The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us) STATE OF MICHIGAN
JENNIFER M. GRANHOLM, ATTORNEY GENERAL
FREEDOM OF INFORMATION ACT:
Calculating fees chargeable under the Freedom of Information Act
In calculating the cost of labor for purposes of establishing the fee to be charged for processing a request under the Freedom of Information Act, a public body may include fringe benefits paid to its employees.
Opinion No. 7017
May 13, 1999
Honorable A. T. Frank
You have asked if a public body, in calculating the cost of labor for purposes of establishing fees chargeable under the Freedom of Information Act, may include fringe benefits paid to its employees.
The Freedom of Information Act (FOIA), 1976 PA 442, MCL 15.231 et seq; MSA 4.1801(1) et seq, requires public bodies to provide access to or copies of public records, unless those records fall within one of the specific exemptions found in section 13 of that statute. Section 4(1) of the FOIA, which authorizes a public body to charge a fee for providing records pursuant to a FOIA request, states that:
A public body may charge a fee for a public record search, the necessary copying of a public record for inspection, or for providing a copy of a public record. Subject to subsections (3) and (4), the fee shall be limited to actual mailing costs, and to the actual incremental cost of duplication or publication including labor, the cost of search, examination, review, and the deletion and separation of exempt from nonexempt information as provided in section 14.
In Tallman v Cheboygan Area Schools, 183 Mich App 123, 130; 454 NW2d 171 (1990), the court analyzed the above-quoted statutory language as follows:
The FOIA clearly provides a method for determining the charge for records. It is incumbent on a public body, if it chooses to exercise its legislatively granted right to charge a fee for providing a copy of a public record, to comply with the legislative directive on how to charge. The statute contemplates only a reimbursement to the public body for the cost incurred in honoring a given request - nothing more, nothing less.
Thus, section 4(1) of the FOIA, as interpreted in Tallman v Cheboygan Area Schools, authorizes a public body to recover its actual labor cost in establishing fees chargeable for processing a FOIA request. In other words, a public body is not to make a profit on information retrieval, nor is it to suffer a loss. In Const 1963, art 11, § 5, paragraph 10, the people have provided that the Legislature appropriate annually to the Civil Service Commission "not less than one percent of the aggregate payroll of the classified service." According to a Letter Opinion of the Attorney General to Senator Hart and Representative Jacobetti dated July 26, 1977, at p 3, "the phrase 'aggregate payroll' as used in Const 1963, art , § 5, paragraph 10 includes fringe benefits paid to State employees." Thus, a state agency's actual labor cost under section 4(1) includes fringe benefits paid to its employees. Similarly, at the local level, a public body's actual labor cost under section 4(1) includes fringe benefits paid to its employees.
Section 4(3) of the FOIA provides that, "[i]n calculating the cost of labor . . . under subsection (1), a public body may not charge more than the hourly wage of the lowest paid public body employee capable of retrieving the information necessary to comply with a request under this act." The "cost of labor" consists of several elements, including an employee's salary, fringe benefits, and employment-related taxes. Although the wage component of the cost of labor is statutorily limited to that of "the lowest paid public employee capable of retrieving the information," the Legislature has not restricted the authority of a public body to include other labor-related costs, provided that such costs represent the "actual incremental cost" incurred by compliance with a FOIA request.
This conclusion is consistent with the practice utilized in processing federal FOIA requests. 28 CFR § 16.11, which specifically authorizes inclusion of fringe benefits in calculating the direct costs of a search and duplication pursuant to a federal FOIA request, provides: "Direct costs include, for example, the salary of the employee performing the work (the basic rate of pay for the employee, plus 16 percent of that rate to cover benefits) and the cost of operating duplication machinery."
It is my opinion, therefore, that in calculating the cost of labor for purposes of establishing fees chargeable under the Freedom of Information Act, a public body may include fringe benefits paid to its employees.
JENNIFER M. GRANHOLM
STATE OF MICHIGAN