Ambivalence Toward PA’s Right-to-Know Law is a Mistake

In 2009, the General Assembly enacted the most sweeping revisions of Pennsylvania’s Right-to-Know Law in its history. The new law created a presumption that a record in the possession of the government was public unless otherwise exempt. Millions of documents in the hands of local and state government that previously would not have been accessible by the public were now available. The business community, for the most part, was ambivalent. However, as the new law has been implemented, businesses dealing with government agencies realize that they should have paid closer attention. Contracts and related records of the transactions, charges and services rendered by these businesses to government agencies have become more available to requesters, including competitors. Some businesses have embraced the law and used it as an effective tool to gain information allowing them to expand their sales reach and to become more effective in bidding for government contracts. In response, some government agencies have protested this use of the law asserting that public records requests should not be used as a “free” method for businesses to compile client lists.

In reaction to this and other issues, various bills to amend the Right-to-Know Law are currently pending in the Legislature. The most expansive of these, Senate Bill 444, is that of Senator Pileggi, who was the primary sponsor and creator of what eventually became the current Right-to-Know Law. It contains several provisions to which the business community should pay particular interest.

The bill adds a provision which would require a requester, individual or business to indicate whether or not the request is for a “commercial purpose.” Generally, a commercial purpose is defined as any purpose which is not for educational, non-commercial scientific, scholarly or news media use. The bill would permit the government agency to charge a fee to the requester for complying with such a request. The fee would be within the agency’s discretion for search, review and redaction of a document produced up to the hourly wage of the lowest paid employee who would be assigned to such duties.

The primary reason given for such a fee is that agencies have indicated that they do not believe that the public’s records should be provided free of charge to businesses so that they can make a profit at the taxpayer’s expense. Although this argument, on its face, has some appeal, it fails to recognize two essential elements.

First, many of the commercial requesters are already taxpayers within the Commonwealth and/or within the municipalities who seek to charge such fees. In essence, they would be charged twice, once through their tax dollars which provide for the maintenance of the records and a second time when making a request for those records. Second, the fee can either be absorbed by the business or passed on to the consumers, many of which would already be taxpayers within the same jurisdiction. This provision would significantly impact realtors, bankers, mortgage lenders and title searchers. For example, if a business provides tax and other lien information to settlement agencies for the purposes of transferring real estate, that entity would have to pay this fee and either absorb it or pass it on to the ultimate consumer, the buyer and/or seller of the real estate. The fee would add to the cost and potentially the delay of transferring real estate at a time when that industry is struggling to recover. Similar examples could be found in mortgage lending, banking and other similar business transactions.

The second provision of interest to business entities would be an amendment which would restrict the public’s access to documents between business entities and government agencies to the actual contract itself and any public records relating to that contract. Although at first blush this may seen attractive to the business community, it is a narrowing of the access available now and could actually restrict public records that are already available to businesses who are seeking information on how to better deal with government agencies and/or make better more effective bids with such agencies.

Finally, the bill also contains language which would exempt tax payment records and records of persons receiving public utility, sewer or municipal services. It provides for a “clearance certificate,” which could be obtained from the municipality and/or its tax collector. However, there is no indication of what this clearance certificate must contain, a timeframe within which it must be provided and what fees may be charged for such documents. Once again, this would add to the cost and delay in real estate and other related transactions. An additional provision makes any form required to be filed by a taxpayer with a federal or Commonwealth taxing authority specifically exempt. This broad language could include real estate tax information and realty transfer information which would severely impact the buying and selling of real estate within the Commonwealth.

Historically, the business community has taken a laissez-faire attitude toward Right-to-Know legislation. In the current Right-to-Know environment, such an attitude is ill-advised. The sweeping changes made in Pennsylvania to its Right-to-Know Law directly impact business by making many more records available to requesters which include businesses. As the current proposed amendments highlighted above demonstrate, the business community should enter the dialogue as to whether these provisions and others do not negatively impact doing business within Pennsylvania. As the legislation may be considered during the fall session of the General Assembly, those discussions should take place now.

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