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March 26, 2001

FOIL-AO-12604

The staff of the Committee on Open Government is authorized to issue advisory opinions. The
ensuing staff advisory opinion is based solely upon the facts presented in your correspondence,
unless otherwise indicated.

Dear

I have received your letter, as well as a variety of related materials. You have sought an
advisory opinion concerning the propriety of a denial of your request made under the Freedom of
Information for a record in possession of the New York City Economic Development Corporation
("EDC").

The matter involves a request for "the letter of Intent signed by the New York Stock
Exchange on or about December 20, 2000 regarding the proposed project to provide a new building
for the New York Stock Exchange on the block bounded by Wall, Broad, and William Streets and
Exchange Place in Manhattan, New York." EDC's Records Access Officer denied the request
pursuant to section 87(2)(c) of the Freedom of Information Law, which authorizes an agency to
withhold records to the extent that disclosure "would impair present or imminent contract awards
or collective bargaining negotiations." Judy E. Fensterman, EDC's FOIL Appeals Officer, affirmed
the denial of access following your appeal.

It is your contention, based on opinions previously rendered by this office and judicial
decisions, that the Letter of Intent must be disclosed. Notwithstanding the thrust of those opinions,
in consideration of the circumstances extant in this situation, it appears that the denial of your request
was consistent with law. Key is Ms. Fensterman's description of the nature, scope and significance
of the Letter of Intent in her determination of your appeal in which she wrote as follows:

"The letter of intent merely establishes the framework for the NYSE
project and subsequent negotiations, but, with the exception of certain
limited provisions, does not, in and of itself, create any legally
binding obligations or liabilities. Since the agreements for the project
have not been finalized, it is my determination that disclosure of the
letter of intent is premature and would unduly impair and
compromised the City's ability to negotiate the final project
documents with the NYSE. Additionally, to the extent that any terms
of the letter of intent can be construed as a binding obligation,
consideration of the ‘effects of disclosure' on the city's ongoing
negotiations with respect to the project is paramount. Although
negotiation of the letter of intent only involves one private party, as
you point out, the NYSE project, in its entirety, involves negotiations
with multiple parties with various property interests. Disclosure of
the letter of intent could have the effect of undermining the City's
negotiations, causing it to lose leverage in its negotiations with
property owners and tenants on the site of the proposed NYSE
project, and compromising its ability to negotiate the best possible
deal for the City."

In an effort to obtain further clarification from Ms. Fensterman, I contacted her by phone.
In addition to reiterating that the Letter of Agreement represents one among many in a series of
negotiations with a variety of parties, she specified that the Letter of Agreement includes reference
to certain deadlines, which, if disclosed, would, in her view, damage New York City's bargaining
position with any number of those parties. In short, she indicated that if those dates became known
to you, or any person, including a party to the negotiations, a party or parties would have the ability
to develop a negotiation or bargaining strategy that would place the City and EDC at a clear
disadvantage.

I am mindful of the opinions and judicial decision involving the contention that records that
are known to both parties to negotiations must be disclosed, for in those situations, there is no
"inequality of knowledge" [see Community Board 7of Borough of Manhattan v. Schaeffer, 570 NYS
2d 769; affirmed, 83 AD 2d 422, reversed on other grounds, 84 NY 2d 148 (1994) ]. Those opinions
and the case law pertained to situations in which there were only two parties involved in a
negotiation process. While the contents of the Letter of Intent are known by and in the possession
of the New York Stock Exchange and the EDC, its contents are not known to the other parties
involved or potentially involved in negotiations regarding the project. That being so, it appears that
disclosure would "impair" present or imminent contract awards" and that the denial of your request
was consistent with law.

I hope that I have been of assistance. If you would like to discuss the matter, please feel free
to contact me.

Sincerely,

Robert J. Freeman
Executive Director

RJF:tt
cc: Judy E. Fensterman