AUSTIN — Open government advocates in Texas say a 3½-year-old court decision, probably unintentionally, has blown a growing hole in the state's transparency about how taxpayers' money is spent.

Conservative and liberal think tanks, government watchdogs, consumer groups and industries that depend on robust access to public records, such as newspapers and broadcasters, have formed the Texas Sunshine Coalition.

They want the Legislature next year to dial back secrecy that a 2015 Texas Supreme Court decision encouraged, but the fight will be heated.

In the case brought by aerospace giant Boeing Co., justices widened an exception in the open-records law for certain information that is gathered as different levels of government contract with businesses.

If the released information would "give advantage to a competitor" of either a government or a bidder, it can be withheld, the court ruled. It also allowed private parties, not just government entities, to invoke the exception.

The Texas Public Policy Foundation, a free market-oriented think tank in Austin, and liberal groups such as ACLU of Texas and Center for Public Policy Priorities are among coalition members who say the loophole is being abused. In some cases, even basic information such as contract amounts is being kept secret, they say.

"If taxpayers are not able to know how our money is being spent, there's no way to hold public officials accountable," said James Quintero, director of the foundation's Center for Local Governance.

An excerpt from a multi-million-dollar contract that the Texas Health and Human Services Commission tried to conceal as news reports exposed the contract had been awarded to tech company 21CT without competition and with the help of a state official with close ties to the company.

Quintero and other coalition members have high hopes that a new House speaker and new leadership in the chamber, to be elected when lawmakers return Jan. 8, will allow earlier and fuller consideration of proposed fixes. One possibility is to make entities that contract with the government show that releasing certain information would harm their interests "in a particular competitive situation."

Bills the Senate passed during the 2017 legislative session contained such language, which would force businesses once again to rely on the law's longstanding exception for trade secrets.

But the bills died in the House after a committee chairman declined to hold a hearing until late April, when there were only five weeks left in the session. Government Transparency & Operations Committee Chairman Gary Elkins, a Houston Republican, lost his seat to Democrat Jon Rosenthal on Nov. 6.

Gearing up for a fight

Sponsors of the "Boeing fix" legislation for the 2019 session have assured trade groups that winning a government contract won't mean "you now have to turn over all of your books," as Sen. Kirk Watson put it.

The Texas Health and Human Services Commission acknowledged last spring that a losing bidder for a managed-care contract in the Children's Health Insurance Program was correct that there were errors in a spreadsheet used to evaluate bids. Open government advocates say such errors can't be caught unless growing secrecy about public contracts is rolled back. (File 2017 / Staff)

Still, the Texas Association of Business, the leading advocacy group for business, has signaled it would again fight against bills limiting the Boeing decision's reach. Architects, engineers, road contractors and the biotech and pharmaceutical industries also opposed the 2017 bills.

The association believes the court's ruling was proper, president and chief executive Jeff Moseley said in a written statement.

"Texas can't win the fight for high-paying jobs if our lawmakers insist that companies wanting to come here must tell competitors their sensitive, confidential proprietary information," Moseley said.

The group "will oppose any legislation in which private entities are subject to [the open-records law] in the release of sensitive, confidential proprietary information in governmental entities' contracts with businesses."

Effects of the Boeing decision

Since the Boeing decision, Attorney General Ken Paxton's office has issued more than 2,600 "letter rulings" in which Boeing was cited in withholding some or all of the contract information requested.

"This ruling is getting used and twisted in many more ways than probably the Texas Supreme Court even envisioned," said Kelley Shannon, executive director of the Freedom of Information Foundation of Texas, which supports open meetings, open records and free speech.

Information that once was routinely available is now kept secret, she said. Even dollar amounts for a municipal power plant being built in Denton are shielded, Shannon said. So was information on a brain concussion research effort at the University of Texas Southwestern Medical Center in Dallas, she said. And it took a lawsuit to keep Austin from withholding names of city manager finalists.

"City officials said they would be at a competitive disadvantage with other cities looking for city manager even though no other major cities in Texas were looking for city manager candidates at that time," according to a fact sheet Shannon's group has prepared.

'Let them see firsthand how we're spending their money,' Rep. Giovanni Capriglione, R-Southlake, says of members of the public. He'll again author a House bill to limit withholding of contracting documents. (File 2014/The Fort Worth Star-Telegram)

What lawmakers say

More transparency, not less, is the way to check contracting mishaps and waste, said Rep. Giovanni Capriglione, a Southlake Republican who is the House point man for the effort.

"Open government has to be -- and should be -- one of the boxes we check by the time the [next] session ends," he said.

He noted that last spring, the Health and Human Services Commission cancelled five managed-care contracts for low-income children's health care after a losing bidder used the open-records law and protested.

"It turned out they had a problem with their spreadsheet and they literally awarded it to the wrong person," Capriglione said.

Watson, an Austin Democrat who is leading the push for a Boeing fix in the Senate, said he's trying to compromise with businesses. Some have the misconception that all their financial records could be open to public scrutiny if they bid for government work, he said.

Even under pre-Boeing laws, trade secrets and proprietary information were protected, he said.

"Those decisions have done great damage to the public's right to know about how their tax dollars are being spent," Watson said.

The Boeing decision

In June 2015, the state's highest civil court resolved a squabble involving Boeing's 20-year-old facility for overhauling huge, aging military cargo aircraft at a former Air Force base in San Antonio. The court said the company could withhold from public view some technical items about its lease with a public agency running the old base.

Boeing contended that with the Pentagon's prescribing in great detail what work aircraft refurbishers must do, what wages they must pay and what parts they must use, its ability to negotiate a low rent for use of hangars and runways was crucial.

In a 7-1 decision, the Supreme Court reversed two lower courts that sided with the attorney general's office and the Port Authority of San Antonio, and said the lease details in Boeing's bid had to be divulged.

Instead, the court widened the exception for information that might betray advantage to a competitor or bidder. To be kept secret, the information no longer had to confer "decisive advantage," but just an advantage, wrote Justice John Devine. The ruling also granted private entities standing to challenge release of their allegedly sensitive, competitive information.