When Private Improvement District Managers Become Public Agencies:
Horvath v. DBIA Services and the Expansion of Functional Equivalency Under Washington’s Public Records Act

I. Introduction

In Horvath v. DBIA Services dba Metropolitan Improvement District, No. 103339‑7 (Wash. Dec. 18, 2025), the Washington Supreme Court significantly extended the reach of the state’s Public Records Act (PRA), chapter 42.56 RCW, into the realm of public–private partnerships and business improvement districts.

The majority opinion, authored by Justice González, holds that DBIA Services (DBIA), a private nonprofit that manages Seattle’s Metropolitan Improvement District (MID), is the “functional equivalent” of a government agency and therefore subject to the PRA. In doing so, the court:

Clarifies that appellate review of summary judgment on PRA liability is de novo, not abuse of discretion; and
Applies and subtly reshapes the four‑factor functional equivalency test from Telford v. Thurston County Board of Commissioners, 95 Wn. App. 149, 974 P.2d 886 (1999), to bring business improvement district managers like DBIA within the PRA’s transparency regime.

Justice Madsen concurs on the standard-of-review point but dissents on the merits, warning that the majority’s approach risks converting a broad class of private contractors—especially those that fund or supplement police and sanitation services—into de facto “agencies” subject to public disclosure, with potential chilling effects on public–private collaboration.

This commentary examines the opinion in depth: the background and procedural history, the court’s reasoning and use of precedent, the dissent’s critique, and the likely impact on Washington law governing public records, business improvement areas, and private entities that work closely with local governments.

II. Case Background

A. Washington’s Public Records Act and the Functional Equivalency Problem

Washington’s PRA descends from Initiative 276 (1972), whose voters’ pamphlet boldly declared, “The People Have the Right to Know.” As reorganized in 2005, the PRA’s core command is that “disclosure is the rule and secrecy the exception,” and courts must construe the Act liberally to promote transparency. See RCW 42.56.030; Resident Action Council v. Seattle Housing Authority, 177 Wn.2d 417 (2013); Hearst Corp. v. Hoppe, 90 Wn.2d 123 (1978).

A recurring challenge is that modern government often operates through contracts with private nonprofits, associations, and vendors. If only formal governmental entities qualify as “agencies” under the PRA, governments could evade transparency “through creative contracting.” To prevent this, Washington courts use the Telford functional equivalency test to decide when a private entity is so intertwined with government that it must be treated as an “agency” for PRA purposes.

B. Parking and Business Improvement Areas and the Metropolitan Improvement District

Washington’s Parking and Business Improvement Area (PBIA) statute, chapter 35.87A RCW, authorizes cities and towns to create geographically defined areas—funded by special assessments on properties within the area—to promote:

Economic development and neighborhood revitalization;
Decorating public places;
Promoting events and furnishing music;
Providing professional management, promotion, and planning;
Providing maintenance and security for common public areas; and
Providing transportation-related services.

Creation of a PBIA requires:

A petition from owners of at least 60% of the assessed value in the area, or initiation by the legislative body itself (RCW 35.87A.030);
A public hearing (RCW 35.87A.060); and
An ordinance that defines boundaries, assessment rates, and authorized uses of the assessment revenues (RCW 35.87A.100).

Special assessments must confer a special benefit on the assessed property, distinct from benefits to the public at large. WASH. CONST. art. VII, § 9; City of Seattle v. Rogers Clothing for Men, Inc., 114 Wn.2d 213 (1990). Revenues must be used within the statutory and ordinance-defined purposes and “solely” for the benefit of the area. RCW 35.87A.120.

The PBIA statute allows cities to contract with a “chamber of commerce or similar business association” to administer the PBIA, including handling funds. RCW 35.87A.110.

C. The Downtown Seattle Association, DBIA Services, and the MID

The Downtown Seattle Association (DSA), a private nonprofit founded in 1958, petitioned the Seattle City Council in 1999 to create the Metropolitan Improvement District. The City did so by ordinance, most recently renewed in Seattle Ordinance 124175 (2013) (as amended).

The MID covers nearly 300 blocks of downtown Seattle and is funded by special assessments on more than 800 property owners. These assessments pay for services “intended to extend, enhance and fill gaps in existing municipal services,” including:

“Clean services” (neighborhood and alley cleaning, graffiti removal, waste pickup, etc.);
Public safety, outreach, “hospitality,” and welfare checks;
Marketing, communication, and economic development;
Transit, parking, and transportation-related programs; and
Public space operations and programming in parks and plazas.

A 35‑member Ratepayer Advisory Board of assessed property owners, appointed by the City’s finance director, oversees MID operations. Among its tasks, it recommends the selection of a program manager.

The Board repeatedly recommended, and the City consistently hired, DBIA Services as the MID’s program manager. DBIA is:

A private nonprofit corporation;
A subsidiary or affiliate of the Downtown Seattle Association; and
Staffed by people who are not City employees.

DBIA’s functions include:

Hiring “downtown ambassadors” who:
- Assist transit riders;
- Provide wayfinding and hospitality services;
- Conduct welfare checks; and
- Pick up trash and needles, remove graffiti, and address cleanliness issues.
Contracting with private security firms;
Contracting with the Seattle Police Department (SPD) to fund “emphasis patrols” in “neighborhood hot spots”; and
Working with the City’s parks department to provide programming in Westlake Park and Occidental Square.

Crucially, over 92% of DBIA’s budget comes from the MID special assessments:

The City imposes and collects the assessments under the ordinance;
The funds are held in a City financial account dedicated to the MID; and
The City pays DBIA monthly upon receiving invoices for services rendered.

DBIA also receives some voluntary contributions, grants, sponsorships, and County funds, but these are a small minority of its revenue. DBIA files its tax returns as “DBIA Services dba Metropolitan Improvement District,” invoices the City using that name, and often uses “MID BIA” or simply “Metropolitan Improvement District” in public-facing materials. Many documents blur any distinction between the district (a city-created PBIA) and DBIA (the private contractor).

D. Horvath’s Records Request and the Litigation

Steven Horvath lives within the MID and pays its special assessments. In 2021, he requested records relating to the MID, including:

Assessments and budgets;
Tax and financial records;
Job descriptions and organizational information;
Minutes of meetings; and
Compensation (wages and benefits) of staff performing MID-funded services.

Horvath first directed his request to Seattle’s Office of Economic Development, which works with PBIAs citywide. After several months, the office advised that it did not have all the requested records and referred him to the Downtown Seattle Association, where DBIA staff also work.

The DSA’s COO, while maintaining that DSA was not subject to the PRA, voluntarily produced many requested records. She declined, however, to provide staff compensation information, citing concerns (as reflected by general counsel) about recruiting and retaining employees if salaries were publicly disclosed. That compensation information—and, as amicus ACLU observed, similar records concerning MID-funded policing decisions—remained undisclosed.

Horvath sued “DBIA Services dba Metropolitan Improvement District” under the PRA, arguing that:

The MID itself was a public entity;
DBIA and the MID functioned as a single, integrated entity; and
DBIA, by “doing business as” the MID and delivering inherently public services, had become subject to the PRA under the Telford functional equivalency test.

DBIA countered that:

DBIA and the MID are distinct—MID is merely a geographical PBIA, whereas DBIA is a private nonprofit;
DBIA is simply a government contractor, not an “agency”; and
It does not meet the Telford criteria for functional equivalency.

The trial court:

Rejected Horvath’s “single integrated entity” theory (holding that a geographical district “cannot ‘do business’”);
Applied the Telford factors to DBIA alone; and
Granted DBIA summary judgment, concluding DBIA was not functionally equivalent to a public agency.

The Court of Appeals affirmed, but in doing so it applied an abuse of discretion standard to the summary judgment ruling, rather than de novo review. Horvath v. DBIA Services, 31 Wn. App. 2d 549, 551 P.3d 1053 (2024).

The Supreme Court granted review formally on the standard-of-review issue but, after acknowledging that both parties had devoted their briefing to the merits, reached and resolved the underlying functional equivalency question as well.

III. Summary of the Opinion

A. Majority Holding

The court issues two key holdings:

Standard of Review: Appellate review of a trial court’s summary judgment ruling on liability under the PRA is de novo. The Court of Appeals erred by applying an abuse-of-discretion standard. See Hearst Communications, Inc. v. Seattle Times Co., 154 Wn.2d 493 (2005); Spokane Research & Defense Fund v. City of Spokane, 155 Wn.2d 89 (2005).
Functional Equivalency and PRA Coverage: Applying the Telford test, DBIA is the functional equivalent of a government agency and therefore subject to the PRA. The court emphasizes:
- DBIA performs core governmental functions, particularly public safety and sanitation;
- DBIA is overwhelmingly funded (about 93%) by mandatory assessments imposed and collected by the City under the PBIA ordinance;
- Although the City does not control DBIA’s day-to-day operations and did not create DBIA, those factors do not outweigh the first two; and
- DBIA’s consistent self-identification as the “Metropolitan Improvement District” and its public-facing integration with the City-created MID strengthen the case for treating its records as “public records.”

Accordingly, the court reverses the Court of Appeals, holds that DBIA must comply with the PRA, and remands for further proceedings, including determination of Horvath’s attorney fees on appeal.

B. Concurring/Dissenting Opinion (Madsen, J.)

Justice Madsen:

Agrees that the standard of review is de novo; but
Would limit the court’s decision to that issue and not reach the merits, as that was the sole issue on which review was granted.

Because the majority reaches the merits, she addresses them and:

Applies the Telford factors to DBIA and would hold that all four factors weigh against functional equivalency;
Concludes DBIA is merely a private government contractor assisting with economic development and neighborhood revitalization—not a stand-in for the City; and
Warns that the majority’s expansive conception of “governmental function” (and its use of DBIA’s branding as MID) risks pulling wide swaths of private entities into PRA coverage whenever they fund or support public safety or sanitation.

IV. Precedents and Doctrinal Framework

A. Definition of “Agency” and “Public Record” Under the PRA

The PRA defines an “agency” broadly to include:

All state agencies (offices, departments, boards, commissions, etc.); and
All local agencies (counties, cities, towns, municipal corporations, quasi-municipal corporations, and special purpose districts) and their departments or offices.

RCW 42.56.010(1). The definition does not explicitly mention private entities.

“Public record” is defined as:

a writing relating to the conduct of government or the performance of any governmental or proprietary function prepared, owned, used, or retained by any state or local agency. — RCW 42.56.010(3); see Nissen v. Pierce County, 183 Wn.2d 863, 879–80 (2015).

Thus, for PRA purposes, coverage typically turns on whether the entity is an “agency,” and whether a given “writing” relates to government functions and is held or used by that agency.

B. The Telford Functional Equivalency Test

Recognizing that the statutory definition of “agency” is ambiguous as applied to hybrid or quasi-public organizations, the Court of Appeals in Telford v. Thurston County Board of Commissioners, 95 Wn. App. 149 (1999), adopted a functional equivalency test drawn from other jurisdictions (notably Connecticut’s Freedom of Information jurisprudence).

Under Telford and its progeny, courts consider four non-exclusive factors:

Governmental function – Does the entity perform a governmental function?
Government funding – To what extent is the entity funded by government?
Government involvement/control – How much control does government exercise over the entity’s operations?
Government creation – Was the entity created by government?

No single factor is dispositive, and the factors are not exhaustive. Courts weigh them “on balance” to determine whether treating the entity as non-public would “frustrate the goal of government transparency.” See Fortgang v. Woodland Park Zoo, 187 Wn.2d 509, 524, 387 P.3d 690 (2017).

C. Key Washington Cases Applying Telford

Telford (Wash. Ct. App. 1999)
The Washington State Association of Counties and the Washington Association of County Officials—private associations—were held to be functionally equivalent to public agencies due to their close integration with county governments.”
Clarke v. Tri-Cities Animal Care & Control Shelter, 144 Wn. App. 185 (2008)
A private animal shelter performing animal control under contract with local government was deemed an agency where:
- Animal control officers employed by the shelter took oaths to enforce animal laws;
- They had power to seize and destroy animals; and
- Statutes required them to comply with the same constitutional and statutory restrictions applicable to police officers.
This case highlights that when the government delegates police powers to a private entity, functional equivalency is strongly indicated.
Spokane Research & Defense Fund v. Western Central Community Development Ass’n, 133 Wn. App. 602 (2006)
A nonprofit receiving public funds to administer community services was not an agency: providing social services, standing alone, was not considered an inherently governmental function, and the entity retained independence.
Cedar Grove Composting, Inc. v. City of Marysville, 188 Wn. App. 695 (2015)
A private communications consultant’s records were treated as public records because, in the specific functions at issue, the consultant acted as the “functional equivalent” of a city employee. This case illustrates that even where the contractor itself is not an “agency,” particular work may be treated as public agency work for PRA purposes.
Fortgang v. Woodland Park Zoo, 187 Wn.2d 509 (2017)
The Woodland Park Zoological Society, a private nonprofit managing a city-owned zoo under contract, was held not to be an agency under the PRA. The court emphasized:
- Operating a zoo is not a core governmental function (unlike police power functions);
- Only about 30% of the Society’s funding came from the City;
- The City had limited day-to-day control; and
- The Society pre-existed governmental involvement and was not created by the City.
Fortgang also refined the funding factor, noting that both percentage and type of public funding matter (e.g., fixed allocations versus fee-for-service).
Shavlik v. Dawson Place, 11 Wn. App. 2d 250 (2019)
A child advocacy center that conducted forensic interviews in criminal cases under contract with a county was held not to be an agency. Key to the decision: the nonprofit had no control over charging decisions or law enforcement investigations and lacked independent governmental authority.

These cases frame the central tension in Horvath: when does a heavily funded, deeply embedded contractor “step into the shoes” of government, and when is it still just a private service provider?

V. The Court’s Legal Reasoning

A. Standard of Review

The majority first corrects the Court of Appeals on a foundational procedural point:

Summary judgment on liability—including under the PRA—is reviewed de novo.
- The appellate court stands in the shoes of the trial court and applies CR 56(c), asking whether there is any genuine issue of material fact and whether the moving party is entitled to judgment as a matter of law.
- Prior cases such as Hearst Communications and Spokane Research & Defense Fund v. City of Spokane have so held.
More deferential review (e.g., abuse of discretion) may be appropriate for certain aspects of remedy or damages (see Borton & Sons, Inc. v. Burbank Properties, LLC, 196 Wn.2d 199 (2020); Niemann v. Vaughn Community Church, 154 Wn.2d 365 (2005)), but liability is a pure question of law on undisputed facts.

Having corrected the standard, and noting that the facts are undisputed, the court elects to decide the merits of functional equivalency in the interests of judicial economy and given the extensive briefing.

B. Application of the Telford Factors to DBIA

1. Governmental Function

The majority frames “core governmental functions” to include police power functions, such as protecting the “peace, security, health, morals, and general welfare of a community.” See State v. Mountain Timber Co., 75 Wash. 581 (1913).

It emphasizes that DBIA:

Provides sanitation and cleanliness services across the district; and
Engages and funds the SPD to conduct emphasis patrols in areas DBIA identifies as “neighborhood hot spots.”

Although the SPD retains ultimate control over officers on these patrols, the majority notes that:

Emphasis patrols are ordinarily “implemented at the behest of public officials”; and
The PRA is intended to provide insight into the “governmental and political process” behind such decisions, including where and why patrols occur (as the ACLU highlighted in its amicus brief).

On this basis, the majority concludes:

at least some of the services DBIA provides, such as public safety and sanitation, support the peace, security, health, and general welfare of the city and thus are core governmental functions.

This factor is held to favor functional equivalency.

2. Government Funding

The second factor heavily favors treating DBIA as an agency:

Approximately 93% of DBIA’s revenue derives from special assessments imposed by the City under the MID ordinance.
The City Council sets the assessment rates; all resulting revenues are, by law, dedicated to MID purposes and held in a City account.
These funds are not discretionary grant funds or general fees for optional services; they are mandatory levies linked to property ownership in the district.

The majority distinguishes this from a typical “fee-for-service” model, where receiving payment for services—even from public funds—tends to weigh against functional equivalency. Here, the City is not just a customer; it is the statutory vehicle

3. Government Involvement and Control

For the third factor, the majority accepts DBIA’s unrebutted evidence that the City:

Does not manage DBIA’s day-to-day operations; and
Exercises oversight mainly through contract, budget approvals, and the advisory board mechanism, not through direct operational control.

Thus, this factor weighs against finding functional equivalency.

4. Government Creation

The fourth factor turns on origin. The majority notes:

DBIA was created by the Downtown Seattle Association, a private nonprofit, not by the City;
By contrast, the Metropolitan Improvement District itself was created by the City via ordinance under the PBIA statute.

Applying its precedent in Fortgang, the majority treats “government creation” as focusing on whether a government incorporation act formed the entity. Because that did not occur for DBIA itself, this factor also weighs against equivalency.

C. The Balancing: Purpose of Telford and DBIA’s “Public Identity”

On a straightforward tally, the Telford factors are “fairly balanced”:

Government function – favors equivalency;
Government funding – strongly favors equivalency;
Government control – opposes equivalency;
Government creation – opposes equivalency.

The majority, however, stresses that Telford is not a mechanical scorecard. The ultimate question is whether exempting the entity from the PRA would frustrate the underlying goal of government transparency.

Here, two additional considerations tip the scales:

The perspective of the assessed resident (Horvath) – For someone living in the MID and compelled to pay assessments that fund DBIA’s operations and salaries, including for services resembling municipal policing and sanitation, denying access to DBIA’s records (such as staff compensation and policing decisions) would plainly frustrate transparency.
DBIA’s self-presentation as the “Metropolitan Improvement District” – DBIA:
- Files taxes and invoices as “DBIA Services dba Metropolitan Improvement District”;
- Uses MID branding (“MID BIA”) in public documents; and
- Appears in business plans and communications without distinction between “MID” and “DBIA.”
The majority treats this “holding itself out” as the public district as an additional, non-enumerated factor weighing in favor of PRA coverage. When a private contractor publicly represents itself as the improvement district created and controlled by government, the public reasonably perceives it as part of government, and its records take on a public character.

Taking into account both the formal Telford factors and these supplemental considerations, the court holds that DBIA is the functional equivalent of a local agency.

Horvath is awarded reasonable attorney fees on appeal, with the amount to be set by the trial court on remand.

VI. The Dissent’s Analysis and Concerns

A. Scope of Review

Justice Madsen first emphasizes that the only question formally accepted for review was the standard-of-review issue. She would have resolved that question (de novo review) and remanded, without reaching the functional equivalency question. She proceeds to address the merits only because the majority does so.

B. Reframing the Governmental Function Inquiry

Justice Madsen provides a more detailed statutory analysis of chapter 35.87A RCW and the City’s MID ordinance. She draws several conclusions:

PBIAs are geographic constructs created to enhance economic viability, livability, and aesthetics—not independent governments with inherent police power.
The PBIA statute’s enumeration of permissible activities (parking, decoration, music, security, etc.) does not itself grant or delegate police or regulatory authority.
The addition of “security” in RCW 35.87A.010(1)(f) in 1985 was expressly intended to allow businesses to finance private security to supplement city law enforcement, not to create new law enforcement bodies.

Drawing on Washington law distinguishing “private security guards” (licensed under chapter 18.170 RCW without law enforcement powers) from “sworn peace officers” (public employees with law enforcement powers), she argues:

Improvement districts and their contractors cannot exercise “police power” unless explicitly granted that authority by statute or ordinance.
No such grant exists here: DBIA’s private security contractors have no power to enforce laws, issue citations, or arrest.
DBIA’s contract with SPD does not change this: SPD officers remain City employees, under the exclusive control of the Police Chief, even when DBIA funds emphasis patrols.

By analogy to Clarke and Shavlik, she stresses that what matters is decision-making authority and control:

In Clarke, animal control officers employed by the shelter wielded statutory police powers.
In Shavlik, the child advocacy center had no authority to control charging decisions or investigations; it merely assisted.
Here, DBIA supplements, but does not control, law enforcement or sanitation; it cannot govern, regulate, or make binding governmental decisions.

Thus, she would hold that DBIA does not perform a core governmental function. To characterize supplemental services as “governmental” merely because they support public health and safety, she warns, would be overbroad enough to encompass any business that hires security or cleaning services in a public-facing environment.

C. Funding as a Fee-for-Service Model

On the funding factor, Justice Madsen notes that Washington cases have suggested that the percentage of public funding is important, but:

None of those cases actually turned on a precise percentage; and
Other jurisdictions caution that even substantial (or predominant) public funding does not automatically make an entity public, absent substantial governmental control. She cites cases such as:
- Dow v. Caribou Chamber of Commerce & Industry, 2005 ME 113, 884 A.2d 667 (Me. 2005);
- Frederick v. City of Falls City, 289 Neb. 864, 857 N.W.2d 569 (2015); and
- State ex rel. Oriana House, Inc. v. Montgomery, 110 Ohio St. 3d 456, 854 N.E.2d 193 (2006).

She emphasizes that MID assessments are legally distinct from general tax revenues:

They must be spent for specific, pre-identified purposes in the petition and ordinance;
They must confer special benefit on the assessed properties; and
The City cannot lawfully divert those funds to other uses.

In her view, the City’s payments to DBIA, made upon submission of invoices, are closer to a fee-for-service arrangement, even if the funds are derived from dedicated assessments. Under Fortgang, this kind of model typically weighs against finding functional equivalency.

D. Government Control and Creation

Justice Madsen agrees with the majority that:

The City does not control DBIA’s daily operations; and
DBIA was not created by the City or by statute but rather by a private nonprofit (the DSA).

Thus, the third and fourth Telford factors unequivocally weigh against PRA coverage.

E. Treating DBIA and MID as a Single Entity

The dissent is particularly critical of the majority’s move, late in the analysis, to treat DBIA and the MID jointly for purposes of “government creation” and the overarching transparency purpose.

The trial court had reasoned—and the dissent agrees—that the MID is:

A geographic improvement area created by ordinance; and
Not an “actor” capable of “doing business,” holding property, or entering contracts in the sense that DBIA does.

Justice Madsen notes that:

For the first three Telford factors, the majority analyzes DBIA alone;
Only at the end does the majority fold the MID’s governmental origin and DBIA’s “dba MID” branding into the calculus.

She views this as inconsistent application of Telford and warns that public references to an entity as an “agency” or district for some purposes do not settle its legal character for all purposes. Cf. Graham v. State Bar Ass’n, 86 Wn.2d 624 (1976).

F. Balancing and Policy Concerns

On balance, Justice Madsen would conclude:

Governmental function – against functional equivalency;
Funding – against (given the fee-for-service character and statutory constraints on use);
Government control – against;
Government creation – against.

She adds policy concerns:

Many private entities (e.g., Seafair, Seattle Pride, large event organizers) routinely contract for additional police presence, road closures, or emergency services. If funding supplemental public safety is treated as a “core governmental function,” those entities may be drawn into PRA coverage.
Private contractors may hesitate to partner with cities—especially in roles touching public safety or sanitation—if doing so exposes their internal personnel records (salaries, leave, evaluations, training records) to public disclosure. See DeLong v. Parmelee, 157 Wn. App. 119 (2010) (discussing privacy concerns in personnel records).
The city already had access to nearly all requested records (except DBIA staff compensation); forcing PRA coverage onto DBIA itself may be a heavy-handed way to fill discrete transparency gaps.

For these reasons, she would affirm the trial court’s determination that DBIA is not an “agency” under the PRA.

VII. Complex Concepts Simplified

A. What Is “Functional Equivalency”?

“Functional equivalency” is a way of asking:

Is this private organization, in practice, acting so much like a government agency that it should be treated as one for purposes of public records transparency?

Courts look beyond formal labels (“nonprofit,” “contractor”) to the reality of the relationship:

Is it doing government’s core work?
Is it mostly funded with public money?
Is government directing its operations?
Did government create it for a public purpose?

If the balance of answers is “yes,” and excluding it from the PRA would undermine government transparency, the court may deem it the functional equivalent of an “agency.”

B. Standard of Review: De Novo vs. Abuse of Discretion

On appeal, courts apply different standards of review depending on the issue:

De novo review means the appellate court decides the issue anew, without deference to the trial court’s legal conclusions. This applies to pure issues of law, like statutory interpretation or summary judgment on undisputed facts.
Abuse of discretion applies when the trial court had latitude to choose among reasonable options (e.g., evidentiary rulings, sanctions, or sometimes the amount of a PRA penalty). The appellate court will reverse only if the decision was manifestly unreasonable or based on untenable grounds.

In Horvath, liability under the PRA turned on legal interpretation and undisputed facts, so the Supreme Court reaffirmed that de novo review is correct.

C. Special Assessments vs. Taxes

A tax is a compulsory contribution to government’s general revenues, used for broad public purposes. A special assessment is also compulsory but:

Is imposed on specific properties within a defined area;
Must finance improvements or services that specially benefit those properties; and
Cannot be used for general governmental purposes.

In a PBIA like the MID, special assessments fund services (cleaning, security, marketing) that are legally required to benefit the assessed area. This special-status funding is central to the debate over whether DBIA’s revenue stream is more like public taxation (supporting functional equivalency) or like a fee paid for services (cutting the other way).

D. Police Power and Governmental Functions

“Police power” refers broadly to the state’s inherent authority to legislate and act for the health, safety, morals, and general welfare of the public. Functions like:

Law enforcement;
Public health regulation;
Fire protection; and
Core sanitation and nuisance abatement

are classic exercises of police power.

The key dispute in Horvath is whether supplemental services—like additional cleaning or extra police patrols, funded and scoped by a private entity—are themselves governmental functions for PRA purposes, when government could (and does) provide similar baseline services.

VIII. Impact and Significance

A. Expansion of PRA Coverage to Improvement District Managers

The central doctrinal development is that private managers of business and parking improvement areas—when heavily funded by mandatory assessments and providing core public safety and sanitation services—can be treated as agencies under the PRA.

Consequences include:

Ratepayers and residents within PBIAs in Seattle and other Washington cities can now seek:
- Budgets and financial records;
- Contract terms with private security and police departments;
- Policies and communications regarding “hot spot” identification and patrol targeting;
- Staff compensation information for employees funded by assessments.
Private nonprofits managing PBIAs (or similar districts) will need:
- PRA-compliant records retention and disclosure procedures;
- To evaluate which of their records fall within the PRA’s scope (particularly where staff perform both public and privately funded work); and
- To budget for potential litigation exposure and penalties for noncompliance.

B. New Emphasis on “Public Branding” and Integration

A notable, and relatively new, element in the court’s analysis is its reliance on DBIA’s self-identification as the MID:

Using “dba Metropolitan Improvement District” on tax filings and invoices;
Using “MID BIA” branding; and
Issuing public documents that blur the line between the MID (a City-created PBIA) and DBIA (the contractor).

This suggests that:

Private entities that closely align their external identity with that of public districts or agencies may increase the likelihood that courts will treat them as “functional equivalents.”
Conversely, maintaining clear public separation between the governmental district and the contractor may become an important risk-management issue for nonprofits and vendors.

C. Policing, Private Funding, and Transparency

The ACLU’s amicus brief underscored a growing concern about privately driven policing:

Entities like BIDs or PBIAs funding extra patrols in targeted “hot spots” can influence where and against whom law enforcement resources are deployed;
Without PRA coverage, the decision-making behind such targeted policing could be shielded from public scrutiny, even though the patrols involve sworn police officers exercising public power.

By classifying DBIA as an agency, the court ensures that:

Records about how and why emphasis patrols are requested and funded can be sought under the PRA;
Communities can examine whether private funding steers public enforcement in ways that raise fairness, equity, or civil-liberties concerns.

This aspect of the decision may prove especially influential in future litigation involving:

University or hospital police forces with mixed public and private financing;
Corporate security partnerships with local law enforcement; and
Nonprofits that coordinate with police on homelessness, mental health outreach, or “safety ambassador” programs.

D. Tensions with Fortgang and Future Telford Cases

Horvath sits in partial tension with Fortgang, where a private nonprofit managing a city-owned zoo was not deemed an agency, despite a long-term management contract and substantial public funding.

Key distinctions the court effectively relies on (whether explicitly or implicitly) include:

Here, DBIA’s work touches on health, safety, and cleanliness—closer to police-power functions—whereas a zoo was treated as a discretionary cultural amenity.
DBIA’s revenue stream is almost entirely public and derived from mandatory assessment mechanisms, not discretionary grants and ticket revenues.
DBIA deliberately markets itself as the MID (a district created and controlled by the City), whereas the zoo society maintained a separate identity.

Future courts applying Telford will need to navigate this emerging line:

Fortgang may continue to protect many nonprofits that manage cultural or recreational assets under contract, especially where funding is mixed and public control limited.
Horvath will likely be invoked where private entities:
- Provide services that are substantively similar to municipal police, sanitation, or other core public services;
- Are overwhelmingly financed by mandatory public assessments or levies; and
- Publicly present themselves as part of a governmental district or program.

E. Possible Chilling Effects and Contracting Strategies

Justice Madsen’s warnings about potential chilling effects are not trivial. Municipalities and private partners may respond by:

Structuring contracts to:
- Clarify that the contractor is not an “agency” and must comply with PRA only as to records it provides to the City;
- Limit contractors’ roles in law enforcement or sanitation to avoid characterization as performing core governmental functions; or
- Require City retention of key records (e.g., budgets, policing proposals) to channel PRA requests through the City rather than the contractor.
Reconsidering the use of PBIA managers for functions that could expose sensitive internal records (e.g., individualized salary data) to public disclosure.

At the same time, the majority’s framework arguably promotes more careful, transparent contracting:

Cities that intend contractors to act as true extensions of government, especially in public safety or neighborhood regulation, can integrate explicit PRA obligations into contracts.
Contractors who want to remain purely private will need to avoid de facto assumption of governmental roles and branding.

IX. Conclusion

Horvath v. DBIA Services is a significant step in Washington’s continuing effort to ensure that the “right to know” keeps pace with modern forms of governance. The decision:

Reaffirms de novo review of PRA liability on summary judgment;
Applies and subtly expands the Telford functional equivalency test, especially in the context of business improvement areas;
Holds that a private, nonprofit program manager of a PBIA—heavily funded by mandatory assessments and providing quasi-municipal safety and sanitation services—can be treated as an “agency” under the PRA; and
Highlights DBIA’s self-presentation as the “Metropolitan Improvement District” as a factor supporting PRA coverage.

The majority’s approach emphasizes transparency for residents compelled to fund public-facing services, particularly where private funding shapes public policing and sanitation in their neighborhoods. The dissent, by contrast, stresses statutory limits on PBIA authority, dangers in conflating supplemental private services with core governmental functions, and the risk of sweeping many public–private collaborations into public-agency status.

Going forward, Horvath will likely serve as a leading precedent for:

Cases involving business and parking improvement districts and their managers;
Disputes over access to records concerning privately funded policing, security, and sanitation programs; and
The broader question of when private nonprofits and contractors so closely parallel government that they must share its obligations of openness under the Public Records Act.

In essence, the Washington Supreme Court signals that when private entities assume the practical mantle of local governance—funded by compelled public assessments and delivering core public-facing services—they cannot fully escape the sunlight that the people, through Initiative 276 and the PRA, demanded half a century ago.

When Private Improvement District Managers Become Public Agencies: Horvath v. DBIA Services and the Expansion of Functional Equivalency Under Washington’s Public Records Act