Applicability of RTKL to “State-affiliated” Entities; Nonprofit Corporation Law
PIAA v. Campbell, 268 A.3d 502 (Pa. Cmwlth. 2021), allocatur granted June 22, 2022, appeal dockets 71 and 72 MAP 2022
This case arises from Simon Campbell’s request seeking disclosure of a variety of financial and internal documents of the Pennsylvania Interscholastic Athletic Association (PIAA) pursuant to the Pennsylvania Right-to-Know Law (RTKL). In response to Campbell’s request, PIAA denied certain portions the request, noting as a general objection that PIAA is not a Commonwealth of Pennsylvania authority or entity subject to the RTKL and that it intended to litigate that issue. Campbell appealed PIAA’s denial to the Office of Open Records (OOR). Before OOR, PIAA asserted that it is not subject to the RTKL, that the RTKL’s application to PIAA constitutes unconstitutional special legislation, and that the RTKL violates PIAA’s equal protection rights under the United States and Pennsylvania Constitutions. OOR issued a final determination finding PIAA was subject to the RTKL and ordered PIAA to disclose certain records responsive to the request.
PIAA appealed to Commonwealth Court on the basis that, inter alia, OOR erred by finding that PIAA subject to the RTKL. Specifically, PIAA argued that:
…notwithstanding it being singled out within the RTKL as such, PIAA is not a state-affiliated entity. PIAA maintains that it is neither a Commonwealth authority nor Commonwealth entity because PIAA: (1) receives no Commonwealth funding or tax dollars; (2) has not been granted any powers by the Commonwealth; (3) is not administered or governed by any Commonwealth personnel; and (4) was not created by the General Assembly. PIAA asserts that it is no different than a myriad of other private nonprofit corporations in Pennsylvania with similar members, powers, and responsibilities.
Slip op. at 9 (emphasis in original). PIAA further argued that permitting access to PIAA’s records under the RTKL was improper because the ordered disclosure conflicts with the Pennsylvania Nonprofit Corporation Law. In support, PIAA reasoned that because it is a nonprofit corporation subject to the Nonprofit Law, PIAA is restricted thereby to only providing its records to its members and board members, and only for proper purposes in accordance with 15 Pa.C.S. §§ 5508(b), 5512. PIAA argued that OOR erred in applying the RTKL to remove those limitations on PIAA and treat it differently than every other comparable nonprofit corporation in Pennsylvania. In response, Campbell countered that no provision in the Nonprofit Law conflicts with the RTKL, and that the record-access provisions of the Nonprofit Corporation Law could not have been intended to make all nonprofit corporation records private.
Commonwealth Court held that the RTKL’s classification of PIAA as a “state-affiliated entity” was not unconstitutional special legislation and did not violate PIAA’s equal-protection rights under United States and Pennsylvania Constitutions. Addressing PIAA’s arguments, the court stated:
Preliminarily, “[t]he answer to these arguments, of course, is that [PIAA] is an agency if the General Assembly says it is. It is axiomatic that[,] within constitutional limits, the General Assembly is empowered to pass legislation[ and] define the terms of its legislation … as it sees fit[.]” Harristown Dev. Corp. v. Dep’t of Gen. Servs., 532 Pa. 45, 614 A.2d 1128, 1131 (1992). It is undisputed that the General Assembly included PIAA as a “state-affiliated entity” for purposes of the RTKL. See Section 102 of the RTKL, 65 P.S. § 67.102 (“A Commonwealth authority or Commonwealth entity. The term includes … the [PIAA.]”).
Slip op. at 9-10. The court emphasized that PIAA undertook state action and was funded primarily by public-school districts, therefore its classification as state-affiliated entity had rational basis and furthered the legitimate state interest of transparency in PIAA’s use of public funds, and therefore passed muster under the US and Pennsylvania Constitutions:
Therefore, as PIAA undertakes state action and is funded primarily by public school districts, id., the General Assembly’s classification of PIAA as a “state-affiliated entity” for the purpose of qualifying as an agency under the RTKL has a rational basis and furthers a legitimate state interest of transparency in PIAA’s use of public funds in a manner that dramatically impacts students’ lives. Just as the nonprofit corporation’s status in Harristown as the largest supplier of rented space to the Commonwealth was sufficient under the rational-basis inquiry for the corporation to be subject to the RTKL, PIAA’s statewide control over high school athletics and the connection between the funds it receives from its members and the Commonwealth’s taxpayers is sufficient such that its classification as a “state-affiliated entity” for purposes of the RTKL is reasonable. Thus, it cannot be said that this classification is arbitrary or that it bears no reasonable relationship to the object of the law. Curtis, 666 A.2d at 268. Therefore, because PIAA meets the definition established for the class in which it is included, and the RTKL’s classification of PIAA as a state-affiliated entity is not unconstitutional special legislation and does not violate PIAA’s equal protection rights, the OOR properly determined that PIAA is subject to the RTKL.
Slip op. at 13-14.
The court further held that record-access provisions of RTKL did not conflict with the Nonprofit Corporation Law’s provisions concerning record access for members and directors, reasoning that:
This Court has held: “In order to constitute an exemption under Section 305(a)(3) of the RTKL, the [ ] statute must expressly provide that the record sought is confidential, private, and/or not subject to public disclosure.” Ali v. Phila. City Plan. Comm’n, 125 A.3d 92, 99-100 (Pa. Cmwlth. 2015). Section 5508(b) of the Nonprofit Law permits “[e]very member … a right to examine … the membership register, books and records of account, and records of the proceedings of the members, directors and any other body[.]” 15 Pa.C.S. § 5508(b). Section 5512(a) of the Nonprofit Law permits,
[t]o the extent reasonably related to the performance of the duties of the director, … a director of a nonprofit corporation … to inspect and copy corporate books, records and documents and, in addition, to inspect[ ] and receive information regarding, the assets, liabilities and operations of the corporation and any subsidiaries of the corporation incorporated or otherwise organized or created under the laws of this Commonwealth that are controlled directly or indirectly by the corporation[.]
15 Pa.C.S. § 5512(a). Because the above-quoted sections of the Nonprofit Law do not state that nonprofit corporate records are “confidential, private, and/or not subject to public disclosure,” they are not exempt from disclosure under the RTKL. Ali, 125 A.3d at 100. Accordingly, the OOR properly determined that the Nonprofit Law did not preclude disclosure of PIAA’s records.
Slip op. at 20-21.
The Supreme Court granted allocatur, limited to the following issues:
(1) Did the Commonwealth Court err in holding that the Right-to-Know Law’s (“RTKL”) singling out of PIAA for inclusion within the definition of a “state affiliated entity” did not constitute special legislation and a violation of PIAA’s equal protection rights where PIAA is a private non-profit corporation that receives no Commonwealth funding of any kind, has not been granted and does not exercise any legislatively-granted powers, is not controlled by Commonwealth personnel and was not created by an act of the General Assembly, and where the only bases used by the Commonwealth Court relied on facts not of record (or accurate) and a standard (whether an entity is a state actor under federal civil rights law) never before applied by any court to determine whether an entity is a Commonwealth Agency?
(2) Where a conflict concerning access to records exists between the Nonprofit Corporation Law of 1988 and the RTKL and where the RTKL provides that its record access provisions do not apply in the event of a conflict, did the Commonwealth Court err in holding that the provisions of the RTKL supersede those of the Nonprofit Corporation Law so as to negate the limitations in that law on disclosure of records of nonprofit corporations?
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