What?! Tax My Property to Fund the Courts?!
“...stable, adequate, long term funding of Washington’s trial courts...”
Mission Statement for Trial Court Funding Task Force
This column presents a strategy question: How to accomplish the mission set forth for the Trial Court Funding Task Force. Should those who support adequate funding for the state’s trial courts join together in a campaign for a substantial tax increase solely to benefit trial courts (similar to the campaign by education interests to increase the sales tax to benefit schools)? In the alternative, should they focus their efforts on securing funding from the state’s general fund, joining with other interests in a campaign for increased taxes to benefit the general fund as a whole?
County Fiscal Crisis
King County is in fiscal crisis. Expenses grow at 5.5 to 6.5 percent a year while revenues increase less than two percent a year. The crisis is not caused by the recession; the crisis will continue even after the economy recovers. Neither is the crisis caused by program bloat. The problem is that inflation and built-in drivers such as cost-of-living allowances and medical benefits cause expenses to grow faster than revenues. It costs more to do the exact same thing tomorrow than it does to do it today.
The easy cuts have already been made: $90 million in 2002 and 2003, $24 million for 2004. The expected deficit for 2005 is about $23 million. Cuts of $10 million to $20 million per year are expected for each year as far into the future as we can see.
King County is not alone in fiscal crisis. Most counties in the state are in the same situation.
Trial Court Fiscal Crisis
Washington relies on local government, primarily the counties, to fund its trial courts. Washington is last in the nation in its contribution to funding trial courts.1
About 70 percent of the county’s general fund goes to the justice system, including the District and Superior Courts. From the trial courts’ point of view, about 90 percent of their funding comes from the county. When counties are in fiscal crisis, so are trial courts.
Preliminary Conclusions of Trial Court Funding Task Force: Increase State Funding and Find $210 Million
The Trial Court Funding Task Force was created to find adequate funding for trial courts and propose a better funding system.
The Task Force has not yet issued its report but has reached several fundamental conclusions. First, the Task Force recommends a better balance between state and local funding. The national average is around 50 percent state funding. The Task Force suggests that Washington move toward this level by requiring the state to pay for expenses mandated by state law, for example, indigent defense, judges salaries, and jury fees. The principle is that the state should pay for expenses that it controls.
Second, the Task Force estimates the gap between present funding and adequate funding for trial courts is on the order of $60 million. The gap in funding for indigent criminal defense is much greater--perhaps as much as $130 million. Finally, a task force commissioned by the Supreme Court recently concluded that another $18 million is needed to adequately fund the civil legal needs of the indigent. In total, the state is about $210 million short of adequate funding.
Taxes in Our Future
Neither local government nor the state has surplus funds to spend on the courts. We have seen that the counties are in fiscal crisis. The state also has a budget problem. The next session will probably face a budget deficit of $500 million to $800 million.
Increases in court fees, even substantial increases, would bring in only about $12 to $18 million, an amount not to be ignored, but certainly not a solution to the problem.
Taxes are the only source of funds large enough to fill the funding gap. An ideal tax would be one that bears a nexus to the trial court system--akin to gasoline taxes that pay for highways or aircraft fuel taxes that fund the state Aeronautics Division. However, the Task Force did not find a tax with a special nexus to the courts. This result is not surprising.
No particular group enjoys the exclusive benefit of the trial courts. Lawyers, of course, have a close connection to courts. Yet, a great number of lawyers do not go to court. Moreover, trial lawyers do not use the courts for their own benefit, but rather for their clients. Even the parties to civil litigation are not the principal beneficiaries of the courts. A substantial part of court resources is devoted to criminal law matters. In civil cases courts establish rules that guide the conduct of those who never come before the court--a vastly greater number of people than the parties to litigation.
Courts benefit all of society, not just those who appear before them. Courts are part of the foundation of our society and government, one of the three co-equal branches of government. As an integral part of government, courts should be funded by a broad-based system that spreads their cost as broadly as their benefits--to all of society.
Strategy Question
Tax Campaign for the Courts
The situation outlined above suggests that supporters of the courts should mount a campaign for a $200 million tax increase for the benefit of the trial courts, including indigent defense and civil legal needs. This conclusion is reinforced by the observation that every study of Washington courts for twenty years or more has concluded that funding is inadequate. Yet, there has never been concerted, long-term follow-through to increase funding. It’s about time
to go after the money.
A tax campaign is a direct res-ponse that, if successful, would result in money the court could call its own. Yet, practical difficulties abound. Tax increases are neither popular nor easy to obtain. Voters have recently been reducing taxes through initiatives. Business detests the B&O tax. Sales taxes are already high and education has pre-empted an increase with its proposal for a one percent tax reserved for education purposes.
Finally, if it can be done, a tax increase of the needed magnitude will surely take a number of years. Major changes come slowly in the legislature. And, while the battle is fought, the county fiscal crisis will cause cut after cut in the court budgets. What will be left when relief arrives?
General Fund Approach
Another, indirect, approach would be to focus efforts on the state’s general fund. The general fund is already supported by the three principal broad-based Washington taxes (property, sales, and B&O taxes) and by a number of lesser taxes. It surely meets the criterion that court funding should be broadly based.
The principle underlying the general fund is that the legislature determines the priority order of all claims for state funding. Claims are funded in priority order until the general fund is exhausted. If claims remain that the legislature and the people believe should be funded, then taxes are raised until general fund is large enough sufficient to pay for them.
Rather than focusing their attention on a tax campaign for the sole benefit of the courts, supporters could instead seek funding from the general fund for specific needs. Given the deficit now facing the general fund, this strategy cannot attempt to fill the entire funding gap at once. However, the general fund strategy has the benefit of fitting neatly into an incremental approach. Even though the state has a deficit, some play remains in the interstices of the budget. Small items may find funding where large reforms are dead on arrival. Critical court programs may be saved on a year-by-year basis until larger reforms can be achieved.
Nevertheless, the general fund strategy has significant problems. Perhaps, from the stand-point of the court fiscal crisis, its greatest problem is that it appears to dodge the immediate need to raise new revenues. It could easily become yet one more call for adequate funding that has no follow-through.
However, the tax issue need not be ignored. If one is serious about increasing taxes, the general fund strategy could, perhaps, lead to a more robust tax campaign. Why should court supporters bear the burden of a tax fight by themselves? Why not join with others to raise taxes for general fund--for the accumulated priorities of the state as a whole--rather than for the single priority of the courts.
Another major problem with the general fund strategy is that it gives no guarantee that courts will be given appropriate priority in funding decisions. A common retort is that the record of the legislature gives little comfort. Moreover, the other priorities of the state--children’s health, transportation, care of the disabled and vulnerable--are compelling and most who support the courts also support these priorities. They do not want to be in the position of competing with other meritorious claimants.
While these concerns have merit, they need not be conclusive. Predicting legislative decisions is hazardous. However, if one takes a long view, legislative bodies appear to have recognized the critical role of the courts. Funding for courts is not adequate but neither is funding for other priorities. Experience with the current county fiscal crisis confirms this view. Court budgets have been cut less on a proportionate basis than other priorities.
What’s The Answer?
We know that funding for the courts is inadequate. We know that government (whether state or local) needs additional revenues to adequately fund the courts if it is also to meet other pressing claims for funding. We know that taxes are the only source of adequate additional revenues. But the best strategy to follow for stable, adequate, long term funding of Washing-ton’s trial courts is still in question. Weighing the advantages and disadvantages of the two strategies outlined above is complex and the outcome uncertain.
If you have the answer, please let me know.
John Cary is KCBA president. He can be reached at caryj@att.net.
1 Some states include the cost of prosecution in trial court costs.
