Monday, March 23, 2015

Is GLWA Gag Order Constitutional?

For most purposes, Detroit’s historic bankruptcy (Case #13-53846) is over. However, on February 6, 2015, Bankruptcy Judge Steven Rhodes extended his Mediation Order (Docket #8468) of November 26, 2014, providing for negotiations concerning the lease of certain water treatment facilities from the Detroit Water and Sewerage Department by a newly created regional entity, the Great Lakes Water Authority.

Under the supervision of U.S. District Judge Sean Cox as mediator, representatives of the City of Detroit and the several counties that comprise the new authority will review anticipated costs and revenues and discuss the financial viability of the proposed lease.

In his Mediation Confidentiality Order (Docket #9176) of February 6, 2015, Judge Rhodes ordered that discussions and documents related to the lease negotiations shall be privileged and confidential. This is commonly referred to as a gag order.

For background, note that, concerning an overly broad, court-imposed gag order following the criminal indictment of former Massey Energy CEO Don Blankenship, the Corporate Crime Reporter said (November 18, 2014), “University [of] California Irvine Law Professor Erwin Chemerinsky has written on gag orders, including a seminal 1997 law review article…”

In the 1997 piece, [now Dean] Chemerinsky reminded us that, in Nebraska Press Association, 427 U.S. 539 (1976), the Supreme Court forbad gag orders on the press -- gag orders which were intended to thwart prejudicial pretrial publicity.  To get around that decision, trial courts began to impose gag orders on the parties and their attorneys.

Chemerinsky concluded that such orders are virtually always unconstitutional because they are founded on untenable assumptions.

First, it is assumed by judges imposing gag orders that publicity puts a fair outcome at too great a risk. Chemerinsky lists numerous, highly publicized criminal cases wherein defendants were subjected to prejudicial pretrial publicity but were acquitted nonetheless.

Next, even if publicity impairs fairness, it is false to assume that the comments of the parties or their attorneys outside the courtroom to the press or the public cause or exacerbate the impairment. Media frenzy doesn’t depend exclusively or even principally on what parties or counsel say.

In denying media access to the thoughts and opinions of participants, gag orders are likely counterproductive to a fair outcome.  That is to say, media are forced to rely on inferior sources of information, to which parties and counsel can’t respond, eroding the prospect of fairness even further.

The third untenable assumption is that, even if you accept that publicity is prejudicial and gag orders on participants make a positive difference, these considerations count more than our rights under the First Amendment.  Gag orders are prior restraints.  They restrict free speech and should be subjected to close, strict scrutiny.

The public has a right to know what is being discussed behind closed doors about a proposed $50 million per year lease that water and sewer ratepayers will be obligated to pay for 40 years.  The GLWA/DWSD gag order is unconscionable, should be challenged in court and, if necessary, taken on appeal.

Tuesday, March 17, 2015

You Have a Right to Know: FOIA and DWSD

Citizens have the right to know what their government is up to.  That includes the Detroit Water and Sewerage Department.  Michigan Freedom of Information Act (FOIA) requests can be directed to:

LaTanya Whitfield
Office of the General Counsel
City of Detroit-Water and Sewerage Department
735 Randolph Street
Detroit, MI 48226
Office: 313-964-9034
Fax: 313-842-6510

State and federal FOIA inquiries have a better chance of success when the request begins on an informed and rational footing.  If new to the process, it helps immensely to read a summary of the statute.  

In Michigan, the Attorney General’s office has posted a summary online.   
In other states, a Google search or a stop at your local library should produce a useful document. To understand the federal FOIA process, a good place to start is  -- or your public or school library.
Before you embark on the formal FOIA process, you may be able to save time by making your request informally, either in person or by phone. Can’t hurt to try. And remember, you don’t have to give a reason why you want a particular record.

Although simplicity of application is usually a stated goal of FOIA legislation, you should take that ideal with a grain of salt.  Be as explicit about the subject of your inquiry as you can.  Details specifying who, where, what, why, when and how should be considered, but don’t overdo it.  Erroneous or superfluous details might throw the government searcher off the track.  Look for examples of successful FOIA request letters. Revise them to suit your circumstances.

I can’t emphasize too much the importance of staying on an even keel. Pursuing a FOIA disclosure while angry or frustrated can be self-defeating.  The same is true of self-righteousness and indignation.

Give careful consideration to suggestions that may improve your chances of success.  If things don’t go as well or as fast as expected, press for explanations (preferably in writing), but don’t assume that you’re being ignored or misled intentionally or that there is a conspiracy against you.   

The older the information you’re seeking, the longer it may take to recover it, especially if it predates digital storage.  (Indeed, agencies are authorized in some instances to destroy records after a specified period.)

Similar considerations apply to the quantity requested.  The more you ask for, the longer it is likely to take to assemble (and the more it’s going to cost).  Also, if you’ve made some false assumptions about the pertinence of records you seek, you could end up being charged for useless results.

Consider requesting records in smaller, separate batches, one at a time; for example, by calendar quarters instead of years.  This will prevent going too far down the wrong path.  A variation of this approach is to have a group of friends, associates or classmates each make a small request on your behalf.  It may save money, too, because some government agencies don’t charge for small orders.  

Remember, too, you probably have the option to view the requested materials and copy them yourself at a specified agency office.  Usually, this can be done at less cost or even for free.

A denial of your request, in whole or part, generally triggers a right to an administrative appeal, followed by court review, if so desired.  The term “denial” embraces a number of different circumstances, some explicit, some not.  It’s important to learn the various meanings.

Keep in mind the possibility that the information you seek may be found in other places, public or private.  In this day and age, for example, given the interaction between local, state and federal agencies, information originating at one level may very well have been sent to agencies at other levels, all subject to FOIA discovery.  

I can say from personal experience that identical or similar FOIA requests to inter-related agencies at different levels (local, state and federal) will occasionally reveal false or misleading information or omissions in the communications between agencies.

Also, if you suspect and want certified proof that an agency doesn't have a particular record that it might be expected to have, make a FOIA request in order to get written confirmation that the record doesn't exist.

Persistence pays off.  If necessary, there are non-profit, public service organizations that will help you.  At the national level, for example, try the Sunlight Foundation or the Center for Investigative Reporting.

Tuesday, March 10, 2015

DWSD Denies FOIA Request, Elusive O&M Savings, Gag Order

Prior to the Detroit bankruptcy settlement, it was represented that the proposed $50 million annual lease payment for water-related facilities, payable by the new Great Lakes Water Authority (GLWA) to the City of Detroit, would be offset partially by cost savings initiated by the Detroit Water and Sewerage Department (DWSD).

Veolia, the international water management and consulting firm, in a report to DWSD this past December, stated, "...Veolia understands that during the negotiations for the creation of the regional authority, the viability of the Lease charge was based on several sources of funds, including O&M cost savings estimated by DWSD in an amount between $10 million and $20 million annually. The details of these savings estimates were not provided to Veolia and, therefore, were not included in the assessment.” (p.ES-3)

Because parties to the ongoing negotiations concerning the transition from DWSD to GLWA are prohibited by a renewed federal gag order from discussing the details surrounding the lease payment, I submitted a FOIA request to DWSD for copies of exclusively internal records of O&M cost savings in the $10-20 million range, independent of the negotiations.

Last Friday, DWSD denied my request for the reasons that (a) no such record exists,and (b) even if it did exist, its release would be prohibited by the gag order.

It looks to me like DWSD's dissembling continues unabated.  Ironically, media outlets later this month will be celebrating Sunshine Week, extolling the virtues of open government.

I can make a pro forma appeal of the denial to Director McCormick, but we all know how much good that will do.  Sooner or later, somebody in a position of public responsibility will have to challenge in court the gag order and DWSD secrecy and obfuscation.
*****     *****     *****


Friday, March 6, 2015

Forecasting Water & Sewer Rates: Con Game or Reckless Use of the Crystal Ball?

“Each system [water and sewer] as a whole, is assumed to experience revenue requirement increases of not more than 4% for each of the first ten years under [Great Lakes Water] Authority management.” -- Memorandum of Understanding (MOU) p.4, September 9, 2014.

“It is important to note that Veolia has not performed an assessment of current costs, nor verified that the proposed projections fit the 4% revenue increase requirement.”  Veolia Peer Review Report to the Detroit Water & Sewerage Department, p.ES-3, December 19, 2014.

“The GLWA board will cap annual increases in water and sewer billings at four percent a year for 10 years.”  Great Lakes Water Authority Frequently Asked Questions.

“The Detroit Water and Sewerage Department is warning customers that rates could rise an average of either 9.2 or 14.1 percent…” Detroit News, January 27, 2015.

“...[O]ne selling point [of Detroit’s bankruptcy settlement] was the assurance that annual rate hikes would be capped at 4 percent.” Id.

“Promising a 4 percent cap on rate hikes wasn't [the right thing to do]. It was reckless and misleading, and likely was never a real possibility.” Id.

“The cost of water in Flint would likely rise 30 percent or more if the city returned to buying it from the city of Detroit, emergency manager Jerry Ambrose is warning.” -- Ron Fonger, MLive, March 6, 2015