NOT TO BE PUBLISHED
95-ORD-81
May 24, 1995
In re: James Malone/Calloway County School System
OPEN RECORDS DECISION
This appeal originated in the submission of a request for public records by Mr. James Malone, a staff writer for The Courier-Journal, to the Calloway County School System on December 21, 1994. Mr. Malone requested access to:
1) Itemized legal bills that would account for every penny Calloway County Schools, or its insurance carrier, has spent on the Barkley Tucker case, including bills for the defense of any litigation arising from the case.
2) Itemized bills which would show the district's entire expenses in contesting the Barkley Tucker case.
3) The amount of money the school currently expends on private placement of exceptional children.
On behalf of the Calloway County School System, Superintendent Jack D. Rose denied Mr. Malone's request on December 22, 1994.
In response to Mr. Malone's request for itemized legal bills spent on the Barkley Tucker case, Superintendent Rose advised him that KRS 61.878(1) exempts from disclosure public records pertaining to litigation where that litigation is still pending. Superintendent Rose explained that the Calloway County School System is currently engaged in litigation, and, relying on OAG 82-169, denied the request. In addition, he noted that the Calloway County School System "would not have copies of all the legal bills submitted to the insurance carrier." Superintendent Rose denied the existence of any other records documenting the district's expenses in the Barkley Tucker case, and of any records reflecting expenses incurred by the school system in the private placement of exceptional children.
In a follow-up letter to this office dated March 8, 1995, Mr. Michael A. Owsley, an attorney representing the school system, elaborated. Confirming that the school system is still actively engaged in litigation in relation to Barkley Tucker, he again cited KRS 61.878(1) and OAG 82-169 in support of the school system's decision to deny Mr. Malone's request. Moreover, he noted, his firm was retained by the Kentucky School Board Insurance Trust to represent the system in this matter. Statements for legal services and other expenses are submitted directly to COREGIS, the third party administrator for the insurance carrier which provided the errors and omissions coverage for the school district. With the exception of the first statement for legal services, which was submitted to the system in order to satisfy the deductible, and statements submitted by hearing officers relative to their charges, which were paid by the carrier and not the school system, the system has no copies of the billing statements or other expenses incurred in the litigation. Finally, Mr. Owsley confirmed that the school system currently expends no funds on private placement of exceptional children, and thus has no records of same.
We are asked to determine if the Calloway County School System violated the Open Records Act in responding to Mr. Malone's request. For the reasons set forth below, and upon the authorities cited, we conclude that the school system's response to his request constituted a partial violation of the Open Records Act.
In support of his denial of Mr. Malone's request for itemized billing statements relating to the defense of litigation arising from the Barkley Tucker case, Superintendent Rose argues that these statements are exempted from disclosure by KRS 61.878(1). Relying on OAG 82-169, he maintains that records of payments made to attorneys may be withheld while litigation is pending. This position was soundly rejected in OAG 92-14 and OAG 92-92, copies of which are attached hereto and incorporated by reference. In OAG 92-14, p. 6, we observed:
There can be little doubt that the public is entitled to review the contracts, vouchers, and other business records of a public agency as a means of insuring agency accountability. We recognized this principle in OAG 82-169 and OAG 85-91, where we expressly held that the records of payments made to attorneys, and bills and statements submitted to an agency by its attorneys, should be made available for public inspection at the conclusion of pending litigation. We believe that that opinion, coupled with the authorities cited above, mandate release of the monthly statements prepared by the City's attorneys which reflect the general nature of the legal services rendered. Should those invoices disclose substantive matters protected by the attorney client privilege, and exempt under KRS 61.878(1)(j) [now codified as KRS 61.878(1)(l)], the exempt material should be separated from the non-exempt materials, and the non-exempt materials released for public inspection.
In OAG 92-92, we elaborated on OAG 92-14, reaffirming our opinion that information about attorney fees is privileged only if its disclosure would reveal confidential communications between the attorney and client, and announcing that the existence of pending litigation does not preclude release of the records by a public agency unless the agency is a law enforcement agency or an agency involved in administrative adjudication, and premature disclosure of the information would harm the agency. KRS 61.878(1)(h). We believe that these opinions, along with our recent recapitulation of this position in 95-ORD-18, a copy of which is also attached, are contrary to the school system's position, and are controlling. The Calloway County School System should immediately arrange for Mr. Malone to inspect those records of expenses incurred in the Barkley Tucker case which Superintendent Rose and Mr. Owsley acknowledge are in its custody, subject to the rules governing redaction which are articulated in the cited decisions.
Superintendent Rose next asserts that the Calloway County School System does not have copies of legal bills submitted to its insurance carrier. Since the system participates in the Kentucky School Board Insurance Trust, statements for legal expenses, as well as other expenses associated with the case, are submitted directly to the carrier. The school system cannot, in his view, disclose records which are not in its custody. It is the opinion of this office that this response is not sufficient under the Open Records Act.
In a recent decision, the Attorney General remarked on the propriety of a records keeping arrangement much like the records keeping arrangement at issue in this appeal. In 95-ORD-61, the Kentucky State Fair Board denied a request for records relating to the bids on a construction project at the Fair Grounds, arguing that those records were in the hands of a private bidding agent which was not bound by the provisions of the Open Records Act. At page 6 of that decision, we observed:
[W]e are constrained to comment on the arrangement between Premier [Sports Marketing, Inc.,] and the Fair Board with respect to the need for public accountability through records access. It is somewhat disquieting to find that a public agency would effectively avoid the requirements of the Open Records Act by failing to maintain copies of records relating to a major construction project at one of its facilities. In our view, it is inappropriate to secret away ostensibly public records in a purportedly private corporation when those records are clearly of interest to the public. Recognizing that it is not our duty under the Open Records Act to comment on the contractual arrangement between the Fair Board and Premier . . . it is incumbent on us to remind the Board:
that the basic policy of KRS 61.870 to 61.884 is that free and open examination of public records is in the public interest and the exceptions provided for by KRS 61.878 or otherwise provided by law shall be strictly construed, even though such examination may cause inconvenience or embarrassment to public officials or others.
KRS 61.871. We concluded that because the Kentucky State Fair Board failed to meet its statutory burden of proof relative to its assertion that the custodian of the disputed records, Premier, is a private entity and therefore not subject to the Open Records Act, those records must be treated as public records. We believe that this decision has a direct bearing on the present appeal. A copy of 95-ORD-61 is attached hereto and incorporated by reference.
It is unclear whether the Kentucky School Board Insurance Trust is a public agency for purposes of the Open Records Act. KRS 61.870(1) defines the term public agency as:
(1) "Public agency" means:
(a) Every state or local government officer;
(b) Every state or local government department, division, bureau, board, commission, and authority;
(c) Every state or local legislative board, commission, committee, and officer;
(d) Every county and city governing body, council, school district board, special district board, and municipal corporation;
(e) Every state or local court or judicial agency;
(f) Every state or local government agency, including the policy-making board of an institution of education, created by or pursuant to state or local statute, executive order, ordinance, resolution, or other legislative act;
(g) Any body created by state or local authority in any branch of government;
(h) Any body which derives at least twenty-five percent (25%) of its funds expended by it in the Commonwealth of Kentucky from state or local authority funds;
(i) Any entity where the majority of its governing body is appointed by a public agency as defined in paragraph (a), (b), (c), (d), (e), (f), (g), (h), (j) or (k) of this subsection; by a member or employee of such a public agency; or by any combination thereof;
(j) Any board, commission, subcommittee, ad hoc committee, advisory committee, council, or agency, except for a committee of a hospital medical staff, established, created, and controlled by a public agency as defined in paragraph (a), (b), (c), (d), (e), (f), (g), (h), (i), or (k) of this subsection; and
(k) Any interagency body of two (2) or more public agencies where each public agency is defined in paragraph (a), (b), (c), (d), (e), (f), (g), (h), (i), or (j) of this subsection[.]
It is possible that the Trust is a public agency which falls within the parameters of one or more of these subsections. For example, it may derive at least twenty-five percent of its funds from state or local authority funds in the form of insurance premiums paid by participating school districts. Alternatively, it may have been established as "an interagency body of two or more public agencies . . . ." If so, it is a public agency within the meaning of KRS 61.870(1), and its nonexempt records are subject to disclosure.
While we question the prudence of the school system's practice relative to payment of expenses incurred in litigation, and its failure to review and retain records reflecting those expenses, we believe that KRS 61.872(4) compels the system not only to notify Mr. Malone that it is not the custodian of the records, but also to furnish him with the name and location of the custodian of the records. [1] KRS 61.872(4) provides:
If the person to whom the application is directed does not have custody or control of the public records requested, that person shall notify the applicant and shall furnish the name and location of the custodian of the agency's public records.
In failing to advise Mr. Malone that the disputed records are in the custody of the Kentucky School Board Insurance Trust, the Calloway County School System violated the Open Records Act. Mr. Malone may wish to resubmit his request to the Trust. If the Trust then denies that it is a public agency for purposes of the Open Records Act, Mr. Malone may raise this issue in a separate appeal.
Turning to the final category of records requested by Mr. Malone, records reflecting the amount of money the school system currently expends on private placement of exceptional children, we find that Superintendent Rose properly denied this portion of his request. This office has long recognized that a public agency cannot afford a requester access to records which do not exist. OAG 83-11; OAG 87-54; OAG 88-5; OAG 91-112; OAG 91-203. Superintendent Rose asserts, and Mr. Owsley confirms, that there are no such records in existence because the Calloway County School System expends no funds on private placements. Accordingly, the school system's denial of Mr. Malone's request was consistent with the Open Records Act.
The Calloway County School System and Mr. Malone may challenge this decision by initiating action in the appropriate circuit court. Pursuant to KRS 61.880(3), the Attorney General shall be notified of any action in circuit court, but shall not be named as a party in that action or in any subsequent proceedings.
CHRIS GORMAN
ATTORNEY GENERAL
AMYE B. MAJORS
ASSISTANT ATTORNEY GENERAL
res/7
Enclosures
Distributed to:
Superintendent Jack D. Rose
Calloway County Schools
P.O. Box 800
Murray, KY 42071
Mr. James Malone
Staff Writer
The Courier-Journal
P.O. Box 1116
Paducah, KY 42001
[1]With respect to the school system's records management obligations under the Kentucky Open Records Act, as amended in the 1994 General Assembly, this office recently recognized:In enacting KRS 61.8715 the General Assembly recognized that the intent of the Open Records Act, to provide full access to public records, was essentially related to, and would be promoted by, efficient records management. This, of course, is the intent and purpose of the State Archives and Records Act. Subversion of the intent of the Archives and Records Act thus constitutes subversion of the intent of the Open Records Act. If a public agency fails to discharge its statutorily mandated duty to establish effective controls over the creation, maintenance, and use of records, and to make known to all of its officials and employees that no records are to be destroyed except in accordance with the law, the agency subverts the intent of the Open Records Act by frustrating full access to public records.94-ORD-121, p. 10. To the extent that the school system's failure to maintain records of funds expended in defending legal actions against it is inconsistent with its records management obligations, its actions may also have the effect of subverting the intent of the Open Records Act and the State Archives and Records Act.