Judge rejects Washington County’s open records request to tourism agency
Commissioners plan to appeal decision to state Commonwealth Court
The Washington County commissioners are expected to appeal a judge’s recent ruling rejecting their claim that the county’s Tourism Promotion Agency is subject to an open records request asking for detailed financial information about the nonprofit organization.
Washington County Court of Common Pleas Judge Michael Lucas denied the county’s appeal in a 27-page order on July 29 in which he found the tourism agency is not a government entity and that its documents do not fall under the state’s Right To Know Law.
“The Legislature empowered counties to demand and receive audits and financial statements from their designated tourist promotion agencies,” Lucas wrote in his order. “By requiring this disclosure, the Legislature appears to have contemplated that tourist promotion agencies are not generally subject to the RTKL.”
County officials filed the open records request last April asking the tourism agency to provide various financial documents and other records. But tourism officials rejected the request, saying the nonprofit does not fall under the open records law and that they had already provided two decades worth of audits and other financial information requested by the commissioners.
The county appealed to the state Office of Open Records, which denied their request Aug. 5 because it determined the tourism agency is not a government entity, although it acknowledged the county has other ways to force compliance, such as withholding funding or even threatening to dissolve the agency. The county appealed that decision to Washington County Court of Common Pleas, prompting Lucas to deny it late last month.
“The Commonwealth Court has stated that nonprofit corporations are not suddenly transformed into ‘Local Agencies’ solely because they receive some amount of government assistance,” Lucas wrote in his order.
The tourism agency typically receives about $2.5 million in annual hotel tax revenue each year, which is more than 90% of its total income source. Last December, Commissioners Nick Sherman and Electra Janis voted to alter how that 5% hotel tax levy is distributed, sending 75% of the funds to a joint account that would require agreement on how the funds are spent. The remaining 20% would go to the tourism agency and 5% would be used on administrative fees.
“Further, the Legislature’s decision to direct Hotel Tax revenues to nonprofits acting as tourist promotion agencies does not come with a ‘Local Agency’ tail,” Lucas wrote. “In the context of public funding of nonprofits, the Legislature’s decision to increase funding to those entities does not transform them into governmental entities.”
During Tuesday’s workshop meeting, the commissioners considered appealing Lucas’ order, but appeared to backtrack on the issue by taking it off the agenda for Thursday morning’s voting meeting. But a couple of hours later, Commissioner Larry Maggi – who is against changes to the hotel tax disbursement and disagrees with the recent open records requests to tourism – said he was informed that a motion to appeal the order would be placed on the agenda for Thursday’s meeting.
County solicitor Gary Sweat said after the meeting that he advised the commissioners that they have until Aug. 28 to appeal the decision to state Commonwealth Court, so they must act within the next 10 days.
“I think this decision could’ve gone either way,” Sweat said in a phone interview after the meeting. “Of course, as a representative of the county, I disagree with the decision and I think we need good appellate law on this issue.”
He said the only case law with the Right To Know regarding nonprofits involves the PIAA sports league and a decision about volunteer fire departments. He thinks the appellate courts should weigh in to have a precedent-setting decision statewide that covers nonprofits that receive large sums of public dollars.
“Because tourism exists in all 67 counties, it’s a case where we need a (precedent-setting) ruling that warrants it at the appellate level (and) a better standard to review,” Sweat said. “How much (financial) involvement has to be for the Right To Know Law to go into effect?”
In a 2-1 vote last August with Sherman and Janis voting in favor and Maggi voting against, the commissioners hired Peacock Keller at a contracted rate of $200 per hour to handle the open records appeals. The work has cost about $30,000 so far and will undoubtedly climb as the appeal works its way through Commonwealth Court. Sweat handled the original open records request before handing the appeals off to attorneys at Peacock Keller.
Jeff Kotula, who is president of the Washington County Chamber of Commerce and Tourism Promotion Agency, said Monday he was pleased with the court’s ruling and hoped to find a path forward working with the commissioners. But upon learning Tuesday afternoon that the commissioners might appeal, Kotula raised concerns about the amount of money being spent using outside legal assistance.
“Every taxpayer and tax-paying business in Washington County, which includes me, should be outraged at Commissioner Sherman and Janis’ continued waste of taxpayer dollars on this new appeal,” Kotula said in a written statement. “They have already lost their two previous appeals – spending tens of thousands of taxpayers’ dollars with two law firms. Now they want to waste more county money on yet another appeal, this time to the Commonwealth Court. Instead of using this money to improve county parks, support local events, or even build a youth sports complex, the majority commissioners are choosing to squander county funds on lawsuits and legal actions.”
Kotula said the tourism agency has already provided the audits and financial statements that are required by law and attempted to open up a dialogue with the commissioners, but those efforts have been rebuffed.
“Over the past year, the commissioners have ignored every effort and offer we have made to meet and resolve their concerns. We even recently offered to engage a third-party neutral facilitator to bring them to the table, again with no response,” Kotula said. “It is clear Commissioner Sherman and Janis’ interests are wasting taxpayer dollars on pointless appeals rather than working with us to attract visitors to our communities, economic development to our area and support the 8,600 tourism jobs in this county.”
The commissioners are scheduled to meet at 10 a.m. Thursday in the ground-floor public meeting room in the Crossroads Center building at 95 W. Beau St. in Washington.