Matthew Scheffler v. Pension Reserves Investment Management Board (SPR 20232899)

The Commonwealth of Massachusetts William Francis Galvin, Secretary of the Commonwealth Public Records Division Manza Arthur Supervisor of Records December 15, 2023 SPR23/2899 John Fitzpatrick Records Access Officer Pension Reserves Investment Management Board 84 State Street, Suite 250 Boston, MA 02109 Dear Mr. Fitzpatrick: I have received the petition of Matthew Scheffler appealing the response of the Pension Reserves Investment Management Board (Board/PRIM) to a request for public records. See G. L. c. 66, § 10A; see also 950 C.M.R. 32.08(1). On September 20, 2023, Mr. Scheffler requested “executive summaries of [the] investments in Vista Equity Partners, Ares Management, Oak Hill, and Blue Owl.” The Board responded on October 10, 2023, providing multiple responsive records, and citing G. L. c. 32, § 23(6) for withholding others. On October 10, 2023, Mr. Scheffler requested “a list of all approved third-party reimbursements specifying the third-party who covered the reimbursement, the cost, and for which PRIM Board members, committee members, and employees dating back to 2010. [He] would also like the copy of the written disclosures of those third-party reimbursements as required by 930 CMR 5.08(2)(d)1 by the States Ethics Commission.” The Board responded on October 25 and 27, 2023, providing multiple responsive records and also providing a fee estimate for others. Following further correspondence with the Board concerning both requests, and unsatisfied with the Board’s responses, Mr. Scheffler appealed, and this case was opened as a result. Subsequent to the opening of this appeal, on December 11, 2023, an attorney for the Board provided a supplemental response to Mr. Scheffler and this office. The Public Records Law The Public Records Law strongly favors disclosure by creating a presumption that all governmental records are public records. G. L. c. 66, § 10A(d); 950 C.M.R. 32.03(4). “Public One Ashburton Place, Room 1719, Boston, Massachusetts 02108 • (617) 727-2832 • Fax: (617) 727-5914 sec.state.ma.us/pre • pre@sec.state.ma.us

John Fitzpatrick SPR23/2899 Page 2 December 15, 2023 records” is broadly defined to include all documentary materials or data, regardless of physical form or characteristics, made or received by any officer or employee of any agency or municipality of the Commonwealth, unless falling within a statutory exemption. G. L. c. 4, § 7(26). It is the burden of the records custodian to demonstrate the application of an exemption in order to withhold a requested record. G. L. c. 66, § 10(b)(iv); 950 C.M.R. 32.06(3); see also Dist. Att’y for the Norfolk Dist. v. Flatley, 419 Mass. 507, 511 (1995) (custodian has the burden of establishing the applicability of an exemption). To meet the specificity requirement a custodian must not only cite an exemption, but must also state why the exemption applies to the withheld or redacted portion of the responsive record. If there are any fees associated with a response, a written good faith estimate must be provided. G. L. c. 66, § 10(b)(viii); see also 950 C.M.R. 32.07(2). Once fees are paid, a records custodian must provide the responsive records. Fee Estimates - Agencies An agency may assess a reasonable fee for the production of a public record except those records that are freely available for public inspection. G. L. c. 66, § 10(d). The fees must reflect the actual cost of complying with a particular request. Id. A maximum fee of five cents ($.05) per page may be assessed for a black and white single or double-sided photocopy of a public record. G. L. c. 66, § 10(d)(i). Agencies may not assess a fee for the first four (4) hours of employee time to search for, compile, segregate, redact or reproduce the record or records requested. G. L. c. 66, § 10(d)(ii). Where appropriate, agencies may include as part of the fee an hourly rate equal to or less than the hourly rate attributed to the lowest paid employee who has the necessary skill required to search for, compile, segregate, redact or reproduce a record requested, but the fee shall not be more than $25 per hour. Id. A fee shall not be assessed for time spent segregating or redacting records unless such segregation or redaction is required by law or approved by the Supervisor of Records under a petition under G. L. c. 66, § 10(d)(iv). See G. L. c. 66, § 10(d)(ii); 950 C.M.R. 32.06(4). The Board’s October 25th Fee Estimate Regarding Mr. Scheffler’s October 10, 2023 request for “a list of all approved third-party reimbursements ... dating back to 2010,” in its October 25, and October 27, 2023 responses, the Board provided Mr. Scheffler with “Disclosures of Travel Expenses Pursuant to 930 CMR 5.08(2)(d)1 from Fiscal Year 2020-2023,” and provided a fee estimate of $875 “to produce responsive documents dated 2019 to 2010.” In the October 25th and October 27th responses, as well as in further correspondence on November 14 and November 30, 2023, the Board suggests that Mr. Scheffler modify the scope of his request. In a separate correspondence on October 26, 2023, Mr. Scheffler expressed willingness to narrow the scope of his request, and on October 27,

John Fitzpatrick SPR23/2899 Page 3 December 15, 2023 2023, requested to further discuss modifying the scope of his request with the Board. In light of both parties’ willingness to communicate in order to modify the scope of the request, I find it is unnecessary to opine on the Board’s October 25th fee estimate at this time. This office encourages Mr. Scheffler and the Board to continue to communicate directly in order to facilitate providing records more efficiently and affordably. See G. L. c. 66, § 10(b)(vii) (an agency shall suggest a reasonable modification of the scope of the request or offer to assist the requestor to modify the scope of the request if doing so would enable the agency to produce the records sought more efficiently and affordably). Any revision to the request would result in the requirement to issue a revised fee estimate. The Board’s October 10th and December 11th Responses Regarding Mr. Scheffler’s September 20, 2023 request for “executive summaries of ... investments,” in its October 10, 2023 response, the Board provides two responsive Board Meeting Agendas. In its December 11, 2023 response, the Board cites Exemption (a) and G. L. c. 32, § 23(6) for withholding “the Protected Board Meeting Agenda for August 15, 2023 and the Protected Investment Committee Meeting Agendas for August 15, 2023 and May 24, 2011 (the ‘Protected Documents’).” Exemption (a) Exemption (a), known as the statutory exemption, permits the withholding of records that are: specifically or by necessary implication exempted from disclosure by statute G. L. c. 4, § 7(26)(a). A governmental entity may use the statutory exemption as a basis for withholding requested materials where the language of the exempting statute relied upon expressly or necessarily implies that the public’s right to inspect records under the Public Records Law is restricted. See Att’y Gen. v. Collector of Lynn, 377 Mass. 151, 54 (1979); Ottaway Newspapers, Inc. v. Appeals Court, 372 Mass. 539, 545-46 (1977). This exemption creates two categories of exempt records. The first category includes records that are specifically exempt from disclosure by statute. Such statutes expressly state that such a record either “shall not be a public record,” “shall be kept confidential” or “shall not be subject to the disclosure provision of the Public Records Law.” The second category under the exemption includes records deemed exempt under statute by necessary implication. Such statutes expressly limit the dissemination of particular records to a defined group of individuals or entities. A statute is not a basis for exemption if it merely lists individuals or entities to whom the records are to be provided; the statute must expressly limit

John Fitzpatrick SPR23/2899 Page 4 December 15, 2023 access to the listed individuals or entities. G. L. c. 32, § 23(6) In its October 10th and December 11th responses, the Board cites G. L. c. 32, § 23(6), which provides in pertinent part: Confidentiality of certain records. Any documentary material or data made or received by a member of the PRIM board which consists of trade secrets or commercial or financial information that relates to the investment of public trust or retirement funds, shall not be disclosed to the public if disclosure is likely to impair the government’s ability to obtain such information in the future or is likely to cause substantial harm to the competitive position of the person or entity from whom the information was obtained. The provisions of the open meeting law shall not apply to the PRIM board when it is discussing the information described in this subdivision. This subdivision shall apply to any request for information covered by this subdivision for which no disclosure has been made by the effective date of this subdivision. G. L. c. 32, § 23(6). In its December 11th response, under G. L. c. 32, § 23(6), the Board argues the following for withholding “the Protected Board Meeting Agenda for August 15, 2023 and the Protected Investment Committee Meeting Agendas for August 15, 2023 and May 24, 2011:” The Protected Documents fall within the purview of G. L. c. 32, § 23(6) because they include trade secrets and financial or commercial information concerning these investment firms. PRIM has entered into nondisclosure agreements (“NDA”) with both Vista Equity Partners and Blue Owl Technology and has made additional assurances of confidentiality in other agreements with these firms. The information in the Protected Documents would not have been provided to PRIM by these firms but for the assurance of the confidentiality in the NDAs and other agreements between PRIM and each of these firms. ... This confidential information was vital to ensure PRIM was well informed about these firms, and without this information, PRIM would not have been sufficiently equipped to make sound investment determinations. Disclosure of the Protected Documents would impair PRIM’s ability to obtain similar information in the future, as investment managers would likely view PRIM as unable to honor its confidentiality agreements. This would, in turn, hinder PRIM from achieving its mission to “generate strong risk-adjusted investment returns that help the Commonwealth of Massachusetts meet its pension obligations and alleviate potential taxpayer burden.”... Further, the Protected Documents include information that investment firms have indicated, if disclosed, would “prejudice their ability to compete for investors in

John Fitzpatrick SPR23/2899 Page 5 December 15, 2023 future funds and would provide their competitors an unfair competitive advantage, resulting in competitive harm to investment firms in which PRIM invests.” Based on the Board’s October 10th and December 11th responses, it is unclear how the withheld meeting agendas, in their entirety, constitute the types of records contemplated under G. L. c. 32, § 23(6). Specifically, although portions of the records may fall within the purview of the statute cited above, it is unclear how the meeting agendas can be withheld in their entirety. See Reinstein, 378 Mass. at 289-90 (1979) (the statutory exemptions are narrowly construed and are not blanket in nature). Any nonexempt, segregable portion of a public record is subject to mandatory disclosure. G. L. c. 66, § 10(a). The Board must clarify these matters. Conclusion Accordingly, the Board is ordered to provide Mr. Scheffler with a response to his request, provided in a manner consistent with this order, the Public Records Law, and its Regulations within ten business days. A copy of any such response must be provided to this office. It is preferable to send an electronic copy of the response to this office at pre@sec.state.ma.us. Sincerely, Manza Arthur Supervisor of Records cc: Matthew Scheffler