State Univ. v. STATE EMPLOYEES'RET. BD.

• Decision Date: 12 August 2005
• Citation: 880 A.2d 757
• Parties: The PENNSYLVANIA STATE UNIVERSITY, Richard Althouse, Rodney A. Erickson, Joseph V. Paterno, and Gary C. Schultz, Petitioners v. STATE EMPLOYEES' RETIREMENT BOARD, Respondent.
• Court: Pennsylvania Commonwealth Court

880 A.2d 757

The PENNSYLVANIA STATE UNIVERSITY, Richard Althouse, Rodney A. Erickson, Joseph V. Paterno, and Gary C. Schultz, Petitioners v. STATE EMPLOYEES' RETIREMENT BOARD, Respondent.

Commonwealth Court of Pennsylvania.

Argued May 4, 2005.

Decided August 12, 2005.

John A. Snyder, State College, for petitioner, Pennsylvania State University.

Brian E. McDonough, Harrisburg, for respondent, State Employees' Retirement Board.

Craig J. Staudenmaier, for intervenor, Patriot-News Co.

BEFORE: COLINS, President Judge, McGINLEY, Judge, PELLEGRINI, Judge, FRIEDMAN, Judge, and COHN JUBELIRER, Judge.

OPINION BY Judge McGINLEY.

This is an appeal from the order of the State Employees' Retirement Board (Board) which granted a Right to Know Act¹ (RTKA) request made by The Patriot-News to-News Company (Patriot-News) and its journalist Jan Murphy (Murphy).

On December 19, 2002, Murphy, a reporter for Patriot-News, requested, via email, documents revealing the years of credited service, current salary, and salary history for certain members of the State Employees' Retirement System (SERS) employed by The Pennsylvania State University (PSU), including: (1) Richard Althouse, University Budget Officer; (2) Rodney Erickson, Executive Vice President and Provost; (3) Gary Schultz, Senior Vice President of Finance and Business/Treasurer; and (4) Joseph Paterno, Professor of Physical Education and Head Football Coach (hereinafter referred to as "Employees"). Murphy specifically stated that her request did not include "Social Security numbers, home addresses or telephone numbers." E-Mail from Jan Murphy to Director of Communications, Sean Sanderson, December 19, 2002, at 1.

Before responding, SERS notified PSU of the RTKA request. Through its counsel, PSU communicated its opposition. Employees and PSU claimed the salary information was private information that could not be disclosed without violating Employees' constitutionally protected rights of privacy. Employees and PSU claimed the request was simply a means to obtain, through the "back door" from SERS, information that they could not obtain directly from PSU.

On March 19, 2003, the Board issued a Rule to Show Cause and ordered SERS to participate in the proceeding to assist in ensuring an adequate record. SERS pointed out that Public Information Policies (PIPS) adopted by the Board did not address a situation where active employees of PSU, a non-state agency which is not subject to the RTKA, contested the release of their service and salary information from SERS. According to SERS, the PIPS merely contemplated the release of salary and service histories from members employed by state agencies and did not address the specific nuances of the current situation involving PSU (a non-state agency) which had never been litigated before the Board.

On October 22, 2003, a hearing examiner conducted a hearing on Employees' objections to the RTKA request. Testimony and exhibits were presented by the parties. The parties jointly stipulated to the following pertinent facts:

3. [PSU] is a state-related institution of higher education . . .

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11. [Murphy] is . . . a reporter for the Patriot-News Company and is a citizen of the Commonwealth of Pennsylvania.

12. Patriot-News Company is the Publisher of the Patriot News and the Sunday Patriot News, both newspapers of general circulation in central Pennsylvania. The newspapers routinely contain articles addressing the workings of state agencies and, in particular, their use of state tax revenues.

13. SERS is the state agency responsible for administering the State Employees Retirement Code ("Retirement Code"), 71 Pa.C.S. §§ 5101-5956, which is a defined benefit plan for state employees.²

14. In accordance with the provisions of the Retirement Code, 71 Pa.C.S. §§ 5101 et seq., and by special legislation amending that statute, employees of [PSU] are eligible, but not required, to participate in the retirement plan administered and operated by SERS.

15. Over 6,400 [PSU] employees participate in the SERS retirement plan.

16. Currently, [PSU] employees make a selection as between SERS and/or TIAA-CREF shortly after they are hired.

* * *

20. On a regular basis, [PSU] is required to furnish to SERS information that [PSU] believes is private and confidential and that [PSU] treats as private and confidential, including the retirement-covered "compensation", as that phrase is defined in 71 Pa.C.S. § 5102, of its participating employees, for the purpose of establishing and administering the employees' retirement accounts with SERS.

21. Retirement covered "compensation" is closely related to salary information and is a type of personal financial information that [PSU] believes is, and treats as confidential.

22. The information provided by [PSU] to SERS is provided for the purpose of allowing the SERS Board to fulfill its statutory duties to its members, including the PSU Employee Respondents herein.

* * *

24. On both a bi-weekly and a monthly basis, a magnetic computer tape is prepared by [PSU].

25. SERS issues to various reporting agencies and institutions, including [PSU] a document known as the "State Employees' Retirement System Magnetic/Electronic Media Reporting Instructions for Transmission of Member's Data" ("Magnetic/Electronic Reporting Instructions").

26. The Magnetic/Electronic Reporting Instructions mandate specific data fields that are to be included by the reporting entity for the participating employees, as well as a description of the format in which the data should be transmitted.

27. The data fields transmitted by [PSU] to SERS on a bi-weekly and monthly basis include the employee's name, social security number, address, monthly/bi weekly compensation, hours worked, amount of retirement contribution deducted, county of residence, and retirement class.

* * *

29. On a bi-weekly basis, a check is drafted and transmitted to SERS as payment for that period's employee contributions.

30. [PSU's] employer contributions are paid quarterly to SERS following the receipt of an invoice from SERS requesting same. Like the employee contributions, the employer contributions are paid via a paper check which is transmitted by [PSU] to SERS.

* * *

38. SERS treats requests for "salary information" as if they are requests for retirement-covered "compensation."

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48. In the ordinary course of business, SERS and the PSU Employee Respondents have communicated regarding their accounts. These communications typically include correspondence, account statements and other membership materials ...

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57. SERS invests the employer and employee contributions.

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66. At the time of Murphy's request [Employees] were all "active members" of SERS.

67. At the time of Murphy's request, SERS had in its possession the information requested, that is, salary information and years of credited service, in a form which could have been provided

. . .

75. SERS maintains records of its members' compensation, both current and historic, and years of credited service.

76. SERS provides annually to its members a statement of account showing compensation information, years of credited service and the projected retirement benefit. The information regarding years of credited service and compensation information is provided to calculate a projected retirement benefit. The projected retirement benefit is an estimate that is subject to change.

77. The information employed by SERS in providing active members with their annual Account Statements . . . is among other things, as follows: the member's age, years of credited service and salary history.

* * *

84. In the defined benefit plan, SERS' members receive statutorily defined benefits that are guaranteed by the state, pursuant to a statutory formula.

Stipulation, October 15, 2003, at 2-13.

On May 10, 2004, the SERS hearing examiner issued his recommendation that the RTKA request be granted because the information requested was a public record to which no exception applied and for which no law barred disclosure. PSU and Employees filed exceptions. On November 16, 2004, the Board denied the exceptions and granted the RTKA request. The Board concluded that the compensation and service credit information requested by Patriot-News and Murphy was an "account voucher or contract dealing with the receipt or disbursement of funds by SERS" and that Employees did not have a privacy right in their compensation information sufficient to defeat a request for those SERS records under the RTKA. Board Opinion, November 16, 2004, at 28.

PSU and Employees appealed the decision of the Board by filing a Petition for Review in this Court. There are two issues presented:³ (1) whether the salary and earnings information requested by Patriot-News and Murphy is a "public record" under the RTKA, and if so, (2) whether the information is protected from disclosure under the "personal security" and "restricted information" exceptions under the RTKA?

1. The Right to Know Act

Section 2(a) of the RTKA provides that "a public record shall be accessible for inspection and duplication by a requester ;in accordance with this act.... Public records shall be available for access during the regular business hours of an agency. Nothing in this act shall provide for access to a record which is not a public record." 65 P.S. § 66.2(a).

Section 1 of the RTKA defines "public record" as "[a]ny account, voucher or contract dealing with the receipt or disbursement of funds by an agency ... and any minute, order or decision by an agency fixing the personal or property rights, privileges, immunities, duties or obligations of any person or group of persons." 65 P.S. § 66.1. Excluded from the RTKA's definition of "public record", in relevant part, is "any record, document. . . which is restricted . . . which would operate to the prejudice or impairment of a person's reputation or personal security.. . ." 65 P.S. § 66.1.

The intent of the RTKA is to allow any...