LaValle v. Office of General Counsel

KELLEY, Judge,

concurring and dissenting.

I concur in the majority’s overruling of Butera v. Office of the Budget, 29 Pa.Cmwlth. 343, 370 A.2d 1248 (1977) to the extent that it conflicts with the recent decisions of our Supreme Court. I dissent, however, with respect to the majority’s conclusion that the report generated by Ernst & Young is not a public record under the Right to Know Act1 because it was not an essential component of the decision to pay Envirotest Partners. In my opinion, the Ernst & Young report was an essential component and therefore constitutes a public record.

The Office of General Counsel admittedly relied upon the Ernst & Young audit to determine the extent of Envirotest’s damages. In effect, the report was the justification for Envirotest’s damages and the decision to pay Envirotest approximately $145 million plus interest from public funds.2

In order to pay Envirotest from the public coffers, the General Assembly was called upon to pass legislation. This legislation authorized the Governor to transfer funds from the Catastrophic Loss Benefits Continuation Fund and funds from continuing appropriations for hazardous waste *334to satisfy litigation awards, and all costs associated with litigation, involving a centralized emission inspection contract with Envirotest.3 Throughout the debate by the Senate, the members questioned the justification for the amount of the settlement and commented that the legislation should be voted down until the members had an opportunity to receive a more detailed explanation of the amount.4 In response to the members’ concerns, Senator Loeper offered certain figures that were verified to the Commonwealth by Ernst & Young.5 Senate Legislative Journal, December 12, 1995. Senator Loeper stated that Ernst & Young audited or reviewed the material submitted by Envirotest in order to determine what Envirotest’s actual costs were.6 Id. Thus, it is clear from the legislative history that the report prepared by Ernst & Young was the justification for the approximately $145 million *335dollars of public funds being expended to settle a public contract dispute with Envi-rotest.' Accordingly, the report was an essential component of the decision to pay Envirotest.

There is an inherent responsibility of disclosure and the absolute duty of cooperation between the branches when inquiry is made by any member of the General Assembly with respect to obtaining a justification for the expenditure of public funds. When such an inquiry is made, it is mandatory for disclosure to occur. The Office of General Counsel, Executive Branch, is constitutionally obligated by implication to disclose the basis of the justification for any financial amounts requested from the General Assembly.

Notwithstanding a separate public contract with Envirotest, the report is part of the justification for the requested amount. This essential information must be provided to the General Assembly as the body authorizing the expenditure of the public funds. Otherwise, by withholding justifying reports from the knowledge of the other branch which of necessity must authorize such money, we would be permitting one branch to act in total or partial ignorance when voting which needless to say would subvert our representative form of government.

Herein, it is clear that the public and the members of the Senate still do not know the justification of the settlement with En-virotest. That is why the Petitioners are attempting to secure a copy of the Ernst & Young report under the Right to Know Act. For the foregoing reasons, I believe that said document is clearly a public record pursuant to the Right to Know Act. Accordingly, I would direct the Office of General Counsel to provide a copy of the subject Ernst & Young report to the Petitioners.

Judge FRIEDMAN joins.

. Act of June 21, 1957, P.L. 390, as amended, 65 P.S. §§ 66.1-66.4.

. See Senate Legislative Journal, December 12, 1995.

. See Section 10 of Act 72, Act of December 20, 1995, P.L. 655, 75 Pa.C.S. § 4706.1.

. Senator O'Pake, in his remarks, stated as follows:

Secondly, last night, quite appropriately in the Committee on Appropriations, we asked for an explanation of where all this money was going. It seems to me that if we are being asked to, in effect, ratify litigation and the settlement of a lawsuit, the Members of this body, in order to intelligently vote ought to know why exactly $145 million, plus $15 million, plus interest, why that figure? And as the gentleman from Montgomery, Senator Tilghman, pointed out, he wanted the Governor to produce some specific information or they would be, in his words, derelict in their duty....
Today we got a very thick package, ... but we have no idea how much of that $145 million is gong to go to salaries for employees who either were hired or were about to be hired or were promised to be hired. We have no idea, although we have a list of properties that were allegedly bought, of the assessed valuation of what those properties will sell for or what they will cost. We really do not know a whole lot. We know the bottom-line figure. We know that somebody thought that $145 million was a way to get out of this lawsuit. I respectfully suggest that to intelligently vote to affirm this and support this, we need additional information.

Senator Porterfield in his remarks, stated as follows:

Mr. President, I have a few comments in regard to this payoff and/or proposal and what has basically happened to the people of Pennsylvania during the last several years. I will start off with my concerns in regard to the proposal to pay Envirotest X number of dollars, and not having information available pertaining to the costs that have been incurred by Envirotest as to whether the $145 million is proper or not, I do not know.

Senator Wagner, in his remarks, stated as follows:

But in reading the settlement and in reviewing the complaint that was filed, I find it to be very difficult to determine what the costs to Envirotest were up until the date when this agreement was terminated. And I think that is a question that needs to be answered tonight.
We have in front of us, as best as I can tell, and it is very difficult to tell, what we are going to spend at a minimum $145 million in taxpayer money as part of this settlement. I do not know how one penny out of that $145 million was determined. .. .[A]nd I have never seen an agreement put in front of me with so little information to verify or justify the settlement than the one we have in front of us tonight

Senate Legislative Journal, December 12, 1995.

. It is clear from the Senate Legislative Journal of December 12, 1995, that Senator Loe-per had access to the Ernst & Young report that is the subject of the present controversy.

. I note that the members of the House also had great concerns about the lack of disclosure and the fact that the members did not have a copy of the independent audit performed by Ernst & Young, For example, in his remarks, Mr. Kukovich stated as follows:

Until we see the independent audit by Ernst and Young - which I have not seen and I have only heard mentioned during Senate debate - until we find out what the details are and whether there have been appropriate appraisals of all the property involved and until we have an understanding as to whether or not Envirotest actually did what they should to mitigate their damages going back over a year ago.... I think until we get full disclosure, ..., we should not support this bill.

House Legislative Journal, December 13, 1995.