County's Public Health Committee to consider LDC running Maplewood Manor

BALLSTON SPA -- County officials on the Public Health Committee are planning today to discuss the possibility of creating a local development corporation to run the county nursing home, Maplewood Manor.

Because Maplewood Manor has been losing millions of taxpayer dollars every year, county officials are looking for a way to take it off the books but maintain some control over the nursing home. Among its recommendations, the county's hired consultant, the law firm Harris Beach, said creating an LDC would provide some deficit relief and allow the county to access some of the equity in the facility.

"Under the control of an LDC, the county would still continue to have obligations to Maplewood and continue to pay for its operations," Harris Beach's recent report said.

According to the Center for Governmental Research, LDCs are private, not-for-profit corporations, usually created by local governments. However, technically, any individual older than 18 legally can create one. They typically take over governmental activities and do government work, but with a reduced amount of oversight and restrictions.

Milton Supervisor Dan Lewza, who does not serve on the Public Health Committee, briefly floated the idea of creating an LDC in Milton to build a new town complex. He said LDCs can attract buyers or businesses for economic development purposes, adding that this is different in the case of Maplewood Manor.

Typically, government officials choose who will serve on the LDC's board.

"It's made up of private individuals, but they probably will have to answer to the chair or the board, depending on how it's set up," Lewza said.

For Maplewood Manor, creating an LDC would allow the county government to engage in a public-private partnership, meaning that a private company would operate the nursing home. The LDC would be designed to oblige a public purpose -- caring for the county's elderly and disabled -- yet it would be separate from county government.

According to state law, LDCs can acquire public property without appraisal or public bidding, but they must hold a public hearing on the proposed sale or lease and give the public

10 days' notice prior to the hearing. The LDC also must use the property for the purpose stated in its incorporation certificate.

Governments have identified numerous reasons for creating LDCs because the state law that defines their purposes is broad, including "lessening the burdens of government." They have been used to manage or upgrade government assets, stimulate tourism and recreation and to address distinctive fiscal dilemmas, among other things.

The income and operations of LDCs are exempt from taxes, although their property is not. Property owned by an LDC and leased to a for-profit corporation to engage in for-profit manufacturing activities on the property is not exempt from taxation.

Unlike local governments, LDCs are not required to adhere to Open Meetings or Freedom of Information laws.

LDCs can take many forms. They can play innovative roles in local government, such as getting liabilities off the books while maintaining a degree of control over them.

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