Opinion
Opinion By: Jack Conway, Attorney General; Amye L. Bensenhaver, Assistant Attorney General
Open Records Decision
This matter having been presented to the Office of the Attorney General in an open records appeal, and the Attorney General lacking sufficient proof to conclusively resolve the issue presented, we cannot conclude that the Appalachian Research and Defense Fund is a public agency for open records purposes or that it violated provisions of KRS 61.870 to 61.884 in the disposition of Lexington Herald-Leader reporter Dori Hjalmarson's February 7, 2011, request for records relating to AppalReD's former executive director, Cynthia Elliott.
In a February 14, 2011, response to Ms. Hjalmarson's request for Ms. Elliott's personnel file and the investigative report leading to her termination, Michael A. Taylor, Chairman of AppalReD's Board of Directors, advised her that the matter was "still under investigation by [its] partner, Legal Services Corporation's Office of Inspector General" and that AppalReD would "not take action which might jeopardize this investigation and also . . . might impede Ms. Elliott's reputation or privacy." In support, Mr. Taylor cited 45 CFR § 1619, "prohibit[ing] disclosure of personnel records of LSC grantees." Shortly thereafter, Ms. Hjalmarson initiated this appeal asserting that "because some of AppalReD's board is appointed by a state entity (the Public Advocate) and because AppalReD receives a certain amount of state funding, it is a public agency that should be subject to open records and meetings laws."
In supplemental correspondence directed to this office after Ms. Hjalmarson initiated her appeal, Mr. Taylor advanced a new argument in support of AppalReD's denial. He argued:
While AppalReD gets substantial revenue from Legal Services Corporation, its parent corporation, and also from IOLTA, through the Kentucky Bar Association, AppalReD is a non-profit corporation that is not the type of "body" contemplated in this statute. Our by-laws call for two appointees who are on the board includ[ing] the sitting Public Advocate (now Ed Monahan) and a professor from the University of Kentucky (now Scott Bauries). This does not meet the required percentage under the statute.
Additionally, Mr. Taylor expanded on AppalReD's position relative to invocation of KRS 61.878(1)(a), (h), (i), and (j), asserting that disclosure of the requested records "would violate the privacy of . . . staff, would compromise an ongoing investigation, and is prohibited by [AppalReD] policies as well as those of LSC, [its] parent corporation." While it is by no means clear that the referenced exceptions to the Open Records Act justify nondisclosure of the records identified in Ms. Hjalmarson's request, we need not resolve this issue. The weight of the evidence that the Attorney General independently uncovered militates in favor of AppalReD's position that it is not a public agency for open records purposes.
Given the importance of resolving this threshold issue, on March 22, 2011, the Attorney General submitted a written request to AppalReD, pursuant to KRS 61.880(2)(c), 1 to substantiate its position that it is not a public agency as defined in KRS 61.870(1). We asked that AppalReD identify the directors who serve on its board and how they are appointed, that it indicate what percentage of its annual budget in the current fiscal year was derived from LSC, what percentage was derived from the Kentucky Bar Association and IOLTA, and what percentage was derived from other sources. We asked that AppalReD provide us with supporting documentation to confirm these figures. In addition, we asked that AppalReD advise us how much money it expended in Kentucky in the current fiscal year, and describe to us the nature and status of the investigation involving Ms. Elliott. Finally, we asked that AppalReD provide us with copies of the records in dispute and respond, in writing, to these questions on or before April 15, 2011. We received no written response to our inquiry. This situation mirrors a situation that arose in 2009.
In 09-ORD-033, this office was asked to determine if the Louisville Arena Authority's "construction manager-at-risk, M.A. Mortenson Company, was a public agency and its records publicly accessible under the Open Records Act. " Mortenson provided this office with figures substantiating its position, but those figures conflicted with the figures provided by the appellant. Mortenson was unwilling to furnish supporting documentation in spite of our formal request, pursuant to KRS 61.880(2)(c), that it do so. At page 6 of that decision, the Attorney General recognized that his "authority under KRS 61.880(2) 'to request additional documentation' extends to agencies, not to bodies that dispute their status as such," and that this limitation "puts the Attorney General in an untenable position relative to compulsory disclosure of supporting documentation. " We expressed concern that "[a]lthough KRS 61.880(2)(c) assigns the burden of proof to public agencies resisting disclosure of records, where, as here, the 'body' disputes its status as a 'public agency, ' that body cannot properly be assigned the statutory burden of proof. " Id. at 10. Ultimately, we acknowledged that, "the Attorney General is not empowered to require an [ostensibly non-public agency] to comply with our KRS 61.880(2)(c) request." Id. We are confronted with the same dilemma in the instant appeal.
As a nonprofit corporation, AppalReD qualifies as a public agency pursuant to KRS 61.870(1)(a) through (k) only if it "derives at least twenty-five percent of its funds expended by it in the Commonwealth of Kentucky from state or local authority" 2 or "the majority of its governing body is appointed by a public agency as defined in [KRS 61.870(1)(a) through (k)]; 3 by a member or employee of such a public agency; or by any combination thereof." Given its origins, the remaining definitional sections found in KRS 61.870(1) are facially inapplicable to it. With reference to the manner of appointment of directors to AppalReD's governing body, we find no conflicting legal authority, and therefore accept, Mr. Taylor's assurances that none of the fourteen directors are appointed by a public agency, by a member or employee of a public agency, or by any combination thereof. Two of the fourteen directors represent public agencies, Mr. Monohan and Professor Bauries, and hold their seats by virtue of AppalReD's by-laws. Clearly, KRS 61.870(1)(i) is inapplicable to AppalReD insofar as the members of its governing body do not owe their appointments to a public agency, member or employee of a public agency, or any combination thereof.
We are hampered in our ability to adequately address the applicability of KRS 61.870(1)(h) to AppalReD as a consequence of AppalReD's failure or refusal to share substantiating information with us under the terms of KRS 61.880(2)(c) and 40 KAR 1:030 Section 3. While we have recognized that our "ability to render a reasoned open records decision" 4 is impeded under these circumstances, AppalReD's error "cannot be remedied by committing another and thus compounding mistakes at the possible expense of" 5 a properly reasoned decision. We have therefore conducted independent research that confirms AppalReD's position that it does not derive at least twenty-five percent of the funds it expends in Kentucky from state or local authority funds. In fiscal year 2010, AppalReD received some $ 4,867,774, or 53% of its budget, from Legal Services Corporation, a nonprofit corporation established by Congress in 1974 that awards grants to legal services providers like AppalReD to insure civil legal assistance to low income Americans. These federal funds are not deposited in the State Treasury awaiting appropriation by the General Assembly pursuant to Section 230 of the Kentucky Constitution, 6 but are directly awarded to LSC's grantees. 7 Kentucky's IOLTA Fund awarded $ 78,300 to AppalReD in 2010-2011, and the Justice Cabinet awarded AppalReD an additional $ 133,000 under the Violence Against Women Act. Representatives of the Legislative Research Commission suggest that di minimus general fund dollars may have been appropriated to AppalReD, but its remaining funds apparently consist of "other federal funds" and private donations. Although it receives substantial federal funding, AppalReD cannot be said to derive at least twenty-five percent of the funds it expends in Kentucky from state or local authority funds, and therefore is not a public agency as that term is defined in KRS 61.870(1)(h). Its refusal to honor Ms. Hjalmarson's request for records relating to former executive director Cynthia Elliott therefore cannot be deemed a violation of the Open Records Act.
Our research did, however, disclose that as a recipient of funding from LSC, AppalReD is obligated to "adopt a procedure for affording the public appropriate access to the [Legal Services Corporation] Act, Corporation rules, regulations, and guidelines, the recipient's written policies, procedures, and guidelines, the names and addresses of the members of its governing body, and other materials that the recipient determines should be disclosed." 45 CFR § 1619.1. This regulation, in essence, requires AppalReD to adopt a records access policy aimed at "insur[ing] disclosure of information that is a valid subject of public interest in the activities of the recipient. " 45 CFR § 1619.1. While 45 CFR § 1619.4 states that "[n]othing in this part shall require disclosure of . . . (e) Personnel, medical, or similar files," AppalReD is the steward of public funds, as well as the public interest in promoting equal access to justice, and the federal regulation does not prohibit disclosure of personnel files. It merely states that the recipient's policy shall not require disclosure of personnel files. Where the public trust was, or may have been, violated, the "public['s] interest in the activities of the recipient" may be better served by disclosure of personnel and investigative files.
A party aggrieved by this decision may appeal it by initiating action in the appropriate circuit court pursuant to KRS 61.880(5) and KRS 61.882. Pursuant to KRS 61.880(3), the Attorney General should be notified of any action in circuit court, but should not be named as a party in that action or in any subsequent proceeding.
Distributed to:
Dori HjalmarsonJonathan PicklesimerMichael A. Taylor
Footnotes
Footnotes
1 KRS 61.880(2)(c) provides:
On the day that the Attorney General renders his decision, he shall mail a copy to the agency and a copy to the person who requested the record in question. The burden of proof in sustaining the action shall rest with the agency, and the Attorney General may request additional documentation from the agency for substantiation. The Attorney General may also request a copy of the records involved but they shall not be disclosed.
See also, 40 KAR 1:030 Section 3.
2 KRS 61.870(1)(h).
3 KRS 61.870(1)(i).
4 95-ORD-61, p. 5.
5 Edmondson v. Alig, 926 S.W.2d 856, 858 (Ky. App. 1996).
6 Compare 10-ORD-092 and 10-ORD-115. (In these decisions, the Attorney General held that federal grants that are deposited in the State Treasury and appropriated by the General Assembly per Section 230 of the Kentucky Constitution constitute state funds even though they are "federally 'born'").
7 We confirmed these facts in a May 2, 2011, telephone conversation with LSC Senior Assistant General Counsel Mattie Cohan.