Municipal Corner

Municipal electricity and natural gas bills must be released under the Texas Public Information Act notwithstanding any arguments that they contain “commercial or financial information” that could competitively harm the utility provider. Tex. Att’y Gen. OR2020-19766.

William Chesser, City Attorney for the City of Brownwood (“City”), sought an opinion by the Attorney General (“AG”) to determine if the City’s electricity and natural gas bills (“bills”) are excepted from disclosure under the Texas Public Information Act (“PIA”). The AG determined that the City must release the bills for public disclosure, but that it could withhold its account number from the documents.

In requesting the opinion from the AG, the City took no position as to whether the bills fall under a PIA exception. Instead, the City notified its electricity and natural gas provider—Gexa Energy, L.P. (“Gexa”)—that it had received a PIA request and that Gexa had a right to submit comments to the AG regarding disclosure of the documents. Gexa submitted comments arguing that the bills fall under Tex. Gov’t Code § 552.110(c), which excepts “commercial or financial information for which it is demonstrated based on specific factual evidence that disclosure would cause substantial competitive harm.”

In evaluating Gexa’s argument, the AG determined that the “commercial or financial information” exception is limited by Tex. Gov’t Code § 522.0222, which provides certain required disclosures for public contracts. This section of the Government Code took effect on January 1, 2020 after the Texas Legislature passed a bill aiming to overturn the 2015 Texas Supreme Court decision in Boeing v. Paxton, which had previously held that private entities could petition the AG to except information that “if released, would give advantage to a competitor or bidder.” 466 S.W.3d 831, 839 (Tex. 2015). The new law codified in section 522.0222—titled “Disclosure of Contracting Information”—narrows the available PIA exceptions related to contracts between public and private entities.

The AG found that the City’s bills are “subject to section 522.0222(b)” and thus “may not be withheld on the basis of [the commercial or financial information exception].” The AG did not note which provision of 522.0222(b) applied, but instead determined that the City’s bills were “subject to” the required disclosures in 522.0222(b), which include information related to any “contract for the purchase of goods or services from a private vendor” (522.0222(b)(1)) and any “major contract” (522.0222(b)(2)). The AG concluded that the City must release all information in its electrical and natural gas bills except for its account number with Gexa, which the AG determined was excepted under Tex. Gov’t Code § 552.136, which protects a public entity’s “credit card, debit card, charge card, or access device number” from disclosure.

While this Open Records Letter Ruling is “limited to the particular information at issue in the [City of Brownwood’s] request,” it serves as a signal to Texas municipalities that the previously broad exceptions for information affecting a private entity’s “competitive advantage” is narrowing. The AG will likely continue its trend of denying requests to withhold information from public contracts containing relevant “commercial or financial information,” and accordingly municipalities should be prepared to publicly disclose contracts with vendors, contractors, and other private entities.

Municipal Corner is prepared by Chris Brewster. Chris is a Principal in the Firm’s Energy and Utility Practice Group. If you would like additional information or have any questions related to these or other matters, please contact Chris at 512.322.5831 or cbrewster@lglawfirm.com.