AP, Oct. 5

Journalists sue PHEAA for spending records.

By MARC LEVY
Associated Press Writer

Three journalists, including an Associated Press reporter, sued Pennsylvania's student-loan agency for its spending records, including receipts for almost $900,000 that board members spent on retreats.

The lawsuit, filed Tuesday, Oct. 4 said the Pennsylvania Higher Education Assistance Agency violated the law and the reporters' due process rights when it denied a request for the records and then asked a state appellate court to rule that the records are not public.

"We're filing this because PHEAA cut off the appeals process," Craig Staudenmaier, the lawyer representing the reporters, told The Patriot-News of Harrisburg. "They short shrifted the process under the statute."

The refusal of a state agency to release records under the state's Right-to-Know Law can be appealed to Commonwealth Court, where both lawsuits were filed.

But the agency improperly cut off appeals and denied the records, the lawsuit said.

PHEAA spokesman Keith New said the agency believes the records are exempt from the state's Right-to-Know Law and filed its Sept. 6 lawsuit in the hope that a declaratory judgment would be a quicker process than three separate appeals processes.

"We felt it was the most responsible and prudent thing to do," New said.

The reporters are Martha Raffaele of the AP, Jan Murphy of The Patriot-News and Jim Parsons of Pittsburgh television station WTAE-TV.

In its lawsuit, PHEAA said the documents are legislative records -- which are exempt from the Right-to-Know Law -- because 16 of the 20 members of the agency's board are lawmakers appointed by legislative leaders. PHEAA's suit also said the records contain "trade secrets" that could damage the agency's value and private information that could harm a person's reputation and security.

PHEAA's suit named the three reporters, all of whom recently filed right-to-know requests. Two of the requests seek receipts and similar documents from a three-day June retreat at Nemacolin Woodlands Resort in Fayette County and similar gatherings PHEAA has sponsored in recent years.

The Patriot-News reported in July that PHEAA had spent about $885,000 since 2000 on retreats as far away as California's Napa Valley. The most recent event cost nearly $136,000.

The third request seeks documents that detail expenditures for travel by PHEAA employees and board members, payments for training and employee-recognition programs and the use of agency credit cards.

PHEAA, a nonprofit corporation created and largely controlled by the Legislature, is the state's largest source of student loans, grants and loan-forgiveness programs. It manages nearly $57 billion in assets and will receive $428 million in state tax money this year for grants and other direct aid to students.