A story in Wednesday's Business and Finance section mentioned a closed meeting held by the Federal Reserve Board. The meeting dealt with anticipated expenditures for renovation work and furniture purchases. The Fed's position is that an open meeting would have trustrated the purpose of getting the lowest possible bids.
Should a Federal Reserve Board meeting to consider its own proposed office furniture design and building renovation project be allowed to be closed to the public?
The Fed thought so, using as grounds to close the meeting the claim that "matters of a sensitive finiancial nature were being considered by the board"
But Common Cause didn't think so, saying that decision "raises serious questions about the Fed's willingness to comply with the spirit and meaning of the Sunshine Act."
Yesterday the Senate Subcommittee and Federal Spending Practices and open Government held hearings to see if the Fed and the other federal regulators are indeed following the mandate of he Sunshine Act.
The Sunshine Act, which was passed by Congress in the fall of 1976 and became effective in last March, has been the subject of two recent studies that indicate there might still be clouds over at least some of the federal agencies it was aimed at.
A Library of Congress research study of how the act is working, published in September, pointed out that of 1,003 meetings listed in the Federal Register between March 24 and Sept. 9:
339 were completely closed to the public.
183 were partially closed.
Relative exemptions, that would allow such closings, were cited in only 193 cases.
32 agencies held totally or partially closed meetings, but only 12 cited the necessary exemption that would allow a private meeting.
A second study by Common Cause found 216 of 591 meetings checked were fully open to the public, with 232 completely closed and 143 partially closed.
"The implications of these statistics are plainly disturbing". Common cause president David Cohen said. "Despite a landmark law mandating openness in multi-member executive agencies, despite President Carter's call for new era of executive branch openness, the prevailing pattern remains the same: to avoid openness. Decision are still made behind closed doors."
Cohen warned that there is a "strong tendency on the part of agencies to close meetings under one of the act's ten exemptions in spite of the presumption in favor of openness."
"We doubt," Cohen said, "that the authors of this legislation anticipated that fewer than 40 per cent of all meetings held would be entirely open to the public."
Beside citing the Fed as a example, Common Cause also named the Interstate Commerce Commission as a violator.
After the law was in force," Cohen testified. "The ICC disposed of one of the most important cases in its history in private."
He cited the ICC meeting on June 28 to determine the tariff rates on the transportation of oil in the Alaska pipeline. That meetings was closed, although several weeks later the ICC did release the transcripts of the proceedings.
Cohen also pointed to a private meeting between ICC members and representatives of the National Industrial Traffic League, a major trade association for shippers affected by the ICC.
"We doubt the wisdom or propriety of an agency meeting in private with an association that has a clear and vested interest in the outcome of agency decisions," Cohen said.
ICC Chairman Dan O'Neal defended his agency in testimony after Cohen.
"The vast majority of our meetings since March have been open to the public," O'Neal said, adding that his agency, with 31 per cent of all of its meetings held in the open, had a much better track record than most others.
He said he personally had favored opening up the hearing on Alaskan oil, but the majority of the commission had voted him down. He also said that the ICC released the transcripts of the meeting even when the Act would have permitted us to withhold disclosure."
Subcommittee Chairman Lawton Chiles (D-Fla.) disagreed, interrupting O'Neal to say. "It strikes me that this is exactly the kind of meeting the public should see to learn about the ICC. And, they're entitled to see it."
O'Neal also defended the legality of the informal meeting he and other ICC commissioners had with the trade association, but added that now, "even though there was nothing secret about it, I consider that meeting a mistake."
"Open discussion of these deliberations could lead to a run on the bank." he said, "or to a smaller price being obtained from the sale of (a failed bank). To the degree that the FDIC does not receive the maximum price possible for a failed bank's asserts, it would not be meeting its obligations as a receiver under state and federal law."
Cobb also said that "poor attendance at open meetings raises the question of whether the administrative burden of the act is justified."
He said that in order to comply with the act, " a substantial amount of paper work and staff time is required for open meetings.
The FDIC, Cobb said, had another special problem. Since the act defines a "meeting" as any discussion of agency business among a quorum of agency members, and since the FDIC has only three members, every time any two of the members had a discussion it could be constructed as a meeting.
Cobb said the problem has not been raised yet, because a third director has not been confirmed, and the Comptroller of the Currency, an Ex-official member of the board, is not directly involved in the day-to-day operation of FDIC business.