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Preliminary AG opinon: Public has right to state pension information

By   /   May 24, 2011  /   2 Comments

By PHIL DRAKE

HELENA – The public has a right to know the retirement benefits they are paying state employees, according to a preliminary opinion by the state attorney general prompted by a request from Montana Watchdog.

In October, Teachers’ Retirement System (TRS) officials asked Attorney General Steve Bullock for an opinion as to whether they could release the names of the top 10 people and the pension and benefit amounts they are receiving from the state.

Montana Watchdog had made the request, stating it was following up on a story in which the State Administration and Veterans’ Affairs Legislative Interim Committee (SAVA) was reviewing the 100 highest annual retirement benefit amounts paid by the TRS and the Montana Public Employees’ Retirement System (MPERS), two state-sponsored retirement systems. Names of the recipients were not provided.

In his memo to Denise Pizzini, chief legal counsel of the TRS, Bullock wrote: “That retirees of the Teachers’ Retirement System of the State of Montana do not have an individual right of privacy in the amount of their retirement benefit that clearly exceeds the public’s right to know.”

Kevin O’Brien, a spokesman for the attorney general, warned the opinion was not final.

“It’s important to understand that this is a draft that went out to interested parties for comment – it should not be described as the official opinion of this office, as it’s only a draft,” he wrote in an email. It was not immediately known when the opinion would become final.

David Senn, executive director of TRS, said he and his staff were reviewing the attorney general’s preliminary opinion. He said he would discuss the matter with the TRS board and other impacted parties.

In late August, Montana Watchdog reported Montana’s top retiree gets $116,587 in annual benefits with 29 others receiving more than $70,000. This was according to a study prepared for SAVA reviewing pension costs for the TRS and MPERS.

Bullock said the state Constitution supports his decision and cited Article 2 Section 9: “No person shall be deprived of the right to examine documents or to observe the deliberations of all public bodies or agencies of state government and its subdivisions, except in cases in which the demand of individual privacy clearly exceeds the merits of public disclosure.”

He also noted “It is further conceded that the information requested constitutes ‘documents of public bodies subject to public inspection.’ The question presented instead turns on “whether the demand of individual privacy clearly exceeds the merits of public disclosure.”

“… I conclude that even if the TRS members had a constitutionally protected right to privacy, when balanced against the public’s right to know, that right to privacy does not ‘clearly exceed the merits of public disclosure,’” Bullock wrote.

He said his office has already opined that employees’ names, salaries, job titles and other employment information was subject to public disclosure.

“Such information helps the public to understand how the state is using its tax dollars and what budget priorities the state has set for those dollars,” he wrote. “Accordingly, such information is crucial to fostering the public’s trust in government.”

The request involving retirees’ names and benefits is somewhat different, he wrote.

“However, it is not so different as to tip the scales to conclude that the retirees’ right to privacy now ‘clearly exceeds’ the public’s right to know,” Bullock stated.

He said the TRS members’ retirement benefits were earned while they were public employees and subject to public disclosures.

“Likewise, their retirement benefits are paid by public funds and, necessarily, subject to the public’s same interest in understanding how the government is functioning.

In September, Mike Meloy, an attorney who offers advice to the Montana Newspaper Association, offered a similar opinion to Montana Watchdog.

“I don’t think a public employee has an expectation of privacy with respect to salary and benefits, including public retirement benefits,” he said in a September e-mail to Montana Watchdog.  “So it’s public information.”

In the TRS, the top 10 employees received between $96,759 and $72,253 in annual benefits. And in the PERS, the top 10 employees made $116,587 to $81,360 in annual benefits, according to the report.

On the lower end of the scale, the 100th top recipient in the TRS received $48,872 in annual benefits and the 100th person listed on the PERS received $55,496.

Montana Watchdog requested more information but the TRS and MPERS both said the information was confidential but each would ask the 10 recipients for permission to release their names.

PERS said their top 10 recipients all declined to have their names and information released. Senn of the TRS said one person queried said the information could be released. Senn said he wanted an opinion from the attorney general.

Below is a copy of Bullock’s opinion. No date was listed at the top of the memo.

Dear Ms. Pizzini:

You have requested my opinion on the following question:

Whether a retiree of the Teachers’ Retirement System of the State of Montana has an individual right of privacy in the amount of his or her retirement benefit that clearly exceeds the public’s right to know.

According to your letter, in August, 2010, the State Administration and Veterans’ Affairs Legislative Interim Committee (“SAVA Committee”) requested information from the Legislative Audit Division on the 100 highest annual retirement benefit amounts paid by the Montana Teachers’ Retirement System (“TRS”) and the Montana Public Employees’ Retirement System. The Legislative Audit Division provided the requested information to the SAVA Committee as a ranked listing of the 100 highest annual benefit amounts paid by each retirement system. The information provided by the Legislative Audit Division did not include any information by which individual retirees’ could be identified.

On Aug. 24, 2010, the executive director of TRS received a written request via email from a media outlet, which stated in part:

Last week I was at a SAVA meeting and members reviewed a list of the top 100 annual retirement benefits to retirees. I am looking into the story a little deeper. I would like the names, job titles, government agency for the top 10 TRS retirees.

According to your letter, TRS does not gather job title information on its member and therefore could not provide that information. Otherwise, if granted, the request would match individual retirees’ benefit amount with their names and agency.

TRS then sent written notices to the retirees at issue, inquiring whether they would be willing to waive any privacy interest they may have in the requested information and authorize TRS to disclose the information pursuant to the media request. Each TRS retiree was informed that their information would be provided pursuant to the request only if they returned a signed and notarized authorization form. TRS further indicated that a retirees’ failure to respond would be construed as the individual having declined to waive his or her privacy rights and therefore declining to authorize TRS to disclose the information.

Of the ten retirees whose information was at issue, only one returned the signed and notarized authorization. That individual’s information was therefore disclosed pursuant to the request. Another retiree provided a written statement to TRS specifically asserting a privacy interest. Another called TRS asserting a privacy interest. The other seven retirees provided no response. Accordingly, TRS construed their silence as declining to waive their privacy interests and authorize TRS to disclose the information.

The Montana Constitution, Article II, § 9, grants the public’s right to know:

No person shall be deprived of the right to examine documents or to observe the deliberations of all public bodies or agencies of state government and its subdivisions, except in cases in which the demand of individual privacy clearly exceeds the merits of public disclosure.

Various statutes, such as Mont. Code Ann. § 2-6-101, specifically provide public access to government documents. Mont. Code Ann. § 2-6-101(1) states, “Every citizen has a right to inspect and take a copy of any public writings of this state….” The Montana Supreme Court has held that the public right to know includes the media. Jefferson County v. Montana Standard, 2003 MT 304, ¶ 13, 318 Mont. 173, 79 P.3d 805.

Montana’s right to privacy is found at Article II, § 10 of the Montana Constitution, and provides, “The right of individual privacy is essential to the well-being of a free society and shall not be infringed without the showing of a compelling state interest.”

It is “well established” that Montana’s constitutional right to know is not absolute. Yellowstone County v. Billings Gazette, 2006 MT 218, ¶ 19, 333 Mont. 390, ¶ 19, 143 P.3d 135, ¶ 19 (citations omitted). As set forth in Becky v. Butte-Silver Bow Sch. Dist. 1, 274 Mont. 131, 136, 906 P.2d 193, 196 (1995), when reviewing situations involving Montana’s constitutional right to know, a three-step process is involved:

First, we consider whether the provision applies to the particular political subdivision against whom enforcement is sought. Second, we determine whether the documents in question are ‘documents of public bodies’ subject to public inspection. Finally, if the first two requirements are satisfied, we decide whether a privacy interest is present, and if so, whether the demand of individual privacy clearly exceeds the merits of public disclosure.

Here it is uncontested that Montana Constitution, Article II, § 9, applies to TRS. It is further conceded that the information requested constitutes “documents of public bodies” subject to public inspection. The question presented instead turns on whether a privacy interest is present and, if so, “whether the demand of individual privacy clearly exceeds the merits of public disclosure.”  Becky, 274 Mont. at 136, 906 P.2d at 196. If the demand for individual privacy clearly exceeds the public’s right to know public disclosure is not required. Yellowstone Co., ¶ 19, citing Bryan v. Yellowstone Co. Elem. Sch. Dist. No. 2, 2002 MT 264, ¶ 33, 312 Mont. 257, ¶ 33, 60 P.3d 381, ¶ 33.

The Montana Supreme Court has established a two-part test to determine whether an individual has a protected privacy interest under Article II, § 10, of the Montana Constitution. Jefferson County, ¶ 15 (citation omitted). A person has a constitutionally protected privacy interest when he or she has a subjective or actual expectation of privacy that society is willing to recognize as reasonable. Lincoln County Com‘n v. Nixon, 1998 MT 298, ¶ 16, 292 Mont. 42, ¶ 16, 968 P.2d 1141, ¶ 16 (citation omitted).”  Under this test, if it is determined that a constitutional right to privacy exists, it must then be balanced against the constitutional right to know. Mont. Health Care Assn. v. Mont. Bd. of Directors, 256 Mont. 146, 150, 845 P.2d 113, 116 (1993). As stated above, only if the demand for individual privacy clearly exceeds the public’s right to know is public disclosure not required. Yellowstone Co., ¶ 19 (citation omitted). 

Good reason exists to conclude the TRS retirees had some expectation of privacy in their retirement benefits. At least nine of the ten retirees either explicitly or implicitly asserted a privacy interest in the information sought. This suggests that they had at least a subjective expectation of privacy concerning their retirement benefits. Further, TRS’ own policies may have created an actual expectation of privacy on the part of the retirees. As your letter points out, generally TRS does not publish or otherwise make publicly available the financial information and benefits of its members. Moreover, the TRS’ “Member’s Retirement Plan Handbook” provides:

RELEASE OF INFORMATION

Most retirement and benefit information is confidential and may only be released to the member, benefit recipient, or an authorized person.

The TRS receives many requests for information from banks, accountants, attorneys, spouses, and other interested parties. Even though most requests are made on behalf of the member or benefit recipient, state law prohibits the release of any confidential information unless the member consents in writing, or we are otherwise required to release the information. Information may be released directly to the member, benefit recipient, or to another person designated by the member in writing.

However, our analysis does not end there. While the TRS members may have had an expectation of privacy, that expectation is only constitutionally protected if society recognizes it as reasonable. Lincoln County, ¶ 16. Whether society would recognize the TRS members’ expectation of privacy in their publicly funded retirement benefits is a more difficult question.

However, it is not necessary to reach that issue today because I conclude that even if the TRS members had a constitutionally protected right to privacy, when balanced against the public’s right to know, that right to privacy does not “clearly exceed the merits of public disclosure.” Yellowstone Co., ¶ 19. It is well established through previous opinions of this office that public employees’ names, addresses, salary, job titles, merit pay, vacation and sick leave, dates of employment, and hours worked may be subject to public disclosure. See 38 Op. Atty Gen. Mont. No. 109 (Oct. 16, 1980), 41 Op. Atty Gen. Mont. No. 35 (Nov. 13, 1985), 43 Op. Atty Gen. Mont. No. 6 (Feb. 27, 1989), 44 Op. Atty Gen Mont. No. 32 (May 1, 1992). Such information helps the public to understand how the state is using its tax dollars and what budget priorities the state has set for those dollars. Accordingly, such information is crucial to fostering the public’s trust in government.

The present situation, involving retirees’ names and retirement benefits, admittedly is somewhat different. However, it is not so different as to tip the scales to conclude that the retirees’ right to privacy now “clearly exceeds” the public’s right to know. This is particularly true in light of the fact that the Montana Supreme Court has indicated under Article II, § 9, of the Montana Constitution, the public’s right to know is essentially presumed. See Bryan, ¶ 39. The TRS members’ retirement benefits were earned while they were public employees and subject to the same public disclosures as discussed above. Likewise, their retirement benefits are paid by public funds and, necessarily, subject to the public’s same interest in understanding how the government is functioning.

This conclusion is consistent with other states which have concluded retirees’ information is subject to public disclosure laws. See Pulitzer Publishing Co. v. Mo. State Employees Ret. System, 927 S.W.2d 477 (Mo. App. 1996), Seattle Fire Fighters Union v. Hollister, 737 P.2d 1302 (Wash. App. 1987), Mergenthaler v. Commonwealth State Employees’ Retirement Bd., 372 A.2d 944 (Pa. Cmmw. 1977).

THEREFORE IT IS MY OPINION

That retirees of the Teachers’ Retirement System of the State of Montana do not have an individual right of privacy in the amount of their retirement benefit that clearly exceeds the public’s right to know.

Sincerely,

Steve Bullock

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Phil Drake

  • Rep. Mike Miller, HD84

    It is too bad that the Governor felt he heeded to veto Rep. Burnett’s HB444 that would have put the State checkbook online. Then the citizens would know where their money was being spent. It is almost amusing that the Governor asked for ideas from Montana citizens to help cut costs and yet refuses to tell us what the costs actually are.

  • Dave Lewis

    Rep. Burnett has a great analysis of pay levels he extracted from state data base. All public information.