January 24, 2012

Ms. Leslie Hargrove

Executive Director

Coastal Area Health Education Center

P.O. Box 2

La Marque, Texas 77568

OR2012-01140

Dear Ms. Hargrove:

You ask whether certain information is subject to required public disclosure under the Public Information Act (the "Act"), chapter 552 of the Government Code. Your request was assigned ID# 441573.

The Coastal Area Health Education Center (the "center") received a request for a copy of an employee handbook, certain financial statements, and the requestor's personnel file. You claim the center is not a governmental body and, thus, the requested information is not public information under the Act. We have considered your arguments. We have also received and considered comments submitted by the requestor. See Gov't Code § 552.304 (interested party may submit comments to this office stating why information should or should not be released).

The Act applies to "governmental bodies" as that term is defined in section 552.003(1)(A) of the Government Code. That section contains the following description of an entity as within the meaning of a "governmental body":

[T]he part, section, or portion of an organization, corporation, commission, committee, institution, or agency that spends or that is supported in whole or in part by public funds[.]

Id. § 552.003(1)(A)(xii). The term "public funds" is defined in the Act as "funds of the state or of a governmental subdivision of the state." Id. § 552.003(5). "Public funds" from a state or governmental subdivision of the state can be in various forms and can include free office space, utilities and telephone use, equipment, and personnel assistance. See Att'y Gen. Op. No. MW-373 (1981).

Both the courts and this office previously have considered the scope of the definition of "governmental body" under the Act and its statutory predecessor. In Kneeland v. National Collegiate Athletic Association, 850 F.2d 224 (5th Cir. 1988), the United States Court of Appeals for the Fifth Circuit recognized that opinions of this office do not declare private persons or businesses to be "governmental bodies" that are subject to the Act "simply because [the persons or businesses] provide specific goods or services under a contract with a government body." Kneeland, 850 F.2d at 228 (internal quotations omitted) (quoting Open Records Decision No. 1 (1973)). Rather, the Kneeland court noted that, in interpreting the predecessor to section 552.003 of the Government Code, this office's opinions generally examine the facts of the relationship between the private entity and the governmental body and apply three distinct patterns of analysis:

The opinions advise that an entity receiving public funds becomes a governmental body under the Act, unless its relationship with the government imposes "a specific and definite obligation . . . to provide a measurable amount of service in exchange for a certain amount of money as would be expected in a typical arms-length contract for services between a vendor and purchaser." Tex. Att'y Gen. No. JM-821 (1987), quoting [Open Records Decision No.] 228 (1979). That same opinion informs that "a contract or relationship that involves public funds and that indicates a common purpose or objective or that creates an agency-type relationship between a private entity and a public entity will bring the private entity within the . . . definition of a 'governmental body.'" Finally, that opinion, citing others, advises that some entities, such as volunteer fire departments, will be considered governmental bodies if they provide "services traditionally provided by governmental bodies."

Id. (omissions in original). The Kneeland court ultimately concluded that the National Collegiate Athletic Association (the "NCAA") and the Southwest Conference (the "SWC"), both of which received public funds, were not "governmental bodies" for purposes of the Act, because both provided specific, measurable services in return for those funds. Id. at 230-31. Both the NCAA and the SWC were associations made up of both private and public universities. Id. at 226. Both the NCAA and the SWC received dues and other revenues from their member institutions. Id. at 226-28. In return for those funds, the NCAA and the SWC provided specific services to their members, such as supporting various NCAA and SWC committees; producing publications, television messages, and statistics; and investigating complaints of violations of NCAA and SWC rules and regulations. Id. at 229-31. The Kneeland court concluded that, although the NCAA and the SWC received public funds from some of their members, neither entity was a "governmental body" for purposes of the Act because the NCAA and SWC did not receive the funds for their general support. Id. at 231. Rather, the NCAA and the SWC provided "specific and gaugeable services" in return for the funds that they received from their member public institutions. Id.; see also A.H. Belo Corp. v. S. Methodist Univ., 734 S.W.2d 720 (Tex. App.--Dallas 1987, writ denied) (athletic departments of private-school members of Southwest Conference did not receive or spend public funds and thus were not governmental bodies for purposes of Act).

In exploring the scope of the definition of "governmental body" under the Act, this office has distinguished between private entities that receive public funds in return for specific, measurable services and those entities that receive public funds as general support. In Open Records Decision No. 228 (1979), we considered whether the North Texas Commission (the "commission"), a private, nonprofit corporation chartered for the purpose of promoting the interests of the Dallas-Fort Worth metropolitan area, was a governmental body. ORD 228 at 1. The commission's contract with the City of Fort Worth obligated the city to pay the commission $80,000 per year for three years. Id. The contract obligated the commission, among other things, to "[c]ontinue its current successful programs and implement such new and innovative programs as will further its corporate objectives and common City's interests and activities." Id. at 2. Noting this provision, this office stated, "Even if all other parts of the contract were found to represent a strictly arms-length transaction, we believe that this provision places the various governmental bodies which have entered into the contract in the position of 'supporting' the operation of the [c]ommission with public funds within the meaning of [the predecessor to section 552.003]." Id. Accordingly, this office determined the commission to be a governmental body for purposes of the Act. Id.

In Open Records Decision No. 602 (1992), this office addressed the status of the Dallas Museum of Art (the "DMA") under the Act. The DMA was a private, nonprofit corporation that had contracted with the City of Dallas to care for and preserve an art collection owned by the city and to maintain, operate, and manage an art museum. ORD 602 at 1-2. The contract required the city to support the DMA by maintaining the museum building, paying for utility service, and providing funds for other costs of operating the museum. Id. at 2. We noted that an entity that receives public funds is a governmental body under the Act, unless the entity's relationship with the governmental body from which it receives funds imposes "a specific and definite obligation to provide a measurable amount of service in exchange for a certain amount of money as one would expect to find in a typical arms-length contract for services between a vendor and purchaser[.]" Id. at 4. We found that "the [City of Dallas] is receiving valuable services in exchange for its obligations, but, in our opinion, the very nature of the services the DMA provides to the [City of Dallas] cannot be known, specific, or measurable." Id. at 5. Thus, we concluded that the City of Dallas provided general support to the DMA facilities and operation, making the DMA a governmental body to the extent that it received the city's financial support. Id. Therefore, the DMA's records that related to programs supported by public funds were subject to the Act. Id.

We further note that the precise manner of public funding is not the sole dispositive issue in determining whether a particular entity is subject to the Act. See Attorney General Opinion JM-821 at 3 (1987). Other aspects of a contract or relationship that involve the transfer of public funds between a private and a public entity must be considered in determining whether the private entity is a "governmental body" under the Act. Id. at 4. For example, a contract or relationship that involves public funds, and that indicates a common purpose or objective or that creates an agency-type relationship between a private entity and a public entity, will bring the private entity within the definition of a "governmental body" under section 552.003(1)(A)(xii) of the Government Code. The overall nature of the relationship created by the contract is relevant in determining whether the private entity is so closely associated with the governmental body that the private entity falls within the Act. Id.

In this instance, you state the center is a non-profit corporation. You have submitted an agreement between the University of Texas Medical Branch at Galveston (the "university") and the center, which states the center, in a cooperative effort with the university, seeks to improve the health of its surrounding population, especially the under-served, by creating partnerships among community and academic organizations. The submitted agreement indicates in order to finance some of the center's projects and operating costs, the center received funds from the university. The submitted agreement also details that the funds the university distributed to the center through this process were allocated to the university from the U. S. Department of Health and Human Services.

We note that in Open Records Decision No. 509 (1988), this office concluded that a private nonprofit corporation established under the Job Training Partnership Act and supported by federal funds appropriated by the state was a governmental body for the purposes of the Act. In that case, we analyzed the state's role under the federal statute and concluded the state acted as more than a simple conduit for federal funds, in part because of the layers of decision-making and oversight provided by the state in administering the programs. Id. at 2. The decision noted that federal funds were initially distributed to the state and then allocated among the programs at issue. Citing Attorney General Opinions JM-716 (1987) and H-777 (1976), the decision observed that federal funds granted to a state are often treated as the public funds of the state. Furthermore, in Open Records Decision No. 563 (1990), this office held that "[f]ederal funds deposited in the state treasury become state funds." Id. at 5 (citing Attorney General Opinions JM-118 (1983), C-530 (1965)).

In this case, the submitted agreement between the center and the university states the center received $90,560.00 from the university to support the furtherance of the center's objectives. Article II of the agreement gives the university the right to inspect, review, and audit the center's books of account, files, and other records to determine the proper application and use of all funds paid to the center. Article IV requires the center to submit monthly invoices to the university for reimbursement of expenses and gives the university the right to withhold payment of any expenditure that appears questionable, or for which additional information or support is required. We find that provisions such as these demonstrate the university has oversight over distribution of the funds. Therefore, the center receives public funds.

As previously noted, however, the Act does not apply to private persons or businesses simply because they receive public funds from a governmental body. See Attorney General Opinion JM-821 (1987); Open Records Decision Nos. 1 (1973), 228 at 2. However, if a governmental body makes an unrestricted grant of funds to a private entity to use for its general support, the private entity is a governmental body subject to the Act. See Attorney General Opinion JM-821; ORD 228 at 2. You assert the center does not receive public funds for its general support but rather to support a contracted scope of work or services. However, in Exhibit A of the submitted agreement, we note that the funds are explicitly provided "in support of [the center's] program objectives." Exhibit A goes on to list these various objectives, including (1) the establishment of an organizational network to effectively and efficiently address administrative activities that support achievement of the center's objectives, (2) health careers promotions to increase the diversity of enrollees in education and training programs, (3) a health literacy campaign to encourage healthy behavior among members of under-served populations, (4) programs to provide health profession students an adequate community-based education experience in under-served areas, and (5) the development of effective retention models to secure the quantity of health professionals needed to adequately serve under-served communities. Upon our review of the submitted agreement between the center and the university, we find the public funding received by the center is used for general support rather than payment for specific services. Further, we find that the center and the university share a common purpose and objective such that an agency-type relationship is created. See Open Records Decision No. 621 (1993) at 9; see also Local Gov't Code § 380.001(a), (b) (providing that governing body of municipality may establish and provide for administration of one or more programs, including programs for making loans and grants of public money and providing personnel and services of the municipality, to promote state or local economic development and to stimulate business and commercial activity in the municipality). Therefore, we conclude the center falls within the definition of a "governmental body" under the Act.

However, we note that an organization is not necessarily a "governmental body" in its entirety. "The part, section, or portion of an organization, corporation, commission, committee, institution, or agency that spends or that is supported in whole or in part by public funds" is a governmental body. Gov't Code § 552.003(1)(A)(xii); see also ORD 602 (only the records of those portions of the DMA that were directly supported by public funds are subject to the Act). Accordingly, only those records relating to those parts of the center's operations that are directly supported by public funds are subject to disclosure requirements of the Act.

Next, we must address the center's obligations under the Act. Section 552.301 of the Government Code prescribes the procedures that a governmental body must follow in asking this office to decide whether requested information is excepted from public disclosure. Pursuant to section 552.301(b), the governmental body must request a ruling from this office and state the exceptions to disclosure that apply within ten business days after receiving the request. Gov't Code § 552.301(b). Pursuant to section 552.301(e), a governmental body that receives a request for information it wishes to withhold under the Act is required to submit to this office within fifteen business days of receiving the request (1) general written comments stating the reasons why the stated exceptions apply that would allow the information to be withheld, (2) a copy of the written request for information, (3) a signed statement or sufficient evidence showing the date the governmental body received the written request, and (4) a copy of the specific information requested or representative samples, labeled to indicate which exceptions apply to which parts of the documents. See id. § 552.301(e). As of the date of this letter, you have not stated the exceptions to disclosure that apply to the requested information, nor have you submitted a copy or representative sample of the specific information requested. Therefore, to the extent the requested records relate to those parts of the center's operations that are directly supported by public funds, we find the center has failed to comply with the requirements of section 552.301.

Pursuant to section 552.302 of the Government Code, a governmental body's failure to comply with the procedural requirements of section 552.301 results in the legal presumption that the information is public and must be released. Information that is presumed public must be released unless a governmental body demonstrates a compelling reason to withhold the information to overcome this presumption. See id. § 552.302 (where request for attorney general decision does not comply with requirements of section 552.301, information at issue is presumed to be public); Simmons v. Kuzmich, 166 S.W.3d 342, 350 (Tex. App.--Fort Worth 2005, no pet.); Hancock v. State Bd. of Ins., 797 S.W.2d 379, 381 (Tex. App.--Austin 1990, no writ) (governmental body must make compelling demonstration to overcome presumption of openness pursuant to statutory predecessor to section 552.302); see also Open Records Decision No. 630 (1994). We note that a compelling reason exists when third-party interests are at stake or when information is confidential under other law. Open Records Decision No. 150 (1977). However, as you raise no exceptions to the disclosure of the requested information, it must be released to the requestor. If you believe the requested information is confidential and may not lawfully be released, you must challenge this ruling in court pursuant to section 552.324 of the Government Code.

This letter ruling is limited to the particular information at issue in this request and limited to the facts as presented to us; therefore, this ruling must not be relied upon as a previous determination regarding any other information or any other circumstances.

This ruling triggers important deadlines regarding the rights and responsibilities of the governmental body and of the requestor. For more information concerning those rights and responsibilities, please visit our website at http://www.oag.state.tx.us/open/index_orl.php, or call the Office of the Attorney General's Open Government Hotline, toll free, at (877) 673-6839. Questions concerning the allowable charges for providing public information under the Act must be directed to the Cost Rules Administrator of the Office of the Attorney General, toll free at (888) 672-6787.

Sincerely,

Sean Nottingham

Assistant Attorney General

Open Records Division

SN/agn

Ref: ID# 441573

Enc. Submitted documents

c: Requestor

(w/o enclosures)

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