FREEDOM OF INFORMATION COMMISSION

OF THE STATE OF CONNECTICUT

 

In the Matter of a Complaint by                        Final Decision

 

Fred Laberge and New Haven Register,

 

                        Complainants

 

            against              Docket #FIC 91-277

 

Connecticut Housing Finance Authority,

 

                        Respondent                  June 10, 1992

 

            The above-captioned matter was heard as a contested case on January 31, 1992, at which time the complainants and the respondent appeared, stipulated to certain facts and presented testimony, exhibits and argument on the complaint.

 

            After consideration of the entire record, the following facts are found and conclusions of law are reached:

 

            1.  The respondent Connecticut Housing Finance Authority (hereinafter "CHFA") is a public agency within the meaning of 1-18a(a), G.S.

 

            2.  By letter of complaint dated September 5, 1991, and filed with the Commission on September 9, 1991, the complainants alleged that the respondent illegally convened an executive session at its August 29, 1991 regular meeting (hereinafter "August meeting").

 

            3.  Specifically, the complainants alleged that despite the objections of a CHFA board member and two newspaper reporters, the respondent illegally convened the executive session.

 

            4.  The complainants further alleged that the respondent's general counsel cited 1-18a(e) and 1-19(b) G.S., as the authority supporting its decision to convene the executive session.

 

            5.  It is found that at its August meeting the respondent called and convened an executive session for the stated purpose of discussing a "draft report" and "ongoing negotiations" concerning New Haven's Ninth Square Redevelopment Project (hereinafter "Project").

 

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            6.  It is found that the proposed Project, which has been in various planning and development stages for approximately five years, would redevelop the blighted ninth square area of downtown New Haven.

 

            7.  Specifically, it is found that the proposed Project would provide several hundred units of subsidized and non-subsidized housing, stores and parking garages in the decaying ninth square area of New Haven.

 

            8.  It is found that by all accounts the major redevelopment Project would be a multimillion dollar undertaking.

 

            9.  It is found that the proposed funding for the Project is from private and public sources.

 

            10.  It is found that in reliance on the Project, the City of New Haven, developers of the Project, residents and business owners have already invested and/or spent money preparing for the long-awaited redevelopment.

 

            11.  The respondent concedes that its involvement in the Project would make it the most complex and costly real estate venture that it has ever considered funding.

 

            12.  It is found that if CHFA agrees to participate in financing the Project, the State of Connecticut--and ultimately the taxpayers of Connecticut--provide a 100% guarantee of repayment of the respondent's debt obligation in the event of default.

 

            13.  The respondent concedes that the Project has "sustained public and private interest and strong emotion about the role and the risk of the State in such endeavors."

 

            14.  For all of the foregoing reasons, this Commission concludes that there is a reasonable and substantial public interest in the Project, including whether or not the respondent will participate in its funding.

 

            15. It is found that at its March 28, 1991 regularly held board meeting (hereinafter "March meeting"), the respondent voted to reject the Project proposal and publicly announced its intention not to participate in financing the Project.

 

            16.  It is found that at its March meeting Richard Baron of McCormack, Baron & Associates, one of the developers of the Project (hereinafter "developer"), expressed his dissatisfaction with the respondent's decision to reject the proposal.

 

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            17.  At the hearing the respondent argued that Mr. Baron's remarks at the March meeting alleged causes of action and implied a threat of litigation.

 

            18.  Specifically, the respondent argued that the developer's remarks were threats of potential lender liability claims.

 

            19.  It is found that at the August meeting the respondent's general counsel, in support of the decision to convene the executive session, stated that CHFA had been threatened with a lawsuit.

 

            20.  At the hearing the respondent argued that, in part, the executive session called and convened at its August meeting was for the purpose of discussing and outlining a strategy for future negotiations with a developer that presented a threat of litigation.

 

            21.  Section 1-18a(g), G.S., states that:

 

            "Pending claim" means a written notice to an agency which sets forth a demand for legal relief or which asserts a legal right stating the intention to institute an action in an appropriate forum if such relief or right is not granted.  (Emphasis added.)

 

            22.  Section 1-18a(h), G.S., states that:

 

            "Pending litigation" means (1) a written notice to an agency which sets forth a demand for legal relief or which asserts a legal right stating the intention to institute an action before a court if such relief or right is not granted by the agency; (2) the service of a complaint against an agency returnable to a court which seeks to enforce or implement legal relief or a legal right; or (3) the agency's consideration of action to enforce or implement legal relief or a legal right.  (Emphasis added.)

 

            23.  It is found that the developer's remarks were recorded in the minutes of the respondent's March meeting.

 

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            24.  It is found that the developer's remarks as recorded in the minutes of the respondent's March meeting failed to allege any causes of action or to threaten litigation.

 

            25.  It is found that the fact that the comments of the developer were reduced to writing by the respondent as part of the minutes of its March meeting does not satisfy the "written demand" requirement set forth in either 1-18a(g) or 1-18a(h), G.S.

 

            26.  It is found that the respondent failed to prove that the developer provided any written notice to CHFA setting forth either a demand for legal relief or asserting an intention to sue.

 

            27.  It is concluded that the respondent failed to prove that the developer's remarks ripened into either a pending claim or pending litigation within the meaning of either 1-18a(g) or 1-18a(h), G.S.

 

            28.  It is concluded that the respondent could not lawfully convene an executive session for the purposes set forth in 1-18a(e)(2), G.S.

 

            29.  It is found that subsequent to the respondent's March vote to reject the Project, the Project proposal was revised.

 

            30.  It is found that prior to the August meeting, the respondent commissioned an advisory report from its financial consultant on the Project, Shelby Chodos.

 

            31.  It is found that a report assessing the risks associated with the revised Project proposal was prepared by Shelby Chodos (hereinafter "Chodos Report").

 

            32.  It is found that the Chodos Report was labeled a "draft" document.

 

            33.  It is found that the Chodos Report was submitted to the respondent at its August meeting for review, discussion and comment.

 

            34.  It is found that the respondent's request for, and discussion of the Chodos Report occurred as part of its deliberative process to determine CHFA's role in the Project.

 

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            35.  It is found that the Chodos Report is a public record as defined in 1-18a(d), G.S.

 

            36.  At the hearing the respondent argued that it was also entitled to convene an executive session at its August meeting to discuss the "draft form" of the Chodos Report concerning the Project.

 

            37.  Specifically, the respondent maintained that the Chodos Report was a preliminary draft document exempt from public disclosure and properly discussed in an executive session.

 

            38.  It is found that neither the designation or characterization of information as "draft" or "preliminary" in form, nor the possibility of revision alone make a document draft or preliminary within the meaning of 1-19(b)(1), G.S.

 

            39.  Section 1-18a(e)(5), G.S., states:

 

            "Executive session" means a meeting of a public agency at which the public is excluded for one or more of the following purposes... (5) discussion of any matter which would result in the disclosure of public records or the information contained therein described in subsection (b) of section 1-19.

 

            40.  It is found that the respondent is relying upon the preliminary drafts or notes exemption discussed in 1-19(b)(1), G.S.

 

            41.  Under 1-19(b)(1), G.S., the disclosure of preliminary drafts or notes is not required "provided the public agency has determined that the public interest in withholding such documents clearly outweighs the public interest in disclosure."

 

            42.  At the August meeting and at the Commission hearing, the respondent asserted that it determined that it would not be in the public interest to discuss the Chodos Report publicly.

 

            43.  It is found that at the August meeting the respondent did not disclose the facts upon which it relied to make its determination that CHFA's interest in nondisclosure "clearly outweighed" the public's interest in disclosure of the Chodos Report.

 

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            44.  However, at the hearing the respondent argued that it chose to discuss the Report in closed session because it did not want to increase the potential for litigation, or disadvantage itself in future negotiations with the developer.

 

            45.  The respondent also suggested that the complexity and magnitude of the financing for the proposal made it a difficult topic for discussion at an open meeting.

 

            46.  It is found that the reasons that the respondent articulated for withholding disclosure of the Chodos Report were not well-founded.

 

            47.  It is found that the respondent failed to prove that it in good faith considered the effect of nondisclosure of the Chodos Report upon the public.

 

            48.  It is found that the respondent failed to adequately prove that it properly conducted the requisite balancing test regarding disclosure of the Chodos Report in light of the clearly substantial public interest in disclosure.

 

            49.  It is concluded that the respondent failed to prove that the Chodos Report that was prepared for its August meeting was exempt from disclosure within the meaning of 1-19(b)(1), G.S.

 

            50.  It is found that an additional inquiry is whether the Chodos Report would have been properly disclosable under the statutory adjunct to 1-19(b)(1), G.S., found in 1-19(c)(1), G.S., notwithstanding the respondent's representation that 1-19(b)(1), G.S., was applicable.

 

            51.  Section 1-19(c)(1), G.S., states that:

 

            Notwithstanding the provisions of subdivision (1) of subsection (b) of this section, disclosure shall be required of (1) interagency or intra-agency memoranda or letters, advisory opinions, recommendations or any report comprising part of the process by which governmental decisions and policies are formulated, except disclosure shall not be required of a preliminary draft of a memorandum, prepared by a member of the staff of a public agency, which is subject to revision prior to submission to, or discussion among the members of such agency,...(Emphasis added.)

 

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            52.  It is found that the Chodos Report was commissioned for use by the respondent during its deliberations about the Project.

 

            53.  Specifically, it is found that the Chodos Report was intended to assist the respondent as it examined CHFA's role in, and the feasibility of financing the Project.

 

            54.  The respondent concedes that the Chodos Report provided guidance in its deliberations about the "complex financial, legal and societal implications of the Ninth Square proposal."

 

            55.  It is found that the Chodos Report contained information that assessed the risks associated with the Project, in light of revisions made to the proposal, and offered suggestions for how the respondent could best minimize those risks.

 

            56.  It is found that prior to, and at the time of its August meeting, the respondent was considering whether or not it should reconsider and change its position regarding involvement in financing the Project.

 

            57.  It is found that exactly fourteen days following the August meeting, at its September 12, 1991 meeting, the respondent approved the proposal and committed the necessary financing to the Project.

 

            58.  The respondent also concedes that on or about September 12, 1991, the Chodos Report was made available to members of the public and press.

 

            59.  It is found that the Chodos Report disclosed to the public on or about September 12, 1991, was identical in form and substance to the Chodos Report submitted to the respondent at its August 1991 meeting.  The date on the Report was changed, but the text of the Report was the same.

 

            60.  It is found that the Chodos Report was not prepared by a staff member of the respondent agency within the meaning of 1-19(c), G.S.

 

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            61.  It is concluded that the Chodos Report did not meet the criteria for exemption from disclosure set forth in either 1-19(b)(1) or 1-19(c)(1), G.S.

 

            62.  It is also concluded that the respondent failed to demonstrate that the executive session was properly convened for the purpose of protecting disclosure of the contents of a document exempt from disclosure pursuant to 1-19(b), G.S.

 

            63.  It is therefore concluded that the respondent violated the provisions of 1-18a(e) and 1-21(a), G.S., when it discussed the Chodos Report and other matters concerning the Project in executive session.

 

            64.  It is further concluded that the complainants were wrongfully denied their right to attend such discussions as required by 1-21, G.S.

 

            The following order by the Commission is hereby recommended on the basis of the record concerning the above-captioned complaint:

 

            1.  Henceforth the respondent shall convene in executive session only for the specific purposes set forth in 1-18a(e)(1)-(5), G.S.

 

            2.  Henceforth the respondent shall act in strict compliance with the open meetings provisions clearly set forth in 1-21, G.S.

 

            3.  Within fourteen days of the date of mailing the notice of final decision in this case, the respondent shall provide to the complainants, either a copy of the Chodos Report dated on or about August 29, 1991, or an affidavit that none exists in the CHFA files or custody of any CHFA member.

 

Approved by Order of the Freedom of Information Commission at its regular meeting of June 10, 1992.

 

                                                                 

                                    Karen J.Haggett

                                    Clerk of the Commission

 

Docket #FIC 91-277                           Page 9

 

PURSUANT TO SECTION 4-180(c), G.S. THE FOLLOWING ARE THE NAMES OF EACH PARTY AND THE MOST RECENT MAILING ADDRESS, PROVIDED TO THE FREEDOM OF INFORMATION COMMISSION, OF THE PARTIES OR THEIR AUTHORIZED REPRESENTATIVE.

THE PARTIES TO THIS CONTESTED CASE ARE:

 

                                                                 

                                    Karen J.Haggett

                                    Clerk of the Commission