TX Supreme Ct. ruling guts transparency of private/public partnerships

posted on 6.29.2015

In a profound 6-3 ruling, the Texas Supreme Court said the Greater Houston Partnership does not have to open its books to public scrutiny of its publicly-funded economic development activities.

The decision turned the clock back on nearly 40 years of Texas Public Information Act case law that said private entities receiving government money were required to release certain information if they passed a series of legal tests such as functioning as an arm of the government.

TAB and the Freedom of Information Foundation of Texas weighed in on the GHP case with an amicus curiae brief siding with the State of Texas.

Paul Watler, an attorney with TAB’s Texas counsel Jackson Walker LLP who prepared the TAB amicus, said the ruling was an erroneous interpretation of the Texas Public Information Act.

“Now GHP and groups like it that tap the spigot of public funding may draw the curtain against citizens examining how those funds are spent,” Watler said.

GHP receives hundreds of thousands of government dollars from the City of Houston to conduct economic development activity.

“The result today is at odds with the Legislature's express mandate that the Court construe the statute in favor of access to information by the public.”

The GHP case began in 2007 with a request by a Montgomery County resident who sought to find out how the group spends city funds for its economic development activities.

When the Texas Attorney General ruled GHP had to release the information, the group sued to keep its books closed saying it was not a governmental body and therefore subject to the TPIA.

A trial court and appellate court ruled that GHP had to make the information available because it was performing work for the city, utilizing city dollars to do so, despite the fact that its primary funding was membership dues.

The Texas Supreme Court disagreed saying GHP, or any organization supported by public money, is not a governmental body for purposes of the TPIA unless it is "sustained" and not merely "supported" by public funding.

The far-reaching ruling means that most public/private partnerships such as chambers of commerce and regional economic development authorities will be able to avoid public information requests despite receiving public funds to conduct operations.

Questions?  Contact TAB's Michael Schneider or call (512) 322-9944.

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