A Pulaski County circuit judge preparing to decide whether Arkansas Children's Hospital is subject to Arkansas' Freedom of Information Act ruled Monday that the institution is not immune from the open-records law solely because it's a tax-exempt charity.
But Judge Tim Fox also sounded skeptical about arguments by attorney Luther Sutter that the hospital could be forced to make public its financial records under the law, either. Pulaski County designated it as the county hospital 37 years ago. The county leases land to the hospital and a county tax helps generate Medicaid funding that benefits it.
The open-records law typically only applies to state government agencies, but the courts have ruled that private entities, like the hospital, can be subject to the open-records law if they rely substantially on public money to perform services typically performed by the government. Fox said he'll decide the question as soon as possible.
Sutter is representing disability rights consultant Dee Blakely, who submitted a Freedom of Information request to the hospital earlier this month asking for records to show how much county money it has received every year over the past five years, including the money it has received through county-backed revenue bonds.
She also asked for records that show how much money the hospital has spent on capital improvements for that time. She sued after the hospital rebuffed her request.
"I wanted to know how the hospital spent the money," she said.
Sutter questioned how county tax money is being used by the hospital.
"Are Pulaski County dollars being used to treat non-Pulaski residents? That's what this lawsuit is about," Sutter told the judge. "I want to know where public funds are being expended. Period."
County taxpayers pay 60 cents for every $1,000 of taxable property value, according to the Pulaski County treasurer's website. But the judge heard testimony that none of that tax collection, a little less than $4 million annually, goes directly to Children's Hospital.
Questioned by hospital lawyer Jane Duke, both Rhonda McKinnis, the hospital's general counsel, and Gena Wingfield, its chief financial officer, testified the hospital does not receive any tax money, state or county, directly.
The county collection is paid directly to Medicaid to qualify for supplementary funding to reimburse the hospital for taking care of poor and disadvantaged children, they said.
Receiving Medicaid is not grounds for finding the hospital is subject to the Freedom of Information law, Duke told the judge.
According to its most recent public financial disclosures, required to maintain its nonprofit status, the hospital collected $536,811,397 in revenue in 2012 and had $500,793,472 in expenses, with $722,882,134 in assets and $203,968,163 in liabilities.
The disclosure also showed compensation for President and CEO Jonathan Bates, who retired in 2013, at $623,447, while Wingfield received $433,480.
Metro on 08/25/2015