A recent court decision should give notice to nonprofit entities across the state.

“It is a fundamental obligation of government to operate openly and provide public records as expediently and efficiently as possible in compliance with this Act.” That “Act” is the Illinois Freedom of Information Act (FOIA), and for decades, it has imposed a significant burden on public bodies to be transparent by providing public records to citizens when they request them. In 1978, this burden was extended to nonprofits that are considered “subsidiary bodies,” and therefore, “public bodies,” if the nonprofit lacks independence from public body control pursuant to factors announced in Rockford Newspapers, Inc. v. Northern Illinois Council on Alcoholism Drug Dependence.

A recent court decision from DuPage County, however, expanded this burden to include a private nonprofit (i.e., a nonprofit not subject to control of a public body), which potentially exposes many more nonprofits to having to disclose what they believe to be private records.

The Tribune Case
In 2015, the Chicago Tribune sued the College of DuPage and the College of DuPage Foundation after both organizations failed to produce certain records it requested under FOIA. The Tribune, College and Foundation each filed motions for summary judgment against each other, asking the court to rule in their respective favor as to whether the withheld records had to be produced. In February 2016, the court heard arguments on those motions. The Foundation argued it was not a subsidiary body of the College, and therefore, not a public body obliged to produce records under FOIA.

The court announced its surprise ruling on March 16, 2016. Notably, it agreed with the Foundation, finding that it was not a subsidiary body. Although the Foundation was staffed by College employees and the College funded the Foundation through facilities and equipment, the court found the College lacked control over the Foundation. The Foundation held its own legal structure and “an independent board of directors, whose voting members consist of prominent private citizens, who are not officers, directors or employees of [the College].” The College did not own the Foundation.

Despite this finding, the court went on to consider the case and stated the important question was whether the Foundation was contracted to perform a governmental function on behalf of the College. Under FOIA, the court observed, “a public record that is not in the possession of a public body, but is in the possession of a party with whom the agency has contracted to perform a governmental function on behalf of the public body, and that directly relates to the governmental function… shall be considered a public record of the public body.”

According to its bylaws, the Foundation’s purpose was to support the educational mission of the College by encouraging third parties to make donations and otherwise assist the College in providing broader educational opportunities. To that end, the College and Foundation entered into a Memorandum of Understanding under which the Foundation holds all private donations made to the College, regardless of whether or not the Foundation solicited the donations.

As a result, the court found the Foundation was under contract to perform a governmental function on behalf of a public body, and the particular record requested by the Tribune from the Foundation directly related to that governmental function. The court ruled in favor of the Tribune, directing the Foundation to turn over the requested record. This decision is believed to be the first time an Illinois court has ordered a private nonprofit to comply with FOIA.

Implications of the Ruling
The scope of what constitutes a “contract” with a public body and the type of records related to a “governmental function performed on behalf of a public body” are unclear following the Tribune decision. Consequently, a nonprofit should evaluate any requests for records it receives closely in light of this decision to determine, on a case-by-case basis, whether a request is one with which the nonprofit should comply. FOIA has strict time requirements by which responses must be provided, and consequently, this evaluation should take place immediately.

Unless and until the Chicago Tribune ruling is rejected by another court, certain nonprofit records will remain at risk of disclosure. Moreover, any failure by the nonprofit to properly handle a records request could subject it to a lawsuit, liability for the requesting party’s attorney’s fees, and civil penalties of up to $5,000. On the other hand, a nonprofit’s disclosure of too much information could adversely impact its ability to collect from private donors and possibly expose it to liability for disclosing personal or protected information. As a result of The Chicago Tribune v. College of DuPage, nonprofits should consider consulting with counsel on any records requests to minimize their liability exposure.

Chicago Tribune is a circuit court decision and is not binding on any other court. However, its rationale and the fact that the court has even taken such an approach, should give notice to nonprofit entities across the state. iBi

Stacy Crabtree is an attorney with Heyl Royster who focuses her practice on compliance, contracts and litigation for businesses, nonprofits, local units of government and school districts.