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Closed CDC meetings and transparency

by Roberta Ginsburg
(Philadelphia, PA USA)

Visitor Question: Can a community development corporation hold meetings which are closed to the community at large?

Editors Reply: A community development corporation, often called a CDC, can hold closed meetings. We think it should not do so, at least as a matter of habit. But it is a private entity, and its board may meet without any type of notice or invitation to the community.

One possible exception in many states would be an instance when a public official is a voting board member. Sometimes state law seems to imply that when a public official is a member of a board that has an overlapping interest with the jurisdiction, that board is subject to the state's sunshine law. We are familiar with an instance of when a court made just a ruling.

Another exception would occur if the CDC was founded by and really acts an arm of the local government, even if no elected officials have an official vote on the CDC board. In this situation, a neighborhood might well win in court if it argued that the CDC's meetings are actually subject to a state's sunshine law requiring meetings to be open and held only after public notice is given.

Note that this condition does not apply when a mayor or other public official who is an ex officio (usually means the same thing as non-voting) board member even if that officially usually attends the meetings.

Now let's go to a less legalistic answer and give a practical answer in terms of best practices for a CDC. In most cases it will be practical for a community development corporation to allow community members to attend their meetings. This practice would build good will with the community, help prevent false rumors, and assist with trust building. Also the CDC may benefit by being able to turn to the community members occasionally to ask for their input informally.

If the CDC board is discussing personnel matters or real estate transactions, they could then go into closed session at the end of their meeting to address those agenda items, just as many city councils do. In our opinion, both of those types of discussion deserve privacy.

Sometimes the community feels that real estate purchases and sales should be discussed openly, but think again if you believe this. This procedure would make it very difficult for the community development corporation to buy property at a reasonable price, as word of their intentions would circulate pretty rapidly in the neighborhood in many instances. You want your CDC to succeed, and sometimes to succeed they need to be able to talk about how much to offer when they are buying and discuss counter-offers when they are selling.

In the end our best advice for a CDC is to operate as transparently as possible without undermining their ability to operate the real estate portion of their projects (often a substantial percentage of what a CDC does). A CDC that discusses very little other than real estate transactions might decide that open meetings are totally impractical, but if so, this CDC should make regular occasions to talk with the community at least quarterly.

If you are a community member who is curious, concerned, or suspicious of the CDC, usually your only recourse is to let all of the CDC board members, not just the staff, know that you are watching what they do and would appreciate the most interaction possible.

Incidentally, many community members in a similar position have been answered courteously, and promises of more transparency have been made. But somehow it doesn't happen. CDCs neglect to post a notice, post it inconsistently, or just generally make it difficult to find out when and where the meeting will occur. If you are the victim of this passive-aggressive behavior, it is fair to call it out through your social media accounts or through an old-fashioned letter to the editor if you have a local newspaper that still prints them.

  1. Community Development
  2. Questions
  3. Community Development Corporations and Open Meetings

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