Order in the court: Budget hit takes its toll

California’s $3.7 billion court system is another of this year’s budget victims, grappling with its highest single-year reduction since the state began paying trial court costs 14 years ago.

Overall, California’s judicial branch – the largest in the nation with nearly 1,700 judges  –  must reduce costs by $350 million in the fiscal year that began July 1.
And continue doing so each year thereafter.

“These are ongoing cuts. Because we have some institutional foundation, what we’ve been able to do for the last two or three years is to shift funds to court operations to keep going without radical cuts,” California Chief Justice Tani Cantil-Sakauye told Capitol Weekly.

“The day of reckoning is going to be fiscal year 2012-13.”

As Drew Soderborg, the legislative analyst overseeing trial courts, puts it:

“There will be very significant impacts on the courts if they continue to do these one-time measures and don’t make the ongoing changes needed for them to operate more efficiently.”
For some courts the day of reckoning has already arrived.

San Francisco said in June state budget cuts might force the closure of 25 of its 63 courtrooms and lay-offs for 200 of its 484 employees.

Like many school districts over the past several budget cycles, the courts have tried to offset cuts without scaling back services.

From September 2009 through June 2010, the state’s courts closed every third Wednesday of each month as a cost-saving measure. Many judges took voluntary 5 percent pay cuts.
Fines and penalty assessments were increased although many of those increases expire within the next few years.

Since 2008, the Administrative Office of the Courts says funding for trial courts has been reduced $614 million. Total judicial branch spending by $647 million.

One-time transfers of $261 million to court operations from other funds mitigated a little less than one-third of those reductions.

Another $70 million was generated from increased fees and penalty assessments although all but $6.5 million of those increases expire in the fiscal year beginning July 1, 2013.  
The budget actions taken in March by Gov. Jerry Brown and the Legislature reduced support for state courts by $200 million.

As the courts had done previously, one-time money was used to temporarily offset the impact of the reduction on court operations.

Transfers of $170 million from two of the court’s construction funds covered most of the $200 million. The remaining $30 million was $20 million taken from another construction related account and spending $10 million less on the court’s ambitious, as-yet-uncompleted, $1.3 billion-and-rising computer project, the California Court Case Management System.
But then Democratic lawmakers added an additional $150 million cut in the budget they approved June 15.

When Brown vetoed the Democratic plan, the courts thought they dodged a bullet. Only to find the $150 million included in the final deal cut between lawmakers and the Democratic governor.     

“The impact of this action would be nothing short of catastrophic to the administration of justice and the public we serve,” wrote 122 trial court and appellate judges in a June 22 letter to Brown and legislative leaders.

“The public may find the clerk’s office closed or courtrooms not in session, as public counter and courtroom hours will be reduced. Conceivably, even entire caseloads may be unserved, as courts may be required to dedicate all available resources to the highest priority filings, like criminal and juvenile proceedings. Victims of domestic violence may not receive protective orders in a timely manner,” the letter continued.

Cantil-Sakauye said she and court policy makers hope to avoid such an “immediate and brittle break in service.”

Brown’s Department of Finance says the additional $150 million reduction is the result of a handful of Republicans refusing to vote for the revised budget plan presented by the Democratic governor in May. It didn’t include the additional cut.

“The initial $200 million reduction the Legislature approved in March was mitigated in large part by the judiciary’s ability to transfer dollars and tap into reserves. That may not be the case with the additional $150 million,” said H.D. Palmer, a Department of Finance spokesman.

The state Judicial Council reviewed a series of options prepared by the Administrative Office of the Courts to cover the $150 million hole in a closed-door session July 13.

In its 20-page laundry list of budget- cutting options, the Administrative Office of the Courts notes that implementing the $35 million will be a “difficult challenge, potentially endangering the public’s access to justice, regardless of how it is spread among the branch entities.”

The council is set to decide how to close the budget gap on July 22.

Several state budget actions make it harder for the courts to solve their problem.

Among them is the state raking off $310 million – nearly one year’s worth of funding – from what’s called the Immediate and Critical Needs Account.

Filing fees and fines were increased by legislation in 2008 to cover the costs of the fund, which targets court construction projects deemed to be of the highest priority.

Besides delaying for one year 40 projects in rural, suburban and urban California – including a new 44-courtroom criminal courthouse in Sacramento – the move restricts the ability of the courts to transfer revenue from the account to plug its budget hole.

Similarly, in March the state borrowed $90 million from the same account and $350 million from the courts’ larger construction fund account. Again, hampering the ability of the judiciary to use the funds to backfill the $150 million cut.

Part of Brown’s realignment plan includes shifting court security costs to counties. Court security, usually provided by sheriff deputies, accounts for nearly $500 million in annual court spending.

If still under the purview of the courts, that spending could have been reduced to help cover the budget cuts.

One option available is drawing down local trial court reserves.

Trial courts receive their annual budget from the Judicial Council. If the local courts don’t spend everything, they can keep the remainder.

Los Angeles, for example, has a reserve of some $81 million. Orange County has nearly $33 million in reserve. San Diego has $7.4 million. But San Francisco has $96,000.

Statewide, the local courts have $311 million socked away – twice what’s needed to cover the $150 million hole.

It’s difficult politically, however, to reduce Orange County’s court budget more because they’ve been more thrifty and reduce San Francisco’s less.

If the court uses the reserves as a budget-balancing tool it would likely be in the form of urging local presiding judges to tap them to the greatest extent possible.

But ultimately the courts need to make more fundamental changes.

“We have to look at new programs and different ways of doing old programs,” Cantil-Sakauye said.

“We’re trying to provide some respite for trial courts this year but we know we have to change the way we do business to stay within our budget.”

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