Opinion
Opinion By: Albert B. Chandler III, Attorney General; Amye L. Bensenhaver, Assistant Attorney General
Open Meetings Decision
The question presented in this appeal is whether ODCH, Inc., violated the Open Meetings Act at its April 3, 2003 special meeting when it went into executive session pursuant to KRS 61.810(1)(f) for the stated purpose of discussing proposals made by Catholic Healthcare Partners, Inc., that might lead to the dismissal of an employee. 1 In response to the open meetings complaint submitted by The Owensboro Messenger-Inquirer relative to the closed session, ODCH later invoked KRS 61.810(1)(g), authorizing closed session "discussions concerning a specific proposal, if open discussions would jeopardize the siting, retention, expansion, or upgrading of the business." Given the time constraints imposed on this office in issuing an open meetings decision, we acknowledge that the intricate legal relationships that exist between the various entities whose competing interests formed the basis for the closed session discussion, and the complex issues raised, are of necessity given a cursory treatment here, but find that ODCH's reliance on the cited exceptions was misplaced. In so holding, we are guided by the legislative recognition that "the formation of public policy is public business and shall not be conducted in secret . . ." and that "the exceptions provided for by KRS 61.810 . . . shall be strictly construed." KRS 61.800.
On April 4, 2003, Messenger-Inquirer Editor Robert H. Ashley submitted a written complaint to ODCH Chairman Stuart Augenstein in which he alleged that the April 3 closed session of ODCH's Board of Directors constituted "in whole or in part" a violation of the Open Meetings Act. He observed:
ODCH Inc. has, as we understand it, no employees. It tests credulity, then, that the closed discussions could have involved "discussions or hearings which might lead to the appointment, discipline, or dismissal of an individual employee . . ."
Further, any discussion in that meeting that concerned the other options in the Catholic Healthcare Partners proposal, as outlined in open session - the purchase by either partner of the other partner's state - would not in any way be covered by this exemption.
As a means of remedying the alleged violation, Mr. Ashley proposed that "the session be re-conducted in public; that any documents, letters, memoranda or other written material presented at that discussion be released to the public; and that any minutes, transcripts or recordings of the meeting be provided for public inspection." 2
In a response dated April 9, 2003, Chairman Augenstein denied the allegations in Mr. Ashley's complaint and raised an additional defense to that complaint. He advised:
Owensboro Mercy Health System, Inc. ("OMHS") is a private, non-profit corporation that owns and operates the only hospital in our community. OMHS is owned by its two members: ODCH (81.25%), and Catholic Healthcare Partners ("CHP," 18.75%). ODCH is a private, non-profit corporation that has voluntarily committed in its bylaws to comply with the Open Meetings Law and the Open Records Act. 3
CHP has submitted three, alternate proposals to ODCH. The proposals would change the member relationship between CHP and ODCH, or have either CHP or ODCH acquire the member interest of the other. On April 3, 2003, the ODCH board of directors voted "to go into closed session to discuss the proposals of CHP to ODCH, which may lead to the dismissal of an individual employee. "
. . .
The individual in question is, as you know, Greg Carlson. Mr. Carlson is the President/CEO of both ODCH and OMHS. His salary is paid by OMHS. But Mr. Carlson is responsible and held accountable by the ODCH board for management and operation of ODCH's reproductive service program (annual revenues of approximately $ 993,000), and investments of approximately $ 8 million, along with associated regulatory and tax issues related to running the business of ODCH. Make no mistake about it: if ODCH selects and implements the terms of either of two of the three proposals made by CHP, Mr. Carlson will be dismissed from his positions with both ODCH and OMHS.
ODCH did not, and could not, separate discussion of the two CHP proposals that would result in the dismissal of Mr. Carlson, from discussion of the proposal that would not result in his dismissal. His value to ODCH and to the subsidiary in which ODCH owns an 81.25% interest, and his job performance are inextricably part of the discussions regarding all proposals. As you know, the board did not take final action on any of the proposals submitted by CHP.
Additionally, the ODCH board's closed session on April 3, 2003, was authorized because it involved "[d]iscussions between a public agency and a representative of a business entity and discussions concerning a specific proposal, if open discussions would jeopardize the siting, retention, expansion, or upgrading of the business. " This exception to the Open Meetings Law is found in KRS 61.810(1)(g), and was not required to be disclosed before the board went into closed session for this purpose.
The discussions regarding the CHP proposals concern the future of OMHS, our region's largest employer, and the future of one of its key employees. If CHP acquires the interest of ODCH in OMHS, the commitment of CHP to invest in expanding and upgrading services and facilities at OMHS is a key issue. Conversely, if ODCH acquires CHP's interest in OMHS, the purchase price paid by ODCH cannot be so high that it adversely impacts the ability of ODCH/OMHS to make the same investments. Continued joint ownership of OMHS with changes in the relationships between the owners must also be structured with these issues in mind. Public discussion of the strategies of ODCH on these issues, at this opening stage of negotiations with CHP, could seriously jeopardize the strength of ODCH's negotiating position.
(Emphasis in original.) On appeal, The Messenger-Inquirer, through its attorney Ralph W. Wible, challenges ODCH's reliance on KRS 61.810(1)(f), asserting that because Greg Carlson is not an employee of ODCH, but is instead employed as President and CEO of Owensboro Mercy Health Systems, Inc., which pays his $ 292,008.00 salary, ODCH could not discuss his dismissal in closed session. In addition, The Messenger-Inquirer objects to ODCH's reliance on KRS 61.810(1)(g), six days after the closed session occurred and only in response to his client's open meetings complaint, asserting that ODCH "cannot invoke an exception after the fact," and that even if it can, none of the proposals under discussion related to the "siting, retention, expansion or upgrading" of CHP, or were such that open discussion would have jeopardized the "siting, retention, expansion, or upgrading" of the hospital that lies at the heart of this controversy. 4
In supplemental correspondence directed to this office following commencement of The Messenger-Inquirer's appeal, ODCH's attorneys James M. Miller and R. Michael Sullivan elaborated on their client's position. In defense of ODCH's reliance on KRS 61.810(1)(f), they observed:
OMI agrees that Greg Carlson's employment is integral to the negotiations between CHP and ODCH, but illogically denies the existence of any basis for ODCH treating Mr. Carlson as an employee for purposes of the open meetings exemption under KRS 61.810(1)(f). The Open Meetings Law does not define the term "employee," nor does it expressly state that the "employee" must be an employee of the public agency in question. But the exemption does expressly state that "discussions . . . which might lead to the . . . dismissal of an individual employee" may be held in closed session.
Mr. Carlson's position as an employee of OMHS is uncontested. He was employed as President and CEO of OMHS by action of ODCH and CHP, not the OMHS board of directors, under the powers reserved to members in the OMHS bylaws. OMHS Bylaws, Section 3.01(c)(9). As pointed out above, that employment would be terminated upon the implementation of Alternatives 1 or 2 in the CHP Letter. And only by action of the ODCH board would either of those alternatives be implemented.
. . .
Additionally, KRS 61.810(1)(f) protects discussions of the ODCH board concerning Mr. Carlson, even if those discussions only concerned his status as an employee of OMHS (which they did not). The purpose of this exception is to protect the privacy of the employee, since the exception allows the employee to open these discussions to the public if he or she so wishes. OMI's argument defies logic. Does the law protect the privacy interest of a public employee, but not a private employee?
Even if the ODCH board only discussed Mr. Carlson's status as an employee of OMHS, he was still an employee that ODCH could dismiss by selection of a transaction with CHP that required that result. Subsection (f) does not explicitly require the employee to be an employee of a public agency. Based on the intention and purpose of this exception, ODCH properly went into closed session under KRS 61.810(1)(f) even if the discussion only concerned Mr. Carlson's role as an employee of OMHS.
But Mr. Carlson is also an employee of ODCH for purposes of the Open Meetings Act, regardless of whether he is an employee of ODCH for federal income tax purposes. He is the board-elected President and CEO of ODCH. As such he has substantial duties and authority under the ODCH bylaws . . . Article IV, Section 6;
. . .
Black's Law Dictionary (Fifth Ed. 1979) defines "employee" as "a person in the service of another under any contract of hire, express or implied." The Kentucky Whistleblower Act defines "employee" at KRS 61.101(1) as a person in the service of the Commonwealth "who is under contract of hire, express or implied, oral or written, where the Commonwealth . . . has the power to control and direct the material details of work performance." In common sense terms, an employee is someone who performs duties for the employer and who the employer can hire or fire. Mr. Carlson satisfies all of these definitions. ODCH elected him to a corporate office; he accepted that position and undertook to perform the duties of that corporate office. And the ODCH board can dismiss him from his officer's position in ODCH if it chooses. The ODCH board of directors hired Mr. Carlson into the paid position of president and CEO of a corporation in which it owns an 81.26% interest (OMHS), and then appointed him to perform the duties of president and CEO of ODCH for no additional compensation.
On these bases, Messrs. Miller and Sullivan asserted that it properly relied on KRS 61.810(1)(f) in conducting the April 3 closed session discussions.
In support of ODCH's reliance on KRS 61.810(1)(g), Messrs. Miller and Sullivan asserted:
This exception protects not only discussions between the public agency and a private business entity, but also discussions of the public agency itself concerning the siting, retention, expansion or upgrading of a private business entity. 94-OMD-119, page 3. OMI mistakenly assumes that ODCH invoked this exception based upon protecting the involvement of CHP in OMHS. In fact, this exception is applicable because the closed session involved discussions by the ODCH board concerning the retention, expansion and upgrading of another private entity, OMHS, a private hospital not subject to the Open Meetings Act. Because of CHP's offer, ODCH went into closed session and to discuss specific proposals that could definitely affect the following issues: [continued availability of reproductive services, continued availability of indigent care, expansion and upgrading versus reduction of the range of services provided, and expansion and upgrading of physical facilities].
It was their position that the CHP's letter "that arrived after representatives of CHP became upset by information leaks to the media," as compared to CHP's initial proposal, led the ODCH Board of Directors "to reach the reasonable conclusion on April 3, 2003, that open discussion of the CHP letter could jeopardize the negotiations with CHP and the future of OMHS." Continuing, they noted that neither of the records released to The Messenger-Inquirer, after the open meetings complaint was filed, "revealed the substance of the discussions held in closed session, including the negotiating strategy of ODCH and which of CHP's alternative was more attractive to ODCH."
Additionally, Messrs. Miller and Sullivan noted, ODCH was not obligated to invoke KRS 61.810(1)(g) prior to going into closed session based on the language of KRS 61.815(2), and was certainly not foreclosed from raising the exception as a defense to the April 3 closed session "after the fact." They reasoned:
OMI also incorrectly argues that ODCH violated the Open Meetings Act when it failed to cite KRS 61.810(1)(g) in its motion in the public session of the April 3, 2003, meeting as a ground for going into closed session, and that a public agency cannot invoke an exception after the fact. OMI overlooks the express language of KRS 61.815 that makes the public declaration requirements of subsection (1) subject to the exceptions of subsection (2). And subsection (2) of KRS 61.815 expressly states that public declaration of the reason for going into closed session is not required if the reason is the open meetings exception found in KRS 61.180(g), discussions concerning a specific business proposal.
This reading of the clear language of KRS 61.815 is confirmed in at least three opinions of the Attorney General: OAG 75-354, OAG 77-674 and OAG 78-227. Even if OAG 01-OMD-227 can be read to support OMI's position, it is axiomatic that the unambiguous language of a statute cannot be altered by an opinion of the Attorney General.
[T]here is no authority for OMI's proposition that a public agency cannot invoke an exception after the fact. In 99-OMD-104 . . . , the Marion City Council originally stated that it went into closed session for the purpose of discussing real property pursuant to KRS 61.810(1)(b). After the meeting, the city argued that the closed session was also authorized by KRS 61.810(1)(g). In the opening paragraph of the decision, the Attorney General stated, ". . . although it initially relied on the wrong exceptions, the Marion City Council subsequently justified its actions on the basis of KRS 61.810(1)(g). The Attorney General upheld the propriety of the closed session based on an exception the public agency did not cite until after the closed session. Thus, a public agency can rely on an exception not expressly mentioned in its motion to go into closed session, especially when KRS 61.815(2) provides that it need not follow the procedures set forth in KRS 61.815(1) if it is a reason for going into closed session.
For all of these reasons, Messrs. Miller and Sullivan urged this office to affirm their client's position.
As we observed in the opening paragraph of this decision, the Attorney General is constrained by time and resources from conducting a thorough inquiry into the intricate legal relationships that exist between the entities which share an interest in Owensboro's only hospital and the difficult open meetings issues which arise from the dynamics of those relationships. To paraphrase an earlier opinion of this office involving a dispute arising under KRS 61.870, et seq., "[g]iven the limited role for the Attorney General contemplated by the statutes and the office's limited resources, the Attorney General cannot truly be a 'judge' in the sense of reviewing volumes of documents, listening to testimony, considering briefs, etc." OAG 88-64, p. 1. There, we concluded that on occasion the application and meaning of both the Open Meetings and Open Records Act must be determined by a court of law. Having said this, we acknowledge that the complexity of the issues raised does not relieve us of our statutory duty under KRS 61.846(2) and proceed to an adjudication of this open meetings appeal.
KRS 61.810(1)(f)
Fundamental to an analysis of the propriety of a public agency's conduct under the Open Meetings Act is the legislative statement of policy codified at KRS 61.800:
The General Assembly finds and declares that the basic policy of KRS 61.805 to 61.850 is that the formation of public policy is public business and shall not be conducted in secret and the exceptions provided for by KRS 61.810 or otherwise provided for by law shall be strictly construed.
In interpreting this provision, Kentucky's courts have recognized that "the failure to comply with the strict letter of the law in conducting meetings of a public agency violates the public good," E. W. Scripps Co. v. City of Maysville, Ky.App., 750 S.W.2d 450 (1990) cited in Floyd County Board of Education v. Ratliff, Ky., 955 S.W.2d 921, 923 (1997), and that:
Consequently, the courts of the Commonwealth must narrowly construe and apply the exceptions so as to avoid improper or unauthorized closed, executive or secret meetings.
Id. "[T]he exceptions to the open meetings laws," the Court concluded, "are not to be used to shield the agency from unwarranted or unpleasant public input, interference or scrutiny." Id. at 924. Kentucky's legislature, as well as its judiciary, have thus demonstrated their commitment to "open government openly arrived at." Maurice River Board of Education, v. Maurice River Teachers, 455 A2d 563, 564 (N.J. Super. Ch. 1982) paraphrasing Woodrow Wilson.
KRS 61.810(1)(f) authorizes public agencies to go into a closed session for:
Discussions or hearings which might lead to the appointment, discipline, or dismissal of an individual employee, member, or student without restricting that employee's, member's, or student's right to a public hearing if requested. This exception shall not be interpreted to permit discussion of general personnel matters in secret [.]
With specific reference to this provision, commonly referred to as the "personnel exception" to the Open Meetings Act, this office has opined:
A public agency's authority to go into a closed session relative to personnel matters is severely restricted. General personnel matters cannot be discussed in a closed session. The only personnel matters which can be discussed in a closed session by a public agency are those which might lead to the appointment, discipline, or dismissal of personnel of that particular agency. See 93-OMD-49, at page three, and OAG 90-125, at page two.
Prior to going into a closed session for one of the specific purposes authorized by KRS 61.810(1)(f), a public agency must state during the regular and open portion of the meeting the general nature of the business to be discussed and the reason for the closed session. While the public need not be advised as to the name of the specific person being discussed in connection with a possible appointment, dismissal, or disciplinary action, the public is entitled to know the general nature of the discussion which would be that it involves either a possible appointment, a possible dismissal, or a possible disciplinary matter relative to a specific unnamed person or persons.
97-OMD-110, p. 3; see also 97-OMD-124; 99-OMD-49; 99-OMD-94; 00-OMD-86.
These decisions echo an earlier open meetings opinion in which the Attorney General recognized that:
The legislature specifically intended to close discussions only of these three subjects due to the potential for reputational damage. Closed discussions of other matters are expressly precluded by KRS 61.810[(1)(f)] which prohibits the "discussion of general personnel matters in secret. "
OAG 83-415, p. 2. It is for this reason that the Attorney General has declared that "matters only tangentially related to the appointment, or the discipline, or the dismissal of an individual employee cannot be discussed in closed session [under authority of KRS 61.810(1)(f)] . . ."00-OMD-86, p. 3, and that "KRS 61.810(1)(f), interpreted by this office in a manner consistent with the rule of strict construction codified at KRS 61.800, is 'severely restricted . . . [and only applies to discussions] which might lead to the appointment, discipline, or dismissal of personnel of that particular agency." 97-OMD-110, p. 3, cited in 99-OMD-94.
Although Mr. Carlson's dismissal was tangentially related to the subject of the closed session discussion conducted at ODCH's April 3 special meeting, the primary focus of that discussion was which, if any, of the three alternate proposals submitted by CHP to "change the member relationship between CHP and ODCH, or have either CHP or ODCH acquire the member interest of the other," was most attractive. There is no exception in existing open meetings law for such discussions. Each of the proposals contained numerous features, only one of which was Mr. Carlson's dismissal. Given the fact that ODCH's Board has declared that it "stands foursquare behind Greg Carlson and his leadership of OMHS," 5 we find that the dismissal of an individual employee was not the focus of the closed session discussion but was instead an unavoidable consequence which would flow from selection of two of the three proposals, and that Mr. Carlson's reputational interest was implicated, if at all, only indirectly. We therefore conclude that ODCH's liberal construction of KRS 61.810(1)(f) in this context is not supported by the language of the exception and the rule of strict construction codified at KRS 61.800.
KRS 61.810(1)(g)
Similarly, we find that ODCH's belated invocation of KRS 61.810(1)(g) as an additional basis for the closed session was legally unsupportable. 6 With reference to this exception, the Attorney General has commented:
What formerly appeared among the exceptions to open and public meetings as KRS 61.810(7) was an exemption for "Meetings between public agencies and industrial prospects." As a result of the 1992 amendments to the Open Meetings Act (1992 Acts, Chapter 162, HB 16), KRS 61.810(7) was repealed and the phrase "industrial prospects" was stricken. What was substituted for KRS 61.810(7) is what now appears as KRS 61.810(1)(g) and which provides as one of the exceptions to open and public meetings:
Under the new provision a meeting between the city and a representative of a business entity or a meeting of the city [council] pertaining to a specific proposal could only be closed if an open and public discussion would jeopardize, among other things, the locating of the business in the area.
94-OMD-119, p. 3. Whereas prior to 1992 proper invocation of the exception depended upon the presence of a representative of the industrial prospect (see, e.g., OAG 80-530), the amended KRS 61.810(1)(g) was broadened to include "discussions concerning a specific proposal," with or without the representative (see, e.g., 94-OMD-119), but only if open discussion would jeopardize the business entity's undisclosed interest in siting, retention, expansion, or upgrading of the business. Compare 94-ORD-119 (KRS 61.810(1)(g) not properly invoked where business involved had publicly announced at a ceremony attended by the Governor that it intended to locate in the area); 99-OMD-104 (KRS 61.810(1)(g) properly invoked to conduct closed session discussion concerning corporations undisclosed interest in expanding and upgrading its operations in county, and confidentiality was required to consummate the expansion project); 01-OMD-45 (KRS 61.810(1)(g) not properly invoked for discussion of cost estimates for remodeling a public building).
Again, we find that although the continued availability of services and expansion and upgrading of facilities at OMHS were tangentially related to the subject of the closed session discussion, that discussion focused primarily on the three proposals submitted by CHP. As noted above with reference to ODCH's invocation of KRS 61.810(1)(f), the unavoidable consequences that would flow from selection of a proposal that would vest control of OMHS in CHP, or selection of a proposal by which ODCH would purchase CHP's interest in OMHS include the continued availability of services and the expansion and upgrading of facilities, but the closed session discussion centered on the proposals to change the member relationship between CHP and ODCH, and there is no exception in existing law for such discussions. The discussion did not involve a representative of a business entity with previously undisclosed plans to locate, expand, or upgrade its business; nor did the discussions center on a specific proposal submitted by a business entity relative to siting, retention, expansion, or upgrading of the business. "The purpose underlying KRS 61.810(1)(g), namely to promote and facilitate economic development by private industry in the Commonwealth," 01-OMD-45, p. 8, is not served by closed session discussions of various proposals to change the legal relationship between a public and private entity. Accordingly, we conclude that ODCH's invocation of KRS 61.810(1)(g) reflected a liberal interpretation of that provision that was legally unsupportable in this context.
Conclusion
It is therefore the decision of the Attorney General that ODCH, Inc., violated the Open Meetings Act at its April 3, 2003 special meeting when it went into executive session pursuant to KRS 61.810(1)(f) and KRS 61.810(1)(g) for the purpose of discussing the three proposals submitted by CHP to ODCH to change their legal relationship. Although the discussion tangentially involved the dismissal of an employee and the possibility that services might be curtailed or physical facilities expanded or reduced, we find that the discussion did not qualify under either of these exceptions.
A party aggrieved by this decision may appeal it by initiating action in the appropriate circuit court pursuant to KRS 61.846(4)(a). 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.
Ralph W. Wible326 S. Ann StreetOwensboro, KY 42303
Stuart Augenstein, ChairmanBoard of Directors ODCH, Inc.811 East Parrish AvenueOwensboro, KY 42303
James M. MillerR. Michael SullivanSullivan, Mountjoy, Stainback & Miller, P.S.C.100 St. Ann BuildingOwensboro, KY 42303
Footnotes
Footnotes
1 The draftminutes of the April 3 meeting indicate that:
A motion was made and duly seconded to go into closed session, as authorized by KRS 61.180(1)(f) to discuss the proposals of CHP to ODCH, Inc., which may lead to the dismissal of an individual employee. The motion was adopted unanimously.
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2 In its supplemental response to The Messenger-Inquirer's appeal, ODCH urged the Attorney General to treat the appeal as moot, pursuant to 40 KAR 1:030 Section 6, inasmuch as ODCH later gave The Messenger Inquirer copies of the minutes of the April 3 meeting, the letter containing Catholic Healthcare Partners, Inc.'s proposals, and ODCH's reply to CHP's proposals. It was ODCH's position that because it "provided all relevant documents to [the newspaper] including the subject of the discussion and the minutes, " and because ODCH took no action on CHP's proposal in closed or open session, "no purpose would be served by conducting the meeting again." In reviewing public agency action under the Open Meetings Act, the Attorney General must decide "whether the agency violated the provisions of KRS 61.805 to 61.850," KRS 61.846(2), and not whether the remedial measures taken were appropriate. The former question was not "mooted" by disclosure of the referenced records, and we therefore proceed with our review.
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3 Clearly, ODCH is a public agency for open meetings purposes regardless of whether it has "voluntarily committed in its bylaws to comply with the Act." KRS 61.805(2)(f) defines the term "public agency" to include "[a]ny entity when the majority of its governing body is appointed by a 'public agency' as defined in paragraph (a), (b), (c), (d), (e), (g), or (h) of this subsection, a member or employee of a "public agency, " a state or local officer, or any combination thereof[.]" One-half of ODCH's Board of Directors is appointed by the Daviess County Judge/Executive and the other one-half by the Mayor of the City of Owensboro (with the consent of the respective legislative bodies). Regardless of whether ODCH voluntarily committed to comply with the Act, it is legally obligated to do so by virtue of KRS 61.805(2)(f).
4 The Hospital's ownership status is described as follows:
Owensboro's only hospital is known as Owensboro Mercy Health Systems. The hospital is owned and operated by Owensboro Mercy Health Systems, Inc., (OMHS). Owensboro Mercy Health Systems is the survivor of a public hospital known as Owensboro-Daviess County Hospital and Mercy Hospital, which was originally operated by an Order of Roman Catholic sisters. One-half of the Board of Directors of Owensboro Mercy Health Systems, Inc., are appointed by ODCH, Inc., and one-half are appointed by Mercy Health System, Inc. If Owensboro Mercy Health Systems, Inc., is ever dissolved, 81.25% of the assets go to ODCH, Inc. and 18.75% to Mercy Health Systems, Inc. Amended Articles of Incorporation, dated September 29, 1995, recorded at lease, etc. Book 96, page 404, in the Daviess County Court Clerk's Office. Catholic Healthcare Partners, Inc., (CHP, Inc.), acts as successor to the Rights of Mercy Health Systems, Inc.
(April 16, 2003, letter of appeal submitted by Ralph W. Wible on behalf of The Messenger-Inquirer. )
Owensboro Mercy Health System, Inc. ("OMHS") owns and operates the sole hospital located in Owensboro and Daviess County, Kentucky. OMHS is a private, non-stock, non-profit Kentucky corporation organized under KRS Chapter 273. It is not a "public agency" under either the Open Meetings Act or Open Records Act. OMHS is the surviving entity from the 1996 merger of OMHS and two hospitals located in Owensboro: Owensboro-Daviess County Hospital (formerly owned by ODCH) and Mercy Hospital (formerly owned by a subsidiary of Catholic Healthcare Partners, Inc.). The Board of Directors of OMHS consists of twenty members: Eight directors are appointed by ODCH, ten directors are appointed by Catholic Healthcare Partners, Inc. ("CHP"), and one director is appointed by each of the mayor of Owensboro, and the county judge-executive of Daviess County. ODCH and CHP are the only member/owners of OMHS.
ODCH is a non-stock-non-profit Kentucky corporation that is entitled to receive 81.25% of the assets of OMHS, if OMHS is dissolved. ODCH agrees that, for purposes of the Open Meetings Act, it is a "public agency. " Greg Carlson, the President and Chief Executive Officer ("CEO") of OMHS, has also served as President and CEO of ODCH since 1995.
CHP is a non-profit Ohio corporation that is entitled to receive the remaining 18.75% of the assets of OMHS, upon its dissolution. According to public information on its web site, CHP owns or operates 31 hospitals (in addition to a number of other facilities), and as of 2001 had assets of approximately $ 3.6 billion, and net operating revenues of approximately $ 2.9 billion.
(April 24, 2003, supplemental response submitted by James M. Miller and R. Michael Sullivan on behalf of ODCH.)
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5 April 4, 2003 letter from Stuart Augenstein to Susan Smith Makos, Executive Vice President of CHP.
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6 We will not unnecessarily lengthen this decision with a recitation of the Attorney General's long-standing interpretation of KRS 61.815(2) "that does not entirely defeat the purpose and intent of KRS 61.815(1)." 01-OMD-181, p. 10. Instead, we attach a copy of the latter decision, fully explicating our position which has not yet been successfully challenged in the courts, and incorporate the reasoning therein by reference. Nor will we engage in a lengthy analysis of the issue of whether an agency is foreclosed from belatedly raising an exception in defense of a closed session which was not raised in advance of the closed session. Although "the express purpose of the Open Meetings Act is to maximize notice of public meetings and actions," Ratliff at 923, and the Ratliff Court declared that "there must be specific and complete notification in the open meeting of any and all topics which are to be discussed during the closed meeting," id. at 924, we are not prepared to say that an agency is absolutely foreclosed from invoking additional exceptions in support of a closed session after that closed session. Such an omission or error "cannot be remedied by committing another and thus compounding mistake at the possible expense of due process." Edmondson v. Alig, Ky.App., 926 S.W.2d 856, 859 (1996). Nor, finally, will we consider the unique sensitivity of CHP, and its desire to avoid public scrutiny. As a private entity whose activities are inextricably intertwined with a public agency, ODCH, it must accept the necessary consequences of this relationship, including some degree of public accountability.
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