LOUISVILLE, Ky. — Gov. Matt Bevin’s administration wrongfully denied a newspaper’s request for records identifying shareholders and investors in a company receiving millions of dollars in public support for a new aluminum plant, Kentucky’s attorney general said.
The state Cabinet for Economic Development violated open records law by refusing The Courier-Journal’s request for the names of those owning shares in Braidy Industries Inc., according to the ruling released Monday.
The identities “are unquestionably a matter of public interest,” the ruling by Attorney General Andy Beshear’s office said.
The open records dispute creates another conflict between the Republican governor’s administration and the Democratic attorney general. And like others, it’s headed to court.
“We are fully confident the information not disclosed is protected” from disclosure, said cabinet spokesman Jack Mazurak.
He said the cabinet plans to appeal Beshear’s decision to Franklin County Circuit Court.
As this year’s General Assembly session wound down, lawmakers approved Bevin’s request for a $15 million incentive for a budding economic development project in eastern Kentucky.
Bevin revealed a few weeks later that Braidy, a privately held company, would build a $1.3 billion aluminum plant in Greenup County. The company promised to hire 550 people in a region devastated by the loss of coal and manufacturing jobs.
The $15 million in public funding was transferred to Commonwealth Seed Capital, a limited liability company which is owned by a state board that also governs the economic development cabinet, The Courier-Journal reported. The money ultimately was invested in Braidy Industries.
Following media requests for public records about the deal, the state released documents that identified only two investors and said both owned at least 20 percent of the company.
The names of Braidy’s other investors were redacted from records released separately by Commonwealth Seed Capital, the Louisville newspaper reported.
Because the state invested public funds in Braidy, the newspaper said, the public is entitled to examine whether any shareholders have other business dealings or personal relationships with the officials responsible for investing the money.
Beshear’s office ruled that the public interest in disclosing those names outweighs the privacy interests of individual stockholders.
“Here, the cabinet, through CSC, made an extraordinary investment of public funds in Braidy,” the opinion said. “In doing so, the commonwealth has conferred a direct benefit on the Braidy shareholders in the form of a capital injection into Braidy.
“Moreover, the commonwealth is now in business with those shareholders,” it added. “This creates a heightened public interest in disclosure.”
The AG’s ruling denied that revealing the list of Braidy’s stockholders would create an unfair commercial advantage to Braidy’s competitors.
“We do not … believe that the identities of the shareholders reveal anything of substance about the economic status of either Braidy or its shareholders,” the opinion said. “Specifically, the fact that an individual is an equity holder does not reveal how well-capitalized the company is, and it says nothing about how much money the investor has.”
Besides the $15 million investment, the state also offered Braidy about $12.5 million in tax incentives, the bulk of which are tied to the company achieving job numbers and wage targets over a number of years.