The Supreme Court Narrowly Construes the “Minimum-Value” Executive Session Exception to the OPMA

On June 8, the Washington Supreme Court issued its opinion in Columbia Riverkeepers v. Port of Vancouver, adopting a very narrow interpretation of the executive session “exception” to the OPMA for discussion about the sale or lease of real estate (the “minimum-value exception”). This exception permits governing bodies to enter executive session “[t]o consider the minimum price at which real estate will be offered for sale or lease when public knowledge regarding such consideration would cause a likelihood of decreased price.” RCW 42.30.110(1)(c).

What did the Port Argue?

The Port of Vancouver argued that the minimum-value exception was designed to protect a public agency’s negotiating position to allow the agency to meet “its obligation to maximize the value for public property.” It therefore argued that it could go into executive session to discuss any factor that might affect the sale or lease price.

What did the Court Conclude?

In summary, the Court narrowly defined the purpose of the minimum-value exception as only protecting the government agency’s bottom line/backstop bargaining position on price. It is not meant to allow the agency to negotiate the best possible price and does not protect any and all aspects of the negotiating position.

To the extent that any factor may potentially impact the agency’s bottom-line price, that factor must first be discussed in open session without reference to the specific dollar impact on the bottom line price. After this public discussion has occurred, the governing body may go into executive session but only to discuss how this factor will impact the bottom-line price. 

What was the Court’s Rationale?

The Court disagreed with the port and identified a much narrower purpose for the minimum-value exception. Specifically, it was not meant to protect agencies from “be[ing] disadvantaged in commercial negotiations.” Instead, the exception is only intended to “prevent potential buyers of public real estate from becoming aware of the government entity's minimum price and, therefore, failing to offer the public agency a higher price.” In other words, it was only meant to protect the “bottom line price” or “backstop” price, while “requiring that "[a]ll other aspects" of a sale or lease be discussed in public.”

The Court therefore held that “a government entity may enter executive session to discuss the minimum acceptable value to sell or lease property, but not to discuss all factors comprising that value. To the extent that various factors directly alter the lowest acceptable value, the governing body may discuss how these factors impact the minimum price; but general discussion of the contextual factors themselves must still occur at an open public meeting.”

The Court carefully further explained that "‘to consider the minimum price’ means to carefully think about the least acceptable amount of money or benefits to be accepted for a piece of property. Under this plain meaning, an executive session must be specifically concerned with the minimum price and information discussed must be tied to that minimum price.”

The Court recognized that many factors may affect the minimum price, but ruled that those factors should first be discussed in public without stating “their specific dollars-and-cents impact on price” and only then can the actual impact be discussed in executive session: “Having educated themselves on the issues relevant to the property in an open session, commissioners can then retire to executive session to decide an appropriate minimum value for the lease or sale of that property.”

The Court further explained that these other factors can be referenced in executive session, but the focus must be on the impact on price: the members of the governing body “can properly reference the reason for a particular price without making those factors the focus of discussion. Again, focus is key. Contextual references are appropriate so long as the goal and outcome of the discussion remains identification of the lowest acceptable value.”

The Court then provided a summary of how the port’s negotiations should have proceeded that helps explain what can and cannot be discussed in executive session: 

Applying our analysis to the Port's facts, we see some initial practical impacts as follows-public meetings would review a lease's potential impacts on local jobs, local spending, environmental risks, public safety, and risks to neighboring tenants. For instance, discussion of Tesoro-Savage's limited liability structure would take place in public, exploring the possible need for environmental cleanup, the limits on the prospective tenant's ability to pay, and the role of insurance in responding to uncovered risks. After a full discussion of these issues in public, the Port's commissioners would then enter executive session to establish the dollar impact on the acceptable lease price-setting the new minimum value. Having established this minimum value, the commissioners would return to discussing the project in public session. In contrast to this hypothetical scenario, the Port's broad interpretation of the statute would allow the vast majority of discussions pertaining to the sale or lease of real estate to continue taking place behind closed doors. 

Does this Case Affect Other Executive Session Exceptions?

A couple of other points are worth noting regarding other executive session exceptions. First, the Court adopted a general rule for interpreting the OPMA that could be applied to PRA exemptions as well: “where multiple reasonable interpretations of an exception are available, we are directed to adopt the narrowest of the alternatives.”

Second, the Court expressly contrasted the narrow language in the minimum-value exception with the broader language in the attorney-client-privilege exception. Thus, while the Court would likely reject any overbroad interpretation of any exception, this decision does not directly restrict every exception in the same way. 

Third, while the Court did not discuss the “real-estate-purchase” exception, it is worth noting that that exception is worded very differently. Instead of identifying a single factor—price—the exception permits executive sessions “[t]o consider the selection of a site or the acquisition of real estate by lease or purchase when public knowledge regarding such consideration would cause a likelihood of increased price.” RCW 42.30.110(1)(b). Thus, by its very terms, it would seem to permit an agency to keep even its intent to purchase property secret. Whether this exception still applies to protect an agency’s bottom line maximum price once an agency’s intent to purchase is known is a question that will have to be answered another day.