Open meeting violation dispute began in 2005

From The Spokesman-Review

Betsy Z. Russell
Staff writer
May 26, 2007

BOISE – The Idaho Supreme Court on Friday scolded Ada County commissioners for their protracted litigation over an open meeting violation, but ruled partly in their favor and partly against them.

The ruling sets no precedent because the clause in question, defining when government boards can hold closed meetings to talk with their attorneys about lawsuits, was amended by the Legislature this year. The commissioners also failed to record in their minutes the motion to close the meeting, as specifically required in the open meeting law; they said they had a tape recording of that.

“The commissioners concede that the votes are not recorded in the handwritten notes from the meeting, and apparently concluded that litigating this issue was of more consequence than the expedient of transcribing the recording for a few dollars,” Chief Justice Gerald Schroeder wrote acidly in the ruling.

Since it began in 2005, the case has cost county residents thousands of dollars in legal fees.

The dispute centered around a closed-door meeting the three commissioners of the state’s most-populated county held in 2005 with a Boise city councilman to discuss city-county relations. The commissioners, Rick Yzaguirre, Judy Peavey-Derr and Fred Tilman, justified the closed meeting by citing the “litigation exception” to the Idaho Open Meeting Law, saying they were discussing issues about which there would probably be lawsuits.

The Idaho attorney general prosecuted the commissioners for violating the open meeting law and fined them $150 apiece, in part because they didn’t have their attorney present – which the attorney general said was necessary for the meeting to fall under the litigation exception. The violation regarding the minutes also was noted. The commissioners counter-sued, but an Ada County district court sided with the state and imposed the fines.

The commissioners then appealed to the Idaho Supreme Court.

The court found that the old law could have allowed a closed meeting on litigation without an attorney’s presence, but it was unclear whether the commissioners could be fined because a lower court would have to review evidence on whether they knew they were violating the law. It remanded the case back to district court for further proceedings on that question, though it ruled against the commissioners on the minutes issue.

“To the attorney general’s office, I think the most important element of this case was that there was a violation of the open meeting law, and the Supreme Court has affirmed that,” Bob Cooper, spokesman for Attorney General Lawrence Wasden, said Friday. “We have an obligation to enforce the law.”

Neither the commissioners nor their public information officer was available for comment Friday on the ruling.

While the appeal was pending, the Legislature this year overwhelmingly voted to amend the Open Meeting Law, changing the litigation exception to make it clear that closed government meetings to discuss a pending or imminent lawsuit involving the agency must include the agency’s lawyer.

The new law says closed meetings regarding litigation can be held only “to communicate with legal counsel for the public agency to discuss the legal ramifications of and legal options for pending litigation, or controversies not yet being litigated but imminently likely to be litigated. The mere presence of legal counsel at an executive session does not satisfy this requirement.”

The previous law, which will be replaced by the new law on July 1, allowed a government board to hold a closed meeting “to consider and advise its legal representatives in pending litigation or where there is a general public awareness of probable litigation.”

Much of the debate in the case was about the grammar of that sentence, and how to weigh the “and,” “in” and “or.”

Justice Jim Jones dissented in part from the otherwise unanimous decision, writing that his analysis of the previous law showed it required the attorney’s presence.

“Although this case has been somewhat mooted by the Legislature’s 2007 amendment … it is worthwhile to make mention of the long-standing policy in Idaho of maintaining openness in government,” Jones wrote. “That requires narrow construction of any exception to the openness rule, including openness at meetings of government bodies.”

From The Spokesman-Review

Editorial from the Idaho Statesman

Unfortunately, not all of last week’s public records news was good.

On Thursday, District Judge Michael McLaughlin said the State Tax Commission does not have to release records justifying a tax break granted to Cabela’s.

Cabela’s does not have to collect sales taxes on its online and catalog sales to Idahoans. Cabela’s has said there is no connection between its retail stores and its Internet and catalog sales divisions — the “nexus,” according to the legalese, that would require the chain to collect taxes on all sales. The commission seconded Cabela’s reading of the law — but since the commission hasn’t released its records, we have no idea why.

Taxpayers deserve some answers.

In siding with Cabela’s, the tax commission is forgoing some sales tax collections. How come?

The state gave Cabela’s a considerable competitive edge in the online and catalog sales sectors — eight months before this trophy buck in the outdoor retail industry opened its first Idaho store. How come?

McLaughlin ruled against the Statesman, which has gone to court demanding the Tax Commission records. All Idahoans lost, though. We all deserve to see tax law interpreted in a transparent environment.

Whether they’re e-mails between county employees or correspondence between tax collectors and business leaders, public records ensure accountability. Public records protect your right to know — and more importantly, your right to understand how your government works.

But only when public records are made public.

Editorial from the Idaho Statesman

Editorial from the Idaho Statesman

To: Public Employees-All.
From: The Idaho Statesman editorial board.
Date: May 8, 2007.
Re: BTW …

… if you’re a public employee using a public e-mail account on taxpayer time, you have generated a public record.

Duh.

Believe it or not, the Idaho Supreme Court was actually asked to settle this. IMHO, the court probably had more serious legal issues to deal with, but what do you do?

Kootenai County commissioners went to the Supreme Court because they didn’t want to release more than 1,000 e-mails between Prosecutor Bill Douglas and Marina Kalani, who used to run a federally funded juvenile drug court in Kootenai County.

A newspaper, the Spokesman-Review in Spokane, Wash., wanted the e-mails so it can figure out what went wrong with the court’s drug program, which was shut down in 2005. The county argued the e-mails were private, and Kalani argued that they should be treated the same as personnel records. Douglas told the Spokesman-Review that the e-mails “constitute nothing more than innocent sarcasm, bantering and joking between myself and a subordinate.”

We’ll judge for ourselves. The court certainly did. “It is clear the e-mails contain information relating to the conduct and administration of the public’s business,” says Supreme Court Justice Roger Burdick. He was speaking on behalf of the Supreme Court, which ruled 5-0 Friday to release the e-mails.

FYI, the court got this absolutely right.

The five justices read the law. Especially this part: “There is a presumption that all public records in Idaho are open at all reasonable times for inspection except as otherwise expressly provided by statute.”

Take it from the court: There’s no exemption covering “innocent sarcasm, bantering and joking.”

The court gets it. Douglas doesn’t seem to. Here’s what he told the Spokesman-Review after the court ruling. “There is no privacy right in private e-mails between government employees, and I feel that is unfortunate.”

LOL.

When public employees use their public e-mail accounts to communicate, what exactly is private about that?

We hope the Supreme Court decision clarifies any conclusion. If you have questions, do not hesitate to e-mail. But be careful what you write. Taxpayers could be reading. It’s their right, you know … 😉

Editorial from the Idaho Statesman

But coordinator’s settlement exempt

From the Spokesman-Review

Bill Morlin
Staff writer

The Idaho Supreme Court ruled unanimously Friday that more than 1,000 e-mails exchanged between Kootenai County Prosecutor Bill Douglas and a woman administering a federally funded juvenile court drug program are public records, not exempt from disclosure.

“It is clear that the e-mails contain information relating to the conduct and administration of the public’s business,” Justice Roger Burdick wrote in the 11-page opinion, with the court’s four other justices concurring.

The ruling came 30 days after the state’s highest court, sitting in Coeur d’Alene, heard oral arguments whether the public should be able to see e-mails between Douglas and Marina Kalani as well as an insurance settlement agreement with Kalani, the former coordinator of the Juvenile Drug Court program.

The Idaho Counties Risk Management Program, representing Kootenai County, agreed to pay Kalani $69,146 to settle a defamation damage claim she filed against the county after resigning in March 2005.

Reporters with The Spokesman-Review sought access to the settlement agreement about the same time they filed public records requests for the e-mails exchanged between her and Douglas between February 2004 and February 2005.

Idaho District Court Judge John Stegner ruled in July 2005 that the e-mails were public records but the settlement agreement was exempt from disclosure. Friday’s Supreme Court ruling completely backed the lower court’s decision.

The Supreme Court ruled that Idaho law allows for the release only of settlement amounts and statistical data, holding that “any other information contained in the settlement agreement or records relating to Kalani’s claim are exempt from disclosure.”

“This decision is an important victory for open government in Idaho,” said attorney Tracy LeRoy, who argued the case for the newspaper.

“This is the first public records case in Idaho to address e-mails as public records, and the court recognized that e-mails between government officials and employees that are investigated by county officials are the public’s business,” LeRoy said.

“We are gratified that the court affirmed the public’s right to investigate through public records how the county and its officials conduct public business,” the newspaper attorney added.

The court’s ruling is expected to affect a similar pending lawsuit in which the newspaper is attempting to gain public access to e-mails of Rick Baughman, Kootenai County’s former chief deputy prosecutor, who is facing sexual harassment allegations by two female co-workers.

In that case, Stegner ruled last month that Baughman’s e-mails on his county computers also should be available for public inspection, but he declined to order their release until the Supreme Court ruling in the Douglas-Kalani case.

Although he didn’t join in the appeal to the Supreme Court, Douglas expressed displeasure with the ruling.

“The court has now given us a bright-line rule: There is no privacy right in private e-mails between government employees, and I feel that is unfortunate,” the prosecutor said Friday afternoon.

Douglas said the court’s ruling, “while accepted by me, will have a chilling effect on e-mail communication about matters employees wish to remain private but do not otherwise violate any law.”

The Supreme Court ruling said Idaho’s public records act gives every person the “right to examine and take a copy of any public record of this state” unless there is a specific exemption.

Kalani’s attorney, Greg Horne, argued the e-mails between his client and the prosecutor were confidential, personnel records and should be exempt from disclosure.

But the Supreme Court didn’t buy that, saying the “public has a legitimate interest in these communications between this elected official and the employee whom he hired and supervised.”

Asked to comment Friday, Horne said, “I really don’t have much to say. I’m disappointed. It’s not appropriate to say much more until I have a chance to talk with my client.”

The court noted that when the juvenile drug court’s financial problems and eventual demise were reported in the media, Douglas defended Kalani’s management to the Board of County Commissioners and the public.

“The e-mail’s content relates to the public’s business because the public’s business includes job performance by a county employee, the spending policies of a county program, the issues surrounding the program’s demise, other employment-related claims and the validity and circumstances surrounding (Kalani’s) claim,” the court’s ruling said.

Douglas said the ruling means a government employee “can no longer complain about a co-worker, adverse work conditions, a supervisor, or act as a whistle-blower without fear of reprisal or that the complaint will become the public’s domain.”

“There never has been a county or state policy prohibiting use of e-mail for private communication, but those policies now ring hollow in light of (this) decision,” he said.

The prosecutor said the e-mails “will be released in an orderly fashion as directed by the court.”

“Unfortunately,” he said, “these e-mails have been the subject of unfair speculation about their nature, (but) they contain nothing obscene or unlawful.

“They constitute nothing more than innocent sarcasm, bantering, and joking between myself and a subordinate, and the type of informal communications that occurs daily in every workplace in America,” Douglas said.

“Unfortunately, some will place unfair speculation on their intent, regardless of content,” he said. “They contain no distasteful attachments. I would only hope that these are reviewed in proper context, and I would be glad to answer any questions about any individual e-mail when they are released.”

From the Spokesman-Review

Newspaper plans to appeal decision; judge says state law clearly exempts tax information from disclosure

By Ken Dey

From the Idaho Statesman

A judge has denied the Idaho Statesman’s request for documents about the state’s decision to allow Cabela’s not to collect sales taxes from the outdoor retailer’s online and catalog customers in Idaho.

District Judge Michael McLaughlin in Boise sided with the Idaho Tax Commission, saying he couldn’t ignore the “plain and obvious” language of state law that exempts tax information from public disclosure.

“The policy reasons for this exemption are obvious,” McLaughlin said in his ruling Thursday. “Taxpayers want to know what their tax liability will be before they engage in an enterprise or action that would subject them to unknown tax consequences.”

The Statesman was disappointed and plans to appeal, Editor Vicki S. Gowler said.

“We aren’t interested in their private tax information,” Gowler said. “But when government decides who or what to tax, that process needs to be open.”

Before opening its Boise store, the Nebraska-based company requested a declaratory ruling from the tax commission to determine whether Idaho would require the company to collect taxes.

Idaho law says companies that have a substantial presence or “nexus” in the state must collect sales tax from their Idaho online and catalog customers. Cabela’s maintains that its retail operations and online operations are two separate companies, so the nexus provision doesn’t apply.

On Dec. 12, 2005, the tax commission issued a ruling granting Cabela’s the tax exemption.

McLaughlin said the declaratory ruling process required the company to disclose sensitive information to the commission. Opening such information to the public would make Cabela’s and other taxpayers “extremely reluctant” to participate in the process, he said.

Other states where Cabela’s has built stores have granted similar exemptions, but some states have fought the company.

From the Idaho Statesman

From the Post Register

REXBURG — District Court Judge Brent Moss said Monday that attorneys in a disputed civil case involving Melaleuca Inc. and a former employee will get the first crack at deciding what the public should and should not know.

Moss did not directly address Melaleuca’s request that documents in its suit against Jeff Wasden, the company’s former vice president of marketing, be sealed and the courtroom be closed to the public.

The Post Register has challenged that request.

But Moss did say that Melaleuca attorney Curt Thomsen and Wasden’s lawyer, Ron Swafford, need to determine what proprietary business records or trade secrets should not be part of the public domain.

Once agreed upon, those records would be covered under a protection order that prevents Wasden from talking publicly about the case.

“That’s why the protection order is in place,” Moss said.

This debate about closed records took place mainly behind closed doors Monday.

Moss spent roughly 30 minutes in his chambers with Thomsen, Swafford and Post Register attorney Steve Wright, attempting to hammer out a compromise on a case that has become increasingly public.

Melaleuca and its CEO, Frank VanderSloot, sued Wasden for allegedly violating a separation agreement and recruiting key employees.

Wasden denies this and in a counter claim accused Melaleuca of breach of contract and VanderSloot of defamation.

After each side disqualified one judge, District Court Judge Darren Simpson was handed the case. But he stepped down after Wasden filed court documents saying he could not get a fair trial because of VanderSloot’s support of Simpson during last year’s election.

Moss’ ruling Monday essentially slowed what has become a frantic paper war between lawyers on both sides of the dispute and the Post Register.

In asking the court to seal all documents pertaining to the case, Thomsen wrote that, “The Post Register has failed to demonstrate any colorable interest it may have in a private employment dispute between Melaleuca and one of its former employees, that exceeds the general curiosity of anyone else in the community, beyond the unusual but well-known and long-standing acrimony the Post Register has nurtured against Frank L. VanderSloot.”

But in a brief filed Monday morning, Wright wrote that Melaleuca’s legitimate trade secrets are entitled to protection and the Post Register has no interest in publishing them. That information could simply be redacted from the court file, Wright said.

Wright wrote that the possibility of trade secrets being revealed is not a reason to seal all documents in the case or to shut the public out of the courtroom.

“This sledge hammer approach is clearly unacceptable where the Constitution and the law require the use of a scalpel,” Wright wrote.

Wright said the newspaper would wait to see how broadly Swafford and Thomsen define “proprietary business records” and “trade secrets” before deciding upon a next step.

Moss made clear Monday that he plans to treat the dispute as just another case.

The disagreement between Melaleuca and Wasden — and the flap over Simpson and whether the court documents and proceedings should be sealed — has inspired several newspaper and television stories. It’s also caught the attention of political bloggers. And Melaleuca employees recently took out a two-page advertisement in the Post Register lauding the company.

“I don’t want this case tried in the newspaper or on the television screen,” Moss said.

VanderSloot, fresh off a trip to Cuba with a contingent of business leaders and Gov. Butch Otter, spent Monday morning in the plaintiff’s chair while his attorney met behind closed doors with the judge.

“Judge Moss stated today that he is going to handle this like any other case,” VanderSloot said in an e-mail Monday afternoon. “I think that is all that anyone could ask.”

Senior reporter Corey Taule can be reached at 542-6754.

”I don’t want this case tried in the newspaper or on the television screen.”

From the Post Register

Editorial from the Idaho Statesman

Bad ideas surface at the end of any legislative session. Some zip through both houses during the rush to adjournment.

In the worst last-minute act of the 2007 session, lawmakers created a $15 million economic reserve slush fund. The money could well be up for grabs today, during a water summit orchestrated by Gov. Butch Otter. Portions of the daylong summit will be closed to the public.

This is certainly no way to spend tax money. Even Otter dislikes the process for spending the $15 million. However, legislators set this in motion with its hasty passage of House Bill 330.

The timeline: The budget-writing House Appropriations Committee introduced the bill on March 28; the bill passed the House 52-12 on March 29; and the bill passed the Senate 25-7 on March 30, the final day of the session.

These 77 lawmakers were, at the risk of a bad pun, logrolled. The last-minute spending bill also earmarked $3.5 million in state money for cash-strapped rural schools in Idaho timber country. The idea is to have a contingency that could replace a federal program that, in turn, has replaced declining timber receipts in past years.

With this as bait, lawmakers put a separate $15 million into the hands of a legislative Gang of Four: Senate President Pro Tem Robert Geddes, R-Soda Springs; House Speaker Lawerence Denney, R-Midvale; Senate Finance Committee Chairman Dean Cameron, R-Rupert; and House Appropriations Chairwoman Maxine Bell, R-Jerome. HB 330 empowers these lawmakers to decide how the Department of Commerce spends the money, although lawmakers must get Otter’s “concurrence.”

Where might the money go? Perhaps, as the speculation goes, to buy out some water users who might otherwise get left dry this summer. Cameron, usually one of the Legislature’s clear-eyed pragmatists, dismisses the suggestion of an under-the-table handout during the closed portions of today’s summit. “I don’t believe for a moment that the decision on spending that money will be made behind closed doors,” Cameron told The Associated Press.

Trouble is, when you combine closed meetings with a big uncommitted lump of dollars, it’s not too much of a stretch to put the two together.

Things get worse. When lawmakers rushed to create this $15 million slush fund, they didn’t take the time to trouble themselves with the Constitution. They allowed a few of their own to decide whether to release this money to a state agency. Otter cannot act unless the lawmakers act first. This “quite possibly” violates the Constitution’s separation of powers language, Deputy Attorney General Mitchell Toryanski wrote on March 30, the day the Senate approved the bill.

As Otter testily but fairly put in a letter to Denney last week, “I refuse to be an active party to the Legislature’s usurpation of executive authority.” Otter doubted the courts gave him the ability to veto a line item of a spending bill, so he allowed the bill to become law without his signature. To his credit, Otter at least gave this bad idea considerably more thought than legislators had.

Editorial from the Idaho Statesman

Editorial from the Idaho Mountain Express

Smoothies at the Idaho State Tax Commission seem to regard the public as undeserving rubes who just fell off the turnip truck.

Why else the full-fledged commission cover-up to conceal paperwork involved in handing out a major tax break to a Wall Street corporation?

Not everyone has accepted this finger in the eye. The Idaho Statesman has wisely sued to force the commission to open tax-exemption paperwork involving Cabela’s, a giant retail and catalog sports gear corporation, whose online Internet sales were generously exempted from Idaho sales taxes with a blatantly deceitful description that minimized Cabela’s “presence” in Idaho.

It’s a familiar smokescreen the commission is using for handing out favors to big business—claiming that disclosing Cabela’s financial data would reveal proprietary information to competitors.

Hogwash. The Boise newspaper doesn’t even want financial data, just Tax Commission papers justifying the exemption.

Cabela’s is a $2 billion, shareholder-owned corporation listed on the New York Stock Exchange, whose 2006 annual report also is online—all 114 pages with minutia about sources of income and how much, liabilities and how much, and, yes, income taxes and how much, among other things.

What’s the State Tax Commission hiding that it considers privileged? Has Cabela’s told it something that it won’t tell shareholders in its government-required annual report?

If Cabela’s shareholders, the NYSE, the Securities and Exchange Commission and financial media know the company’s financial situation, what else went on in those secret deliberations?

Editorial from the Idaho Mountain Express

From the Times-News

Observe carefully how the Idaho Supreme Court decides a case involving improper e-mail messages between two public employees. Pay even closer attention to how the court rules on a financial settlement related to the same matter.

Those issues of the public’s right to observe government are central to the case involving The Spokesman-Review newspaper of Spokane, Wash., and officials in Kootenai County. The ruling is expected this summer and could have far-reaching implications for government agencies throughout Idaho.

Supreme Court justices heard arguments last week on the dispute involving Kootenai County Prosecutor Bill Douglas, former Juvenile Drug Court Supervisor Marina Kalani, and hundreds of e-mails written between them.

The case is an appeal from a July 2005 ruling by 2nd District Judge John R. Stegner. The Spokesman-Review sued to see the e-mail records in order to investigate the drug court’s demise, and whether it was tied to an inappropriate working relationship between Douglas and Kalani.

When the drug court was dissolved, Kalani filed a claim against the county and got a $70,000 settlement through the Idaho Counties Risk Management Program. ICRMP is an insurance payout system funded by taxpayer money. It has funded similar settlements reached in southern Idaho counties.

Stegner ruled in favor of the newspaper for public access to the e-mails under Idaho’s Public Records Law. Kalani appealed and her lawyer argued that the e-mails were personal in nature, and warranted exemption from the law.

That’s a feeble argument when the officials worked on public time using computers bought on the public’s dime. Stegner’s ruling should send a message to other local and state officials that the electronic age does not exempt them from public record laws. E-mail expedites government transactions, but messages sent are still subject to public disclosure.

Yet the same public record laws are more intricate with the actual settlement. Stegner ruled the Kootenai County settlement with Kalani was a public document because it involves public business and payout of public funds. But state laws only require that “statistical data and actual amounts paid” be released to the public.

The judge called that language the equivalent of a poke in the public’s eye.

“Should public records such as this be exempt from disclosure, the public’s ability to monitor actions of agencies like ICRMP and to be aware of how public funds are expended by this agency would be seriously curtailed.”

Fast-forward to this month’s arguments before the justices, and it’s easy to see the relevance to all local government. The question of whether e-mails are public records should be a soft pitch for the high court. But if the ruling to seal settlement terms is also reaffirmed – all because of terse language in state laws – it points to a larger fight.

When courts can’t force government to reveal information directly related to the use of taxes, legislative remedies should be necessary. Taxpayers finally deserve a right to see how and why their funds are spent on surreptitious legal deals.

From the Times-News

Editorial from the Idaho Statesman

No public resource is more important to Idaho than water.

It’s unacceptable, then, for Gov. Butch Otter to plan nearly half a day of closed meetings at his water summit next week. It’s also troubling to see a guest list heavy on traditional rural water users and skimpy on the urban interests that will reshape Idaho water use in the future.

A public resource should be discussed in an all-inclusive public forum, not in what an Otter news release describes as a series of “closed-door caucuses and private discussions.”

There’s nothing illegal about the closed meetings. Otter and his tightly structured group of invitees — 18 active negotiators and 20 “alternates” — do not comprise a public agency, so the Idaho Open Meeting Law does not apply.

However, there’s a considerable difference between what’s legal and what’s good policy. Closed sessions invite skepticism. The itinerary — closed meetings, sandwiched by public sessions in the morning and late afternoon — suggests the open meetings are window dressing, with the real discussions held behind closed doors.

In a sense, the closed sessions are the guts of the summit, scheduled for Tuesday in Burley. The closed meetings will allow water users to hold “frank discussions” about stretching a scant water supply in 2007, interim state Department of Water Resources Director David Tuthill said Tuesday.

“Those solutions are urgently needed,” he said. “There presently is not enough water for all uses.”

This water is not private property, however — as closed negotiations imply.

Another problem transcends this year’s crisis. Otter’s invitation-only process gives short shrift to urban and industrial users, demands that will grow as Idaho grows.

Otter’s guest list skews heavily to rural water users and ag groups, with some local elected officials and staffers and utility reps in the mix. Tuthill says the summit will involve groups that are new to the water debate. Still, of the 38 negotiators and alternates, only three come from Ada County, and none come from Canyon County.

This is, make no mistake, a rural summit. This may adequately represent the current demand for water in a state where ag accounts for 87.8 percent of use. This also represents the current struggle, pitting Idahoans who hold old rights for canal and spring water against Idahoans who hold newer rights to water from the Eastern Snake Plain Aquifer.

It takes no imagination and little foresight to see that the next round of water wars could center on the tension between rural and urban use. Otter need only look to the south, where a 280-mile pipeline is proposed to meet Las Vegas’ ever-expanding municipal thirst, and Utah is seeking a 120-mile pipeline to water the growing city of St. George.

Closed caucuses between current water users do little to instill public trust — and do little to prevent another round of contentious water battles in the future.

Editorial from the Idaho Statesman