Opinion
Opinion By: Gregory D. Stumbo, Attorney General; Amye L. Bensenhaver, Assistant Attorney General
Open Records Decision
The question presented in this appeal is whether the Ballard County Economic and Industrial Development Board, Inc. is a public agency within the meaning of KRS 61.870(1)(a) through (k) and therefore violated the Open Records Act in failing to respond to the October 9, 2004, request for records submitted by Ballard County Fiscal Court members Charles Allred, Vickie Viniard, Bill Marshall, and Bob Renfrow, and in later refusing to honor that request. Based on the written record before us, we conclude that the Board is not a public agency for open records purposes and therefore cannot be said to have violated the Act in the disposition of the request.
In a letter directed to the Chairman and Industrial Development Board members, the named members of the Ballard County Fiscal Court requested access to:
a) Bids on all spec buildings[;]
b) Manufacturer and Purchaser of spec building (Bill of Laden)[;]
c) Total amount of funds collected[;]
d) The total amount of funds, disbursed during each fiscal year to each individual payee and the purpose for which the funds were expended [.]
That request went unanswered, prompting the Fiscal Court members to initiate this appeal on October 20, 2004. 1
In correspondence directed to this office following commencement of the appeal, Board Attorney Charles R. Geveden advised that the Board is not a public agency. He explained that the Board "is a private non-profit corporation created under KRS Chapter 273 and its Board members are not appointed by any public agency. " Further, Mr. Geveden observed, "[l]ess than twenty-five percent of the Board's income is generated through public funds . . . [t]he overwhelming majority . . . [consisting of] rental payments from leases on buildings owned by [the Board]." In support, he cited OAG 84-237 and OAG 84-186. 2
Unable to resolve the issue on appeal on the facts before us, on November 4, 2004, this office propounded a series of questions to the Board pursuant to KRS 61.880(2)(c). 3 Our questions and the Board's responses follow:
1) Does the Board currently derive any funds expended by it in the Commonwealth of Kentucky from state or local authority funds per KRS 61.870(1)(h)?
Answer: No, the Board does not currently receive any funds expended by it in the Commonwealth of Kentucky from state or local authority funds.
2) If so, what percentage of its current annual budget do these state or local authority funds represent?
Answer: 0%
3) Did the Board originally come into existence through a local legislative act (ordinance, resolution, other legislative act) ?
Answer: No, it came into existence through a group of concerned citizens who joined together for the purpose of promoting economic development in Ballard County.
4) Who are the members and how are they appointed? Do any of the members hold public office, and if so, what offices do they hold?
Answer: Members are nominated by a nominating committee and then elected by the Board as set forth in the Bylaws.
Per our request, Mr. Geveden provided this office with a list of the members and the offices they hold, a copy of the financial statements for the years ended June 30, 2003 and 2002, and the Board's Articles of Incorporation and Bylaws.
By letter dated November 8, 2004, the Fiscal Court members supplemented their letter of appeal, advising us that the Board:
Went through the Fiscal Court to receive government loans and grants totaling $ 500,000. The loans and grants were received from Paducah Area Community Reuse Organization, not a private corporation.
The Wickliffe Spec building also sits on Ballard County property not private property.
The Judge Executive does recommend someone to serve on this Industrial Board and should be approved by the Fiscal Court.
In addition, the Fiscal Court members noted, "[a]ccording to KRS 147.050 [sic], 424.220, and 154.50-301 special districts, listing the Industrial Board as such, are to give the Fiscal Court a detailed quarterly [financial] report . . . ." While we acknowledge that the Ballard County Economic and Industrial Development Board, Inc., possesses many of the attributes associated with industrial development authorities which derive their existence from KRS 154.50-301 to 154.50-346, the Local Industrial Development Authority Act, we affirm the Board's position that it is not a public agency within the meaning of KRS 61.870(1)(a) through (k), based on the record before us, and find that KRS 147A.050, 424.220, and 154.50-301 are therefore inapplicable to the Board.
In simplest terms, the question before us is whether an entity which styles itself an industrial development board is distinguishable from an entity which styles itself an industrial development authority, for open records purposes, or whether this is a semantic distinction without a difference. Our starting point is the definition of the term "public agency" that appears at KRS 61.870(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, ordinances, 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, committee, 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 subjection[.]
It is abundantly clear that an industrial development authority established under authority of KRS 154.50-301 to 154.50-346 falls within the parameters of several of the definitional sections set forth above. Pursuant to KRS 154.50-316(1), such authorities come into existence as nonprofit organizations by an act of the legislative body of a governmental unit and therefore qualify as public agency under KRS 61.870(1)(b), (f), (g), and (j). Pursuant to KRS 154.50-316(1) and KRS 154.50-326, the six to eight members of such an authority are appointed by the mayor of the city, if the authority is established by a city (KRS 154.50-326(1)(a)), by the county judge/executive, if the authority is established by a county (KRS 154.50-326(1)(b)), by the mayor and county judge/executive, if the authority is established as a joint city county industrial development authority (KRS 154.50-326(1)(c)), and by the mayors and county judges/executive, if the authority is established by a combination of cities and/or counties (KRS 154.50-326(1)(d)). The authorities therefore qualify as public agencies under KRS 61.870(1)(i).
As evidenced in its Articles of Incorporation, and attested to by Mr. Geveden, the Ballard County Economics and Industrial Development Board, Inc. was established in 1982 by a group of concerned citizens. Although incorporated as a non-profit organization, the Board does not owe its existence to the legislative act of a governmental body and therefore does not fall within the parameters of KRS 61.870(1)(b), (f), (g), and (j). 4 The Board's membership, which consists of twelve, and not six to eight individuals per KRS 154.50-316(1), is determined by a six member nominating committee whose members are appointed by the County Judge/Executive and the Board Chairman, 5 and its members serve a three year term. 6 Accordingly, the Industrial Development Board does not fall within the parameters of KRS 61.870(1)(i).
Our inquiry does not, of course, end here. KRS 61.870(1)(h) confers public agency status on "any body which derives at least twenty-five percent of its funds expended by it in the Commonwealth of Kentucky from state or local authority funds[.]" The Fiscal Court members who initiated this appeal advised that the Industrial Development Board "went through the Fiscal Court to receive government loans and grants totaling $ 500,000 . . . from Paducah Area Community Reuse Organization." The members do not indicate over what period of time these funds were infused into the Industrial Development Board and offer no supporting documentation. Conversely, the Board denies receipt of any state or local authority funds and attaches financial statements confirming this position. Absent specific proof to the contrary, we find no support in the record on appeal for the proposition that the Ballard County Economic and Industrial Development Board, Inc. falls within the parameters of KRS 61.870(1)(h). Additionally, the Board is not a state or local government officer per KRS 61.,870(1)(a); is not a state or local legislative board, commission, committee, or officer per KRS 61.870(1)(c); is not a county or city governing body, council, school district board, special district board, or municipal corporation per KRS 61.870(1)(d) ; and is not an interagency body of two or more public agencies per KRS 61.870(1)(k). 7 In sum, it is not a public agency for open records purposes. Accord, OAG 84-237 (Covington First Development Corporation is not a public agency for open records purposes because it was not created by the City of Covington and receives no funds from the City).
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.
Footnotes
Footnotes
1 On October 21, 2004, the Fiscal Court members received a letter from the Board dated October 14 advising them that the Board met on October 14 to consider their request and was taking the request "under advisement."
2 OAG 84-186 deals with the status of a private non-profit corporation under the Open Meetings Act and is therefore inapposite.
3 KRS 61.880(2)(c) provides:
The burden of proof in sustaining the action shall rest with the agency, and the Attorney General may request additional documentation from the agency for substantiation.
4 The fact that this records access dispute is currently before the Attorney General demonstrates that the Fiscal Court exercises no control over the Industrial Development Board which has resisted the Fiscal Court's efforts to monitor its actions through records inspection.
5 As opposed to the four year term provided for by KRS 154.50-326(2) relative to Authority members.
6 The Articles authorize an alternative mode of establishing membership to the Board of Directors "by the annual purchase of membership, evidenced by a certificate of membership. "
7 It is noteworthy that the Industrial Development Board does not possess the power to acquire property by condemnation, a power statutorily conferred on industrial development authorities per KRS 154.50-320(1)(d). Nor does it appear that the Fiscal Court has made an annual appropriation from its general fund to the Industrial Development Board "for the purchase of property necessary to develop industrial sites, parks, and subdivisions . . ." per KRS 154.50-340(1).