University lodges appeal to keep foundation records private

A Pennsylvania state university and its nonprofit fundraising foundation have asked the state’s high court to hear an appeal in a case over whether the foundation, which is staffed by public employees, is subject to state public records laws.

East Stroudsburg University and the ESU Foundation are asking the Supreme Court of Pennsylvania to overturn a May 24 appellate court ruling saying the foundation must comply with a newspaper’s records request under the state’s Right to Know Law.

“[A]ll contracts that governmental entities enter into with private contractors necessarily carry out a “governmental function” – because the government always acts as the government,” wrote state appellate court Judge Dan Pellegrini in the unanimous opinion.

The case began last year when the Pocono Record made a public records request to the university for records related to the school’s new Science and Technology Center. The requested records, which are maintained by the foundation, included foundation meeting minutes, a list of donors and donor files, which included correspondence. The university denied the request, claiming that the foundation was not a state agency, did not perform “essential government functions,” and thus was not subject to the Pennsylvania’s Right-to-Know-Law.

The newspaper’s request came on the heels of a scandal and lawsuit involving alleged sexual and financial misconduct by Isaac Sanders, who was then the vice president for advancement for the university and executive director of the foundation.

The newspaper appealed the university’s denial to the state Office of Open Records, which ordered the donor records and correspondence—but not the names of individual donors—disclosed. The office also ruled that foundation minutes need not be made public since the meetings were not public nor required by law. Both parties appealed the open records office’s determination, though the newspaper did not appeal the finding that individual donor names could be redacted.

On appeal, the court’s decision hinged on whether the foundation performed a “governmental function.” The court affirmed the open records office’s decision with respect to the donor records, holding that “[i]n this case, there is no dispute that the Foundation . . . carries out fundraising on behalf of the University, making any records “directly” related to performing fundraising activities on behalf of the University.”

The court also took its decision one step further, overturning the finding that no portions of the foundation minutes were public record. "[T]he Foundation is not an agency by definition under the Right-to-Know Law. It is a non-profit corporation, and its Board of Directors’ meeting minutes are not subject to disclosure. Nonetheless, because we have determined that the raising and disbursing of funds is a governmental function that the Foundation is performing on behalf of the University, any portion of the meeting minutes relating to the management of those funds are a public record,” wrote Pellegrini.

“This was a great step towards transparency — a very bold but very needed decision, because without it, it would be possible for agencies to hide behind the veil of subcontracting or the use of nonprofits while doing the public’s business,” said Dan Berrett, the Pocono Record reporter who made the records requests on behalf of the newspaper.