Are Your Private Records Public? Part 1
By W. Robert Vezina, III & Eduardo S. Lombard
Vezina, Lawrence & Piscitelli, P.A.
Whether as part of a claim dispute or bid protest or simply as part of submitting a public records request to a government entity, many Florida road builders have had some experience with Florida’s broad public records laws. Recently, the Florida Legislature enacted legislation that may significantly impact some road builders entering contracts with government entities, including FDOT.1 This new legislation expands some obligations to the government and the general public, potentially increasing job and overhead costs and perhaps making public some contractor documents normally considered private.
Under the new law, if a contractor is acting on behalf of the government entity, the contractor must:
- maintain all records that ordinarily and necessarily would be required by the public agency to perform the service;
- provide the public access to the records on the same terms and conditions that the public agency would provide at a cost set forth by statute; and
- properly maintain those records and transfer, at no cost, to the public agency all public records in possession of the contractor upon termination of the contract and destroy any duplicate records that are exempt or confidential.
Here we discuss Florida’s Public Records Act – highlighting recent changes to the law – and its application to all companies providing services to government entities.
Florida’s Public Records Act
The Florida Constitution provides the right of access to public records to any person.2 The legislature codified this broad right in the Public Records Act (chapter 119 Florida Statutes). The Public Records Act requires every person who has custody of a public record to allow the record to be inspected and examined by any person at a reasonable time and under reasonable conditions. The term “public records” includes “all documents, papers, letters, maps, books, tapes, photographs, films, sound recordings, data processing software, or other material, regardless of physical form, characteristics, or means of transmission, made or received pursuant to law or ordinance or in connection with the transaction of official business by any agency.”3
While this definition is quite broad, there are several exemptions to the Public Records Act. Some of the exemptions are contained within the Act itself, and others can be found in separate provisions of Florida law. For example, sealed bids received by FDOT pursuant to a solicitation are exempt until such time as FDOT provides notice of decision or intended decision or within 30 days after bid opening, whichever is earlier.4 Thus, bid responses typically become public record at the latest 30 days after the bid opening. Trade secrets are another example of exempt records. If a contractor properly marked or designated the materials as trade secret when the contractor submitted the materials to FDOT, the documents remain exempt from public inspection.5 So, for a bidder to protect trade secret information in its bid, the bidder must clearly identify the trade secret information as such when the bid is submitted to the government entity and include language sufficient to put the government entity on notice that the information is trade secret exempt from disclosure.
Documents in the Hands of Private Entities
As indicated above, “public record” is defined broadly to include documents “received pursuant to law or ordinance or in connection with the transaction of official business of any agency.” The term “agency” is defined as:
any state, county, district, authority, or municipal officer, department, division, board, bureau, commission, or other separate unit of government created or established by law . . . , and any other public or private agency, person, partnership, corporation, or business entity acting on behalf of any public agency.6
Courts have determined that the legislature used this language to ensure that a government entity could not avoid its obligations under the Public Records Act by contractually delegating governmental work or responsibilities to a private entity.7 Historically, a contractual relationship between a government entity and a private contractor by itself did not subject the contractor to the Act. Instead, courts limited the application of the Public Records Act to situations where the contractor undertakes to act “on behalf of” an agency. To determine if a private entity acts “on behalf of” a public agency, courts have applied a “totality of the circumstances” test. The factors that may be considered include:
- the level of public funding;
- whether the activity was conducted on publicly owned property;
- whether services contracted for are an integral part of the public agency’s
- chosen decision-making process;
- whether the private entity is performing a governmental function or a function
- which the public agency otherwise would perform;
- the extent of the public agency’s involvement with, regulation of, or control over the private entity;
- whether the private entity was created by the public agency;
- whether the public agency has a substantial financial interest in the private
- who is the beneficiary of the private entity task?
These and other factors typically are applied on case-by-case basis. Some courts have determined that the factors need not even be applied if the delegation of the government function is clear and convincing. In the end, the crux of the analysis is whether the contract transfers an actual public function to the private entity. If so, the private entity is subject to the Public Records Act and documents related to the governmental functions will be subject to the Act.
The New Statute Regarding Contractor Records
During the 2013 session the Florida Legislature revised the Public Records Act in a way that appears to have expanded the responsibilities of contractors that enter contracts for services with a government entity.8 In this new law, a “contractor” is defined as a person (corporate or otherwise) that “enters into a contract for services with a public agency and is acting on behalf of the public agency . . . .” This definition does not seem to alter the “totality of the circumstances” test, but it does make clear that the new law applies only to services contracts. That is to say, materials and goods contracts do not fall under the reach of the new law. This makes sense as the government doesn’t typically make materials or goods. So, in short, the Public Records Act applies to any contractor acting on behalf of a public entity through provision of services.
The more significant impact of the new law lies with the obligations it imposes on those contractors.9 Now, every contract with a public agency must contain a provision requiring such a contractor to comply with the Public Records Act by:
- Keeping and maintaining public records that ordinarily and necessarily would be required by the public agency to perform the service;
- Providing the public with access to the public records on the same terms and conditions that the public agency would provide the record and at a cost not exceeding the cost permitted under law;
- Ensuring the records that are exempt or confidential are not disclosed except as provided by law; and
- Meeting all requirements for the retention of the record and transferring, at no cost, to the public agency all public records in possession of the contractor upon termination of the contract and destroying any duplicate records that are exempt or confidential (including electronic records).
Put differently, it appears that, under the new law, if a particular document would have been kept by the public agency in performing the same service, then the document is a public record that must be maintained by the contractor, made available to the general public, and transferred to the agency at the end of the contract.
Issues Created by the New Law
The threshold issue under both the old and new laws is whether the contractor is acting on behalf of the government entity. That question should continue to be answered by applying the “totality of the circumstances” test described above. In the road construction context, the spectrum ranges from simple maintenance jobs to traditional bid-build projects to design-build and design-build-finance projects to full-blown public-private partnerships. While there is room for debate as to which of these contract types may be deemed subject to the Public Records Act, FDOT has taken a very broad view of the Act’s application.
The second issue is what constitutes records that “ordinarily and necessarily would be required by the public agency to perform the service.” In the FDOT context, the definition may prove slippery. FDOT has not actually constructed roads for itself in more than 60 years. More importantly, there is no statute or rule addressing what documents FDOT would be required to create if it were to build projects itself. Some records might be obvious, such as daily reports; others, like job cost reports, less so. Of course, correspondence with any person would appear to be ordinarily and necessarily required by the government entity to perform the service – just like it is in the private sector. Thus, contractors subject to the Act should assume that all correspondence – including downstream correspondence with subcontractors – would be within the reach of the Act.
There also is a natural tension between the Act and the right of a private entity to keep information that gives it a competitive advantage – such as bid files and job costs reports – away from the public and its competitors. Trade secrets are always exempt, as noted above, but proving the bona fides of a trade secret isn’t always easy. A particular job cost document may or may not qualify as a trade secret depending on the circumstances. Unfortunately, we may see clarity on the scope of this new provision only through legislative revision/repeal or through court actions. The latter could be in the form of a declaratory action by a contractor who is subjected to a public records request or through an action by a member of the public to enforce a public records request. In the latter instance, the contractor likely would be a named defendant (along with FDOT, perhaps) and would be liable to pay the attorney’s fees and expenses of the requesting party if the court determined that 1) the requested documents were public records (e.g., records that “ordinarily and necessarily would be required by the public agency to perform the service”) and 2) the records were not exempt from disclosure under the Act (e.g., trade secret).
The issues of providing public access to the records and transferring the records to the government entity impose additional costs (and risks) on contractors that must comply with the Act. Providing access means that the contractor must promptly respond to public requests for records and provide reasonable access. Although the Public Records Act allows a records custodian to charge a fee for providing copies and the like, those fees may not always cover the actual cost of compliance, which would include staff time and effort and perhaps fees for consulting a legal advisor.
What is a “prompt” response? Although the Public Records Act does not provide a specific time limit for compliance with a public records request, the Florida Supreme Court has declared that the only permissible delay in providing access to records under the Act “is the limited reasonable time allowed the [records] custodian to retrieve the record and delete those portions of the record the custodian asserts are exempt.”10 Timely compliance with public records requests is particularly important in light of the criminal and civil penalties included in the Public Records Act. Any person who knowingly and willfully violates the Act is guilty of a first degree misdemeanor. Additionally, as made reference to above, a civil action to compel compliance may be filed by a person who has submitted a public records request. If through a civil action a court determines that a contractor wrongfully refused to allow inspection of a public record, the court would be required to assess attorney’s fees and costs against the contractor.
What is “access”? The right of access means the right to inspect and copy original, nonexempt records, not merely to receive copies of or extracts from a requested record. A public records custodian may not impose a condition of inspection that restricts or circumvents a person’s right of access.
Since the new law took effect, at least four state court actions have been filed against contractors providing services to the State of Florida.11 In one instance, a requester allegedly showed up at the contractor’s offices and demanded access to a particular public record. The security guard at the reception desk asked the person to provide personal information as a condition of access. When the person refused and the security guard would not let the person into the facility, he left and filed a lawsuit in state court alleging he was denied access to the public record. That action is pending. Although the example may seem extreme, it’s real and now being litigated with attorney’s fees and costs at issue.
Adopting protocols and procedures to address public records requests: At a minimum, contractors covered by the law should have a designated public records compliance employee, who would handle all public records requests, from the inception to the actual provision of electronic or hard copy “access” to documents within the scope of any request.
Lastly, the requirement that the contractor transfer the public records to the government at the expiration of the contract term presents significant challenges in addition to costs. As written, the Act could be interpreted to mean that the original records are to be transferred. If a contractor is required by other laws or regulations (such as IRS rules and FDOT specifications) to maintain the records, the contractor may be asked to choose compliance between different laws/requirements. Even if retention of copies would suffice under other laws, this certainly adds the cost of duplication – which can be significant on major projects. Moreover, a contractor is also required to transfer the electronic versions of all public records in a format compatible with the government entity’s IT system. This theoretically could require conversion of large amounts of data by the contractor to suit the government-preferred IT structure without any ability on the back end to recover those costs.
Exempt records also would need to be transferred. The law requires that the contractor transfer the confidential and exempt public record and destroy any duplicate copies. This seems to imply that the original record would be transferred to the government. This is particularly troublesome when the original trade secret is owned by the contractor. Is the contractor required to transfer its trade secrets to the government? We doubt this was the legislature’s intent, but the wording of the statute is problematic.
In sum, if a contractor is acting on behalf of a government entity, the contractor is required to comply with the new requirements of the Public Records Act. While we await court opinions to define the reach of public access to project-related documents and enter the 2014 legislative session with the possibility of having the statute dialed back, contractors in the business of constructing public works should adopt protocols and procedures to handle requests from the general public. At a minimum, those protocols and procedures should include assigning one person to handle the requests by 1) providing written acknowledgment of the request, 2) logging the request, 3) coordinating efforts to gather responsive documents, and 4) providing reasonable access to the records. Otherwise, a contractor risks exposure to a judgment for attorney’s fees and costs in a public records lawsuit should it fail to comply the Public Records Act.
Rob Vezina is the managing shareholder of Vezina, Lawrence & Piscitelli, P.A., Tallahassee and Ft. Lauderdale, practicing in the fields of construction and public contracts law. He received his law degree from Duke University and has for many years served as general counsel to the FTBA.
Ed Lombard is a VLP shareholder resident in the Tallahassee office, practicing construction law and complex commercial litigation with a primary focus on government contracting and procurement. He received his law degree from The Florida State University, where he served as Associate Editor of the Law Review.
1See ch. 2013-154, Laws of Fla.
2See Art. I, § 24, Fla. Const.
sup>3 § 119(12), Fla. Stat. (2013).
4See § 119.071(b), Fla. Stat. (2013).
5See § 815.04(3), Fla. Stat. (2013); SePRO Corp. v. Fla. Dep’t of Envtl. Prot., 839 So. 2d 781, 784-85 (Fla. 1st DCA 2003).
6§ 119(2) (2013) (emphasis added).
7See, e.g., News & Sun-Sentinel Co. v. Schwab, Twitty & Hanser Architectural Group, Inc., 596 So. 2d 1029, 1031 (Fla. 1992).
8See ch. 2013-154, Laws of Fla.
9Throughout the remainder of this article, we use “contractor” in the same context and definition as the Act.
10Tribune Co. v. Cannella, 458 So. 2d 1075, 1078 (Fla. 1984).
11E.g., Civil Complaint to Enforce Florida’s Public Records Act and for Declaratory and Monetary Relief, Chandler v. WellCare of Florida, Inc., No. 13-CA-9640 (Fla. Cir. Ct. Hillsborough Cnty. July 18, 2013).