A longstanding tourism organization in Harford County alleges the local government sought to undermine its reputation and replace the nonprofit after attempts to seek payment failed, according to a new lawsuit.
Visit Harford, which became the county’s official tourism marketing organization in 2015, filed the lawsuit Wednesday morning, accusing the county of breach of contract and interfering with business relationships. Under an almost decade-long contract, the county is required to pay the organization $645,000 per year in three equal installments. According to the lawsuit, the county did not pay the organization’s last request, totaling $215,000, made in January.
In response to the suit, Matt Button, public information officer for the county, said Wednesday that County Executive Bob Cassilly’s administration had concerns about Visit Harford’s “lack of transparency and effectiveness.” The administration decided to monitor and evaluate the nonprofit for a year and determined the most “transparent and effective” model for tourism in the county, he said.
“Moving forward, Harford County is retaining direct oversight of all taxpayer funding for tourism and services will be provided by the county government and the professional marketing organization,” Button said. “Funding was provided to Visit Harford over the past year, but it was contingent upon certain requirements. We were working with them to reconcile accounts and money due, and we were disappointed to receive a notice of claim for a potential lawsuit.”
The county abolished its tourism and marketing division in 2015, after determining that Visit Harford, then a year-old nonprofit, could promote travel and tourism on its own. For years, the organization said, Visit Harford had a cordial relationship with the administration, becoming the main source of tourism marketing and supporting parks, festivals and other cultural and recreational activities. It found a niche in sports tourism in hosting tournaments, investing in trails and races.
While the Harford County Council pushed legislation that benefited the tourism organization, Cassilly — whose term has been marked by political strife and disagreements with others — has pushed back.
According to the lawsuit, the organization and the county began talking in April after several requests for payment from the organization went unanswered. The organization was in agreement with a finalized collaboration proposal on June 18, in which Visit Harford would work with the Harford County Office of Economic Development to grow tourism in the county — until the county sent a new request on June 25.
In a June settlement offer obtained by The Baltimore Banner, the county gave Visit Harford two options: either the organization would assign its website and logo to the county in exchange for the $215,000, or the organization would keep its website and “waive disbursement” of the last installment.
The settlement offer acknowledged neither option was acceptable to Visit Harford.
“While it was always my hope that Economic Development and Visit Harford would find a way to work collaboratively, Economic Development now needs to move forward on its own and carry out the duties and responsibilities as the County’s DMO [Destination Marketing Organization],” the offer read.
It was the last straw for Visit Harford. The organization, which filed the lawsuit in the Harford County Circuit Court, is asking the judge for $215,000 with interest and damages for breach of contract and $75,000 for intentional interference with prospective advantage.
A simmering tourism dispute
Visit Harford submitted its third written request for a payment installment in early January. It had run into no issues with the first two.
On Jan. 16, while the request was still pending, the Harford County Council passed a bill that would compel the county to pay 25% of its hotel tax to the organization, according to court documents. The council said at the time the new spending formula for distributing hotel tax revenue would allow tourism to continue to grow, The Baltimore Sun reported.
Cassilly said in a press release the law would impose “a spending mandate,” which he called a gimmick to force the county executive to “fully fund pet projects of the council members.” He vetoed the bill, but the council was able to override it in February.
Meanwhile, Visit Harford resubmitted its request for payment twice. Under the contract, the county should pay the organization within five days of receipt or submit a “expression of dissatisfaction.” The county did neither.
The organization resubmitted the request three more times between Feb. 23 and April; the last time was through counsel.
The county responded on April 16 — notifying the organization it was going to terminate the contract. Court documents say it wasn’t until a week later that the county said “for the first time” that it had questions regarding the organization’s use of funds and its reliance on funding from the county.
After that, the county executive and the Office of Economic Development reached out to the Maryland Tourism Development Board and “instructed and directed” the entity not to provide any funding to Visit Harford, saying the organization was no longer eligible for the $50,000 grant.
The administration asked the Maryland Department of Commerce to redirect the funding to the county.
Court documents said the county deliberately tried to damage the organization’s operations and reputation in other ways. The county asked several members of the organization to either serve on a board that will oversee their tourism division or to work for the government. The county also reached out to the Maryland Tourism Council, saying the organization had “no money” to host the annual Maryland Travel and Tourism Summit and offered itself to host the event.
Visit Harford said in a press release that the organization generated $61 million in tax revenue and $479 million in tourism spending. Jay Ellenby, president of Visit Harford, said the county is increasing expenses by reinstating the office and hiring personnel.
“For every dollar we spend in tourism marketing, $15 comes back to the county for investment in our schools, our first responders and our public infrastructure. That is simply an unbeatable return on investment,” Ellenby said in a press release. “That is why it is so hard to understand why County Executive Cassilly is so determined to break something that is working so well for everyone. His actions are hurting local businesses and damaging Harford County’s economy, and it is setting our community back for years to come.”
This is a developing story.
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