CUMBERLAND — This time next year, things may look a bit different for the entity that oversees the special tax districts downtown.
Downtown Development Commission chairwoman Sandi Saville initiated a discussion Thursday morning about the future of the entity. The DDC is funded by a special taxation district that includes the shops along the Baltimore Street pedestrian mall as the primary district, and stores along the side streets as the secondary district. At the time the mall was built, the tax was contrived to pay off the bond used to finance construction. The bond has been repaid for nearly 10 years.
The budget for the next year, Saville said, may change from what was included this year. Information received from the city recently, Saville said, was “very interesting,” as it shows that by the end of this fiscal year, the DDC will have received an estimated $184,000 in tax revenue. Next year, she said, they expect to generate $177,000.
With the decrease in funding and rising personnel fees, Saville said, it would become difficult for the commission to afford a new executive director for the board in addition to paying current maintenance employees. Were a new director to be paid at the same rate as former leader Mikayla Dodge, who resigned late last year, Saville said that would run up their entire budget.
At the same time, the Cumberland Economic Development Corp. is undergoing a transformation of its own as it goes about merging with the Allegany County department, to culminate in the establishment of the brand-new Allegany Development Corp. Paul Kelly, current director of Cumberland’s economic development agency, raised the prospect of the ADC partnering in some way with the city to handle Main Street duties differently.
The taxes levied on shops in the downtown area currently, Kelly said, are a deterrent to businesses they hope to attract. The high taxes, he said, may drive folks away from Cumberland and toward neighboring states and counties.
“At the end of the day, we need to make sure all those buildings are filled up,” Kelly said. “So for me, it is an impediment. Why? Because if you add state tax, city tax, county tax and now special tax, you’ll find us at the top ... of the highest-taxed areas in all the state of Maryland.”
While he advocated for the eventual removal of the primary tax, Kelly said he recognized that it would leave a gap in funding for the mall. To pay for the associated costs, Kelly proposed that a member of his staff handle the mall-related duties. When the merger is done, he said, they’ll have access to county business attraction and tourism staff.
“If you want them to be in-house with us, now’s the time to talk about it because I have to build out the budget,” Kelly said, noting that the proposed role could also be a boon for the county’s other municipalities.
Saville said she was concerned about whether the individual who assumes that role would also oversee maintenance of the mall and promotion of its events. Her fear, she said, was that the DDC would “be left with maintenance and events and no money to pay for someone to do it.”
“I’m worried about getting stuck with this mandated stuff we’re supposed to do, and no one to do it,” Saville said.
Member Larry Jackson said in the meeting he views the potential changes as “a reboot” for downtown, and that it could be an opportunity to foster unity between the shops on the pedestrian mall and Canal Place that would benefit the city as a whole.
Cumberland Mayor Ray Morriss said he is “fully for either the elimination of or reduction of the DDC tax, after we figure out what the service level to be provided is.” He asked that they identify what services they need, and said he’d be “fully willing to provide” them once they’ve been identified, along with an alternative source of funding.
“We’re in a unique situation right now because of everything that’s going on with the CEDC and county economic development merging, with the opening of Baltimore Street and quite frankly the fact you all don’t have an executive director at this point in time,” Morriss said. “It puts us in a position where we can take a good, hard look to rework how we want it to be. But we need to do it as quickly as we can. ... This is a golden opportunity for us, and we just need to sit down and work through the nuts and bolts.”
The board ultimately voted unanimously to move forward with conducting formal discussions on the subject.
The DDC will next meet on March 19 at 8:45 a.m.
Follow staff writer Lindsay Renner-Wood on Twitter @LindsayRenWood.