The Effects of Pennsylvania’s New Right-to-Know Law on the Business Community – What You Don’t Know Will Hurt You

On February 14, 2008, Governor Rendell signed into law Pennsylvania’s new Right-to-Know Law resulting in the most extensive revisions to the open records law in 50 years.  Unfortunately, the Act and its effects remain largely unknown and unexplored by the business community in Pennsylvania.  This article will address the major changes brought about by the new Act, effective January 1, 2009, and highlight several provisions of particular interest to businesses in Pennsylvania.

What Government Agencies are Subject to the New Right-to-Know Law?

The new Act divides government agencies into four categories:  Commonwealth, local, legislative and judicial agencies.  A Commonwealth agency is basically any office, department, commission, or board of the executive branch, independent agencies and state-affiliated entities and includes the Attorney General, Auditor General and Treasury Department.  A local agency is any political subdivision and includes counties, townships, boroughs, cities, school districts and any local, regional or municipal authority, board or commission similar in nature.  A legislative agency is defined primarily as the House and Senate and the various commissions, committees and bureaus created by the legislative branch.  Finally, a judicial agency is any of the courts of the Commonwealth, including magisterial district judges.

The Three Major Changes

The Act brings about three major changes.  First, the Act creates a presumption of openness.  Every record in the possession of a Commonwealth or local agency, a legislative agency or a judicial agency, will be presumed to be public unless it (1) is made confidential by state or federal law, court decision or regulation, (2) is subject to one of the exemptions set forth within the Act, or (3) is privileged.  The burden of demonstrating that a record, is not public, will be upon the agency asserting the exclusion and not upon the requester.  This is a complete reversal of existing law.

“Legislative agency” is a defined term but primarily includes the Senate and House and various other committees, commissions and bureaus created by it.  The Act only makes “legislative records” public records, which is a narrower category of documents than for Commonwealth and local agencies, but there is now greater access to these records, particularly financial records, of the Legislature than before.
The third major change is the creation of the Office of Open Records.  This office, headed by Terry Mutchler,  will oversee the implementation of the Act, as well as, hear appeals from Commonwealth and local agencies, provide training, and establish a fee schedule for allowable charges to obtain records from Commonwealth and local agencies.

Major Provisions Affecting Businesses

Certain provisions of the Act require particular attention from the business community, especially those that currently do business with any of the agencies listed above and/or those that seek to do business with them.

The Act generally exempts from public disclosure “confidential proprietary” or “trade secret” information.  An entity doing business with an agency can now expect certain records of that transaction are now more than likely public records.  “Confidential proprietary information” is commercial or financial information received by an agency (1) which is privileged or confidential and (2) the disclosure of which would cause substantial harm to the competitive position of the person that submitted the information.  A “trade secret” is defined as information that derives independent economic value and is not generally known or easily obtained by proper means by other persons who could derive economic value from its disclosure and is subject to efforts that are reasonable under the circumstances in maintaining its secrecy.  A typical example of trade secrets would be customer lists, specific software license programs, computer codes, and specific product formulas.

Businesses that routinely provide such information to an agency, may not have automatic protection for such information.  Rather, the Act requires that the business notify the agency which it believes is in possession of protected information in writing and specify the information  believed to fall within these definitions.  Therefore, businesses who have ongoing contracts or requirements to provide such information to agencies, should begin reviewing the documents and information provided and submit this written notice to the agency as soon as possible.  After January 1, 2009, that notice should accompany the information as provided.

If the appropriate notice is provided to the agency, the agency must provide written notice to the business that a public records request has been made and that this information may be provided within 5 business days of receipt of the request.  The business then has 5 business days from receipt of that notice to provide return notice to the agency that it does not wish this information to be released.  Regardless, within 10 business days after the provision of the aforesaid notice, the agency must either grant or deny the request, so it is well-advised to respond within the time period allowed.

Bids/Contracts for Procurement, Disposal or Construction

Another provision provides that, if an agency requests bids for procurement or disposal of supplies, services or construction, although the information provided prior to the award of the contract or prior to the opening or rejection of all bids, remains confidential, after the contract is awarded, the bid is awarded or all bids are rejected, that information is no longer protected by the exemption and may become public.  Individuals and businesses who routinely bid for and deal with public agencies are well advised to keep this in mind and be certain that they also provide the written notice of any confidential, proprietary or trade secret information they believe is contained within the information provided.  Certain financial information may remain private regardless.

The Business as a Requester

The business community should also not overlook the fact that greater access to agency records may be a benefit.   Businesses who routinely deal with Commonwealth agencies or who seek to do business with them in the future, will be able to obtain vital information by public record requests which may help them in their attempts to solicit or bid upon work for various agencies.  Although they may not be able to obtain information which is protected from disclosure as set forth above, they may be able to obtain important information on how to present bids and proposals, specifications, key areas the agency may concentrate on, who their competitors are, and other similar information.  Agencies, who also can be requesters under the Act, may also be able to obtain information on what other agencies have paid vendors for services, equipment and construction if they are venturing into a new area and one in which they are unfamiliar with what the competitive rates, specifications or requirements may be.

Transparency in government and the public’s ability to review the workings of its government through public record access is a fundamental principle of our form of government.  The changes brought about by Pennsylvania’s new Right-to-Know Law are long overdue.  Although certain aspects of it may cause initial apprehension among the business community, following the guidelines of the Act in protecting information which is truly confidential, proprietary or trade secret information will help ease that anxiety and promote greater access of the workings of government to the benefit of all, including the Pennsylvania business community.

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