Freedom at $140 Per Hour: How Daily & Woods Fleeces Taxpayers Through AFOIA

Assume you are an Arkansas citizen.1 Further assume that you have an interest in seeing some public records pursuant to the Arkansas Freedom of Information Act (“AFOIA”).

If those records are in the possession of the City of Little Rock, fulfillment of your request will generally cost you a couple cents per page.

If you make your request to a state-level agency, the records will likely not cost you anything in most instances2.

Furthermore, in both instances, if you request the records in electronic format, sent to you via email, the cost drops to zero (assuming the custodian of those records has the necessary hardware and software to provide them electronically).

Perhaps most importantly — at least for purposes of this post — in both examples above, no costs will be passed on directly to taxpayers because of your request.3  The actual budgets for the City of Little Rock and the state agencies do not change, and the expenditures of those agencies do not appreciably increase as a direct result of your having requested public records.

These outcomes make perfect sense; after all, the AFOIA explicitly states:

Except as provided in § 25-19-109 or by law, any fee for copies shall not exceed the actual costs of reproduction, including the costs of the medium of reproduction, supplies, equipment, and maintenance, but not including existing agency personnel time associated with searching for, retrieving, reviewing, or copying the records.

Should the records that you seek be in the possession of the City of Fort Smith, however, things are different: In Fort Smith, it very frequently happens that your request costs the taxpayers $140 per hour, even if it costs you nothing because you asked for electronic copies.

“How is that possible,” you ask?

Like so many other questionable things in that town, the answer is “because of Daily & Woods.”

Say, for example, you are aware of the fact that the AFOIA does not contain an exemption for attorney-client privilege,4 so you send a request to Daily & Woods for their work-product in a case, asking for all of those records to be provided in electronic format.  Let’s say you were even nice and provided them with the applicable caselaw in your request.  When you later look at Daily & Woods’ invoice to the City of Fort Smith for that time period, you would see the following entries:

Re: FOIA. Legal research regarding work product; phone conference with Attorney General’s office regarding possible meeting with members of Arkansas General Assembly (2).  1.30 hours.  $182.00.

Re: Police Department – FOIA Request. E-mail from Attorney Campbell regarding AFOIA request in three cases with police department; letter to Mr. Gosack; conference with Attorneys Canfield and Wade; review Arkansas AFOIA; telephone call to Attorney Campbell, left voicemail; locate and print requested e-mails and documents; telephone conference with Attorney Campbell regarding FOIA request; letter to Attorney Campbell; gather documents from file to comply with request.  4.10 hours.  $574.00.

Re: FOIA.  Letter from Attorney Campbell; initial review of file re requested documents; two letters from Attorney Roe; review letter from Attorney Campbell to Attorney Roe.  0.70 hours. $98.00.

Re: Police Department FOIA Request. Continue gathering documents in response to request.  0.30 hours.  $42.00.

Re: FOIA.  Review files and retrieve records for FOIA requests.  2.30 hours.  $322.00.

Re: Police Department FOIA Request.  Complete the accumulation of documents in response to request; conference with Attorney Carson; telephone call to Attorney Campbell, left voice mail; draft letter to Attorney Campbell.  1.90 hours.  $266.00.

Re: FOIA.  Further review files and retrieve and organize records for FOIA request; conference with Attorney Roe.  3.30 hours.  $462.00.

All told, that’s $1,484 charged by Daily & Woods to the taxpayers of Fort Smith in response to a single AFOIA request, solely for providing public records that were created and maintained at public expense.

And it’s not just when a person makes a request to Daily & Woods directly; the city, for whatever reason, has made Daily & Woods the de facto reviewer of many (if not most) requests. For example, in February 2014 alone, they reviewed requests sent to the Fire Department, Deputy City Administrator Jeff Dingman, and City Administrator Ray Gosack (x2), at a total of $478.00.

Think about that for a second. A person sends a FOIA request to the Fire Department. In Little Rock, Fayetteville, Springdale, Conway, and nearly every other city of appreciable size, while that request might cost the requesting party a few cents per page, the Fire Department could ask the city attorney in those cities for an opinion on the request without incurring any additional cost to the city. In Fort Smith, merely by checking with the city’s legal department, the Fire Department costs the taxpayers money. If that’s not a massive red flag about Fort Smith’s relationship with Daily & Woods, I don’t know what is.

It’s worse than just being a red flag, however; it’s also pretty clearly illegal.

First, as noted above, “any fee for copies shall not exceed the actual costs of reproduction…not including existing agency personnel time associated with searching for, retrieving, reviewing, or copying the records.” Obviously, a city department (or Daily & Woods themselves) could not charge the requesting party for the firm’s time in reviewing or responding to an AFOIA request.  Yet, for whatever reason, Daily & Woods thinks they can charge a fee to the taxpayers that they could not charge to the requesting party.

Furthermore, as John J. Watkins and Richard J. Peltz note in “The Arkansas Freedom of Information Act (5th Edition)”5:

Just as a public entity may not turn public records into a “cash cow,” so a private contractor may not profit from records insofar as they are already maintained at public expense.  Consistently with the established proposition under the FOIA that public access may not be subverted through outsourcing, a private contractor may be subject to the FOIA as a record custodian.  Accordingly, the FOIA requires that contractors as well as public entities employ software and hardware tools that contemplate public access.  Similarly, the fee-control provision of the FOIA apply to private contractors when they are the custodians of public records.

It is well-settled that a private contractor cannot do anything under the AFOIA that a public entity could not do. Everyone agrees (or should agree, at least) that a public entity could not bill the requesting party or the city (e.g. the taxpayers) for personnel time expended in response to an AFOIA request.  Accordingly, Daily & Woods, as a private contractor, is similarly precluded from billing the requesting party or the taxpayers for their time.  A public entity cannot turn public records into a profit-making enterprise — they are legally required to charge nothing more than the actual cost of reproduction.  Likewise, because a public entity cannot bill the requesting party or the taxpayers for legal work performed by in-house counsel in response to an AFOIA request, neither can Fort Smith expend taxpayers’ money for Daily & Woods’ time spent on AFOIA requests.

Does it matter that the city has a contract with Daily & Woods that allows the firm to charge $140 per hour for work done on behalf of the city?

In a word, no.6  Because, as the Arkansas Attorney General has explained, a city ordinance that is in conflict with the AFOIA is invalid.  If Fort Smith cannot pass an ordinance that is in contravention of the AFOIA, it certainly cannot circumvent the AFOIA through a contractual relationship with a third party, no matter how much that city might want to blindly pretend like the third party was above board.

In fact, if a person were so inclined, he could probably make the case that charging the city for reviewing AFOIA requests or complying with requests sent directly to Daily & Woods was illegal, irrespective of the language of the AFOIA. (Spoiler: I am so inclined.)

Under the City of Fort Smith Code of Business Conduct, municipal representatives — which includes Daily & Woods as city attorney — are prohibited from certain acts relative to city funds.  Specifically:

Conflicts of interest. Municipal representatives must avoid conflicts of interest involving the city or its business. A conflict of interest occurs when an individual’s private interest interferes in any way, or even appears to interfere, with the interests of the city as a whole.

[***]

Impartiality in the performance of duties. Municipal representatives will perform their duties without regard for personal benefit.

Financial interests. A municipal representative is prohibited from engaging in a financial transaction for his or her private business purposes as it relates to city business. 

It’s hard to look at those rules and see how it is not a problem for Daily & Woods to charge fees to taxpayers that the firm could not legally charge to anyone — requester or taxpayer — if they were just standard, in-house city attorneys.  Their private interest (profiting from AFOIA requests) certainly conflicts with the city’s interests (following the AFOIA and not paying unnecessary costs).  They perform their duties (AFOIA compliance) with an explicit regard for personal benefit (profit).  They engage in a financial transaction (billing the city) for private business purposes (profit) as it relates to city business (AFOIA compliance).

So, whether we’re looking at the AFOIA itself or simply looking city rules, it seems pretty straightforward that Daily & Woods’ role in complying with AFOIA requests in Fort Smith is troubling at best and illegal at worst.  (It is certainly yet another in a long line of questions about whether Daily & Woods’ contract with the city is good for anyone but Daily & Woods.)  Yet, based on previous actions by City Administrator Ray Gosack and certain City Directors, there is no chance that Fort Smith city government will step in and put a stop to this practice.  To the extent taxpayers want this behavior to stop, it will take a motivated Fort Smith resident who is willing to fight it directly.

*****

Epilogue: Did you see it?  Did you catch where Daily & Woods, in the form of Rick Wade, tipped their hand?  It was back up there near the top, where the quoted part of their July invoice read:

Re: FOIA. Legal research regarding work product; phone conference with Attorney General’s office regarding possible meeting with members of Arkansas General Assembly (2).  1.30 hours.  $182.00.

Ignore the part where they charged for research that they’ve previously done on more than one occasion, and just focus on the second part. Why would Rick Wade want to meet with two legislators to discuss work product and the AFOIA? I’m fairly certain it would not be to tell the lawmakers, “hey, guys, this whole thing about not having attorney-client privilege under the AFOIA is great and shouldn’t be changed at all!”

Which means, then, that Daily & Woods is so irritated by the fact that they have to be transparent and that people are questioning their billing practices that they literally want to go whine to a couple of legislators and try to get the law changed. Worse, they have the unmitigated gall to bill the taxpayers for a conversation aimed at killing accountability and transparency to those same taxpayers.

Regardless of how oddly impressive that level of hubris might be, this is something that everyone in Arkansas — not just Fort Smithians — needs to be aware of and ready to fight against.  Or, at least, everyone in Arkansas who values accountability in government.