Lee Academy Education Assoc. and Lee Academy Board of Trustees, No. 87-UD-05
(April 14, 1987), reversed by MLRB No. 87-A-07. Board decision aff'd CV-87-338 and
556 A.2d 218 (Me. 1989). STATE OF MAINE MAINE LABOR RELATIONS BOARD Case No. 87-UD-05 Issued: April 14, 1987 _________________________ ) LEE ACADEMY EDUCATION ) ASSOCIATION/MTA/NEA ) ) and ) JURIDICTIONAL DECISION ) LEE ACADEMY BOARD OF ) TRUSTEES ) _________________________) This unit determination proceeding was initiated on December 1, 1986, when Lee Academy Education Association/MTA/NEA (hereinafter referred to as "Union") filed a petition for appropriate unit deter- mination, pursuant to 26 M.R.S.A. 966 (Pamph. 1986). The Union's petition seeks the creation of a bargaining unit composed of all Teachers (including half-time Teachers), the Athletic Director, Department Heads, the Business Secretary, the Assistant Treasurer, the Assistant Head Master, Dormitory Parents, and the Library Aide employed by the Lee Academy Board of Trustees ("Employer"). The Employer opposed the Union's petition on the grounds that the Lee Academy Board of Trustees is not a public employer, within the defini- tion of 26 M.R.S.A 962(7) (Pamph. 1986); therefore, the Maine Labor Relations Board ("Board") lacks jurisdiction to fashion any bargaining unit composed of the Employer's employees. At the outset of the evi- dentiary proceeding in this matter, the parties agreed that con- sideration of this action should be bifurcated. The hearing examiner would first receive evidence on, weigh, and decide the jurisdictional issue. If it was determined that the Board has jurisdiction to make an appropriate unit determination herein, the evidentiary proceeding would be reconvened in order to receive evidence pertinent to the usual unit determination issues. The evidentiary proceeding on the jurisdictional issue in this case was conducted by the undersigned hearing examiner for the Board in the Commissioner of Administration's Conference Room, State Office Building, Augusta, Maine, on February 17, 1987. The Union was repre- sented by Elmer S. Pinkham, Jr., Affiliate Service Director, MTA/NEA [-1-] ________________________________________________________________________________ District #8, and the Employer was represented by Linda D. McGill, Esquire. Prior to presenting testimonial evidence, the following exhibits were offered and admitted into the record: Union Exhibit No. 1 Certification list of Lee Academy Employees, Maine Department of Education and Cultural Services, 1/22/87 [Admitted without objection] Union Exhibit No. 2 Letter from former Lee Academy Headmaster John A. Robinson to Dept. of Education & Cultural Services, April 16, 1986. Contains 1986-1987 Block Grant informa- tion, data has been updated for 1987-1988 and is, therefore, different from that in the exhibit. [Admitted without objec- tion, with caveat about 1987-1988 data] Union Exhibit No. 4 Lee Academy Board of Trustees By-Laws (1983 Revised Edition) [Admitted without objection] Union Exhibit No. 5 Faculty/Staff Contract, currently in use at Lee Academy [Admitted without objec- tion] Union Exhibit No. 7 Letter from Internal Revenue Service District Director to Lee Academy, 1/31/78 [Admitted without objection] Union Exhibit No. 9 Internal Revenue Service Tax Examiner to Lee Academy, 2/11/83 (Admitted without objection] Union Exhibit No. 13 Maine State Retirement System Payroll Reporting Manual for Public School Teacher Employers, 9/17/86 (Employer objected on the grounds that expert testimony would be required to interpret any relevant sections of the Maine State Retirement Law. Objection overruled. To the extent that some Lee Academy employ- ees participate in the State Retirement System and to the extent, if any, that such participation is relevant hereto, then the Payroll Manual is relevant as the Retirement System's interpretation of its own rules and procedures.) Employer Exhibit No. 1 Chapter 246 of the Private and Special Laws of 1845 (Admitted without objec- tion] -2- ________________________________________________________________________________ Employer Exhibit No. 2 Current contract between Lee Academy and Maine School Administrative District No. 30 [Admitted without objection] Employer Exhibit No. 3 Letter from Superintendent of Schools, Maine School Administrative District No. 30, to Deputy Commissioner, Maine Department of Education and Cultural Services, 12/29/86 [Admitted without objection] Employer Exhibit No. 4 Letter from Ellen Egan George to Superintendent of Schools, Maine School Administrative District No. 30, 1/8/87 [Admitted without objection] Employer Exhibit No. 5 July, 1986 - June, 1987 Operating Budget, Approved by Lee Academy Board of Trustees on 10/18/86 [Admitted without objection] The following exhibits were offered for admission into evidence but were not admitted for the reasons stated in parentheses following a description of each item. Union Exhibit No. 3 Contract between Lee Academy and MSAD #30 (Withdrawn with the understanding that the Employer is to submit the current contract between Lee Academy and MSAD #30; see Employer Exhibit No. 2.) Union Exhibit No. 6 Seven-page package concerning the with- drawal of Lee Academy from participation in Social Security retirement and the Academy's efforts to become involved in the Maine State Retirement System (Employer's objection that the exhibit contains confidential communications between Lee Academy and its attorney was sustained.) Union Exhibit No. 8 Memorandum from Assistant Attorney General to Maine state Retirement System dated February 6, 1981 (Employer's objec- tion that there was no proper authen- tication for the exhibit was sustained.) Union Exhibit Nos. 10, Excerpts from the Maine State Retirement 11 and 12 System Public School Teacher payroll Manual (Employer's objection that these exhibits should be excluded as irrelevant was sustained; see Union Exhibit No. 13 and caveat noted during discussion of its admissibility.) -3- ________________________________________________________________________________ Employer Exhibit No. 6 Lee Academy Faculty Handbook (Union objected to the relevancy of the exhibit to the jurisdictional question presented and the Employer withdrew the proposed exhibit.) The sole witness presented by the Union was Ms. Therese Sawyer who testified on voir dire on the issue of whether the Employer had waived its attorney-client privilege in connection with Union Exhibit No. 6 and who appeared as a rebuttal witness. The Employer presented Mr. Paul J. Keaney, Headmaster of Lee Academy, and Mr. Howard Mallett, President of the Lee Academy Board of Trustees, as its witnesses. The parties were afforded full opportunity to examine and cross-examine witnesses and to introduce evidence. Both parties filed written argu- ments which have been considered by the hearing examiner. FINDINGS OF FACT On the basis of the record as a whole, the hearing examiner finds: 1. The Petitioner, Lee Academy Education Association/MTA/NEA, is a lawful organization which has as its primary purpose the represen- tation of employees in their employment relations with employers, within the meaning of 26 M.R.S.A. 962(2) (1974). 2. Through adoption of Chapter 246 of the private and special Laws of 1845, the Legislature incorporated Lee Academy as a "body politic" named Lee Normal Academy. The term "body politic" was a generic term describing private corporations as illustrated by its use in the enactments creating the Kennebec and Boston Steam Packet Co. and the Bangor Steam Navigation Co. (Chapters 259 and 290, respec- tively, of the Private and Special Laws of 1845). 3. Under Chapter 246, Lee Academy was to be governed by a Board of Trustees which was authorized to sue and be sued; to have a cor- porate seal; to enact by-laws for the management of the concern; to take, hold, grant, convey, or lease real and personal property; and to "choose all officers necessary for the management of their affairs, for the promotion of education, and the preparation of teachers of primary schools." 4. Since its incorporation, the Board of Trustees has been self- perpetuating with current members filling vacancies on the Board as -4- ________________________________________________________________________________ they occur. 5. The Board of Trustees consists of 30 members, each being elected to a 6-year term by the other members of the Board, and meets at least three times per year. 6. The Board of Trustees has full authority to manage the affairs of the Academy including the power to take the following actions: purchasing and selling realty, incurring debt, hiring and firing all employees including the Headmaster and the faculty, managing endowment funds, approving the budget, determining personnel policies and staff salaries, determining curriculum options, establishing grade require- ments, and maintaining the physical plant. 7. Between meetings of the Board of Trustees, the Board of Directors, consisting of 8 members of the Board of Trustees, has the power to act on behalf of the Academy, subject to ratification by the Board of Trustees. 8. The Board of Directors meets with the Headmaster at least once per month and therefore is more directly involved in the day-to-day operation of the Academy. The Board of Directors functions as an exe- cutive committee of the Board of Trustees and serves as the latter Board's Finance Committee, managing the Academy's endowment fund. 9. The Academy's assets primarily consist of an endowment fund valued at $1,141,000.00 and land and buildings worth between 2.5 and 3.5 million dollars. 10. The Academy's physical plant includes the main academy building, a science/auditorium/planetarium building, a special educa- tion classroom building, a home economics classroom building, 2 gym- nasiums which are attached to each other, 2 residences, a dining hall, a dormitory, and a garage, situated on a parcel of land 60 to 75 acres in size. 11. The Academy is a member of the Association of Independent Schools and is accredited by the New England Association of Colleges and Secondary Schools. 12. Maine School Administrative District No. 30 ("M.S.A.D. No. 30") was created by the Legislature, through its adoption of -5- Chapter 90 of the Private and Special Laws of 1963. 13. Under the education laws in effect in 1963, no school adminis- trative district could be created unless it encompassed a geographic area having at least 300 resident high school pupils. 14. The Legislature recognized that "it is geographically impossible to meet the minimum requirement of 300 resident high school pupils in this area" and enacted Chapter 90 of the Private and Special Laws of 1963 which stated, in part, as follows: School Administrative District for Lee, Prentiss Plt., etc. authorized. The municipalities of Lee, Prentiss Plt., Springfield, Webster Plt., and Winn are exempted from the limitations provided in the Revised Statutes of 1954, chapter 41, section 111-E, as amended, and the Maine School District Commission is authorized to proceed pursuant to sections 111-F to 111-U-1 of said chapter 41, to take the necessary action to allow the municipalities of Lee, Prentiss Plt., Springfield, Webster Plt., and Winn to form a School Administrative District and contract with Lee Academy for the education of high school pupils. 15. During 1963 and pursuant to the authority granted in Chapter 90, cited above, the M.S.A.D. No. 30 Board of Directors, the Trustees of Lee Academy, and the Maine Department of Education negotiated a contract under which Lee Academy would provide secondary education for the high school pupils from M.S.A.D. No. 30. 16. Through adoption of Chapter 46 of the Private and Special Laws of 1965, the Legislature approved a "reconstitution" of M.S.A.D. No. 30. Although it does not mention the school district's contract with Lee Academy, Chapter 46 states, in part, that "[A]ll of the proceed- ings of the board of school directors of said district as said board, was from time to time constituted and as shown by the records of said district . . . are validated, confirmed and made effective." 17. Since its creation in 1963, M.S.A.D. No. 30 has always con- tracted with Lee Academy for the latter to provide secondary education to students from the geographic region encompassed by the former. 18. The complete text of the current contract between the Academy and M.S.A.D. No. 30 is as follows: -6- ________________________________________________________________________________ SECONDARY TUITION CONTRACT BETWEEN LEE ACADEMY AND MSAD #30 Lee Academy and MSAD #30, by and through their respec- tive Board of Directors, hereby contract for the education of secondary students in MSAD #30. Lee Academy does cove- nant and agree to provide high school instruction in accor- dance with Title 20, Chapter 207 of the Revised Statutes of 1982 and all succeeding amendments and revisions thereto, for all pupils, legal residents of MSAD #30 for the five school years beginning on August 24, 1983. This contract is meant to be a continuing contract, reviewed annually at the combined meeting of the Directors of MSAD #30 and Lee Academy with needed changes being made by mutual consent. In consideration of the above service MSAD #30 agrees to pay Lee Academy the legal tuition rate charged other com- munities as provided in Chapter 207, as amended or hereafter amended. Students from the district may be permitted to attend another secondary school other than Lee Academy, under the following conditions: A. Can show evidence that the alternative secondary school offers a program of interest not offered at Lee Academy. B. Can show extraordinary circumstances for such a request. Approval of either A/B requests shall be made only upon a majority vote of the respective boards of directors of Lee Academy and MSAD #30. The MSAD #30 Board of Directors reserve the right to establish criteria for withholding secondary tuition privi- leges for individuals as need arises. (emphasis in original) 19. M.S.A.D. No. 30 is managed by a Board of Directors which con- sists of 15 members and which functions pursuant to the authority granted by 20-A M.R.S.A. 1251-1258. 20. Under the By-Laws of the Lee Academy Board of Trustees, the Chairman of the M.S.A.D. No. 30 Board of Directors is, by virtue of his office and co-terminus therewith, a Trustee and a Director of Lee Academy with full voting rights in each capacity. One other member of the M.S.A.D. No. 30 Board of Directors is, by virtue of his office and co-terminous therewith, a Trustee of Lee Academy with full voting -7- ________________________________________________________________________________ rights. 21. Article III, 6 of the By-Laws of the Lee Academy Board of Trustees states: Where possible and when number restrictions permit, any sending unit that has five or more students enrolled at Lee Academy will have representation on the Board of Trustees of at least one person. 22. The M.S.A.D. No. 30 Board of Directors and the Lee Academy Board of Directors meet in joint session two times per year. One of the joint meetings is held to review the contractual relationship between the parties, as is contemplated by the terms of their con- tract. Meeting in joint session, the two Boards of Directors also coordinate their school calendars one with the other and address mutual concerns. 23. Lee Academy meets the statutory requirements to receive public funds for tuition purposes found in 20-A M.R.S.A. 2951-2955. 24. The Academy's operating budget for the 1986-1987 school year is $941,645.00. The following table illustrates the dollar amounts and the percentages of the operating budget derived from public sources. Percentage of Source Dollar Amount Operating Budget Tuition M.S.A.D. No. 30 282,493.50 30% Other Towns 395,490.90 42% State Subsidy for Faculty Salaries 30,600.00 3.25% Special Education Salary Subsidy 30,230.00 3.21% Accounts Receivable (All from public 48,546.00 5.16% sending units) Dept. of Agriculture 12,500.00 1.33% __________ ______ TOTALS 799,860.40 84.95% 25. M.S.A.D. No. 30 uses the Academy's auditorium and gymnasiums -8- ________________________________________________________________________________ without paying for such use. 26. M.S.A.D. No. 30 has never provided the Academy with funds for the purpose of helping to defray the Academy's capital expenditures in such areas as the construction, maintenance, and repair of buildings. 27. The Academy contracts with M.S.A.D. No. 30 for the latter to provide transportation for the Academy's students to and from school, for athletic team travel, and for field trips. The Academy compen- sates M.S.A.D. No. 30 annually for such transportation services. 28. Since December of 1942, Lee Academy has been exempt from payment of Federal Income Tax as a non-profit corporation organized for educational purposes, within the meaning of 501(c)(3) of the Internal Revenue Code of 1954. 29. Some employees at Lee Academy participate in the retirement program administered by the Maine State Retirement System. 30. Teachers at Lee Academy have received Teacher Recognition Grant payments, pursuant to the provisions of 20-A M.R.S.A. 13503-A and 13509(1) and (2) (Supp. 1986). 31. Some teachers and one administrator at Lee Academy have par- ticipated in the development of a school improvement plan in conjunc- tion with members of the M.S.A.D. No. 30 educational staff. JURISDICTIONAL DISCUSSION The question presented in this phase of the bifurcated unit determination proceeding is whether Lee Academy is subject to the pro- visions of the Municipal Public Employees Labor Relations Law ("Act"), 26 M.R.S.A. ch. 9-A (1974 & Pamph. 1986), and, hence, comes within the jurisdiction of the Maine Labor Relations Board. The purpose of the Act is to "promote the improvement of the relationship between public employers and their employees by providing a uniform basis for recog- nizing the right of public employees to join labor organizations of their own choosing and to be represented by such organizations in collective bargaining for terms and conditions of employment." 26 M.R.S.A. 961 (1974). To facilitate employee efforts in self- organization for purposes of collective bargaining, the Board is -9- ________________________________________________________________________________ empowered, upon receipt of a petition therefore together with the required showing of interest, to fashion appropriate bargaining units. 26 M.R.S.A. 966(1) (Pamph. 1986). Each such unit consists of a public employer's employee classifications that share a clear and identifiable community of interest. 26 M.R.S.A. 966(1) and (2) (Pamph. 1986). A threshold requirement[fn]1 in every unit determination is that the employer, whose employee classifications are being considered for inclusion into a proposed bargaining unit, must be a public employer, within the definition of 26 M.R.S.A. 962(7) (Pamph. 1986). The mere fact that an employer is a private corporation is not dispositive of the question of whether that entity is a public employer within the meaning of the Act. The Law Court has addressed this issue as follows: Plaintiff's contention that a private corporation can- not be a "public employer" is also without merit. Section 962(7) provides that a "public employer," for purposes of the Municipal Public Employees Labor Relations Act ("the Act") (26 M.R.S.A. ch. 9-A), includes "any officer, board, commission, council, committee or other persons or body acting on behalf of any municipality or town . . . or of any school . . . district." (Emphasis added) The Act defines "person" as an individual, corporation, partnership, _______________ 1 Although there are no burdens of proof in unit proceedings, Rule 1.09(D), the question of whether the Board has jurisdiction to act in a unit determination is, like the substantial change requirement in a unit clarification, State of Maine v. Maine State Employees Associa- tion, MLRB: No. 82-A-02, Interim Order, slip op. at 15-16 (June 2, 1983), a threshold issue concerning which the petitioner bears the burden of both alleging and establishing the requisite element. The petitioner in the instant proceeding offered its documentary evidence, secured rulings on the admissibility of said exhibits and, reserving the right to offer rebuttal evidence, rested its case. Reserving its right to argue that the Petitioner had failed to carry its burden of proof on the issue of jurisdiction, the Employer then offered its evi- dence. The Employer did not press its objection in its brief; there- fore, consistent with the Board's precedent, the objection is deemed to have been withdrawn. Coulombe v. City of South Portland, MLRB No. 86-11, majority opinion, slip op. at 9 (Dec. 29, 1986); Teamsters Local Union No. 48 v. University of Maine, MLRB No. 79-37, slip op. at 4, n.2 (Oct. 17, 1979). In any event, by the time that it rested, the Petitioner had placed sufficient evidence in the record to warrant a conclusion that the Academy is a public employer within the meaning of the Act. -10- ________________________________________________________________________________ company or association," 26 M.R.S.A. 1. It is thus evi- dent that a "public employer" can be a private corporation, such as plaintiff, it if acts on behalf of a municipality. The phrase "acting on behalf of" used by Maine to define the sweep of the term "public employer" is appar- ently sui generis in public labor relations law. By including within the definition of "public employer" a corporation, as well as natural persons, who "act on behalf of" a municipality, section 962(7) invokes the general principles of agency, which are defined in the identical terms of "acting on behalf of." See Desfosses v. Notis, Me., 333 A.2d 83, 86 (1975), quoting Restatement (Second) of Agency, 1(1) (1958). However, as the Board with the affirmance of the Superior Court properly recog- nized, the Act's purposes do not require that every agent of a municipality be treated as a "public employer" subject to the Act. By the established law of agency, some agents are independent contractors, while there are other agents who, if natural persons, are in contrast designated as servants." The distinction between an agent-servant and an agent-independent contractor is whether the agent's performance with respect to his physical conduct is sub- ject to another's control or right to control. In deter- mining whether Baker Bus was a "public employer" under the Act, the tribunals below, in effect, applied that tradi- tional test. Baker Bus Service, Inc. v. Keith, 416 A.2d 727, 730 (Me. 1980) (foot- note omitted). There is no question that Lee Academy is a private, non-profit corporation organized for educational purposes; therefore, our inquiry will focus on whether, in its operation, the Academy is "acting on behalf of" a school district. The Board has had four opportunities to apply the above standard in determining whether a "private" contractor was independent from the public employer or was merely its alter ego in performing the services in question. The following factors have been considered important in evaluating whether the "private" contractor was subject to the public employer's control or right to control, within the meaning of the Baker Bus test: (1) the existence of a contract for the services at issue; (2) the extent of the private contractor's capital investment in the facilities and equipment required to perform the contracted services; (3) the percentage of the "private" corporation's overall operating budget received from the public employer; and (4) the right to control or actual control exercised by the public employer over the -11- ________________________________________________________________________________ "private" entity's performance of the contracted services. In the Baker Bus case itself, the Law Court affirmed the Board's conclusion that the private corporation was a public employer within the meaning of the Act stating as follows: Plaintiff [Baker Bus Service, Inc.] thus was not required to furnish any of the necessary equipment, sup- plies, or materials when it agreed to operate the school bus system for Augusta. Nor was plaintiff required to make more than a minimal capital investment. The City's retained powers over routes and the hiring of personnel establishes that plaintiff could exercise little indepen- dent judgment in carrying out the contract. On the record before us, the Board and the Superior Court were not incor- rect in concluding that plaintiff, in performing its con- tract to operate the Augusta school busses, was acting on behalf of the City and under its control to an extent that rendered it a "public employer" for purposes of the Act. Baker Bus Service, Inc., 416 A.2d, at 731 (addition by hearing exam- iner and footnote omitted). The next case in which the Board applied the Baker Bus test was Erskine Academy Teachers Ass'n v. Erskine Academy Board of Trustees, MLRB No. 79-06, slip op. (Mar. 27, 1979) (Employee Representative Schoonjans dissenting). In that case, an employee organization charged that the Erskine Academy Board of Trustees had violated the Act by failing and refusing to negotiate in good faith for a successor collective bargaining agreement. The Academy argued that it was not a public employer; therefore, its conduct did not violate the Act. Despite the fact that the Academy derived over 95% of its income from public tuition payments, Erskine Academy, supra, at 2, the Board concluded that it was not a public employer within the meaning off the Act. After outlining the Baker Bus standard, the majority of the Board applied the test as follows: In applying Baker Bus to the instant case, we are com- pelled to conclude that Erskine Academy is not an agent of a town or school district and is therefore not a public employer under the Act. The Erskine Academy Board of Trustees is under contract with no public body; it is totally independent of local town and school officials; it was founded as a private school and still operates under trustees who need be faithful only to State law, State regulations, and the founding trust deed; it is responsible for its employees and operations; and, signi- ficantly, it owns a huge capital investment. -12- ________________________________________________________________________________ To hold otherwise would require a twisting of the theory of Baker Bus. We are loathe to do so since we believe the agency theory is a most plausible interpreta- tion which is also well-suited to a definite application. * * * * * This is not to say that all privately-owned high schools are the same. For example, we could reach a different conclusion if a school had a contract with a town, or if there were other significant differences. Erskine Academy, supra, at 5. The third case involving the Baker Bus test is Portland Public Library and Portland Teachers Ass'n, MLRB No. 81-A-02, slip op. (June 18, 1981), aff'd Portland Public Library v. Portland Teachers Ass'n, No. CV-81-884 (Me. Super. Ct., Cum. Cty., Aug. 22, 1983). The Board based its holding that the Library was a public employer on the following factors: (1) the legislation establishing the Library was like a contract in that it outlined the terms of the relationship between the Library and the City of Portland, essentially providing that the City was responsible for furnishing the buildings and funds required to operate the Library and the Library would provide free services to City residents, MLRB No. 81-A-02, at 8; (2) the Library was "almost totally dependent" on the City for its annual operating revenues, receiving approximately 80% of such funds from the City, MLRB No. 81-A-02, at 3-4; and (3) despite the fact that the Library is governed by a self-perpetuating Board of Trustees, two of the twenty Trustees, the Mayor of the City and its Superintendent of Schools, were public officials and, during the course of the relationship between the parties, the Board of Trustees had abdicated to the City Council the authority to decide most of the important questions con- cerning the operation of the Library, including control over the hours of operation, the number of employees, and the employee pay scale. MLRB No. 81-A-02, at 7. In reaching its conclusion, the Board mini- mized the influence of the fact that the Library owned assets valued in excess of 9 million dollars and had an endowment fund worth $1,068,000., MLRB No. 81-A-02, at 4, by stating that "[t]he Library's capital investment clearly is dwarfed by the large City investments in buildings and in the operating funds provided by the City." MLRB -13- ________________________________________________________________________________ No. 81-A-02, at 7. The final case applying the Baker Bus test is International Brotherhood of Electrical Workers and Fox Islands Electric Coopera- tive, Inc., MLRB No. 87-A-01, slip op. (Feb. 27, 1987). In that case, none of the factors relevant to public employer control or right to control over the "private" corporation was present. The Board based its conclusion that the Cooperative was not a public employer on the following: (1) the Cooperative did not provide service under any contract with any public employer; (2) the Cooperative owned all of the facilities and equipment required in its operations and there was no evidence that the municipalities involved ever made significant financial contributions to the Cooperative or provided it with land or equipment; (3) the municipalities in question merely purchased electricity from the Cooperative, like the Cooperative's other mem- bers, and no evidence was presented concerning the percentage of the Cooperative's total operating budget derived from the municipalities; and (4) the member municipalities could neither appoint nor remove members of the Cooperative's Board of Trustees and, participating at the Cooperative's annual meetings on the same one meter-one vote basis as the other members, the towns could only exercise about 10 votes out of the 1206 votes eligible to be cast. Fox Islands, supra, at 3. The municipalities in question had never controlled the Cooperative's operations and the above factors established that the towns had the right to control the utility's conduct. In the instant case, Lee Academy provides secondary education to essentially all high school students from SAD. No. 30 pursuant to the terms of the contract between the Academy and the S.A.D. While the mere existence of such an agreement may not be dispositive of the public employer status issue, the terms of the pertinent contract suggest that the School District has the right to control the Academy's performance thereunder. The contract provides that the par- ties are to review their relationship annually at a joint meeting of their Boards of Directors. In addition to that provided for in their agreement, the two Boards of Directors usually hold a second joint meeting every year. At such joint meetings, the parties discuss mat- ters of mutual concern. Encompassed within the annual review process -14- ________________________________________________________________________________ is the potential for non-renewal of the parties' agreement. Second, Lee Academy, like the Portland Public Library, derives an overwhelming majority of its operating revenues from public employer funds. Such funds are in the form of tuition payments from local "sending units" and subsidies from the State paid because the Academy educates publicly-funded students. See, i.e., 20-A M.R.S.A. 13502(1)(B) (Supp. 1986). While a high degree of financial support by a public employer does not, in and of itself, translate to public employer control over the recipient, such a level of support is "a pertinent element" in establishing such control. Portland Public Library, MLRB No. 81-A-02, at 8. Clearly, the Academy would be unable to continue its operation at present levels without the public employer funds which it currently receives. Third and most significant is the fact that the S.A.D. and other "sending units" exercise control over the Academy's activities through their representation on the Academy's governing bodies. The chairman and one other member of the S.A.D. Board of Directors are, by virtue of the Academy Trustees' By-Laws, members of the Academy Board of Trustees and the Chairman is a member of the Academy Board of Directors. The Academy Trustees' By-Laws also provide that, where possible, each "sending unit" having 5 or more students enrolled at the Academy should have at least one representative on the Academy Board of Trustees. The Academy Board of Trustees has de jure authority to operate the enterprise, to hire and fire employees, to set their wage rates, and to establish personnel policies; however, unlike the situations in Fox Islands and Erskine Academy, the public employers involved are represented with full voting rights of the Academy boards. Although no evidence was presented that such public employer representatives exercise majority control on either of the Academy's governing bodies, the Academy's heavy reliance on the tuition payments and related subsidies tends to amplify the public employers' voices on the Academy boards. The Academy's contract with the S.A.D., the degree of financial support which the Academy receives from public employers, and the public employers' representation on the Academy's governing bodies -15- ________________________________________________________________________________ together persuade the hearing examiner that the Academy is subject to the public employers' "right to control," under the Baker Bus test and is, therefore, a public employer, within the meaning of the Act. In reaching this decision, the hearing examiner is aware that, like Erskine Academy, the Academy owns substantial assets, including all of the facilities and equipment required to satisfy its obligation under the contract with S.A.D. No. 30. While such a heavy capital invest- ment is significant, the other relevant factors, taken together, qualitatively outweigh the capital investment factor in this case. The following facts had no effect in the decision-making process in this case: (1) the Academy's tax-exempt status for Federal Income Tax purposes, (2) some Academy employees participate in the retirement plan administered by the Maine State Retirement System, and (3) some Academy personnel participated in the development of a "school improve- ment plan" together with some S.A.D. No. 30 employees. The first two of these facts reflect decisions by other agencies, the Internal Revenue Service and the Maine State Retirement System, with regard to the statutes which each administers. Neither of these agencies is competent to decide, nor did they in fact determine, that Lee Academy is a public employer within the meaning of the Act. Their treatment of the Academy and/or of its employees is, therefore, irrelevant here. Fox Islands, supra, 87-A-01, at 2-3. The third fact was not given any weight because no statute, regulation, or other authority was cited limiting or requiring participation in the development of such plans to public school employees. In any event, the treatment of particular academic institutions by the Department of Education and Cultural Services for certain purposes pursuant to the statutes which it admin- isters does not require similar treatment for other purposes under different statutes. CONCLUSION On the basis of the foregoing findings of fact and discussion and by virture of and pursuant to the provisions of 26 M.R.S.A. 966 (Pamph. 1986), the hearing examiner concludes that Lee Academy is a public employer, within the definition of 26 M.R.S.A. 962(7) (Pamph. -16- ________________________________________________________________________________ 1986). The Executive Director or his designee, therefore, has juris- diction to make an appropriate unit determination, pursuant to 26 M.R.S.A. 966. Dated at Augusta, Maine, this 14th day of April, 1987. /s/____________________________ Marc P. Ayotte Hearing Examiner -17-