Overhaul urged for California court fines

California’s courts impose hundreds of millions of dollars of “excessive and disproportionate” fines each year for common infractions, then use much of the money to support their own operations. A blue-ribbon panel examining the system said the fines should be collected by the executive branch — not the courts themselves — to avoid conflicts.

The 306-page report by the Commission on the Future of California’s Court System said the state should “restructure the funding and finances of the judicial branch,”  and urged “eliminating all add-ons (i.e., surcharges, penalties and assessments).” The add-ons are fees and charges that are attached to a base fine and help finance myriad services, including court construction and administration. They can boost a base penalty by 10-fold, or more.

Spiraling court fines, especially traffic fines, have captured attention in the Capitol in recent years for their disproportionate impact on the poor and for the role they play in financing the system

The commission’s April 26 study — which was sent to state Supreme Court Chief Justice Tani Cantil-Sakauye —  recommended changes throughout California’s court system, including civil operations, traffic and criminal procedures, family law, court administration and technology, among others.

The recommendations on fees and fines were included in its review of fiscal issues and court administration. The commission is composed of judges, appellate court justices and court executive officers from across the state, among others.

Spiraling court fines, especially traffic fines, have captured attention in the Capitol in recent years for their disproportionate impact on the poor and for the role they play in financing the system.

A California man, Howard Herships of suburban Sacramento, has challenged the California courts’ financial structure in federal court. He contends the current system is unconstitutional, and is seeking a temporary restraining order to halt the practice. (Click here  and here for earlier stories on Herships’ case.)

The issue also has drawn federal attention: In 2016, the U.S. Justice Department sent a letter to federal prosecutors across the country, noting that “recent years have seen an increased attention on the illegal enforcement of fines and fees in certain jurisdictions around the country,” often for misdemeanors and civil infractions.

“Typically, courts do not sentence defendants to incarceration in these cases; monetary fees are the norm,” the federal letter noted, adding that when the fines “are not geared toward public safety but rather toward raising revenue, they can cast doubt on the impartiality” of the judicial system.

The California court system, which serves more than 39 million people, has been caught in a fiscal pickle.

The percentage of money from California’s General Fund — the state’s main coffer of income, corporation and sales taxes — that goes to support the courts is “among the lowest of court systems supported by state General Funds, ranking California at 29th out of 36 states.”

The 2017-18 state budget proposes about $1.7 billion for the courts, or about 1.4 percent of the General Fund. That money covers less than half of the judiciary’s total $3.7 billion budget, with the rest financed by the fines and fees payable to the courts or counties, a financial scheme the report described as “complex and cumbersome.”

The financial penalty imposed on a driver in California for a traffic violation is the result of a complex formula that takes into account as many as a dozen separate statutes.

“Under the current system, a stop sign violation with a base fine of $35 can result in a total fine of $238. These costs are among the highest in the United States.”

Some fines are a set amount, others are calculated as a proportion of the total penalty. For example, a $5 charge to help pay for court construction costs is levied on every $10 of the base fine imposed.

The complex formula leads to a twisting money trail linking state and local governments.

In 2013-14, about “$600 million, or 35 percent, of all fines and fees went to the court system as its direct share, with 65 percent going to other state and local programs,” the report noted. “But $160 million  of the local money was paid back to the courts by the counties…” under the provisions of an earlier trial court funding law. At that time, the total amount of revenue distributed in the system was about $1.7 billion, reflecting a $400 million decline from 2010, according to the Legislative Analyst.

Adding the fees and surcharges can boost the total penalty exponentially.

“Under the current system, a stop sign violation with a base fine of $35 can result in a total fine of $238. These costs are among the highest in the United States for an infraction violation.” For those who can’t pay the fine, additional penalties are ordered. A failure to appear in court can trigger an additional $300 civil penalty on top of the earlier fines, pushing a $35 base fine to $538.

Since 2007, the controller has conducted 66 audits of revenue from fines and fees in 52 counties, and only 6 percent of the audits showed the funds were distributed correctly.

According to the study, “between 1994 and 2015, reliance on fines and fees as a support mechanism for the California courts increased as over 300 new offenses were added to those eligible for payment by forfeited bail.”

The commission recommended eliminating the add-ons, but increasing the level of the base fine — a move that would ease the administrative load on the courts to track, redistribute and apportion the fines. A medium-sized court typically spends about 400 hours a month in staff time receiving and distributing the fines and fees; a larger court may spend 3,000 hours per month, or 5 percent of their staff time.

Despite the effort, “proper allocation is quite low,” the report said. Since 2007, the controller has conducted 66 audits of revenue from fines and fees in 52 counties, and only 6 percent of the audits showed the funds were distributed correctly. About two-thirds of the audits showed the state was underpaid, while a fourth showed the state was overpaid.

The panel recommended that all court-imposed fines be paid to a state treasury fund, and that a state agency, such as the Franchise Tax Board, be responsible for collecting the money, not the courts.

Last year, in her State of the Judiciary Address, Chief Justice Cantil-Sakauye noted the problems with the current system.

“We have a system of fines and fees that has morphed from a system of accountability to a system that raises revenue for essential government services,” she said. “For example, we raise approximately $1.7 billion in fines, fees and assessments. More than 60 percent of that money goes to fund programs and services at the local and state level. The rest goes to the court system,” she said.

“This is an inequity.”