Bill would allow government contractors to avoid disclosure law

jcheves@herald-leader.comMarch 1, 2012 

Some targets of critical news stories and state audits from recent years could avoid scrutiny under changes that lawmakers are proposing to the Kentucky Open Records Act.

Presently, any organization that gets at least 25 percent of its revenue from local or state government must share most of its records under the act, which is meant to bring transparency to public spending.

But House Bill 496, set to be heard next week in committee, would change the act to exempt from disclosure any money awarded by a government "for goods or services that are provided by a contract obtained through a public procurement process." While a government entity still would have to share its records upon request, a private organization that is awarded state business, and taxpayer money, would not.

Among those asking questions about the bill are state Auditor Adam Edelen and the Kentucky Press Association.

"The government's business is the public's business, and the public has a right to know what's going on with its money at all levels," said David Thompson, KPA executive director. "Some of these entities might not consider themselves public. But that portion of their revenues that comes from government should be open for inspection."

The bill potentially would shield private contractors, such as Utility Management Group, which is paid more than $11.6 million a year to manage Pike County's water and sewer systems. Attorney General Jack Conway's office ruled in September that UMG is a public entity under the Open Records Act and must disclose spending information requested by local citizens. UMG is appealing in Pike Circuit Court.

UMG and its public employer, Mountain Water District, have been at the center of several controversies in recent years, including no-bid contracts that led to an ethics sanction of state Rep. Keith Hall, D-Phelps, who owns a company that digs sewer lines. UMG also refused to share its financial data with the state auditor's office.

Rep. Johnny Bell, the sponsor of HB 496, said he respects the public's right to know. Bell said his bill is a response to a flurry of Open Records Act requests filed in the last five months against private companies in construction, highway building, engineering and architecture, who do much of their business with government. The companies are complaining about wasted time and legal fees, Bell said.

Those requests, filed by Glasgow bankruptcy attorney John Rogers, ask for copies of companies' spending records, paychecks and emails. Rogers, who does not identify a client in his letters, has appealed more than a dozen rejected requests to the attorney general, whose opinion carries the force of law on open records issues.

"We're getting a lot of shotgun letters sent to private companies asking for private financial information that goes beyond what we believe the records act is meant to cover," said Bell, D-Glasgow. "The quasi-public groups that get money, like the Kentucky League of Cities, the Kentucky Association of Counties — this will not pertain to them. This only will apply to private businesses seeking to do government work."

Rogers did not return calls Thursday seeking comment on his records requests.

In a Feb. 20 letter to the attorney general, a lawyer for one of the companies Rogers targeted, Hinkle Contracting Co. of Paris, said Rogers is working on behalf of UMG.

"Rather than serving the public interest, Rogers seeks to inconvenience (Hinkle Contracting) and numerous other privately owned contractors to the point where, in exchange for Rogers dropping his requests, the contractors will agree to side with a Rogers client in pending litigation, which presents issues regarding the act," attorney Buckner Hinkle Jr. wrote. Hinkle then cited UMG's lawsuit in Pike Circuit Court.

Asked for comment Thursday, Hinkle said: "I have not spoken to Mr. Rogers. Multiple sources inform me that he represents one of the UMG owners and that his open records requests are intended to goad other contractors to support UMG in the Pike circuit litigation. To me, that purpose is inconsistent with the intent of the statute."

UMG executives did not return calls seeking comment on Rogers. In several of his appeals to the attorney general, Rogers has cited the UMG case to support his arguments.

Frankfort attorney J. Guthrie True, who represents UMG in its Open Records Act appeal, said he's heard people talk about Rogers' multiple records requests, but does not know who employs Rogers.

"I frankly don't know who, if anyone, employed John Rogers. I don't know John Rogers," True said. He added: "We'll be glad to have all the allies who want to join us on our side."

HB 496 is scheduled for a hearing next Thursday before the House State Government Committee, said chairman Mike Cherry, D-Princeton. Cherry said he's not yet read the bill and has no opinion on it.

Bell, the bill's sponsor, said he's willing to amend the bill so the exemption for private businesses is finely tuned and could not be used by a quasi-public agency or any similar entity that wholly depends on a government for its revenue.

"I don't want to do anything that's going to prevent any news media or anyone in the public from going through actual public records," Bell said.

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