Request By:
Keith B. Hunter, Esq.
General Counsel
Kentucky Lottery Corporation
Two Paragon Centre, Suite 400
6040 Dutchmans Lane
Louisville, Kentucky 40205-3271
Opinion
Opinion By: FREDERIC J. COWAN, ATTORNEY GENERAL; Gerard R. Gerhard, Assistant Attorney General
By letter of July 13, 1989, Jon Fleischaker has appealed your July 7, 1989 denial, on behalf of the Kentucky Lottery Corporation (KLC), of Courier-Journal staff writer John Voskuhl's request to inspect copies of bids submitted to the KLC, for equipment and services related to an on-line lottery gaming system for Kentucky.
FINDINGS IN BRIEF
For reasons expressed in OAG 89-43, records concerning end prices bid for certain major facets of a public procurement cannot be considered trade secrets. Accordingly, inspection of records containing such information must be permitted once all bids have been rejected or a contract has been awarded.
FACTUAL BACKGROUND
The KLC sought proposals from several vendors for the supply of equipment and services for an on-line automated lottery gaming system for Kentucky. Its Request for Proposals (RFP) called for certain pricing details to be furnished. In accordance the terms of the RFP, the proposals were to become the property of the KLC, and any proposal of a selected vendor would become part of any subsequent contract awarded.
Two vendors, Scientific Games, Inc., of Atlanta, Georgia, and GTech Corporation, of Providence, Rhode Island, submitted proposals. Each firm indicated, in substance, that the pricing detail furnished would be competitively damaging and asked that the information be held confidential.
A contract was awarded to GTech on July 5, 1989.
By letter of July 5, 1989, Mr. Voskuhl asked to inspect copies of bids submitted by GTech Corporation, and Scientific Games, Inc., both before and after price negotiations. By letter of July 7, 1989, you denied his request, indicating, in part, that pricing information was a "trade secret and exempt from disclosure under KRS 158.040(1)(b) and 61. 878(1)(j)."
By letter of July 13, 1989, Jon Fleischaker, of Wyatt Tarrant & Combs, on behalf of the Courier-Journal and Louisville Times Company, appealed your denial.
A more extensive discussion of the facts involved in this appeal appears in OAG 89-43, which involved substantially the same questions presented in this appeal.
OPINION OF THE ATTORNEY GENERAL
KRS 61.880(2) provides in part for the Attorney General to review, upon request, a denial of a request to inspect public records, and issue a written opinion stating whether an agency ". . . acted consistent with provisions of KRS 61.870 to 61.884."
The KLC is a public agency for purposes of applicability of Kentucky's Open Records laws, and its records are, in general, subject to such laws. KRS 154A.020(1); KRS 154A.040.
The Kentucky Lottery Corporation acted consistent with the provisions of KRS 61.870 to 61.884, to the extent it cited a specific exception under the Open Records Law for denying inspection of public records. Also in keeping with the Open Records statutes, the KLC gave a brief explanation of the relationship of the denial to the records in question, and promptly forwarded a copy of its denial to the Attorney General's Office.
As discussed in more detail in OAG 89-43, however, we find the denial cannot be upheld. Inspection of the records in question must be permitted.
KRS 154A.040(1)(b) provides, in substance, that records of the KLC are not subject to public inspection if they involve a trade secret of the KLC or of a vendor. Thus the KLC, pursuant to KRS 154A.040(1)(b) and KRS 61.878(1)(j), could deny inspection of records containing "trade secrets. "
You indicated, in substance, that pricing data submitted to the KLC in connection with the procurement in question was a "trade secret. "
Upon review of the RFP, and learning from an interview with KLC president Frank Keener, that the responses (and subsequent submissions) contained no more detailed information than called for by the RFP, we conclude that the pricing information submitted to the KLC involves "end prices" bid for major facets or categories of a public procurement.
"End prices" bid to a public agency, for major facets or categories of a procurement, are distinguished from information regarding a vendor's "costing and pricing strategy" for which we upheld denial of inspection in OAG 88-1. Where, as here, a contract has been awarded, records containing end prices bid by vendors must be made available for inspection. OAG 85-68.
It is axiomatic that the public is entitled to scrutinize records regarding public procurements. Permitting inspection of the records here involved is in keeping with the principle that "[T]he Kentucky lottery corporation shall be accountable to . . . the people of the Commonwealth . . . through thorough financial disclosure . . ." set forth in the statutes establishing the corporation. KRS 154A.020(1).
One who inspects public records is entitled to be furnished copies of them upon payment of a reasonable fee. Such fee is not to exceed the actual cost of copying and may not include the cost of staff required. KRS 61.874.
As required by statute, a copy of this opinion is being sent to Mr. Jon Fleischaker, Esq., the requesting party, on behalf of the Courier-Journal and Louisville Times Co.
Your agency may have a right to challenge this opinion in the Jefferson Circuit Court, pursuant to KRS 61.880(5) and KRS 154A.040(2).