Was the publicly funded WeGOJA Foundation subject to South Carolina’s Freedom of Information Act?

Plain-English summary

In March 2022, the South Carolina Attorney General predicted a court would treat the WeGOJA Foundation as a public body under the state's Freedom of Information Act. The foundation was a nonprofit, but the request described state and federal funding without an identified arm's-length exchange for goods or services and without another framework for public reporting and accountability. The AG said that public support made the foundation subject to the law's public-record disclosure requirements on the facts presented.

The office drew a distinction between a nonprofit supported with public funds and an ordinary seller paid fair-market value for specified goods or services. It separately declined to determine whether WeGOJA was a public charity, because that status called for factual findings. The AG said public-charity status would not itself prevent the foundation from being a public body under FOIA.

What this means for you

WeGOJA and publicly supported nonprofits

The opinion tied FOIA coverage to the character of the public funding and the absence of another accountable exchange or reporting structure in the request. It said WeGOJA likely had to permit inspection, copying, or electronic receipt of public records as a public body.

Records requesters and archives officials

The AG's conclusion supported access to the foundation's public records under the state FOIA on the stated funding facts. It did not decide the separate question of whether the foundation qualified as a public charity.

Common questions

Q: Did nonprofit status exempt WeGOJA from South Carolina FOIA? A: No. The AG predicted the foundation counted as a public body because of the public support described in the request.

Q: Does every private vendor paid by government become a public body? A: The opinion distinguished arm's-length payment for specific goods or services from funding that supports a related organization without that exchange.

Q: Did the AG decide whether WeGOJA was a public charity? A: No. It said the issue required factual findings outside an AG opinion and did not control the FOIA analysis.

Background and statutory framework

The Department of Archives and History asked about WeGOJA, which grew from a foundation supporting the state's African American Heritage Commission and received public funding. The AG applied the FOIA definition of a public body and South Carolina Supreme Court cases explaining how public funding and accountability affect a private organization's status.

Citations and references

• S.C. Code Ann. § 30-4-20(a): public-body definition analyzed by the AG.
• S.C. Code § 30-4-30(A)(1): public-record access right cited in the opinion.
• Weston v. Carolina Rsch. & Dev. Found., 303 S.C. 398, 403, 401 S.E.2d 161, 164 (1991): public-funding rule quoted in the opinion.

Source

• Landing page: https://www.scag.gov/opinions/opinions-archive/opinion-addressing-whether-a-non-profit-corporation-that-receives-state-and-federal-funding-is-a-public-body-according-to-the-sc-freedom-of-information-act/
• Original PDF: https://www.scag.gov/media/obmiiwsv/02935003.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

ALAN WILSON
ATTORNEY GENERAL

March 23, 2022

W. Eric Emerson, Ph.D.

Director and SHPO

South Carolina Department of Archives & History
8301 Parklane Road

Columbia, SC 29223

Dear Director Emerson:

Attorney General Alan Wilson has referred your letter to the Opinions section. Your letter states the following:

At the March 4, 2022 quarterly meeting of the SC Commission of Archives and History, the members of that body passed a motion that “the commission (SCCAH) ask for an opinion from the SC Attorney General's Office as to whether or not the WeGOJA Foundation-is considered a public charity and subject to the Freedom of Information Act (FOIA).” This letter constitutes a request for an opinion regarding those issues.

As background to the first part of this request, the South Carolina African American Heritage Commission (SCAAHC) created the SC African American Heritage Foundation (SCAAHF) in 2008 as a 501(c)(3) with the goal of raising private funds to support the work of the SCAAHC. The SCAAHF rebranded itself as the WeGOJA Foundation in 2020, and that organization appears on the South Carolina Secretary of State's Charities Search Home Page https://search.scsos.com/charities (Public Id: P15729). That same page contains a link to a filed federal form 990-EZ (2019) as an organization exempt from income

Concerning the second part of the request, the WeGOJA Foundation, and its predecessor organization SCAAHF, have been the recipients of both state and federal funds from the South Carolina Department of Archives and History (SCDAH) and the State Historic Preservation Office (SHPO) on behalf of the SCAAHC, In your November 15, 2019 opinion regarding the Hagood Mill Foundation, you referenced Section 30-4-20(a) and underlined language from that section of code, which states “any organization, corporation, or agency supported

in whole or in part by public funds or expending public funds” falls within the definition of a public body for purposes of FOIA.

ReNBERTC, DENNIS BUILDING ¢ POST OFFICE BOX 11549 = COLUMBIA, SC 29211-1549 © TELEPHONE 803-734-3970 FACSIMILE 803-253-6283

W. Eric Emerson, Ph.D.

Page 2

March 23, 2022

According to Section 60-11-50(6), the SC Commission of Archives and History (SCCAH) will “control the expenditure in accordance with law of such public funds as may be appropriated to the Department.” Section 60-11-110(E) states that SCDAH “shall serve in a nonvoting advisory role...” and fund the commission (SCAAHC). To meet its obligation to advise and fund the SCAAHC and to assure transparency in the expenditure of public monies, the Commission of Archives and History is seeking this opinion.

Law/Analysis

It is this Office’s opinion that a court would likely find the WeGOJA Foundation is a “public body” as defined in the S.C. FOIA. S.C. Code §§ 30-4-10 et seq. The S.C. FOIA grants a person the “right to inspect, copy, or receive an electronic transmission of any public record of a public body.” S.C. Code § 30-4-30(A)(1) (emphasis added). The primary issue presented in your letter is whether a court would find that the WeGOJA Foundation is a “public body” under

the Act. Public body is defined to mean

S.C. Code Ann. § 30-4-20(a) (emphasis added). In Weston v. Carolina Rsch. & Dev. Found., 303 S.C. 398, 403, 401 S.E.2d 161, 164 (1991), the South Carolina Supreme Court stated that this definition “mandates that the receipt of support in whole or in part from public funds brings a corporation within the definition of a public body.” The Court explained there is a distinction for private entities that receive public funds in exchange for goods or services at fair market value. These entities would not fall within the definition of public body, while a private entity

any department of the State, a majority of directors or their representatives of departments within the executive branch of state government as outlined in Section 1-30-10, any state board, commission, agency, and authority, any public or governmental body or political subdivision of the State, including counties, municipalities, townships, school districts, and special purpose districts, or any organization, corporation, or agency supported in whole or in part by public funds or_expending public funds, including committees, subcommittees, advisory committees, and the like of any such body by whatever name known, and includes any quasi-governmental body of the State and its political subdivisions, including, without limitation, bodies such as the South Carolina Public Service Authority and the South Carolina State Ports Authority. Committees of health care facilities, which are subject to this chapter, for medical staff disciplinary proceedings, quality assurance, peer review, including the medical staff credentialing process, specific medical case review, and self-evaluation, are not public bodies for the purpose of this chapter.

that receives funds in block grants with no mechanism for public oversight would.

W. Eric Emerson, Ph.D.
Page 3
March 23, 2022

[T]his decision does not mean that the FOIA would apply to business enterprises that receive payment from public bodies in return for supplying specific goods or services on an arms length basis. In that situation, there is an exchange of money for identifiable goods or services and access to the public body's records would show how the money was spent. However, when a block of public funds is diverted en masse from a public body to a related organization, or when the related organization undertakes the management of the expenditure of public funds, the only way that the public can determine with specificity how those funds were spent is through access to the records and affairs of the organization receiving and spending the funds.

Id. at 404, 401 S.E.2d at 165 (emphasis added); see also DomainsNewMedia.com, LLC v. Hilton Head Island-Bluffton Chamber of Com., 423 S.C. 295, 303, 814 S.E.2d 513, 517 (2018) (“The reporting and accountability provisions directly governing the expenditure of these funds control” in finding that the Chamber of Commerce was not a “public body” subject to the S.C. FOIA.).

As noted above, this Office has previously addressed a similar question regarding whether the Hagood Mill Foundation (“HMF”), which was also formed as a 501(c)(3) corporation to oversee a historic site, is considered a public body under the S.C. FOIA. See Op. S.C. Att’y Gen., 2019 WL 6445344 (November 15, 2019). The opinion concluded that HMF was a public body according to the S.C. FOIA as follows:

While HMF is organized as a nonprofit corporation, you indicated it receives funds from Pickens County. In addition, you give no indication that Pickens County receives anything in return for these funds. Likewise, HMF likely expends public funds. Accordingly, we are of the opinion that HMF is a public body for purposes of FOIA and therefore, would be subject to the provisions of FOIA.

Id. at 3. With these authorities in mind, this opinion will next consider the public funding provided to the WeGOJA Foundation as described in your letter.

The WeGOJA Foundation shares many of the same characteristics with the entities described in the Weston decision and the HMF opinion. The most significant similarities are that it is organized as a nonprofit corporation and that it receives funding from the State. Although, the Foundation also receives private support, throughout the S.C. FOIA the General Assembly expressed “its intent to ensure transparency is provided to the public with regard to the general expenditure of public funds.” Id. at 302, 814 S.E.2d at 516. This concern is why the Weston Court found that support of a private entity, “even in part,” by public funds mandates finding it is a public body. The letter contains no indication that the Foundation provides “specific goods or services on an arm’s length basis” in return for these funds. DomainsNewMedia.com, 423 S.C. at 306, 814 S.E.2d at 518. In the absence of a framework requiring oversight for the expenditure of these funds or otherwise mandating public reporting and accountability, it is this Office’s opinion that a court would hold the WeGOJA Foundation is a public body according to the S.C. FOIA.

W. Eric Emerson, Ph.D.
Page 4
March 23, 2022

As a result, the Foundation is subject to the disclosure requirements concerning the public’s right to inspect, copy. or receive public records. S.C. Code § 30-4-30(A)(1).

Finally, your letter asks this Office to determine whether the WeGOJA Foundation is a public charity. However, this Office cannot offer an opinion on the Foundation’s status as a public charity because that determination would require findings of fact. See Op. S.C. Att’y Gen., 2006 WL 1207271 (April 4, 2006) (“Because this Office does not have the authority of a court or other fact-finding body, we are not able to adjudicate or investigate factual questions”).! Regardless of whether the WeGOJA Foundation is a public charity or not, a court would hold this status does not prevent the foundation from being characterized as a public body under the S.C. FOIA.

Conclusion

As is discussed more fully above, it is this Office’s opinion that a court would likely find the WeGOJA Foundation is a “public body” as defined in the S.C. FOIA. S.C. Code Ann. § 30- 4-20(a). Although the Foundation is organized as a nonprofit corporation, its receipt of state funds compels this conclusion. As described in the request letter, the Foundation receives both state and federal funds from the South Carolina Department of Archives and History and the State Historic Preservation Office. The letter provides no indication that the Foundation provides goods or services in return for these funds. Moreover, the letter does not indicate that there are parameters for public reporting and accountability for these funds. As a result, the Foundation is subject to the disclosure requirements concerning the public’s right to inspect, copy, or receive public records. S.C. Code § 30-4-30(A)(1).

i

Matthew Houck
Assistant Attorney General

REVIEWED AND APPROVED BY:

[PL
Robert D. Cook
Solicitor General

' We note that your letter references a 990-EZ form linked on the Secretary of State’s website that indicates the Foundation filed as a public charity.