to evaluate our unique structure and evaluate whether it's the most effective and efficient way to operate moving forward," he added. "I think all sides are open to making changes if it's in the best interest of the organization and county."

As part of the restructuring discussion, county and CAEDC solicitors are looking at issues such as competitive bidding and open meetings requirements, and whether they apply to the agency, Bowser said. Commissioner Gary Eichelberger said this morning that he asked county solicitor Keith Brenneman to render an opinion on those issues.

Many counties run economic policy through one of two formats: an office of economic development within county government, or an independent nonprofit corporation. CAEDC is a little of both and administers the county hotel-tax receipts, mainly through the Cumberland Valley Visitors Bureau. The tax generates $1.6 million annually.

The hotel tax has been a nonstop source of controversy for commissioners, beginning when the Army Heritage Center Foundation requested 20 percent of the hotel tax last July. While the Army Heritage Center request never came to fruition, commissioners followed up with an audit of the hotel tax funds, which turned up no problems.

In April, commissioners approved a change that mirrors state law clarifying that hotel tax receipts can be spent toward business travel, promoting conventions and associated travel in the name of tourism.

Meanwhile, commissioners cut the county contribution to CAEDC from $90,000 to $40,000 this year with the expectation the agency would be “self supporting” in the future, commissioners have said. That led to a CAEDC plan to sell "memberships" as the agency seeks to replace public funding with private dollars.

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