The PENNSYLVANIA STATE UNIVERSITY, Richard Althouse, Rodney A. Erickson, Joseph V. Paterno, and Gary C. Schultz, Appellants, v. STATE EMPLOYEES’ RETIREMENT BOARD, Appellee, Jan Murphy and the Patriot-News Company, Intervenors.
No. 160 MAP 2005
Supreme Court of Pennsylvania
Argued May 14, 2007. Decided Nov. 20, 2007.
935 A.2d 530 | 594 Pa. 244
Brian E. McDonough, Esq., PA State Employees’ Retirement System, Harrisburg, for State Employee‘s Reitrement Board.
Teri L. Henning, Esq., for Pennsylvania Newspaper Association.
Craig James Staudenmaier, Esq., Nauman, Smith, Shissler & Hall, L.L.P., Harrisburg, for Patriot-News Co. and Jan Murphy.
BEFORE: CAPPY, C.J., and CASTILLE, SAYLOR, EAKIN, BAER, BALDWIN and FITZGERALD, JJ.
OPINION
Justice FITZGERALD.
We decide whether Pennsylvania‘s Right to Know Act (RTKA),
Background:
The State Employees’ Retirement System (“SERS“) is the Commonwealth agency responsible for administering the Commonwealth‘s defined retirement benefit plan for individuals statutorily defined as “state employees.” See
The RTKA provides that public records shall be accessible for public inspection and duplication. The RTKA excludes, however, any record as to which publication is restricted by law, or any disclosure that would operate to the prejudice or impairment of a person‘s reputation or personal security.
Although PSU is not currently subject to the RTKA as a Commonwealth agency,1 the parties have stipulated that PSU
On December 19, 2002, reporter Jan Murphy and the Patriot News Company (“Appellees“) requested information from SERS pertaining to the Appellants’ salaries and service history pursuant to the RTKA. Upon Appellants’ Exceptions, however, the Board submitted the matter to a hearing examiner. Based on the examiner‘s recommendation, and pursuant to the RTKA, the Board ultimately granted Appellees’ request for the information at issue. The Board concluded that the information sought was “public record” for purposes of the RTKA because information pertaining to Appellants’ salary and service history fits the definition of an “account, voucher or contract dealing with the receipt or disbursement of funds by an agency.” Pennsylvania State University v. State Employees’ Retirement Bd., 880 A.2d 757, 764 (Pa.Commw.2005) (quoting
I.
The central issue now before this Court is whether the public has a right to know the specific basis of guaranteed disbursements to certain individuals from the Commonwealth‘s retirement fund, notwithstanding any privacy interests affected thereby. We hold that the public does in fact have a right to such information to the extent necessary to justify all guaranteed disbursements from the fund. Our holding applies to names, service history and salaries, but does not extend to information pertinent to an individual‘s personal security such as addresses, telephone numbers, or social security numbers.
II.
The first question presented to the Court in this matter is whether the information sought constitutes public record under the RTKA? We hold that it does. The RTKA defines the term “public record” as:
[a]ny account, voucher or contract dealing with the receipt or disbursement of funds by an agency or its acquisition, use or disposal of services or of supplies, materials, equipment or other property and any minute, order or decision by an agency fixing the personal or property rights, privileges, immunities, duties or obligations of any person or group of persons: Provided, [t]hat the term “public records” shall not include any record, document, material, exhibit, pleading, report, memorandum or other paper, access to or the publication of which is prohibited, restricted or forbidden by statute law or order or decree of court, or which would operate to the prejudice or impairment of a person‘s reputation or personal security....
Appropriately, in construing the Right to Know Act, the Commonwealth Court has consistently and properly held that the term “account” is to be broadly construed for the benefit of the public, encompassing, at minimum, the Commonwealth‘s financial records of debit and credit entries, as well as monetary receipts and disbursements. See LaValle v. Office of General Counsel of Com., 737 A.2d 330, 332 (Pa. Commw.1999) (“‘account’ is to be broadly construed, and need only constitute ‘records’ evidencing disbursement....‘“); Carbondale Tp. v. Murray, 64 Pa.Cmwlth. 465, 440 A.2d 1273, 1274 (1982) (“[w]ithout attempting to exhaust all of the acceptable definitions of the word ‘account,’ we deem it sufficient for deciding the instant case to define ‘account’ as a record of business dealings between parties“); Butera v. Com., Office of Budget, 29 Pa.Cmwlth. 343, 370 A.2d 1248, 1249 (1977) (the General Assembly intended the word “account” to include a record of debit and credit entries to cover transactions during a fiscal period of time). Because the word “account” can be properly defined in its ordinary sense to denote, inter alia, a list or enumeration of financial transactions,5 and because SERS participants make specified financial contributions to the retirement fund in exchange for specified financial returns, we do not hesitate to conclude that SERS necessarily maintains records establishing contractual rights with respect to, detailing, and evidencing monetary receipts and disbursements pertaining to every SERS member. There would be no
We note that Appellants cite this Court‘s opinion in Tribune-Review Pub. Co. v. Department of Community and Economic Development, 580 Pa. 80, 859 A.2d 1261 (2004), for the proposition that information does not qualify as public record unless it is created by a public agency.6 Such reliance is misplaced here. In Tribune Review, this Court upheld a Department of Community and Economic Development decision not to produce information pertaining to applicants who were denied state funded grants. In so doing, this Court stated: “we have recently confirmed that the Act is designed to require disclosure only of documents prepared by the government agency or at the express direction of the government agency.” Id. at 1268 (emphasis added). But see id. at 1269 (dissenting opinion by Saylor, J., joined by Castille and Nigro, JJ.).7 Because no funds were received, distributed or
III.
As noted above, the RTKA provides that the term “public records” shall not include any record to which access or of which publication is prohibited, restricted or forbidden by “statute, law or order or decree of court.”
A.
Appellants cite this Court‘s ruling in Mooney v. Board of Trustees of Temple University, 448 Pa. 424, 292 A.2d 395
B.
Appellants next argue that disclosure of information pertaining to their salaries and service history is prohibited by common law fiduciary duties. The threshold question raised by this argument is whether, and to what extent, SERS qualifies as a fiduciary. The General Assembly has established that the State Employees’ Retirement Board has limited fiduciary duties in that the Board, “stand[s] in a fiduciary relationship to the members of the system regarding the investments and disbursements of any of the moneys of the fund [such that it] shall not profit either directly or indirectly with respect thereto.”
[a]ny record, material or data received, prepared, used or retained by the board or its employees, investment professionals or agents relating to an investment shall not constitute a public record subject to public inspection under ... the Right-to-Know Law, if, in the reasonable judgment of the board, the inspection would:
(i) in the case of an alternative investment or alternative investment vehicle, involve the release of sensitive investment or financial information relating to the alternative investment or alternative investment vehicle which the fund was able to obtain only upon agreeing to maintain its confidentiality;
(ii) cause substantial competitive harm to the person from whom sensitive investment or financial information relating to the investment was received; or
(iii) have a substantial detrimental impact on the value of an investment to be acquired, held or disposed of by the fund or would cause a breach of the standard of care or fiduciary duty set forth in this part.
C.
Appellants also argue that disclosure of information is restricted by the Gramm-Leach-Bliley Act (GLBA),
Moreover, we note that the GLBA regulates disclosure of nonpublic personal information in the financial services industry. The purpose of the United States Congress in enacting the GLBA was “to enhance competition in the financial services industry by providing a prudential framework for the affiliation of banks, securities firms, insurance companies, and other financial service providers....” H.R. CONF. REP. 106-434, 1, 1999 U.S.C.C.A.N. 245 (1999). Along these lines, the federal legislature was concerned with information sharing practices among financial institutions and affiliates, as affecting the customers of those financial institutions. See
Furthermore, whereas the GLBA is designed to protect “consumers” of the financial services industry (see, e.g.,
D.
Appellants also attempt to raise their rights to privacy as a bar to disclosure. The RTKA accounts for the individual‘s right to privacy by excluding from the definition of “public record” “any record, document, material, exhibit, pleading, report, memorandum or other paper, ... which would operate to the prejudice or impairment of a person‘s reputation or personal security.”
In Sapp Roofing, a labor union requested the payroll records of a non-union private contractor which were in the possession of a Commonwealth school district. The records related to roofing work performed on certain school district buildings and paid for using state funding. The contractor submitted payroll records to the school district pursuant to the Prevailing Wage Act (“PWA“),
This Court concluded that the disclosure of personal information such as names, addresses, social security numbers, and phone numbers, reveals little, if anything, about the school district‘s compliance with the PWA. This Court thus decided that the union would be given access to the school district records containing wage information regarding Sapp Roofing‘s employees, but that the personal information, i.e., the names, addresses, social security numbers, and phone numbers could not be released. Id. at 630.
The public interest asserted in Sapp Roofing was the school district‘s compliance with the PWA; the specific identification of Sapp Roofing employees was not at all relevant to the asserted interest. Here, however, our focus is not so narrow; the public interest asserted herein is the people‘s right to governmental transparency in the form of their right to know the identities of individuals receiving, or standing to receive, Commonwealth funds and the specific basis therefor. Such requests for information go to the heart of the RTKA and are precisely what the General Assembly intended when codifying
With regard to the right to privacy in one‘s social security number, telephone number or home address, we would have greater difficulty concluding that the public interest asserted here outweighs those basic rights to privacy. Such is not the scenario presently before the Court, however. The requests for disclosure in this matter specifically excluded such personal information. We hold that the public‘s interest in governmental transparency regarding receipts and disbursements of Commonwealth funds generally outweighs any recipient‘s, or future recipient‘s, right to privacy with respect to his or her name and relevant financial data. Any person who desires to keep such information private should refuse Commonwealth disbursements, and should decline SERS participation. The public has a right to know how the Commonwealth spends its money.
Much argument has been made regarding whether Appellants have a reasonable expectation of privacy in the information requested. Appellants may very well have had a subjective expectation of privacy regarding their salaries and service history in light of the fact that PSU generally regards this information as confidential. SERS, however, is not PSU. And while PSU is only a “state-related” university,9 SERS is a Commonwealth agency and therefore an extension of the Commonwealth. Individuals and private entities cannot reasonably expect the Commonwealth to keep secrets from its citizens regarding the disbursement of public funds, past, present or future. The minute any individual or entity voluntarily submits any information to the Commonwealth for the purpose of deriving a financial benefit and acquires such benefit or a contractual interest therein, that information ceases to be private in nature. It is inappropriate for the Commonwealth to keep information relevant to Commonwealth expenditures secret from the public under ordinary
By statutory definition, PSU employees who elect to participate in SERS are state employees.
IV.
Finally, Appellants raise the issue of whether the Commonwealth Court erred in failing to recognize the appropriateness of the “balancing test” analysis discussed supra, and “improperly resurrect[ing] the ‘intrinsically harmful’ standard” previously rejected by the Commonwealth Court. Appellants’ Brief at 22. Appellants’ argument is fatally premised on the false implication that the Commonwealth Court failed to balance Appellants’ privacy concerns against the countervailing government interest below. The Commonwealth Court committed no such error.
Appellants correctly point out that prior to this Court‘s decision in Denoncourt v. Commonwealth of Pa., State Ethics Commission, 504 Pa. 191, 470 A.2d 945
In its Opinion below, the Commonwealth Court cited Moak, noting its holding that disclosure of information must be intrinsically harmful to fall within the RTKA‘s personal security exception. Pennsylvania State University, 880 A.2d at 767. The court then proceeded, however, with an appropriate balancing analysis as follows:
In Times Publishing Co. v. Michel, 159 Pa.Cmwlth. 398, 633 A.2d 1233, 1239 (Pa. Cmwlth., 1993), this Court noted that a personal privacy right under the Pennsylvania Constitution exists under the RTKA. Times Publishing addressed the issue of whether portions of firearm application records that disclosed applicants’ addresses, telephone and social security numbers should be withheld because the information may compromise personal security. This Court held that in analyzing the personal security exception to the RTKA, we must apply “a balancing test, weighing privacy interests and the extent to which they may be invaded, against the public benefit which would result from disclosure.” Id. at 1239.
* * * *
Any privacy right Employees may have had in their personal salaries was extinguished when they voluntarily contracted to participate in a government program managed by a public agency for which compensation disclosure is required by law.
Because Employees have failed to convince this Court that they have a privacy right in their salary information, the personal security exception does not apply.
Pennsylvania State University, 880 A.2d at 767-768. Thus we conclude that the Commonwealth Court applied the appropriate balancing test, notwithstanding its reference to Moak‘s “intrinsically harmful” analysis. For clarity‘s sake, we now hold, as stated above, that where privacy rights are raised as a bar to disclosure of information under the RTKA, our courts must determine whether the records requested would potentially impair the reputation or personal security of another, and must balance any potential impairment against any legitimate public interest. Sapp Roofing, 713 A.2d at 629. The issue of whether a particular disclosure is intrinsically harmful may be relevant in determining the weight of any privacy interest at stake for purposes of conducting the appropriate balancing test, as indeed intrinsic harmfulness may affect the reasonableness of any privacy expectation. Intrinsic harmful-
V.
For the foregoing reasons, the decision of the Commonwealth Court is hereby AFFIRMED.
Justice BALDWIN did not participate in the consideration or decision of this matter.
Justice SAYLOR, EAKIN and BAER join the opinion.
Chief Justice CAPPY files a dissenting opinion in which Justice CASTILLE joins.
Chief Justice CAPPY, dissenting.
Because I do not agree that the records at issue in this matter are “public records” as defined in The Right to Know Act,
At issue in Tribune-Review was whether a log kept by the Department of Community and Economic Development was a public record under The Right to Know Act. In reviewing this issue, a majority of this court stated that “we have recently confirmed that the [Right to Know Act] is designed to require disclosure only of documents prepared by the government agency or at the express direction of the government agency.” Id. at 1268. While the dissenting opinion disagreed with this statement, it concluded that the statutory definition of a public record “applies to a wide range of documents that contain information relating to the disbursement of public funds or an action of an agency that fixes the rights or obligations of individuals.” Id. at 1270 (Saylor, J. dissenting). Under either theory of The Right to Know Act, it is clear that the records in this case are not public records, since the information that is
Indeed, Tribune-Review makes this very point when it concluded that a database, which was “simply an electronic storage facility, and not a decisional document” was not a public record. Id. at 1268. Furthermore, we explained that “a log” compiled by a state agency, which is merely a collation of data provided by applicants, did not amount to a public record.
In this case, we are faced with a similar situation. Until the employee retires, the salary and years of service information is not utilized by SERS for any purpose. Rather, it is information that is simply collated and/or assembled by SERS for use at some date in the future when the employee is ready to or has retired. That information may become a public record at the time the retirement benefits are computed and paid by SERS, but until that point, there has been no disbursement of public funds or even the anticipation of disbursement of public funds to the employees under The Right to Know Act. Likewise, there is no “fixing” of employees rights or obligations at this point. Accordingly, I would conclude that the instant matter is controlled by Tribune-Review, and I respectfully dissent.
Justice CASTILLE joined this dissenting opinion.