VIRGINIA FREEDOM OF INFORMATION ADVISORY COUNCIL COMMONWEALTH OF VIRGINIA

AO-48-01

October 30, 2001

Mr. Christopher A. Corbett
Stuart, VA

The staff of the Freedom of Information Advisory Council is authorized to issue advisory opinions. The ensuing staff advisory opinion is based solely upon the information presented in your correspondence of September 7, 2001.

Dear Mr. Corbett:

You have asked whether, based on the following facts, a local nonprofit hospital would be considered a public body as defined by the Virginia Freedom of Information Act (FOIA) and therefore subject to the provisions of FOIA. You indicated that a local industrial development authority (IDA) has agreed to extend a line of credit to a local hospital upon certain conditions. One condition is that the current directors resign and the County Board of Supervisors ("the Board") appoint a new slate of directors. The hospital bylaws authorizes the Board to reappoint the directors but not remove them.

Section 2.2-3701 of the Code of Virginia defines a "public body" as any legislative body; any authority, board, bureau, commission, district or agency of the Commonwealth or of any political subdivision of the Commonwealth, including cities, towns and counties; municipal councils, governing bodies of counties, school boards and planning commissions; boards of visitors of public institutions of higher education; and other organizations, corporations or agencies in the Commonwealth supported wholly or principally by public funds. It shall include any committee, subcommittee, or other entity however designated, of the public body created to perform delegated functions of the public body or to advise the public body. It shall not exclude any such committee, subcommittee or entity because it has private sector or citizen members.

Although the nonprofit hospital does not fit into one of the enumerated entities under FOIA, there are two remaining possibilities that might make the hospital a public body under the definition. The first relates to the extension of the line of credit from the IDA, clearly, a public body under FOIA. The second relates to the Board's control over the appointments of the hospital's board of directors. Each question will be addressed below.

The first possibility that might make the hospital a public body will depend on whether the hospital is supported wholly or principally by public funds. Here, your facts indicate the hospital is obtaining a line of credit from the IDA. The IDA, by statute, is a political subdivision of the Commonwealth¹. While the funds obtained from the IDA are clearly public funds, the extension of a line of credit does not rise to the level of wholly or principally supported by public funds, as these funds must be repaid to satisfy the loan.

Section 15.2-4901 states the IDA was created to acquire, own, lease, and dispose of properties and make loans to the end that such authorities may be able to promote industry and develop trade by inducing manufacturing, industrial, governmental, nonprofit and commercial enterprises and institutions of higher education to locate in or remain in this Commonwealth. (Emphasis added.) The statute also grants the IDA the necessary powers with respect to medical facilities and facilities for the residence or care of the aged to the end that such authorities may protect and promote the health and welfare of the inhabitants of the Commonwealth by assisting in the acquisition, construction, equipping, expansion, enlargement and improvement of medical facilities. (Emphasis added.) In short, the statute delegates authority to an IDA to loan money to private enterprises, including hospitals, to promote industry. This line of credit does not make the hospital a public body because the IDA is fulfilling its statutory obligations by extending a loan to a private entity, in this case a hospital.

Secondly, the hospital may be a public body if it was created to perform a delegated function of [a] public body or to advise [a] public body." (Emphasis added). Section 15.2-403 states the Board shall be the policy-determining body of the county. You have stated that the hospital's directors will be removed and reappointed by the Board. Based upon your facts presented, the sole reason the Board is involved in the removal of the hospital's directors is because the IDA conditioned its line of credit upon the Board taking such action. Nothing in your facts indicates the hospital is performing any of the Board's policy-making functions or acting as the Board's advisor. The removal and reappointment of the hospital's directors by the Board does not make the hospital a public body.

In conclusion, the hospital's line of credit obtained from the IDA is not enough to establish that the hospital is supported wholly or principally by public funds. Furthermore, the Board's authority, which will consist of the reappointing of the hospital's directors upon the existing directors resigning, neither makes the hospital perform delegated functions of the Board nor provide advice to a public body. Thus, the hospital does not fit any part of the definition of "public body" and in turn is not subject to the requirements of FOIA.

Thank you for contacting this office. I hope that I have been of assistance.

Sincerely,

Maria J.K. Everett
Executive Director

¹ See Subsection B of § 15.2-4903.