October 28, 2008
The staff of the Committee on Open Government is authorized to issue advisory opinions. The ensuing staff advisory opinion is based solely upon the information presented in your correspondence.
I have received your letter and the materials relating to it. You wrote that your requests directed to the Research Foundation of the State University of New York (“the Research Foundation”) and Health Research, Inc. (“HRI”) for records indicating the names and salaries of their employees were denied. The entities have been characterized as private, not-for-profit corporations, and it was contended, therefore, that they are not subject to the Freedom of Information Law.
From my perspective, based on the terms of the Freedom of Information Law and judicial decisions, those entities constitute “agencies” that are required to comply with that statute. In this regard, I offer the following comments.
First, as you may be aware, the Freedom of Information Law is applicable to agency records, and §86(3) defines the term “agency” to mean:
"any state or municipal department, board, bureau, division, commission, committee, public authority, public corporation, council, office or other governmental entity performing a governmental or proprietary function for the state or any one or more municipalities thereof, except the judiciary or the state legislature."
Although the definition of “agency” refers to “governmental” entities performing a governmental function, the courts have considered the functions of not-for-profit corporations closely associated with government and the extent to which there is governmental control over those corporations in determining whether they are subject to the Freedom of Information Law.
I note that both HRI and the Research Foundation are included within the definition of “state agency” in §53-a of the State Finance Law. Subdivision (5) of that statute provides that:
“‘State agency’ means (a) any state department, bureau, commission, authority or division and shall include the state university;
(b) any institution or organization designated and authorized by law to act as agent for the state, including Cornell University and Alfred University as representatives of the state university board of trustees for the administration of statutory or contract colleges at those institutions;
(c) any public corporation or institution the governing board of which consists of a majority of state officials serving ex-officio or has one or more members appointed by the governor; and
(d) certain membership corporations closely affiliated with specific state agencies and whose purposes are essentially to support, supplement or extend the functions and programs of such state agencies, specifically: Youth Research, Inc., The Research Foundation for Mental Hygiene, Inc., Health Research Inc., The Research Foundation of the State University of New York, and Welfare Research, Inc.”
In a decision involving the status of a similar entity, it was held that a community college foundation, also a not-for-profit corporation, and its records are subject to the Freedom of Information Law. The Court wrote that:
"At issue is whether the Kingsborough Community College Foundation, Inc (hereinafter 'Foundation') comes within the definition of an 'agency' as defined in Public Officers Law §86(3) and whether the Foundation's fund collection and expenditure records are 'records' within the meaning and contemplation of Public Officers Law §86(4).
The Foundation is a not-for-profit corporation that was formed to 'promote interest in and support of the college in the local community and among students, faculty and alumni of the college' (Respondent's Vertified Answer at paragraph 17). These purposes are further amplified in the statement of 'principal objectives' in the Foundation's Certificate of Incorporation:
'1 To promote and encourage among members of the local and college community and alumni or interest in and support of Kingsborough Community College and the various educational, cultural and social activities conducted by it and serve as a medium for encouraging fuller understanding of the aims and functions of the college'.
Furthermore, the Board of Trustees of the City University, by resolution, authorized the formation of the Foundation. The activities of the Foundation, enumerated in the Verified Petition at paragraph 11, amply demonstrate that the Foundation is providing services that are exclusively in the college's interest and essentially in the name of the College. Indeed, the Foundation would not exist but for its relationship with the College" (Eisenberg v. Goldstein, Supreme Court, Kings County, February 26, 1988).
The Research Foundation was chartered in 1951 by the Board of Regents as a non-profit educational corporation. It is my understanding that the focal point of the relationship between SUNY and the Foundation is an agreement between those institutions signed in 1977 and approved by the Attorney General and the Comptroller. The agreement describes the powers and duties of SUNY and its Board of Trustees and cites the purposes of the Foundation in its charter as follows:
“a. To assist in developing and increasing the facilities of the State University of New York to provide more extensive educational opportunities for and service to its students, faculty, staff and alumni, and to the people of the State of New York, by making and encouraging gifts, grants, contributions and donations of real and personal property to or for the benefit of State University of New York;
b. To receive, hold and administer gifts or grants, and to act without profit as trustee of educational or charitable trusts, of benefit to and in keeping with the educational purposes and objects of State University of New York; and
c. To finance the conduct of studies and research in any and all fields of the arts and sciences, of benefit to and in keeping with the educational purposes and objects of State University of New York...”
The agreement also states that “a major function of the Foundation has been to serve as the fiscal administrator of funds awarded by the federal government and other authorized sources for the conduct of sponsored programs at the State-operated institutions of the University.” The agreement refers to the fact that:
“most grants of such funds are initiated by proposals by faculty members of the State-operated institutions of the University detailing the scope, objectives, staffing, and budget of the proposed sponsored program, which are then incorporated into formal applications to the sponsor by the University and the Foundation, following, when applicable, the filing of notice of such applications in accordance with Section 53-a of the State Finance Law; such awards are made to the Foundation for and in conjunction with the University subject to the terms and conditions specified by the sponsors, including the ultimate accountability to them for the proper management and use of such grant awards...”.
In addition, the agreement states that “the Foundation’s sole purpose is to serve the University”, that the Foundation “shall assist the University in procurement of funds from the federal government and other authorized sources to support such sponsored programs at the University as the University shall request”, and that “All applications to prospective sponsors by faculty or staff members at the State-operated institutions of the University seeking support for sponsored programs shall be made by the University through the Foundation.” Further, the agreement states that no application shall be made by the Foundation “without prior written approval of the chief administrative office of the college or other institution of the University where the sponsored program is to be conducted, and the prior written approval of the Chancellor or his designee.
The Charter of the Research Foundation states that the Chancellor of the University or his designee serves ex officio as chair of its Board of Directors and that “Upon dissolution of the corporation, surplus assets, if any, shall be devoted and applied in accordance with law, to the educational objects and purposes of the State University of New York.”
In short, the Research Foundation’s purpose is “to serve the University”, it cannot carry out its duties without the approval of University officials, and it is an “integral part” of the University. Moreover, the Foundation utilizes space at many SUNY campuses.
The most direct judicial precedent concerning the status of the entities in question is a recent decision, Siani v. The Research Foundation of the State University of New York (Supreme Court, Albany County, March 26, 2007) in which, for reasons fully consistent with those offered above, concluded that the Research Foundation is an agency required to comply with the Freedom of Information Law. Specifically, the Court found that:
“The powers and duties of the Research Foundation as found in its charter are to assist in developing and increasing facilities of the State University of New York by making and encouraging gifts, grants and donations of real and personal property, to receive, hold and administer gifts, grants and to finance studies and research of benefit to and in keeping with the educational purposes and objectives of the State University. The relationship between the State University and the Research Foundation is set out in a 1977 agreement between those entities. The agreement defines the major function of the Research Foundation as serving as the fiscal administrator of funds awarded by the federal government and other authorized sources for the conduct of sponsored programs at the State-operated institutions of the University. Under the agreement, all applications to prospective sponsors by faculty or staff members at the State-operated institutions of the University seeking support for sponsored programs are to be made by the University through the Research Foundation. All such applications made by the Research Foundation require prior written approval of the chief administrative office of the college or other institutions of the University where the sponsored program is to be conducted and the prior written approval of the Chancellor or his designee. The Chancellor is the chair, ex officio, of the Board of the Research Foundation.
“As the fiscal administrator of the majority of the State University’s sponsored programs, the activity of the Research Foundation is included in the financial statements of the State University. In addition, the Research Foundation is included within the definition of a ‘state agency’ in State Finance Law §53-a.
“Given the functional relationship between the Research Foundation and the State University, the importance of the role played by the Research Foundation in the educational efforts of the State University and the power it has with respect to sponsored programs of the State University, the Research Foundation exercises a governmental function and is therefore, subject to the provisions of the Freedom of Information Law.”
As in the case of the Foundation in Eisenberg, the Research Foundation would not exist but for its relationship with SUNY. Due to the similarity between the situation involving the entity at issue in Eisenberg and the Research Foundation, and in view of the essential purposes of the Research Foundation as described in the State Finance Law, its charter, the Agreement referenced earlier, and the holding in Siani, I believe that it is an agency subject to the Freedom of Information Law. To suggest otherwise would, in my opinion, exalt form over substance.
With respect to the other entity at issue, HRI was created as a membership corporation in 1953 and later designated as a not-for-profit corporation in 1973. Its purposes are similar to those of the Research Foundation, but they relate to the State Department of Health. Specifically, the certificate of Incorporation states that the purposes of HRI include:
“(a) To assist in developing and increasing the facilities of the New York State Department of Health, the institutions and agencies within such Department or associated therewith, and other departments of health within the State, to provide more extensive conduct of studies and research into the causes, nature and treatment of diseases, disorders and defects of particular importance to the public health by encouraging gifts, grants, bequests, devises, contributions and donations of real and personal property to the corporation for such purposes:
(b) To receive, hold and administer gifts or grants for the purposes of the corporation and in keeping with the research, prevention and treatment purposes and objectives of the New York State Department of Health, the institutions, and agencies within such Department or associated therewith; and other departments of health within the State;
(c) To conduct and finance the conduction of studies and research in any and all fields of the arts and sciences and in keeping with the purposes and objectives of New York State Department of Health, the institutions and agencies within such Department or associated therewith; and other departments of health within the State...”
Based on the foregoing, as in the circumstance of the Research Foundation, HRI’s essential purpose is to enhance the functioning of a state agency, and it would not exist but for its relationship with that agency. That conclusion is bolstered by information expressed on HRI’s website, which states that “HRI’s mission is to assist DOH [the New York State Department of Health] and RCPI [the Roswell Park Cancer Institute, a unit of the DOH] to effectively evaluate, solicit, and administer external financial support for DOH and RPCI projects, and to disseminate the benefits of DOH expertise through programs such as technology transfer.”
For the reasons indicated in the preceding commentary, I believe that the Research Foundation and the HRI are “agencies” required to comply with the Freedom of Information Law.
Lastly, an obligation imposed by the Freedom of Information Law relates to the information sought, the names and salaries of employees. Specifically, §87(3)(b) of the Freedom of Information Law requires that “Each agency shall maintain...a record setting forth the name, public office address, title and salary of every officer or employee of the agency.” The record required to be maintained pursuant to §87(3)(b) is routinely disclosed by other agencies, entities of state and local government, for none of the grounds denying access appearing in §87(2) of the Freedom of Information Law may justifiably be asserted.
In an effort to resolve the matter, copies of this opinion will be forwarded to representatives of both the Research Foundation and HRI.
I hope that I have been of assistance.
Robert J. Freeman
cc: John J. O’Connor
Heather D. Diddel