Case No. VFA-0356, 27 DOE ¶ 80,102

January 8, 1998

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Appeal

Name of Petitioner: K&M Plastics, Inc.

Date of Filing: December 9, 1997

Case Number: VFA-0356

On December 9, 1997, K&M Plastics, Inc. (K&M) filed an Appeal from a determination that the Rocky Flats Field Office (RFFO) of the Department of Energy (DOE) issued to it on November 13, 1997. That determination denied a request for information that K&M submitted under the Freedom of Information Act (FOIA), 5 U.S.C § 552, as implemented by the DOE in 10 C.F.R. Part 1004. The Appeal, if granted, would require RFFO to release the requested information.

The FOIA requires that documents held by federal agencies generally be released to the public upon request. The FOIA, however, lists nine exemptions that set forth the type of information that may be withheld at the discretion of an agency. 5 U.S.C. § 552(b); 10 C.F.R. § 1004.10(b). The DOE regulations further provide that a document exempt from mandatory disclosure under the FOIA shall nonetheless be released to the public if the DOE determines that disclosure is permitted by federal law and is in the public interest. 10 C.F.R. § 1004.1.

I. Background

On July 30, 1997, K&M filed a request under the FOIA in which it sought “a copy of the bid abstract for Kaiser-Hill Company, L.L.C., Rocky Flats Environmental Tech. Site, Golden, Colorado, Solicitation No. DC 706517 CE dated June 19, 1997.” This FOIA request was initially filed with the DOE’s Albuquerque Operations Office (AO). AO informed K&M that the requested records were at RFFO, and transferred the request to RFFO for processing. Letter from FOI Officer, AO, to K&M (August 5, 1997). RFFO issued a determination to K&M on November 13, 1997. In that determination, RFFO found that the records sought by K&M were not “agency records” because they were not in the possession and control of the agency at the time of the FOIA request. RFFO further explained that under the terms of the contract between DOE and Kaiser-Hill, the procurement records requested are the property of the contractor and therefore not subject to release under DOE regulations. Letter from Mary Hammack, FOIA Officer, RFFO, to C. Poellet, President, K&M (November 13, 1997) (Determination Letter).

In its Appeal, K&M argues that the records should be made public because they do not affect national security or public safety. In addition, K&M further alleges that it requested similar information in the past, (1) and that this request was honored. See Letter from C. Poellet, President, K&M, to Director, Office of Hearings and Appeals (December 9, 1997) (Appeal Letter).

II. Analysis

Our threshold inquiry in this case is whether procurement records of a DOE contractor which were in the possession of the DOE contractor at the time of the request are subject to the FOIA. Contrary to K&M’s assertion, the FOIA does not direct that all records that do not affect national security or public safety are subject to disclosure. Rather, we must first determine whether the requested records are "agency records," and thus subject to the FOIA, under the criteria set out by the federal courts. See 5 U.S.C. § 552(f). Records that do not meet these criteria may nonetheless be subject to release under the DOE regulations if they are owned by the government. 10 C.F.R. § 1004.3(e); see 59 Fed. Reg. 63,884 (December 12, 1994). For the reasons set forth below, we conclude that the records in question are not "agency records" and are not subject to release under the DOE regulations.

The statutory language of the FOIA does not define the essential attributes of "agency records," but merely lists examples of the types of information required to be made available to the public. See 5 U.S.C. § 552(a). In interpreting this phrase, we have applied a two-stage analysis fashioned by the courts for determining whether documents created by non-federal organizations, such as Kaiser-Hill, are subject to the FOIA. See, e.g., The Cincinnati Enquirer, 26 DOE ¶ 80,205 (1997); Diane C. Larson; 26 DOE ¶ 80,112 (1996); Judith M. Gibbs, 16 DOE ¶ 80,133 (1987) (Gibbs). That analysis involves a determination (i) whether the organization is an "agency" for purposes of the FOIA, and if not (ii) whether the requested material is nonetheless an "agency record." See Gibbs, 16 DOE at 80,595.

A. Kaiser Hill Is Not An Agency Under The FOIA

The FOIA defines the term "agency" to include any "executive department, military department, Government corporation, Government controlled corporation, or other establishment in the executive branch . . . , or any independent regulatory agency." 5 U.S.C. § 552(f). The courts have identified certain factors to consider in determining whether an entity should be regarded as an agency for purposes of federal law. In United States v. Orleans, 425 U.S. 807 (1976), a case which involved a statute other than the FOIA, the Supreme Court defined the conditions under which a private organization must be considered a federal agency as follows: "[T]he question here is not whether the . . . agency receives federal money and must comply with federal standards and regulations, but whether its day-to-day operations are supervised by the Federal Government." Id. at 815. In other words, an organization will be considered a federal agency only where its structure and daily operations are subject to substantial federal control. See Ciba-Geigy Corp. v. Matthews, 428 F. Supp. 523, 528 (S.D.N.Y. 1977). Subsequently, the Supreme Court ruled that the Orleans standard provides the appropriate basis for ascertaining whether an organization is an "agency" in the context of a FOIA request for "agency records." Forsham v. Harris, 445 U.S. 169, 180 (1980) (Forsham). See also Rocap v. Indiek, 539 F.2d 174 (D.C. Cir. 1976); Washington Research Project, Inc. v. HEW, 504 F.2d 238, 248 (D.C. Cir. 1974), cert. denied, 421 U.S. 963 (1975) (degree of independent governmental decision-making authority considered).

Under its contractual relationship with the DOE, Kaiser-Hill is the prime contractor responsible for maintaining and operating the Rocky Flats Environmental Technology Site. This Office has frequently held that DOE management and operating contractors are not “agencies” for FOIA purposes. See, e.g., The Cincinnati Enquirer, 26 DOE ¶ 80,205 (1997) (Fluor Daniel Fernald); Diane C. Larson, 26 DOE ¶ 80,112 (1996) (Westinghouse Hanford Company); William Kuntz III, 25 DOE ¶ 80,157 (1995) (Lockeed Martin Corporation). We have previously determined that the DOE has obtained Kaiser-Hill’s services and exercises general control over the contract work, but it does not supervise Kaiser-Hill’s day-to-day operations. See ChemData, Inc., 26 DOE ¶ 80,228 (1997). Therefore, Kaiser-Hill does not meet the test set forth in the Orleans and Forsham decisions, and we find that Kaiser-Hill is not an "agency" subject to the FOIA.

B. The Records Were Not Within DOE’s Control

Although Kaiser-Hill is not an agency for the purposes of the FOIA, records in its possession which are responsive to K&M’s request could be deemed "agency records" if they were obtained by the DOE and were within the DOE's control at the time the FOIA request was made. Department of Justice v. Tax Analysts, 492 U.S. 136, 144-46 (1989) (Tax Analysts); see also Kissinger v. Reporters Comm. for Freedom of the Press, 445 U.S. 136 (1980); Forsham, 445 U.S. at 182. However in this case, the documents in question had not been obtained by the DOE and were not in the agency's possession at the time of K&M’s request. See Determination Letter.

C. Procurement Records Are The Property Of The Contractor

Even if a contractor-acquired record fails to qualify as an "agency record," it may still be subject to voluntary release if the contract between the DOE and that contractor provides that the document in question is the property of the agency. The DOE regulations state that "[w]hen a contract with DOE provides that any records acquired or generated by the contractor in its performance of the contract shall be the property of the Government, DOE will make available to the public such records that are in the possession of the Government or the contractor, unless the records are exempt from public disclosure under 5 U.S.C. § 552(b)." 10 C.F.R. 1004.3(e)(1).

We therefore look next to the contract between DOE and Kaiser-Hill to determine the status of the withheld records. That contract states:

Except as is provided in paragraph (b) of this clause, all records acquired or generated by the Contractor in its performance of this contract shall be the property of the Government and shall be delivered to the Government . . . .

Contract DE-AC34-95RF00825, Section H.4. Paragraph (b) excludes from this provision "[r]ecords related to any procurement action by the Contractor." Id. at Clause H.20(b)(8). Thus, because procurement records are not among the records which are property of the Government under the DOE's contract with Kaiser-Hill, these records are not subject to release under the DOE regulations.

For the reasons set forth above, we find that the records sought by K&M are neither "agency records" within the meaning of the FOIA, nor subject to release under DOE regulations. Accordingly, the Appeal should be denied.

It Is Therefore Ordered That:

(1) The Appeal filed by K&M Plastics, Inc. on December 9, 1997, Case Number VFA-0356, is hereby denied.

(2) This is a final Order of the Department of Energy from which any aggrieved party may seek judicial review pursuant to the provisions of 5 U.S.C. § 552(a)(4)(B). Judicial review may be sought in the district in which the requester resides or has a principal place of business, or in which the agency records are situated, or in the District of Columbia.

George B. Breznay

Director

Office of Hearings and Appeals

Date: January 8, 1998

(1)Prior to 1995, RFFO released bid abstracts on request because that information was considered government property. However, in 1995 Kaiser-Hill became the prime contractor responsible for the Rocky Flats Environmental Technology Site, and pursuant to the contract between DOE and Kaiser-Hill, those records became the property of the contractor. See Record of Telephone Conversation between Mary Hammack and Valerie Vance Adeyeye, OHA Staff Attorney (January 5, 1998).