(Editor’s Note: Due to this breaking news, the Friday interview will not appear today. It will return next week.)
RALEIGH — In what is considered a first for state government, the Department of Commerce agreed this week to pay lawyers’ fees in order to settle a public records lawsuit that was brought against it.
The state agency led by Secretary Jim Fain (who was also named as a defendant) paid plaintiffs Carolina Journal and the North Carolina Press Association $7,500 for their legal expenses related to a suit they filed in January. The two organizations sued because they alleged that Commerce officials violated the state’s public disclosure laws when it failed to timely release public records related to its economic incentives negotiations with Dell Corp. The settlement stated that Commerce officials admitted no wrongdoing.
“It’s the only time I’m aware of that any state agency has paid fees before,” said John Bussian, the lawyer who represented CJ and the NCPA in the case. “And they vowed they never would in this case. It showed they had a losing hand.”
The state granted Dell $242 million in economic incentives to build its first East Coast assembly plant in Forsyth County. The project was announced in early November last year, but CJ sought the immediate release of all of Commerce’s records related to the negotiations for the deal. Documents weren’t released until January 18 — the same day the lawsuit was filed — more than two months after the agreement was announced.
Earlier last year CJ had similar difficulties with Commerce. In mid-December 2003 editor Richard Wagner tried to gain the release of department records related to its incentives negotiations with Boeing. Documents were not made available until mid-February 2004, after the threat of a lawsuit.
“Commerce officials took more than 60 days to comply with two of our requests under the Public Records Law,” Wagner said. “That amount of time is ridiculous. Later, in testimony to a House committee [during this year’s session of the General Assembly] considering new legislation, Commerce’s lead lawyer, Don Hobart, himself admitted that Commerce could have the information in as little as 15 days.”
That legislation ultimately passed into law when Gov. Mike Easley signed it last week. It requires Commerce and local governments to release their records within 25 days of a business prospect either announcing its intentions to locate in North Carolina, or if the company has made a final decision to not locate in the state. The new law also requires Commerce to publish annually all financial information about the incentives it awards and disburses through all its programs.
Bussian lobbied for the new law, and said it should serve as “a backstop” that would prevent governments from withholding economic recruitment records.
“The problem began because there were long delays,” he said. “It was badly needed in this setting.”
The new law, combined with Commerce’s payment of legal fees in the Dell records case, could mean governments will be more readily forthcoming with public documents.
“The fact that Commerce Department officials paid our lawyers’ fees speaks for itself,” Wagner said. “The payment establishes a precedent that should make it easier for anyone to get access to public records and to recover legal fees if they have to sue to get them.”