Request By:
[NO REQUESTBY IN ORIGINAL]
Opinion
Opinion By: Albert B. Chandler III, Attorney General; James M. Ringo, Assistant Attorney General
Open Records Decision
This is an appeal from the Kentucky State Treasurer's denial of Mindy Hines's November 23, 1998 open records request to inspect and receive copies of all unclaimed property reports filed by banks with the Department for the year of 1998. In her request, Ms. Hines noted her understanding that social security numbers and account numbers would be redacted before copies were sent to her.
By letter dated November 24, 1998, Tim Lester, Unclaimed Property Branch Manager, denied Ms. Hines's request, stating:
Your request, as stated, cannot be granted for a number of reasons. First, there are other privacy and confidentiality concerns to consider. Because of an office policy change that was made prior to the publication of this year's list in the newspaper, we no longer release, universally, amounts for unclaimed accounts. That is to say, we do not include amounts in any lists that are generated for use in publication, or any other use (such as State Fair, and other outreach). The exception is for items included on lists prior to the 1998 report year. If someone sees his or her name on a list, the amount and other pertinent information may be obtained by calling our office.
Since the Treasury only acts as custodian for unclaimed property, to "stand in the shoes" of the rightful owners, we take the position that a private citizen would, for example, not want the general public to know how much money was in his or her bank account. If we release that information, this would be a violation of that privacy.
The second reason for denying your request, as stated, is because of the sheer size of the paperwork and manpower required to facilitate your request. Many of these reports are very voluminous, and to make copies would require a great deal of work and time. This would create an unreasonable burden on our staff. Copy costs would have to be paid "up front."
Lastly, there is another confidentiality question I have considered in my decision to your request as stated. The reports you are seeking are reports required by law for the banks to file with our office. These reports are disclosed confidentially to Treasury, much in the same way tax records are disclosed to the Revenue Cabinet. We would be in violation of that confidentiality if your request were granted.
Should you wish to amend your request, I would be happy to consider it.
After receipt of Ms. Hines's letter of appeal, and as authorized by KRS 61.880(2) and 40 KAR 1:030, Section 2, the Department, through its attorney, Assistant Attorney General Robert S. Jones, provided this office with a response to the issues raised in the appeal.
In the response, the Department reiterated its denial of the request based on KRS 61.878(1)(a), arguing that release of information, such as account numbers, social security numbers, amounts held in those accounts, would constitute a clearly unwarranted invasion of the privacy of the property owners.
It then expanded its original denial by explaining how complying with Ms. Hines's request would infringe upon the privacy interests of the bank and further explained how requiring the Department to redact all the exempted information from each report would place an undue burden upon the agency. In this regard, the response stated:
The privacy interests of the various banks protected by a denial of the request is less obvious, but just as significant as the privacy interests of the holders. In addition to providing information about the specific property owners, banks must also report information such as interest rates paid and amounts of property held as lost and abandoned. Although current interest rates by banking institutions are often common knowledge, it is not known publicly the rates paid on individual accounts, especially the very old accounts which have been long held by the depositors. However, further consequences include revealing the total deposits held as lost and abandoned for a bank in a given year. From this information, mathematical and business models can be used to derive accurate estimations as to the total deposits held, percentage of deposits held in specific types of accounts, and age of various types of accounts, and age of various types of deposits held, thus providing the requester with information sufficient to accurately model and analyze the business condition of the bank, potentially providing a competitor an unfair commercial advantage. Consequently, the second basis for denial is based upon KRS 61.878(1)(c)(1) and KRS 61.878(1)(e). See OAG 96-ORD-176 (8-20-96).
Finally, the request has also been denied because it would produce undue burden upon the Department. The Department receives literally hundreds of reports from banks throughout the state which set forth all accounts held by those banks which are presumed abandoned in a given year. To comply with the request of Ms. Hines, which does identify areas of personal information which would need to be redacted, it would be necessary for the Treasury to redact almost all of the information contained on the reports, excepting possibly the name of the property owner. Such a redaction would take an estimated 200-300 hours of employee time from the Treasury, employee time which the Treasury does not have to devote to such a request, especially when production of the information in such a redacted form is highly unlikely to provide the requester [with the] information initially sought, i.e., amounts held. The final basis of rejection is found under KRS 61.872(6).
The issue presented in this appeal is whether the Treasurer properly denied Ms. Hines's request to inspect and receive copies of all unclaimed property reports filed by banks with the Department for the year of 1998.
For the reasons that follow, we find that the Department established that the reports contain information of a personal or confidential nature the disclosure of which would constitute an unwarranted invasion of the owner's personal privacy and would require redaction in order to comply with Ms. Hines request. In light of this necessary redaction and the Franklin Circuit Court's recent decision in Commonwealth of Kentucky, Department of the Treasury v. Mindy Hines , Civil Action Nos. 98-CI-00134 and 98-CI-0345, decided January 21, 1999, we conclude the Department properly denied the request under authority of KRS 61.878(1)(a) and KRS 61.872(6).
In Commonwealth of Kentucky, Department of the Treasury v. Mindy Hines , a case involving both parties to the instant appeal, the Department appealed from two decisions of this office, 98-ORD-7 (in which this office overturned the Department's denial of Ms. Hines's requests for print screens of forty-eight abandoned property accounts reported in 1997) and 98-ORD-33 (which denied Ms. Hines's request to inspect the computer database containing unclaimed property accounts for the reporting year of 1997) holding, in each instance, Ms. Hines was entitled to the information she requested under the Open Records Act.
The Franklin Circuit Court reversed the portion of this office's decisions, in 98-ORD-7 and 98-ORD-33, which granted Ms. Hines access to the requested records, and held that the requests were improper under KRS 61.872(6), in that to produce the requested records created an unreasonable burden upon the agency. In reaching such a conclusion, the Court stated:
While the creation of a new database would clearly fall within this provision, the generation of an unlimited amount of individual "print screens" with information redacted might in fact be unduly burdensome within the meaning of the provision. So too might be allowing individuals access to the Treasury's computer database for an unlimited amount of time. As previously discussed, the Treasury makes this information available to the commercial public annually. The Treasury expends much time and effort in obtaining information, revising it, entering the information into the computer, advertising, and attempting to locate the owners of lost and abandoned property so that it may be returned to them at the least cost to them. Ms. Hines is requesting the same information that is contained in the annual list, only she desires it sooner than the list is published, presumably so that she may obtain an advantage over other commercial finders. While an individual request for forty-eight (48) "print screens" with personal information redacted may not be burdensome to the Treasury's staff, it is easy to see how such requests, if repeatedly made to the Treasury or made by an increasing number of people, could quickly become so burdensome that the Treasury is unable to efficiently perform its job of managing unclaimed property. The same is true with respect to the computer database - would the Treasury be expected to abdicate use of its computers to the public or to spend its annual budget providing more computers, rather than spending its budget trying to locate the owners of lost property? These are perhaps the reasons that the Treasury opted to provide the commercial public with an annual list. We find that allowing the public to make such requests of the Treasury, when the Treasury already has in place a mechanism for providing this information to the public is unduly burdensome on the Treasury.
Thus, the Franklin Circuit Court ruled that the specter of frequent and unlimited access to the Department's database by the public and commercial finders could become so burdensome as to disrupt its essential function of managing unclaimed property and found Ms. Hines's requests improper under KRS 61.872(6). This holding, plus the fact that the Department had in place an alternative mechanism to provide this information to commercial finders, such as Ms. Hines, by publishing an annual list, led the court to find the Open Records Act does not require the Treasury to provide her direct access to its computer database. As a result, the court ordered that Ms. Hines should not receive the information in the Department's database prior to the publication and availability of the annual list.
In the instant appeal, Ms. Hines has asked for all unclaimed property reports filed by banks with the Department for the year of 1998, recognizing the agency would have to redact each property owner's social security number and bank account number. In addition to redacting the property owner's social security number and bank account number, the Department indicated that, pursuant to an office policy change, made prior to the publication of the 1998 annual list, they no longer released, "universally," the amounts for the unclaimed property accounts. The Department argued that a private citizen would not want the general public to know how much money was in his or her bank account and, under authority of KRS 61.878(1)(a), denied access to the amount in each bank account on the basis that release of such information would constitute an unwarranted invasion of the unclaimed property owner's privacy.
We agree. Although KRS 393.110 requires the bank to file reports of its accounts presumed abandoned with the Department, it nevertheless is a privately generated report regarding depositor information which is well recognized as confidential information. We conclude that the owner of the account may have at least some privacy interest as to the amount in his or her bank account.
Having determined that the amount of an unclaimed property owner's account is information of a personal nature, we proceed to a determination of whether disclosure of this information constitutes a clearly unwarranted invasion of personal privacy. This determination turns on whether the privacy interests are superior to the public interest in disclosure. 96-ORD-123.
In determining the propriety of an agency's invocation of KRS 61.878(1)(a), the Court of Appeals, in Zink v. Com., Dept. of Workers' Claims, Labor Cabinet, Ky. App., 902 S.W.2d 825, 828 (1994), stated:
While binding precedent has yet to clearly speak to the point, we believe that the only relevant public interest in disclosure to be considered is the extent to which disclosure would serve the principle purpose of the Open Records Act. This is the approach the United States Supreme Court has taken in a similar analysis of requests under the Freedom of Information Act (FOIA). See Dept. of Justice v. Reporters Comm. for Freedom of Press, 489 U.S. 749, 774-75, 109 S. Ct. 1468, 1482-83, 103 L. Ed. 2d 774, 796-97 (1989). As stated in Board of Examiners [of Psychologists v. Courier-Journal and Louisville Times Co., Ky., 826 S.W.2d 324, 327 (1992)], "the public's 'right to know' under the Open Records Act is premised upon the public's right to expect its agencies properly to execute their statutory functions. In general, inspection of records may reveal whether the public servants are indeed serving the public, and the policy of disclosure provides impetus to an agency steadfastly to pursue the public good." 826 S.W.2d at 328. At its most basic level, the purpose of disclosure focuses on the citizens' right to be informed as to what their government is doing. That purpose is not fostered however by disclosure of information about private citizens that is accumulated in various government files that reveals little or nothing about an agency's own conduct.
Thus, the public's right to know under the Open Records Act is premised upon its right to expect its agencies properly to execute their statutory functions. Providing access to the amount in the unclaimed property owners account, while maybe of understandable interest to a commercial finder, would reveal little or nothing about either the conduct or functioning of the Department in its efforts to locate the owner of that property. Accordingly, we conclude the disclosure of the amount of the account would constitute an unwarranted invasion of personal privacy and the Department could properly withhold that information under KRS 61.878(1)(a).
Although the Department has provided access to the amount in the accounts in the past, prior to the adoption of its new policy adopted in 1998, it is not required to do so. Because the exemptions contained in KRS 61.878(1)(a) through (j) are permissive, the decision to remove or redact excepted material rests within the sound discretion of the public agency. OAG 89-76; 97-ORD-12.
In its response to the letter of appeal, the Department indicated the redaction required to meet Ms. Hines's request would take an estimated 200-300 hours of employee time from the Treasury. This fact, coupled with the Franklin Circuit Court's holding in Commonwealth of Kentucky, Department of the Treasury v. Mindy Hines, supra , a case involving the same parties and involving records which are essentially similar to those is this appeal, require us to find the Treasury properly denied Ms. Hines's request to inspect and receive copies of all unclaimed property reports filed by banks with the Department for the year of 1998.
The Department also argued that certain banking information may also have to be redacted because it is of a confidential or proprietary nature under KRS 61.878(1)(c). Because the foregoing is dispositive of this appeal, we need not address this issue here, except to point out that this information, if found exempt, might also require additional redaction by agency staff.
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.