Opinion ID: 1707448
Heading Depth: 1
Heading Rank: 5

Heading: The Foundationa legal or constitutional duty upon receipt of funds?

Text: Even assuming the Foundation is not a public body, it is evident that they accepted the funds in connection with a constitutional or legally endowed responsibility. This is not a case where the recipient of public funds has provided goods or services, and as to which there may be independent statutory authority requiring the maintenance of books and records for auditing purposes. See, for instance, LSA-R.S. 39:1516, the statute concerning state procured negotiated contracts. Rather, it is one where the recipient has accepted funds to assist and further the goals of a public body. The Foundation has undertaken, as its purpose, assistance to the University, its faculty, and its students, by promoting public education, a purpose that coincides with the University's and the Federation's constitutional and legal duties. The transaction between the Federation and the Foundation constitutes a transfer of public funds (rather than simply a donation, which is prohibited by La. Const. art. 7, § 14(A)). In essence, it is somewhat similar to what transpired in Seghers v. Community Advancement, Inc., 357 So.2d 626 (La.App. 1st Cir.1978). [8] Because the objectives of the Federation, the Foundation and the University coincide in the furtherance of a governmental purpose, and because a simple donation would be illegal under La. Const. art. 7, § 14(A), we find that the money was given and accepted under authority of the constitution and the laws of this state in furtherance of a governmental purpose. It was not a donation in the sense comtemplated by La. Const. art. 7, § 14(A). We summarize our conclusions as follows: 1) we need not determine whether the Foundation is a public body; 2) the Federation is indeed a public body under the Public Records Act; 3) the funds transferred from the Federation to the Foundation are and were public money; 4) the funds were transferred in the discharge of the Federation's constitutional or legal duties; and 5) the funds were accepted by the Foundation, assumedly a nonpublic body (a private nonprofit corporation) with a commitment to assist the Federation in carrying out its constitutional and legal duties in public education. The district court granted defendants' motion for directed verdict and the court of appeal affirmed. However, a motion for directed verdict should be granted only if the facts and inferences are so overwhelmingly in favor of the moving party that the court finds that reasonable men could not arrive at a contrary verdict. La. C.C.P. 1810. Howes v. Allstate Ins. Co., 480 So.2d 991, 993 (La.App. 4th Cir.), writ denied, 484 So.2d 672 (La.1986); Cuccia v. Cuccia, 394 So.2d 840, 841 (La.App. 4th Cir.1981). We find that the evidence in this case is not so one-sided that reasonable men could only find in the defendants' favor. In fact, on the record the reverse is more nearly so. The defendants contend that in this holding there is the potential for invading the books and records of private corporations whose missions and activities are almost entirely private, and whose receipt of public money other than through payment for goods and services in a given case may be miniscule. They argue that allowing examination will discourage private donations to profit and nonprofit corporations and will ultimately hurt the recipients. The answer to this is not difficult. If a private corporation accepts public money from a public body in the discharge of the latter's constitutional or legal duties, it must disclose records concerning those transactions, including the receipt and expenditure of those funds. If those corporations wish to avoid divulging nonpublic receipts and expenditures, they need only maintain separate and distinct books, accounts and records. In this case, the right of inspection is limited to the records of receipts and expenditures of public funds. The Inspector General does not have the right to examine records regarding private donors, nor other receipts or expenditures unrelated to the transmitted fees. Indeed, the Inspector General has not sought such relief.