Minn. case probes public data in outsourced work

When Minnesota governments farm work out to private companies, state law presumes most data "collected, received, stored, used, maintained or disseminated" for those projects is available to the public just as if the work was done by public employees.

That open records principle is at the heart of a dispute before the state Court of Appeals. The court takes up a case Friday testing the reach of Minnesota's Data Practices Act when it comes to outsourced work.

The case springs from a small-town newspaper editor's effort to access data from a construction management firm and its subcontractor on a major school buildings project. It's the first significant judicial look at that portion of the records law in about a decade.

The stakes go beyond the regional school district's $78 million project behind the information standoff. Hundreds of millions of dollars are spent annually on services or construction projects authorized by Minnesota's state government, municipal councils and school boards.

Lawyers for the firm, Johnson Controls Inc., argue that an adverse ruling for them could open private companies to unnecessary scrutiny by forcing them to divulge sensitive pricing and strategic information to anyone who asks, including competitors. In turn, they say it may lead some companies to charge taxpayers more or make others less likely to bid on public work.

An attorney for the Timberjay Newspapers in northern Minnesota says a ruling the other way could make it harder for the public to track project price changes or performance reports, to judge whether taxpayers are getting good value, or to assess whether cozy relationships are giving some subcontractors a leg up.

"It would knock a gaping hole in what has been past practice in Minnesota in terms of the public being able to find out about contracts entered into between government agencies and private contractors," Timberjay lawyer Mark Anfinson said.

The school district never handled the information the newspaper editor was after so it didn't become public through that route.

So far, two formal reviews of the case have yielded two interpretations.

An advisory opinion from a state information officer appointed by Democratic Gov. Mark Dayton ruled that Johnson Controls failed to comply with the Minnesota records law by not turning over its contract with an architectural firm assisting in the project. An administrative law judge appointed by former Republican Gov. Tim Pawlenty ruled the main company was properly protecting sensitive information that its own contract with the school district didn't seek.

The three-judge appeals panel must figure out where to draw the line, such as what constitutes a government function that exposes a private company to public records requirements.

In a brief submitted by Johnson Control's lawyers ahead of the hearing, Minneapolis attorneys David Lillehaug and Christopher Stafford caution against taking an expansive view

"Although school districts do not typically produce their own textbooks, a publisher contracting with the district to provide textbooks would perform a government function," they wrote, adding that a publisher "could be required to disgorge all of its internal documents regarding that textbook, such as its contract and correspondence with the author."

Instead, they say government agents should have to specifically outline in the contract what becomes public.

Anfinson counters that tying data access to clauses in the formal contracts puts too much power in the hands of those at the negotiating table. Wittingly or not, some information could be deemed off-limits because officials failed to write the disclosure expectations into contracts.

"You don't give public officials that much discretion of whether the public gets to see something or not," he said.

The last time the state appellate court tackled this issue was in 2003, when it ruled that a private architect under contract to design a county jail had to disclose details of its quality standards and bidding requirements for builders. The architect's contract with the county didn't warn the architect that the information could be considered public, but the appeals panel decided that the task of constructing a jail is an inherent public purpose.

A ruling in the current case is expected by mid-October. The loser would have the ability to petition for Supreme Court review.