UPDATE: Senator seeks subpoena for SBA documents related to pension investments after getting $10K billby Dara Kam | October 3rd, 2011
After getting a bill for more than $10,000 from the State Board of Administration, state Sen. Mike Fasano is asking Senate President Mike Haridopolos to subpoena the documents from the Cabinet agency regarding a $125 million investment in the state pension fund earlier this year.
Fasano is seeking public records demonstrating the “due diligence” the SBA used before it invested $125 million in Starboard Value and Opportunity, a hedge fund spin-off of Ramius LLC. Ramius’s president is a former client of SBA executive director Ash Williams. Williams told Fasano it would cost $10,750.13 for 360 hours of staff time and possibly take months to produce the documents.
An SBA spokesman said the investment – which took more than two years to research, negotiate and complete – was already in the works before Williams came to work for the SBA in July 2008 and neither the agency nor Williams has done anything wrong.
But on Friday, Fasano wrote a letter asking Haridopolos, R-Merritt Island, to use his legislative authority to subpoena the documents or order Williams to appear before a committee to explain the investment.
In his letter, Fasano said the SBA’s estimated cost of the records is “chilling to the concept of governmental transparency” and sets a dangerous precedent.
“It is a disgrace that the SBA could merely set a price tag on information that it does not want the public to see. Florida’s Government in the Sunshine laws are a protection that prevent secret deals and other behaviors from being hidden from public view. Circumventing these laws by slapping a price label on the requested material must not be tolerated. Not only will it damage access to information for the legislature, the greater danger is that it will damage access to information for Floridians as a whole,” Fasano, R-New Port Richey, wrote.
Florida’s open government laws, among the broadest in the nation, allow agencies to charge for the cost of copying and salaries of staff who collect the documents and scrub them of exempt information. The law also allows citizens to inspect the documents, once they’ve been vetted, at no cost.
The SBA provided Fasano a timeline of the deal, dating back to 2007 – before Williams went to work for the SBA – when negotiations with a third-party consultant began. Prior to the Starboard spin-off, Ramius was one of three investment funds put on short list by the consultant, SBA spokesman Dennis MacKee said.
“We have provided ample documentation to establish the process was followed and all the appropriate checks and balances were in place,” MacKee said.
Fasano’s records request – more than 6,000 documents – is so expensive because the state’s Sunshine Law includes an exemption for these types of investments that allow third parties to inspect the records and redact any information they deem to be trade secrets or proprietary information, MacKee said.
“The exemption related to this is very clear. We have to comply with the law. We don’t have an option,” he said.
Haridoplos spokeswoman Lyndsey Cruley said the senate president has not yet decided whether to issue the subpoena.
“The President is currently reviewing the letter and prior to making any decision he intends to meet with the parties involved,” Cruley said.
But the subpoena comes, MacKee said his agency will comply as they have in the past.
“As long as we know the confidentiality of the documents will be respected, we have no problem with it,” MacKee said.