Recent court decision supports better open data on America’s nonprofits

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The IRS. (Photo credit: David Boeke/Flickr)

Recently, Carl Malamud and his site public.resource.org scored a victory in a long-running effort to give the public better access to data on America’s nonprofits.

The IRS was trying to deny a FOIA request for form 990s filed electronically by nine tax-exempt charitable organizations, claiming that it would be too costly to release the records in the machine-readable format that was requested by public.resource.org in its original FOIA.

United States District Judge William H. Orrick of California wasn’t particularly impressed with this argument, and ordered the IRS to produce the records as requested.

Judge Orrick identified some pretty significant problems with the IRS’ argument.

The FOIA was filed under a 1996 E-FOIA amendment which basically says that an agency has to produce documents in any format they are requested in, so long as the documents are “readily reproducible by the agency in that form or format.” The IRS collects 990 data electronically and possesses and maintains it in the format requested by public.resource.org.

Furthermore, this data is already public, the IRS just prefers to make it available in formats that are essentially useless (until people like Carl Malamud spend loads of time and money converting it into better formats).

So, why is the IRS so hesitant to release the good data that they do have? Because it’s used to doing it the old way and doesn’t want to change. The agency claims that it would be a significant burden ($6,200) to “develop protocols and train staff to be able to redact exempt information from the Form 990s” in machine-readable format.

Judge Orrick did not find this argument compelling; in fact, he found his own argument in favor of the IRS spending the money now, saying, “It is worth noting that the ‘one-time expenses’ related to developing a protocol and training staff may well be recouped if the IRS receives and responds to other modest requests for Form 990s in MeF in the future.” In short, open the data once and it’s a lot easier — and cheaper — to do so in the future.

This is a big win, but the legal saga — which started in 2013 — isn’t over yet. The IRS has appealed Judge Orrick’s ruling, leaving me wondering how much more than $6,200 they will end up spending fighting the release of these records.