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### Novaber**17, 1987** 

Honorable Mike Toomev Opinion No.**JM-821** Chairman Judiciary Committee Re: Whether a volunteer Texas House ofRepresentatives firedepartment is subject P. 0. Box 2910 to the Open Records Act, Austin, Texas 78769 article 6252-17a, V.T.C.S. (RQ-1225)

DearRepresentative Toomey:

You ask whether avolunteer fire department that receives public funds through acontract with a rural fire prevention district constitutes a "governmental body" under the Texas Open Records Act, article 6252-17a, V.T.C.S. your concern focuses on the Cy-Fair Volunteer Fire Department, which you state is organized as a nonprofit corporation under Texas law. you indicate that the department receives public funds through a contract with theHarris County Rural Fire Prevention District No. 9toperform fire fighting services inthe district. At various times, members of the public have requested records from the district.

The Open Records Act applies togovernmental bodies

asdefined in section 2 of the act. Section 2(l)(A) describes the state agencies covered by the act. Sections Z(~)(B)-(E) list specific types of local governing bodies

or their subdivisions that are covered **by** the act. A volunteer fire department does not fallwithin any of these specific descriptions. Section 2(l)(F) provides that a "governmental body" also includes

the part, section, or portion of every organization, corporation, commission, committee, institution, or agency which is suvvorted in whole or in nart bv nublic funds, or which exnends DUbliC funds. Public funds asused herein shallmean funds of the State ofTexas orany governmental subdivision thereof. (Emphasis added.)



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Private nonprofit corporations can fall within this provision. See, e.s., Open Records Decision Nos. 302 (1982); 228 (1979).

The primary issue in determining whether certain private entities are "governmental bodies" under the act iswhether they are supported inwhole or in part by public funds A.H. Belo orwhether they expend public funds. See

Cornoration v. Southern Methodist University, 734 S.W.2d 720. 723 (Tex. App. - Dallas 1987, writ pending); Attorney General Opinions JM-154 (1984): JM-116 (1983):Open Records Decision Nos. 343, 302 (1982); 228 (1979);see also Kneeland v.National Colleoiate Athletic Association, 650 F. Supp. 1047, 1056 (W.D.Tex. 1986); cf. Attorney General Opinions JM-596 (1986);JM-120 (1983). .---.

In A. -H. Belo -Corvoration v. Southern Methodist Universitv, sunra, the court held that certain private schools' athletic deoartments are not llsovernmental bodies" under the Open Records Act because they did not receive public funds. The member schools, state and private, retained apredetermined amount of funds from gate receipts and from broadcasting fees. The remaining fundswere forwarded to the Southwest Athletic Conference (SWC)and other schools. The SWC retained apredetermined ? amount anddistributed the rest to member schools. The court reasoned that the departments did not receive "public funds" within the meaning of section 2(l)(F) because themoney distributed by the SWCdid not constitute the "funds of the State ofTexas orany governmental subdivision thereof." The court concluded that, because the fundsnever "vested" inany school, including apublic school, the fundsdid not constitute "public funds." See 734 S.W.2d at 723.

The contract between the Cy-Fair Volunteer Fire Department and the Harris County Fire Prevention District No. 9, however, expressly involves a transfer to the department of the bulk of funds received by the district from its tax collections, less the district's administrative costs. Inthe A.H. Belo case, the court distinguished Open Records Decision No. 228 on the basis that it clearly involved public funds; funds transferred directly from agovernmental body to theprivate entity in question. The case athand is similar. Thus, this case isnot one inwhich the governmental body acts only as a conduit for funds.

The receipt ofpublic funds for the general support of the activities .ofaprivate organization brings that

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### 3904Honorable Mike Toomey -Page 3 **(JM-821)**

organization within the definition of a "governmental body." OpenRecords Decision No. 228. For example, in Open Records Decision No. 228, this office determined that

aprivate, nonprofit corporation chartered topromote the interests of the Dallas-Fort Worth metropolitan areawas a governmental body under the OpenRecords Act because of its contract with the city of FortWorth. The contract didnot impose 'Iaspecific anddefinite obligation on the commission toprovide ameasurable amount of service in exchange for a certain amount of money as would be expected ina typical arms-length contract for services between avendor andpurchaser." OpenRecords Decision No. 228. The corporation was not simply a vendor or independent contractor who provided goods or services to a governmental body in an arms-length transaction. For these reasons, the decision determined that the contract fundswere forthe general support of the corporation rather than for specific measurable services. Consequently, the corporation was supported inpart **by**public fundswithin the meaning of section 2(l)(F) of the Open Records Act. Id.; see also Attorney General Opinion JM-116 (1983):OpenRecords Decision No. 302 (1982).

In contrast, OpenRecords Decision No. 343 (1982) determined that a private, nonprofit corporation under contract with ahospital district to provide emergency medical service isnot a "governmental body" because the applicable contract provided that the corporation should receive "eachmonth a sum equal to the differences between cash receipts and approved operating expenditures of the ambulance service." The decision stated that this language imposed adefinite obligation tomake a "specific payment for specific measurable services" rather than to provide for general support. The decision did not indicate how thepayment ofmonthly operating expenses through this formula constitutes payment for "specific measurable services" or how that payment canbe distinguished fromgeneral monthly support. The Vest*' applied inDecision 343 ispart of the test adopted and applied in OpenRecords Decision No. 228. The VUtestVV was formulated inDecision No. 228, however, tohelp distinguish the "private" nonprofit corporation from aprivate vendor who sells goods or services toa governmental body. The "test" cannot be appliedmechanically. The precise manner of funding is not the sole dispositive issue in determining whether an entity falls under the Open Records Act.

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Other aspects ofa contract or relationship involving the transfer ofpublic fundsbetween aprivate and public entity must be considered indetermining whether aprivate entity is a l@governmental body" under the Open Records Act. For example, a contract or relationship that involves public funds and that indicates a common purpose or objective or that creates an agency-type relationship1 between aprivate entity and a public entity will bring theprivate entity within the section 2(l)(F) definition ofa "governmental body." See Open Records Decision Nos. 302, 228; see also Kneeland v. National Colleaiate Athletic Association, m (following Open Records Decision No. 228). For example, Open Records Decision No. 228 cited aprovision of the contract which directed the private entity to continue to carry out the common objectives itheldwith the city. Structuring a contract that involves public funds toprovide a formula to compute
a fixed amount of money.for a fixed period of time will not automatically prevent a private entity from constituting a VVgovernmental body" under section 2(l)(F) of the Open Records Act. The overall nature of the relationship created by the contract is relevant in determining whether the private entity is so closely associated with the governmental body that the private entity fallswithin the OpenRecords Act. As indicated, theprecise manner of funding isnot the sole dispositive issue in determining whether an entity falls under the Open Records Act. For this reason, the determination in Open Records Decision No. ,343 with regard to a "governmental body" under the act should notbe relied upon.2

1. It should .be noted that the common purpose or agency-type relationship that will subject a "private"

. entity to the OpenRecords Act isnot the equivalent ofan agency relationship for purposes of tort liability. gg cenerallv Attorney General Opinion JM-748 (1987).

2. Review of the contract at issue inOpen Records Decision No. 343 reveals that the contract did not involve 'Iaspecific anddefinite obligation on the [entity] to provide ameasurable amount of service inexchange fora certain amount ofmoney aswould be expected inatypical arms-length contract for services between avendor and purchaser." &g Open Records Decision No. 228 (1979). (Footnote Continued)



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Additionally, when volunteer fire departments

contract with a political subdivision, considerations apply to them that ordinarily set them apart from private vendors of goods and services who typically deal with governmental bodies in arms-length transactions. Fire protection isone of the services traditionally provided bygovernmental bodies. Snn.Citv of Coleman v.Rhone, 222 S.W.2d 646 (Tex.Civ.App. -Eastland 1949,writ ref'd). Although no statute expressly makes nonprofit volunteer firedepartments subject to theOpen Records Act or labels them governmental bodies for other purposes, several statutes recognize that theymay have strong affiliations with public agencies. See. e.a.,V.T.C.S. art. 8309h, §1(2) (political subdivisions may bring volunteer firefighters within workers compensation coverage): art. 6243e.3 (political subdivision may opt toprovide relief and retirement benefits to volunteer firefighters): see ~&g Tex. Const. art. III, 551-d (legislature may provide benefits for survivors of members of volunteer fire departments killed in the performance of "official duties"). These considerations make itmore likely that a nonprofit volunteer firedepartment that enters into a contract with a public entity will fallwithin the Open Records Act. Whether or not a particular nonprofit volunteer firedepartment fallswithin the Open Records Act depends on the circumstances ineach case, including the terms of the contract between thedepartment and the public entity. See Schwartzman v.Merritt Island Volunteer Fire Denartment, 352 So. 2d 1230 (Fla. APP. - 4th Dist. 1977), cr denied 358So.2d 132 (Fla. 1978) (cited inOpen Ee&rds DeciLion No. 228 (1979)).

The contract between the Cy-Fair Volunteer Fire Department and theHarris County Rural Fire Prevention District No. 9 involves the general support of the activities of the department with public funds. The contract provides:

The Department will provide the emergency ambulance services, the fire prevention

(FootnoteContinued) For example, thehospital district provided ambulances for the ambulance service andprovided forthe general monthly operating expenses of the service. The service could not make expenditures, including hiring personnel, without district approval.

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services, the fire fighting services in the geographic District andwill not look to the District to arovide anv services whatsoever excevt for thewrovidina of funds to enable the Denartment to carrv on itsduties and resnonsibilities. (Emphasis added.)

Thus, the department receives public funds toprovide all of the district's needed services. Additionally, the contract involves the submission by the department to the district ofone-year operating budgets and'a three-year capital expenditure budget forplanning purposes. The contract also provides for a form of continuing annual renewals. Consequently, the contract provides for the general support of the department forpurposes of section 2(l)(F) of the Open Records Act.

As indicated, section 2(l)(F) covers only "the part, section, orportion" of corporations supported by public funds. See Open Records Decision No. 228. Accordingly, the department must comply with the Open Records Act to the extent that it receives public funds from the district. Because the contract requires the department to maintain a separate accounting of the expenditure of funds received fromthe district, this **partial"coverage should not require undue delay in responding to requests for information under the Open Records Act.

SUMMARY

The Cy-Fair Volunteer Fire Department, a nonprofit corporation, is a "governmental body" within themeaning of section 2(1) (F) of the Texas Open Records Act, article 6252-17a, V.T.C.S., to the extent that it is supported bypublic funds received pursuant to its contract with theHarris County Rural Fire Prevention District No. 9.

Very truly yo s

J lldJ% k;, JIM MATTOX Attorney General ofTexas

MARY KELLER Executive Assistant Attorney General

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JUDGE ZOLLIE STEAKLEY Special Assistant Attorney General

RICK GILPIN Chairman, Opinion Committee
Prepared by Jennifer Riggs Assistant Attorney General

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