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                          Novaber 17, 1987




    Honorable Mike Toomev                Opinion No. JM-821
    Chairman
    Judiciary Committee                  Re: Whether   a volunteer
    Texas House of Representatives       fire department is subject
    P. 0. Box 2910                       to the Open Records Act,
    Austin, Texas   78769                article 6252-17a, V.T.C.S.
                                         (RQ-1225)

    Dear Representative   Toomey:

         You ask whether     a volunteer  fire department   that
    receives public funds through a contract with a rural fire
    prevention   district   constitutes  a "governmental   body"
    under the Texas Open Records Act, article          6252-17a,
    V.T.C.S.   your concern   focuses on the Cy-Fair Volunteer
    Fire Department,    which you state is organized       as a
    nonprofit corporation under Texas law. you indicate that
    the department receives public funds through a contract
    with the Harris County Rural Fire Prevention District No.
    9 to perform fire fighting services in the district.      At
    various   times, members    of the public have requested
    records from the district.

         The Open Records Act applies to governmental   bodies
    as defined  in section 2 of the act.      Section  2(l)(A)
    describes the state agencies covered by the act. Sections
    Z(~)(B)-(E) list specific types of local governing  bodies
    or their subdivisions that are covered by the act.       A
    volunteer fire department does not fall within     any of
    these specific descriptions.    Section 2(l)(F) provides
    that a "governmental body" also includes

           the part, section, or portion       of every
           organization,    corporation,     commission,
           committee, institution, or agency which     is
           suvvorted in whole or in nart bv nublic
           funds, or which      exnends DUbliC    funds.
           Public funds as used herein shall mean funds
           of the State of Texas or any governmental
           subdivision thereof.   (Emphasis added.)




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Honorable Mike Toomey - Page 2      (JM-821)
                                                                     .




Private nonprofit   corporations can       fall within   this
provision.  See, e.s., Open Records        Decision Nos. 302
(1982); 228 (1979).                                              .---.

     The primary   issue in determining      whether   certain
private entities are "governmental     bodies" under the act
is whether  they are supported     in whole or in part by
public funds or whether they expend public funds.          See
A.H. Belo Cornoration v. Southern Methodist       University,
734 S.W.2d 720. 723      (Tex. App. - Dallas      1987, writ
pending); Attorney General Opinions JM-154 (1984): JM-116
(1983): Open Records    Decision Nos. 343, 302 (1982); 228
(1979); see also Kneeland v. National Colleoiate      Athletic
Association, 650 F. Supp. 1047, 1056 (W.D. Tex. 1986); cf.
Attorney General Opinions JM-596      (1986); JM-120   (1983).
In A. - H. Belo -Corvoration       v.    Southern    Methodist
Universitv, sunra, the court held that certain         private
schools' athletic deoartments       are not     llsovernmental
bodies" under the Open Records Act because they did not
receive public   funds.    The member    schools,   state and
private, retained a predetermined      amount of funds from
gate receipts and from broadcasting fees. The remaining
funds were forwarded to the Southwest Athletic      Conference
(SWC) and other schools. The SWC retained a predetermined        ?
amount and distributed    the rest to member schools.      The
court reasoned that the departments         did not receive
"public funds" within the meaning        of section    2(l)(F)
because the money distributed by the SWC did not consti-
tute the "funds of the State of Texas or any governmental
subdivision thereof." The court concluded that, because
the funds never "vested" in any school, including a public
school, the funds did not constitute "public funds."       See
734 S.W.2d at 723.

     The contract between the Cy-Fair Volunteer        Fire
Department and the Harris County Fire Prevention   District
No. 9, however,    expressly  involves a transfer   to the
department of the bulk of funds received by the district
from its tax collections,    less the district's   adminis-
trative costs.   In the A.H. Belo case, the court dis-
tinguished Open Records Decision No. 228 on the basis that
it clearly   involved public    funds; funds    transferred
directly from a governmental body to the private entity in
question.  The case at hand is similar. Thus, this case
is not one in which the governmental body acts only as a
conduit for funds.

     The receipt of public funds for the general  support
of the activities .of a private organization brings  that




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Honorable Mike Toomey - Page 3      (JM-821)




organization within the definition    of a "governmental
body." Open Records Decision No. 228.     For example,   in
Open Records Decision No. 228, this office determined that
a private, nonprofit corporation chartered to promote the
interests of the Dallas-Fort Worth metropolitan area was a
governmental body under the Open Records Act because     of
its contract with the city of Fort Worth. The contract
did not impose 'Iaspecific and definite obligation on the
commission to provide  a measurable amount of service    in
exchange for a certain amount of money as would be
expected in a typical arms-length   contract for services
between a vendor and purchaser."    Open Records   Decision
No. 228.    The corporation was not simply a vendor      or
independent contractor who provided goods or services to a
governmental body in an arms-length     transaction.    For
these reasons, the decision determined that the contract
funds were for the general    support of the corporation
rather than for specific measurable      services.     Con-
sequently, the corporation was supported in part by public
funds within the meaning of section 2(l)(F) of the Open
Records Act.    Id.; see also Attorney    General Opinion
JM-116 (1983): Open Records Decision No. 302 (1982).

     In contrast,    Open Records Decision No. 343      (1982)
determined that a private, nonprofit      corporation    under
contract with a hospital district to provide        emergency
medical service is not a "governmental body" because       the
applicable contract provided that the corporation       should
receive "each month a sum equal to the differences between
cash receipts and approved operating expenditures of the
ambulance   service ."   The   decision  stated that      this
language imposed a definite obligation to make a "specific
payment for specific measurable    services" rather than to
provide   for general support.      The decision    did    not
indicate how the payment of monthly      operating   expenses
through this formula constitutes payment      for "specific
measurable services" or how that payment     can be distin-
guished from general monthly support. The Vest*' applied
in Decision 343 is part of the test adopted and applied in
Open Records Decision No. 228. The VUtestVV  was formulated
in Decision No. 228, however, to help distinguish          the
"private" nonprofit corporation from a private vendor who
sells goods or services to a governmental        body.     The
"test" cannot be applied mechanically.    The precise manner
of funding is       not the sole     dispositive   issue    in
determining whether an entity falls under the Open Records
Act.




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Honorable Mike Toomey - Page 4     (JM-821)




     Other aspects of a contract or relationship involving
the transfer of public funds between a private and public
entity must be considered in determining whether a private
entity is a l@governmental body" under the Open Records
Act.    For example, a contract     or relationship      that
involves public funds and that indicates a common purpose
or objective or that creates an agency-type    relationship1
between a private entity and a public entity will bring
the private entity within the section 2(l)(F) definition
of a "governmental body." See Open Records Decision      Nos.
302, 228; see also Kneeland v. National           Colleaiate
Athletic   Association,   m      (following Open      Records
Decision No. 228). For example, Open Records Decision No.
228 cited a provision of the contract which directed      the
private   entity to continue to carry out the common
objectives it held with the city. Structuring a contract
that involves public funds to provide a formula to compute
a fixed amount of money.for a fixed period of time will
not automatically      prevent a    private    entity    from
constituting a VVgovernmental body" under section     2(l)(F)
of the Open Records Act. The overall nature           of the
relationship   created by the contract      is relevant     in
determining whether the private     entity   is so closely
associated with the governmental    body that the private
entity falls within the Open Records Act. As indicated,
the precise manner of funding is not the sole dispositive
issue in determining whether   an entity falls under the
Open Records Act. For this reason, the determination        in
Open Records     Decision No.   ,343 with     regard to      a
"governmental body" under the act should not be relied
upon.2



      1. It should .be noted that the common purpose    or
agency-type relationship  that will subject .a "private"
entity to the Open Records Act is not the equivalent of an
agency relationship for purposes of tort liability.    gg
cenerallv Attorney General Opinion JM-748 (1987).

      2. Review of the contract at issue in Open Records
Decision No. 343 reveals that the contract did not involve
'Iaspecific  and definite  obligation on the [entity] to
provide a measurable amount of service in exchange    for a
certain amount of money as would be expected   in a typical
arms-length contract  for services between a vendor     and
purchaser."  &g   Open Records  Decision No. 228    (1979).
                                       (Footnote Continued)




                         p. 3906
    ,
        Honorable Mike Toomey - Page 5 (JM-821)
    c

h


              Additionally,    when    volunteer    fire     departments
        contract with a political        subdivision,    considerations
        apply to them that ordinarily set them apart from private
        vendors of goods and services who typically           deal with
        governmental bodies    in arms-length     transactions.     Fire
        protection is one of the services traditionally         provided
        by governmental bodies. Snn. Citv of Coleman v. Rhone, 222
        S.W.2d 646 (Tex. Civ. App. - Eastland 1949, writ ref'd).
        Although no statute expressly makes nonprofit          volunteer
        fire departments subject to the Open Records Act or labels
        them governmental     bodies   for other purposes,       several
        statutes recognize that they may have strong affiliations
        with public agencies.     See. e.a., V.T.C.S.       art. 8309h,
        §1(2)    (political   subdivisions    may    bring     volunteer
        firefighters within workers compensation coverage):         art.
        6243e.3 (political subdivision may opt to provide         relief
        and retirement    benefits to volunteer firefighters):        see
        ~&g Tex. Const. art. III, 551-d (legislature may provide
        benefits    for survivors of members of volunteer            fire
        departments    killed in     the performance     of    "official
        duties").    These considerations make it more likely that a
        nonprofit volunteer    fire department    that enters    into a
        contract with a public entity will fall within the Open
        Records Act.      Whether or not a particular          nonprofit
        volunteer fire department     falls within the Open Records
        Act depends on the circumstances in each case, including
        the terms of the contract between the department and the
        public entity. See Schwartzman v. Merritt Island Volun-
        teer Fire Denartment,    352 So. 2d 1230 (Fla. APP. - 4th
        Dist. 1977), c r       denied    358 So.2d 132      (Fla. 1978)
         (cited in Open Ee&rds DeciLion No. 228 (1979)).

             The contract between the Cy-Fair Volunteer   Fire
        Department and the Harris County Rural Fire Prevention
        District No. 9 involves the general    support of the
        activities of the department with public   funds.  The
        contract provides:

                   The Department will provide the emergency
                ambulance  services, the fire     prevention


        (Footnote Continued)
        For example, the hospital district provided ambulances for
        the ambulance service and provided for the general monthly
        operating expenses of the service. The service could not
        make expenditures,   including hiring personnel,   without
        district approval.




                                   p. 3907
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Honorable Mike Toomey - Page 6     UM-821)




       services, the fire fighting services in the
       geographic District and will not look to the
       District to arovide anv services whatsoever
       excevt for the wrovidina of funds to enable
       the Denartment to carrv on its duties    and
       resnonsibilities.   (Emphasis added.)

Thus, the department receives public funds to provide     all
of the district's    needed services.    Additionally,    the
contract involves the submission by the department to the
district of one-year   operating budgets   and'a three-year
capital expenditure   budget  for planning   purposes.    The
contract also provides for a form of continuing        annual
renewals.  Consequently,   the contract provides     for the
general support of the department for purposes of section
2(l)(F) of the Open Records Act.

     As indicated, section 2(l)(F) covers only "the part,
section, or portion" of corporations supported by public
funds. See Open Records   Decision No. 228.    Accordingly,
the department  must comply with the Open Records Act
to the extent that it receives public     funds from the
district.  Because the contract requires the department to
maintain a separate accounting of the expenditure of funds
received from the district, this **partial" coverage should
not require undue delay in responding to requests        for
information under the Open Records Act.

                        SUMMARY

          The Cy-Fair Volunteer Fire Department,   a
       nonprofit corporation,  is a "governmental
       body" within the meaning of section 2 (1) (F)
       of the Texas Open Records Act, article
       6252-17a, V.T.C.S., to the extent that it is
       supported by public funds received pursuant
       to its contract with the Harris County Rural
       Fire Prevention District No. 9.

                                       Very truly yo   s


                                   J        k;,     lldJ%
                                       JIM      MATTOX
                                       Attorney General of Texas

MARY KELLER
Executive Assistant Attorney General




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Honorable Mike Toomey - Page 7    (JM-821)




JUDGE ZOLLIE STEAKLEY
Special Assistant Attorney General

RICK GILPIN
Chairman, Opinion Committee

Prepared by Jennifer Riggs
Assistant Attorney General




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