January 4, 2010
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.
As you are aware, I have received your letter and the correspondence attached to it. You have sought an advisory opinion concerning a request for records made to the Department of Taxation and Finance on behalf of a client in May of this year.
By way of background, you wrote that the client was the subject of a nine count indictment, and was acquitted of six, those involving offering a false instrument for filing in the first degree (2 counts concerning quarterly tax returns), failure to withhold income taxes, grand larceny in the second and third degrees, and money laundering in the fourth degree. He was convicted of falsifying business records in the first degree, failure to pay benefits, and criminal contempt in the second degree. An appeal is pending concerning the charges for which the client was convicted. The correspondence indicates that a Department attorney and a Saratoga County assistant district attorney confirmed that, prior to your client’s trial, “‘boxes’ of investigative records had been provided to the Office of the District Attorney and thereafter returned to DTF.”
In what I understand to be the only written response to the request, the Department’s records access officer wrote on July 9 as follows:
“The Secrecy Provisions of the New York State Tax Law prevent the release of the information that you have requested. Therefore, unless you are able to provide the Records Access Office with notarized releases/powers of attorney from [the subject of the records, your client], the Department is unable to provide you with the requested information.”
A day after receiving that response, a notarized release, signed by your client, authorizing you and any other representative of the firm that employs you to gain access to the Departments records pertaining to him, “without limitation”, was sent to the records access officer. Nevertheless, you received no further response. Consequently, you appealed on August 25, but the appeal has not yet been determined.
You have requested an opinion concerning the following:
“(1). whether the Department has denied access to these records without a proper basis under the statute; (2). whether the Department has met its obligations to produce the paper and electronic records that [you] seek; (3). whether the ability exists to recover attorney fees and costs associated with this FOIL request based on non-compliance with statutory deadlines by the Department and (4) on any other issues related to FOIL which may be relevant to this situation.”
In this regard, I offer the following comments.
First, as a general matter, the Freedom of Information Law is based upon a presumption of access. Stated differently, all records of an agency are available, except to the extent that records or portions thereof fall within one or more grounds for denial appearing in §87(2)(a) through (k) of the Law. It is emphasized that the introductory language of §87(2) refers to the authority to withhold "records or portions thereof" that fall within the scope of the exceptions that follow. In my view, the phrase quoted in the preceding sentence evidences a recognition on the part of the Legislature that a single record or report, for example, might include portions that are available under the statute, as well as portions that might justifiably be withheld. That being so, I believe that it also imposes an obligation on an agency to review records sought, in their entirety, to determine which portions, if any, might properly be withheld or deleted prior to disclosing the remainder.
The Court of Appeals expressed its general view of the intent of the Freedom of Information Law in Gould v. New York City Police Department [89 NY2d 267 (1996)], stating that:
"To ensure maximum access to government records, the 'exemptions are to be narrowly construed, with the burden resting on the agency to demonstrate that the requested material indeed qualifies for exemption' (Matter of Hanig v. State of New York Dept. of Motor Vehicles, 79 N.Y.2d 106, 109, 580 N.Y.S.2d 715, 588 N.E.2d 750 see, Public Officers Law § 89[b]). As this Court has stated, '[o]nly where the material requested falls squarely within the ambit of one of these statutory exemptions may disclosure be withheld' (Matter of Fink v. Lefkowitz, 47 N.Y.2d, 567, 571, 419 N.Y.S.2d 467, 393 N.E.2d 463)" (id., 275).
Just as significant, the Court in Gould repeatedly specified that a categorical denial of access to records is inconsistent with the requirements of the Freedom of Information Law. In that case, the Department contended that DD5's could be withheld in their entirety on the ground that they fall within the exception regarding intra-agency materials, §87(2)(g), an exception separate from those cited in response to your requests. The Court, however, wrote that: "Petitioners contend that because the complaint follow-up reports contain factual data, the exemption does not justify complete nondisclosure of the reports. We agree" (id., 276), and stated as a general principle that "blanket exemptions for particular types of documents are inimical to FOIL's policy of open government" (id., 275). The Court also offered guidance to agencies and lower courts in determining rights of access and referred to several decisions it had previously rendered, stating that:
"...to invoke one of the exemptions of section 87(2), the agency must articulate 'particularized and specific justification' for not disclosing requested documents (Matter of Fink v. Lefkowitz, supra, 47 N.Y.2d, at 571, 419 N.Y.S.2d 467, 393 N.E.2d 463). If the court is unable to determine whether withheld documents fall entirely within the scope of the asserted exemption, it should conduct an in camera inspection of representative documents and order disclosure of all nonexempt, appropriately redacted material (see, Matter of Xerox Corp. v. Town of Webster, 65 N.Y.2d 131, 133, 490 N.Y.S. 2d, 488, 480 N.E.2d 74; Matter of Farbman & Sons v. New York City Health & Hosps. Corp., supra, 62 N.Y.2d, at 83, 476 N.Y.S.2d 69, 464 N.E.2d 437)" (id.).
In the context of your request, the only basis for denying access involved reference to the “Secrecy Provisions” of the Tax Law. While I am not an expert with respect to the Tax Law, I believe that there are several “secrecy provisions.” No particular statute was cited in the response to the request. Further, the response suggested that notarized release or power of attorney would permit access. Although that document was submitted, the Department took no action. In short, I believe that the blanket denial of the request by the Department, was clearly inconsistent with law.
Second, when a statute requires or confers secrecy or confidentiality, the initial ground for denial may be cited. Section 87(2)(a) pertains to records that “are specifically exempted from disclosure by state or federal statute.” It appears that the “secrecy provision” most pertinent in this instance is §202(1) of the Tax Law. In brief, the Department, its employees and agents, unless authorized to do so by “proper judicial order or as otherwise provided by law”, are prohibited by that statute from disclosing “reports” submitted by taxpayers. That provision also states that:
“[t]he officers charged with the custody of such reports shall not be required to produce any of them or evidence of anything contained in them in any action or proceeding in any court, except on behalf of the state or the commissioner of taxation and finance in an action proceeding under the provisions of this chapter or in any other action or proceeding involving the collection of a tax due under this chapter to which the state or the commissioner of taxation and finance is a claimant, or on behalf of any party to any action or proceeding under the provisions of this article, when the reports or facts shown thereby are directly involved in such action or proceeding...” (emphasis added).
The same provision states that: “[n]othing herein shall be construed to prohibit the delivery to a corporation or its duly authorized representative of a copy of any report filed by it...”
As I understand the foregoing, secrecy is required with respect to records submitted by a taxpayer, whether an individual or a corporation, but that requirement does not apply when those records are sought by the taxpayer or his/her or its “duly authorized representative.” If that is so, the tax secrecy provisions in the Tax Law appear to be inapplicable as a basis for denying access to the records sought, and rights of access would be governed by the Freedom of Information Law.
As you suggested and as the courts have confirmed, records that “are not tax returns” are not subject to the secrecy provisions in the tax law, and “the fact that the data....may be derived from tax forms...does not place such data within the protection of the confidential provisions of the Tax Law (see Tax Law §202, §697[e]; 26 USC 6103)” (Herald Company v. New York State Department of Economic Development, Supreme Court, Albany County, February 8, 2007). Similarly, in a case in which petitioners were the subject of an audit, some 3,000 pages of material were made available by the Department. Although some of the records sought were found to have been properly withheld, access was denied pursuant to provisions other than statutes conferring or requiring confidentiality in the Tax Law (Grasso v. Megna, NY Slip Op 300004(U), Supreme Court, Albany County, January 2, 2009).
Although I am unfamiliar with the content of the “boxes” of records that fall within the scope of your request, several of the grounds for denial of access may be pertinent in analyzing rights of access.
Section 87(2)(b) authorizes an agency to withhold records insofar as disclosure would constitute “an unwarranted invasion of personal privacy.” The records at issue might include identifying details pertaining employees of the corporation with which your client was associated. If portions of any such records identifiable to those persons include intimate or highly personal information, those elements of the records might justifiably be withheld. If, however, the records pertain to persons acting in their business or professional capacities, there may be nothing “personal” about them. Further, it has been held that unless witnesses or others requested or were promised confidentiality, their identities and statements following a prosecution that has been completed are accessible [see Cornell University v. New York City Police Department, 153 AD2d 515, 517 (1989)]. Most recently, it was determined by the Appellate Division, Third Department, that “[c]onclusory statements are insufficient to deny access, as are categorical assertions that all law enforcement investigations will be harmed if witnesses’ names are available through a FOIL request....” and that the agency denying access “provided no proof that disclosing this information here would constitute an unwarranted invasion of personal privacy, such as causing economic or personal hardship” [Carnevale v. City of Albany, ___AD3d___ (decided December 10, 2009)].
An allusion was made in one of the decisions cited above to law enforcement investigations, and because your client was the subject of a criminal proceeding, §87(2)(e) is also pertinent. That provision permits an agency to withhold records that:
“are compiled for law enforcement purposes and which, if disclosed, would:
(i) interfere with law enforcement investigations or judicial proceedings;
(ii) deprive a person of a right to a fair trial or impartial adjudication;
(iii) identify a confidential source or disclose confidential information relating to a criminal investigation; or
(iv) reveal criminal investigative techniques or procedures, except routine techniques or procedures.”
Because the trial in the criminal proceeding in which your client was the defendant has been completed, I do not believe that either subparagraphs (i) or (ii) of §87(2)(e) could justifiably be asserted to deny access. Whether subparagraph (iii) is pertinent is questionable, for if a confidential source possessed or shared information pertinent to the criminal proceeding, that source would likely have been identified and the information disclosed in conjunction with or as part of that proceeding.
More likely to be relevant, in my view, would be subparagraph (iv). The leading decision concerning that provision, Fink v. Lefkowitz, involved access to a manual prepared by a special prosecutor that investigated nursing homes, in which the Court of Appeals held that:
"The purpose of this exemption is obvious. Effective law enforcement demands that violators of the law not be apprised the nonroutine procedures by which an agency obtains its information (see Frankel v. Securities & Exch. Comm., 460 F2d 813, 817, cert den 409 US 889). However beneficial its thrust, the purpose of the Freedom of Information Law is not to enable persons to use agency records to frustrate pending or threatened investigations nor to use that information to construct a defense to impede a prosecution.
"To be distinguished from agency records compiled for law enforcement purposes which illustrate investigative techniques, are those which articulate the agency's understanding of the rules and regulations it is empowered to enforce. Records drafted by the body charged with enforcement of a statute which merely clarify procedural or substantive law must be disclosed. Such information in the hands of the public does not impede effective law enforcement. On the contrary, such knowledge actually encourages voluntary compliance with the law by detailing the standards with which a person is expected to comply, thus allowing him to conform his conduct to those requirements (see Stokes v. Brennan, 476 F2d 699, 702; Hawkes v. Internal Revenue Serv., 467 F2d 787, 794-795; Davis, Administrative Law [1970 Supp], section 3A, p 114).
"Indicative, but not necessarily dispositive of whether investigative techniques are nonroutine is whether disclosure of those procedures would give rise to a substantial likelihood that violators could evade detection by deliberately tailoring their conduct in anticipation of avenues of inquiry to be pursued by agency personnel (see Cox v. United States Dept. of Justice, 576 F2d 1302, 1307-1308; City of Concord v. Ambrose, 333 F Supp 958)."
In applying those criteria to specific portions of the manual, which was compiled for law enforcement purposes, the Court found that:
"Chapter V of the Special Prosecutor's Manual provides a graphic illustration of the confidential techniques used in a successful nursing home prosecution. None of those procedures are 'routine' in the sense of fingerprinting or ballistic tests (see Senate Report No. 93-1200, 93 Cong 2d Sess ). Rather, they constitute detailed, specialized methods of conducting an investigation into the activities of a specialized industry in which voluntary compliance with the law has been less then exemplary.
"Disclosure of the techniques enumerated in those pages would enable an operator to tailor his activities in such a way as to significantly diminish the likelihood of a successful prosecution. The information detailed on pages 481 and 482 of the manual, on the other hand, is merely a recitation of the obvious: that auditors should pay particular attention to requests by nursing homes for Medicaid reimbursement rate increases based upon projected increase in cost. As this is simply a routine technique that would be used in any audit, there is no reason why these pages should not be disclosed" (id. at 573).
From my perspective, as the Court of Appeals has suggested, to the extent that the records in question include descriptions of investigative techniques which if disclosed would enable potential lawbreakers to evade detection or effective law enforcement, a denial of access may be appropriate. However, insofar as those potentially harmful effects would not arise by means of disclosure, §87(2)(e)(iv) would not serve as a basis for a denial or access.
The remaining exception of likely significance, due to its structure, often requires substantial disclosure. Specifically, §87(2)(g) permits an agency to withhold records that:
"are inter-agency or intra-agency materials which are not:
i. statistical or factual tabulations or data;
ii. instructions to staff that affect the public;
iii. final agency policy or determinations; or
iv. external audits, including but not limited to audits performed by the comptroller and the federal government..."
It is noted that the language quoted above contains what in effect is a double negative. While inter-agency or intra-agency materials may be withheld, portions of such materials consisting of statistical or factual information, instructions to staff that affect the public, final agency policy or determinations or external audits must be made available, unless a different ground for denial could appropriately be asserted. Concurrently, those portions of inter-agency or intra-agency materials that are reflective of opinion, advice, recommendation and the like could in my view be withheld.
The Court of Appeals in Gould, supra, analyzed the provision quoted above and found that:
"...we note that one court has suggested that complaint follow-up reports are exempt from disclosure because they constitute nonfinal intra-agency material, irrespective of whether the information contained in the reports is 'factual data' (see, Matter of Scott v. Chief Medical Examiner, 179 AD2d 443, 444, supra [citing Public Officers Law §87[g]). However, under a plain reading of §87(2)(g), the exemption for intra-agency material does not apply as long as the material falls within any one of the provision's four enumerated exceptions. Thus, intra-agency documents that contain 'statistical or factual tabulations or data' are subject to FOIL disclosure, whether or not embodied in a final agency policy or determination (see, Matter of Farbman & Sons v. New York City Health & Hosp. Corp., 62 NY2d 75, 83, supra; Matter of MacRae v. Dolce, 130 AD2d 577)...
"...Although the term 'factual data' is not defined by statute, the meaning of the term can be discerned from the purpose underlying the intra-agency exemption, which is 'to protect the deliberative process of the government by ensuring that persons in an advisory role [will] be able to express their opinions freely to agency decision makers' (Matter of Xerox Corp. v. Town of Webster, 65 NY2d 131, 132 [quoting Matter of Sea Crest Constr. Corp. v. Stubing, 82 AD2d 546, 549]). Consistent with this limited aim to safeguard internal government consultations and deliberations, the exemption does not apply when the requested material consists of 'statistical or factual tabulations or data' (Public Officers Law 87[g][I]. Factual data, therefore, simply means objective information, in contrast to opinions, ideas, or advice exchanged as part of the consultative or deliberative process of government decision making (see, Matter of Johnson Newspaper Corp. v. Stainkamp, 94 AD2d 825, 827, affd on op below, 61 NY2d 958; Matter of Miracle Mile Assocs. v. Yudelson, 68 AD2d 176, 181-182).
"Against this backdrop, we conclude that the complaint follow-up reports contain substantial factual information available pursuant to the provisions of FOIL. Sections of the report are devoted to such purely factual data as: the names, addresses, and physical descriptions of crime victims, witnesses, and perpetrators; a checklist that indicates whether the victims and witnesses have been interviewed and shown photos, whether crime scenes have been photographed and dusted for fingerprints, and whether neighborhood residents have been canvassed for information; and a blank space denominated 'details' in which the officer records the particulars of any action taken in connection with the investigation.
"However, the Police Department argues that any witness statements contained in the reports, in particular, are not 'factual' because there is no assurance of the statements' accuracy and reliability. We decline to read such a reliability requirement into the phrase 'factual data', as the dissent would have us do, and conclude that a witness statement constitutes factual data insofar as it embodies a factual account of the witness's observations. Such a statement, moreover, is far removed from the type of internal government exchange sought to be protected by the intra-agency exemption (see, Matter of Ingram v. Axelrod, 90 AD2d 568, 569 [ambulance records, list of interviews, and reports of interviews available under FOIL as 'factual data']). By contrast, any impressions, recommendations, or opinions recorded in the complaint follow-up report would not constitute factual data and would be exempt from disclosure. The holding herein is only that these reports are not categorically exempt as intra-agency material. Indeed, the Police Department is entitled to withhold complaint follow-up reports, or specific portions thereof, under any other applicable exemption, such as the law-enforcement exemption or the public-safety exemption, as long as the requisite particularized showing is made" [Gould, Scott and DeFelice v. New York City Police Department, 89 NY2d 267, 276-277 (1996); emphasis added by the Court].
In sum, for the reasons offered in the preceding remarks, and in response to the first two questions that you raised, I do not believe that the basis for denial of access to the records by the Department was proper; on the contrary, in my opinion, it appears that many of the records sought must be disclosed in whole or in part.
Finally, with respect to the ability to recover attorney fees and costs in the event that a judicial proceeding is initiated to challenge a denial of access by the Department, §89(4)(c) of the Freedom of Information Law states that:
“The court in such a proceeding may assess, against such agency involved, reasonable attorney's fees and other litigation costs reasonably incurred by such person in any case under the provisions of this section in which such person has substantially prevailed, when:
i. the agency had no reasonable basis for denying access; or
ii. the agency failed to respond to a request or appeal within the statutory time.”
As indicated at the outset, the request to the Department was made in May, and the only written response was provided in July. An appeal was made in August, and as of the date of the preparation of this opinion, no determination had been made. Section 89(3)(a) requires that an agency respond in some manner to a request within five business days of the receipt of the request. Several weeks passed before any response, and that was the denial based on the secrecy provisions of the Tax Law. The last sentence of §89(4)(a) states that “[f]ailure by an agency to conform to the provisions of subdivision three of this section shall constitute a denial.” The first sentence of that provision states in relevant part that:
"any person denied access to a record may within thirty days appeal in writing such denial to the head, chief executive or governing body of the entity, or the person thereof designated by such head, chief executive, or governing body, who shall within ten business days of the receipt of such appeal fully explain in writing to the person requesting the record the reasons for further denial, or provide access to the record sought."
Many more than ten business days have passed since the receipt of your appeal by the Department.
In consideration of the foregoing, should you “substantially prevail” in a judicial proceeding, it is clear that a court has the authority to award reasonable attorney’s fees and other litigation costs reasonably incurred.” However, the authority to do is discretionary, and there is no obligation on the part of a court to award attorney’s fees and associated costs, irrespective of the outcome of the proceeding.
It is reiterated that the courts, and particularly the Court of Appeals, have clearly confirmed that in order to meet the burden of proof in denying access to records, agencies must provide “persuasive evidence” that disclosure would cause the harm envisioned by an exception to rights of access, rather than a “speculative conclusion that disclosure might potentially cause harm” [Markowitz v. Serio, 11 NY3d 43, 51 (2008)]. Most recently, the Court criticized an agency for denying access to records based on “conclusory characterizations”, and stated that the petitioner “was compelled to bring suit to obtain either the documents or explanation of ESDC’s denial, the very information it should have received during the administrative appeal process” (West Harlem Business Group v. Empire State Development Corporation, ___NY3d___, December 15, 2009).
To attempt to avoid the initiation of costly and time consuming litigation and to encourage disclosure in a manner consistent with law, copies of this opinion will be sent to the Department.
I hope that I have been of assistance.
Robert J. Freeman
cc: Deborah Liebman