Judges: MIKE BEEBE, Attorney General
Filed Date: 8/23/2006
Status: Precedential
Modified Date: 7/5/2016
The Honorable Larry Jegley Prosecuting Attorney Sixth Judicial District 122 S. Broadway Little Rock, AR 72201
Dear Mr. Jegley:
I am writing in response to your request for an opinion on several questions involving a request that was submitted under the Arkansas Freedom of Information Act (FOIA), A.C.A. §§
1. Criminal action (A.C.A. §
25-19-104 ). Given the paperwork submitted, can it be proven beyond a reasonable doubt that:(a) ACH is "wholly subject" to FOI, per se? (e.g. what proof exists of doctors' salaries from UAMS operating on patients at ACH or working the unit in question? What proof of the source of UAMS doctors' salaries exists?);
(b) ACH is "partially subject" to FOI, per se, due to receipt of public funds in whole or in part? (Does documentation exist about what units receive public funds or what doctor salaries are publicly funded?)
(c) Whether the specific records sought from the cardiovascular intensive care surgery unit (i.e. financial records concerning certain operations) are subject to FOI, per se?
(d) If such records are per se subject to FOI, whether exemptions in criminal prosecution may justify withholding of such financial information claimed to be a "competitive interest" (
25-19-105 (b)(9)(A)).2. Civil action (A.C.A. §
25-19-107 ). Given the paperwork submitted, would the Democrat-Gazette be advised to pursue a civil action? If so, would the paper be able to employ broad civil discovery methods to inquire about the details of any records which would better prove or disprove their entitlement to the specific records sought and provide a forum, such as in camera review or discovered documents, to allow a circuit court to decide whether the documents are discoverable?3. Other Remedies. Are there other legal remedies available to resolve the FOI request?
RESPONSE
I cannot make any prosecutorial judgments with regard to this matter, due to the intensive fact finding that necessarily attends the decision, and in recognition of the general principle of prosecutorial discretion. It has long been the policy of this office to decline to issue an opinion concerning the pursuit of criminal charges, in deference to the prosecutor's sound discretion in the matter. Nor can I offer advice regarding the best course of action for the party seeking access to records. By statute, I am forbidden to engage in the private practice of law (see A.C.A. §
Question 1 — Criminal action
(a) — (c) Can it be proven beyond a reasonable doubt that ACH is"wholly subject" or "partially subject" to the FOIA?
I am neither authorized nor equipped to perform the inquiry necessary to identify all the relevant factors in deciding these matters. The question of whether ACH is subject to the FOIA, and to what extent, ultimately is a factual one falling outside the scope of this opinion. See Ark. Ops. Att'y Gen. Nos.
Although I cannot draw any legal conclusions that would require determinations of fact, I can discuss the legal principles upon which the appropriate factual inquiry and determination must be based. The FOIA in relevant part defines the term "public records" as follows:
"Public records" mean writings, recorded sounds, films, tapes, electronic or computer-based information, or data compilations in any medium, required by law to be kept or otherwise kept, and which constitute a record of the performance or lack of performance of official functions which are or should be carried out by a public official or employee, a governmental agency, or any other agency wholly or partially supported by public funds or expending public funds. All records maintained in public offices or by public employees within the scope of their employment shall be presumed to be public records.
A.C.A. §
The emphasized language in subsection
The second part of the inquiry derives from the FOIA's stated purpose and policy, from which it is clear that the mere receipt of public funds does not alone make the records of a private entity "public records" under the act. In declaring the purpose and policy of the FOIA, the legislature stated:
It is vital in a democratic society that public business be performed in an open and public manner so that the electors shall be advised of the performance of public officials and of the decisions that are reached in public activity and in making public policy.
A.C.A. §
In order for its records to be public under the FOIA, therefore, the private entity must also be carrying on "public business" or, as stated by one of my predecessors, be "otherwise intertwined with" the activities of government. Ark. Op. Att'y Gen. 1983-163.See also City of Fayetteville v. Edmark,
When the state or a political subdivision thereof seeks to conduct its affairs through private entities, it seems clear that those entities are for all practical purposes the government itself. It should not matter whether the activity is "proprietary" or "governmental" in nature, for in either case the government is involved in the" public business." Thus when a county official hires a certified public accountant to conduct an audit of a county department instead of using public employees for that purpose, the CPA's records relevant to that task should be obtainable under the FOIA.
In summarizing the test with respect to private organizations, two recognized authorities on the FOIA have identified the following three-part inquiry:
[T]he FOIA applies only to private organizations that (1) receive public funds, (2) engage in activities that are of public concern, and (3) carry on work that is intertwined with that of government bodies. This approach is sound. If the mere receipt of public funds were enough to trigger the act, it would reach anyone who received government largesse, including welfare recipients and private hospitals that receive Medicare and Medicaid payments. As the Supreme Court has recognized, however, the FOIA should apply when the government "seeks to conduct its affairs through private entities," for in that situation "the entities are for all practical purposes the government itself." Or, as the Attorney General has put it, the FOIA covers a publicly funded organization that enjoys a "symbiotic relationship" with the state or its political subdivisions: "[w]hen the activities of a private organization and the government become intertwined, the private organization may well render itself part of the State for [FOIA] purposes." [Quoting from Op. Att'y Gen. 1983-163.]
J. Watkins R. Peltz, THE ARKANSAS FREEDOM OF INFORMATION ACT (mm Press, 4th ed. 2004), at 50-51 (footnotes omitted).
In applying this test to ACH, I am able to determine that the first two prongs are met. ACH's activities clearly are of public concern, and public funding is evident. With regard to funding, I assume you are correct in stating that ACH received over $2.5 million from Pulaski County last year. Although I cannot verify that exact figure, I am aware of a tax that is levied pursuant to Ark. Const. amend.
It is apparent that ACH receives partial financial support from both the State and the County. In my opinion, the inquiry must focus on the third prong of the test, that is, whether ACH is "intertwined" with the government such that it is involved in "public business" or "public activity" (A.C.A. §
It has also been suggested that "perhaps the most obvious case of such intertwining occurs when a private entity receives public funds for the general support of activities that are closely aligned with those of government." Watkins and Peltz, supra at 43 (citing Rehab. Hospital Services Corp. v. Delta-Hills HealthSystems Agency, Inc.,
These cases and Attorney General Opinions provide some guidance with respect to the intertwining element. But it still remains unclear just how "intertwined" a private entity must be with the government before the FOIA will be deemed applicable. See,e.g., Op. Att'y Gen. Nos.
I believe these are relevant factors to consider in determining whether ACH is subject to the FOIA. I cannot decide the matter, however, based on these state laws alone. There undoubtedly are other factors to consider and I cannot, through the issuance of an Attorney General's opinion, conclusively determine such a fact-intensive inquiry. In my opinion, the provisions of law cited above indicate that ACH is at least "partially bound" by the FOIA. See generally Watkins and Peltz, supra at 58 (observing that a private organization may be "partially bound by FOIA requirements" by virtue of enjoying "only partial financial support from government.") State law targets funds for certain discrete activities, and there is evidence of intertwining with respect to such funds. In my opinion, however, the inquiry does not end there. It seems that ACH also receives general, non-designated public funds. I am referring primarily to the allocation of public funds from Pulaski County, although I also note the $700,000 appropriation under Act 2298 of 2005, § 37, for "Children's Hospital Payments," supra. Accordingly, an issue remains whether there is sufficient alignment with government, or "intertwining," to trigger the FOIA generally, such that ACH is wholly subject to the act. I have no information regarding the County funds other than what can be gleaned from Pulaski County Ordinance No. 198, supra. According to the Ordinance, a copy of which is enclosed with this opinion, a "Hospital Maintenance Tax" was approved by the voters pursuant to Ark. Const. amend.
[I]f the Hospital Maintenance Tax were approved by a majority of the qualified Electors voting at the General Election, and subject to Court approval, the County would accept ownership of the hospital properties now operated by the Corporation and located in the County (the ``Hospital') as a public hospital of the County, and would lease the Hospital to the corporation.
Id. at 1-2.
The purpose of the tax is stated as follows:
The County needs to assure that adequate medical care will be available to all children residing in the County, and accepting ownership of the Hospital, designating the Hospital as a public hospital of the County, leasing it to the corporation, and levying and collecting the Hospital Maintenance Tax will serve a proper public purpose by assuring the availability of such care.
Id. at 2.4
It therefore appears that it was expressly anticipated and agreed that ACH would run the public hospital after voter approval of the tax, presumably with the understanding that proceeds from the Hospital Maintenance Tax would be allocated to ACH. The Arkansas Supreme Court has not addressed a scenario such as this in the FOIA context. Nor has this type of arrangement prompted a request for an opinion of this office. I have previously opined that a private organization carried on work that was intertwined with that of a government body when it leased a hospital from a county. Att'y Gen. 2004-223. But in that instance, the county had operated the hospital prior to its arrangement with the non-profit corporation, prompting me to note that "[t]he activity of operating a hospital thus appears to be one that would be conducted by the county itself in the absence of the arrangement with the corporation." Id. It seemed clear that the necessary "intertwining" element was met under those circumstances. Seealso Op. Att'y Gen. No.
The issue arguably is less clear regarding ACH. The argument can be made that the County has determined to conduct its affairs through ACH by accepting ownership of the hospital properties, making the hospital a public hospital, levying the tax in anticipation of ACH running the hospital, and leasing the hospital to ACH. The corollary argument is that ACH becomes subject to the FOIA when it accepts the tax proceeds. I find this argument compelling and I believe some support for this approach might be found in cases such as Rehab. Hospital Services Corp.,supra, where "a private entity receives public funds for the general support of activities that are closely aligned with those of government." Watkins and Peltz, supra at 51. I recognize, however, that this argument might be countered with the assertions that the hospital operations nevertheless remain private and the County was never engaged and does not intend to be engaged in the activity of running a children's hospital. The small percentage of ACH's operating revenue that actually comes from tax proceeds (reportedly less than 3%) might be cited as further undermining the intertwining prong of the FOIA test.
Notwithstanding this apparently small percentage of revenue, I am nevertheless troubled by the history of the "Hospital Maintenance Tax" and the fact that the County has expressly declared the hospital to be a "public hospital" (Ordinance, supra). The Ordinance suggests that the tax is allocated to ACH for the general operation of a public hospital to provide care for all children in the County. Given the liberal disclosure standard, the court might well interpret that action in and of itself as warranting application of the FOIA. The Arkansas Supreme Court has steadfastly interpreted the FOIA liberally in favor of openness so as to serve the FOIA's purpose of assuring that the public is "fully apprised of the conduct of public business."Kristen Invest. Prop.,
(d) Do exemptions in criminal prosecution justify withholding ofsuch financial information claimed to be a "competitiveinterest"?
With regard to the "competitive advantage" exemption, A.C.A. §
As for the test's application, it should be noted that the burden of proving substantial competitive injury is upon the entity seeking nondisclosure. See generally Gannett River StatesPublishing Co. v. Arkansas Indus. Dev. Comm'n.,
Question 2 — Civil action
The decision whether to pursue a civil action in this matter is one that must rest with the party seeking access to the records, not this office. Although I am charged with advising legislators, other officials and boards on matters of public concern, I cannot counsel private litigants. See A.C.A. §
In response to that part of your question concerning the use of discovery, it appears self-evident, given the alternative of no access to detailed information or records by which to prove entitlement to the records sought in this instance, that discovery in a civil action could be employed to access such information or records. How broad that discovery will be is governed the Arkansas Rules of Civil Procedure. The scope of discovery is dictated, generally, by the cause of action. Rule 26 states in relevant part:
Parties may obtain discovery regarding any matter, not privileged, which is relevant to the issues in the pending actions, whether it relates to the claim or defense of the party seeking discovery or to the claim or defense of any other party, including the existence, description, nature, custody, condition, identity and location of any books, documents, or other tangible things and the identity and location of persons who have knowledge of any discoverable matter or who will or may be called as a witness at the trial of any cause. It is not ground for objection that the information sought will be inadmissible at the trial if the information sought appears reasonably calculated to lead to the discovery of admissible evidence.
Ark. R. Civ. P. 26(b)(1) (emphasis added).
In the case of a civil action against ACH to obtain specific records, the issue will be whether ACH is subject to the FOIA. Matters pertaining to that issue thus would appear to be generally obtainable through discovery, in accordance with the above rule. This may involve an in camera review of records by the court deciding the issue, although I cannot speculate further in this regard. See generally Johninson v. Stodola,
Question 3 — Other Remedies.
Other additional remedies may be available through the courts, depending upon the particular circumstances. Declaratory judgments have been held a proper remedy to enforce FOIA rights.See Arkansas Gazette Co. v. Pickens,
Assistant Attorney General Elisabeth A. Walker prepared the foregoing opinion, which I hereby approve.
Sincerely,
MIKE BEEBE Attorney General
MB:EAW/cyh
It is the specific intent of this section that the following shall not be deemed to be made open to the public under the provisions of this chapter: . . . [f]iles which, if disclosed, would give advantage to competitors or bidders[.]
A.C.A. §
Arkansas Gazette Company v. Pickens , 258 Ark. 69 ( 1975 )
Apodaca v. Montes , 1980 Tex. App. LEXIS 3945 ( 1980 )
Gannett River States Publishing Co. v. Arkansas Industrial ... , 303 Ark. 684 ( 1990 )
Smithey v. State , 269 Ark. 538 ( 1980 )
Sebastian County Chapter of the American Red Cross v. ... , 311 Ark. 656 ( 1993 )
Martin v. Musteen , 303 Ark. 656 ( 1990 )
NORTH CENT. ASS'N OF COL. v. Troutt Bros. , 548 S.W.2d 825 ( 1977 )
Rehab Hospital Services Corp. v. Delta-Hills Health Systems ... , 285 Ark. 397 ( 1985 )
Commercial Printing Co. v. Rush , 261 Ark. 468 ( 1977 )
National Park Medical Center, Inc. v. Arkansas Department ... , 322 Ark. 595 ( 1995 )