Galbreath v. State, Dep't of Budget & Mgmt.

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JOHN A. GALBREATH v. STATE OF MARYLAND DEPARTMENT OF BUDGET AND MANAGEMENT, CENTRAL COLLECTION UNIT

No. 1575-2022

Court of Special Appeals of Maryland

April 4, 2024

IN THE APPELLATE COURT OF MARYLAND ^[*]

Circuit Court for Baltimore County Case No. C-03-CV-22-002232

Graeff, Zic, Salmon, James P. ^[**] (Senior Judge, Specially Assigned), JJ.

OPINION

GRAEFF, J.

This appeal arises from a complaint filed in the Circuit Court for Baltimore County, by John A. Galbreath, appellant, against the State of Maryland Department of Budget and Management, Central Collection Unit ("CCU"), appellee. Appellant sought to compel the CCU to comply with his requests under the Maryland Public Information Act for information regarding its Tax Refund Intercept Program. Appellee filed a Motion to Dismiss or In the Alternative for Summary Judgment. The court issued an order granting the motion and dismissing the complaint.

On appeal, appellant presents two questions for this Court's review,^[1] which we have consolidated and rephrased, as follows:

Did the circuit court err in dismissing the complaint on the ground that the Tax Refund Intercept Program documents requested by Mr. Galbreath were protected from disclosure under § 13-202 of the Tax General Article?

For the reasons set forth below, we shall reverse the judgment of the circuit court, and remand for further proceedings.

FACTUAL AND PROCEDURAL BACKGROUND

I. The CCU

The CCU "is responsible for the collection of each delinquent account or other debt that is owed to the State or any of its officials or units." Md. Code Ann., State Fin. &Proc. ("SF") § 3-302(a)(1) (2022 Supp.). The CCU collects debt by various means, including the Tax Refund Intercept Program ("TRIP"), through which the CCU can certify a debt to the Comptroller of Maryland (the "Comptroller"), who then intercepts any state tax refund that the debtor may receive and applies it to the debt. Md. Code Ann., Tax - Gen. ("TG") §§ 13-914 to 13-919 (2022 Repl. Vol.).^[2] Before certifying a debt to the Comptroller, the CCU must notify the debtor of the intent to use the TRIP procedure. TG § 13-914(a). Debtors then can request an investigation regarding the validity of the debt. TG § 13-916.

II. Mr. Galbreath's Prior Involvement With the CCU's TRIP

In April 2019, Mr. Galbreath received a notice of intent to use the TRIP procedure to offset a debt. Galbreath v. Dep't of Budget and Mgmt., Cent. Collection Unit, No. 1431, Sept. Term, 2022, 2023 WL 5969289, at *1 (filed Sept. 14, 2023). In May 2019, he requested an investigation. Id. at *2. In October 2020, the CCU sent another letter notifying Mr. Galbreath of its intent to certify his name to the Comptroller to intercept any tax refund to satisfy outstanding debt. Id. Mr. Galbreath explained that the debt matter had been resolved. Id. at *3. An administrative hearing was scheduled, but the CCU advised that it had decertified the debt from the TRIP, and a hearing was not necessary. Id. at *4. On May 21, 2021, the Administrative Law Judge ruled that the validity of the CCU's determination to certify Mr. Galbreath's name through the TRIP was moot. Id. Mr. Galbreath then filed a complaint in the Circuit Court for Baltimore County, seeking a declaratory judgment that the CCU violated Maryland law in the process of certifying his alleged debt. Id. On September 14, 2022, the court dismissed the complaint for failure to state a claim upon which relief could be granted, rejecting Mr. Galbreath's argument that the CCU acted unlawfully. Id. at *5. Mr. Galbreath appealed, and this Court concluded that the claim was moot because the CCU had dismissed its tax intercept action and could not seek to collect the alleged debt. Id. at *7.

III. Mr. Galbreath's Public Information Act Requests

On August 12, 2021, while Mr. Galbreath's challenge to the CCU's procedures in his case was continuing, Mr. Galbreath requested TRIP records from the CCU pursuant to Maryland's Public Information Act ("MPIA"). Md. Code Ann., Gen. Provisions ("GP") § 4-601 (2019 Repl. Vol.). He requested "an opportunity to inspect or obtain copies of public records that concern communications between alleged debtors and the Department of Budget and Management (DBM) or its Central Collection Unit (CCU);" communications within the DBM or CCU and "any Maryland or Federal agency/governmental unit concerning the alleged debtors/debts." The request was "confined to situations where the alleged debtor requested an investigation after receiving a delinquency notice or letter from the CCU concerning the alleged debt." Mr. Galbreath sought communications between alleged debtors and the CCU within the previous five years.

In an e-mail dated August 23, 2021, the CCU denied "the bulk" of Mr. Galbreath's request based on the advice of the Office of the Attorney General. The e-mail stated, in relevant part:

I must deny the bulk of your request as per the advice of DBM's Assistant Attorney General. According to their search, over 1,500 debtors over the past five years have requested an investigation into the validity of their alleged debts following receipt of a notice of intent to intercept a state tax refund; however, with the exception of your own account, you do not constitute a "person of interest" as defined in the General Provisions Article of the Maryland Code, §4-101(g). Accordingly, your request to inspect any such records must be denied under GP §4-336(b), as the records contain confidential financial information of individuals.^[3]

The e-mail advised that all requested documents specific to Mr. Galbreath's accounts were being compiled and would be forwarded upon receipt.

On August 25, 2021, Mr. Galbreath sent a "new/amended" request in response to the State's denial. The request was amended to state that "[i]nformation that identifies an alleged individual debtor or entity debtor, such as name, address, telephone number, social security number or EIN, may be redacted. The amount of the alleged debt may also be redacted." In all other respects, the August 12, 2021 and August 25, 2021 requests were identical.

In a letter dated September 9, 2021, the Office of the Attorney General ("OAG"), representing the appellee, denied Mr. Galbreath's request, again citing GP §§ 4-101(g) and 4-336(b). The OAG explained that, with respect to communications with other agencies, once a debt is "certified to the Comptroller for certification through CCU's account management system[,] no written or electronic communication exists between CCU and the Comptroller pertaining to this process." With respect to communications with debtors, the letter explained:

Over 4,000,000 debtors received notices of CCU's intent to intercept a state tax refund within the last five (5) years. Of those debtors, approximately 3,600 debtors requested investigations as to the validity of debts and fall within the parameters of your request. With the exception of your own account, it is my understanding that you are not, nor do you represent a person of interest as defined in GP § 4-101(g). Accordingly, your request to inspect any records must be denied under GP § 4-336(b) as these records contain confidential financial information of individuals.

Accordingly, enclosed in response to your request, please find a copy of a Notice of Intent to Offset through federal vendor payments previously sent to you on April 13, 2019, and a copy of your Notice of Tax Refund Interception along with CCU's response to your Tax Refund Interception Investigation Request.

Second, regarding your communication dated August 25, 2021 which amends your August 12, 2021 request, that request also must be denied for the same reasons discussed above.

The OAG further noted that, even if Mr. Galbreath was "entitled to inspect or copy the requested documents after the appropriate redactions of all personnel information of individuals and all confidential information of individuals," a CCU agent would have to search through thousands of documents and manually remove non-disclosable information, and therefore, the estimated cost would be $221,367.23. Attached to the OAG's letter was a Good Faith Cost Estimate for Mr. Galbreath's request.

On September 22, 2021, Mr. Galbreath submitted a new request to the CCU. This request narrowed the scope of the previous requests. Mr. Galbreath stated that he was seeking three communications between debtors and the CCU for each alleged debt:

1. The initial TRIP notice sent to the alleged debtor;

2. The letter from the alleged debtor that first requests an investigation; and

3. The investigation report sent to the alleged debtor.

Mr. Galbreath's request noted that "[i]nformation that identifies an alleged individual debtor or entity debtor, such as name, address, telephone number, e-mail address, bank account number, social security number, EIN, etc. may be redacted. The amount of the alleged debt may also be redacted." Finally, Mr. Galbreath limited his request "to cases where the alleged debtor first requests an investigation between May 2018 and May 2020." Mr. Galbreath requested a "waiver of all fees in that the disclosure of the requested information is in the public interest and will contribute significantly to the public's understanding of the various procedures the DBM and CCU go through when pursuing payment from alleged debtors."

In a letter dated October 18, 2021, the OAG denied Mr. Galbreath's request. It explained:

Over 3,000,000 debtors received notices of CCU's intent to intercept a state tax refund between May 18 2018 and May 2020. Of those debtors, approximately 1,600 debtors requested investigations as to the validity of the debts and fall within the parameters of your request. With the exception of your own account,

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