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Penalty Assessments

A Review of Their Use As A Financing Mechanism

Office of the Legislative Analyst

January 1988

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Introduction 1

Executive Summary 3

Chapter IBackground of Penalty Assessments 5

Development of Penalty Assessments 5

Definition of Penalty Assessments 6

Collection and Distributionof Penalty Assessments... 6

Chapter IISources and Benefits of PenaltyAssessments 10

The Underlying Sources of PenaltyAssessment Revenues 10

Distribution of Penalty Assessment Benefits 12

Comparison of Penalty Assessment Sourcesand Benefits 13

How Should the Source/Benefit Relationshipfor Penalty Assessments Be Structured? 14

Chapter IIIAlternate Sources ofFunding 16

Problems with Penalty Assessment Funding 16Alternative Revenue Sources forProgram Funding 18Summary 18

Appendix I 20

Appendix II 21

Table ofContents

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Introduction

Introduction

In 1986 the Legislature adopted SenateConcurrent Resolution 53 (SCR 53), whichrequired the Legislative Analyst to studyvarious aspects of penalty assessments andthe programs which these assessments fund.Penalty assessments are levied on nearly allfines, penalties, and forfeitures imposed andcollected by the court system for criminaloffenses, including violations of the VehicleCode. Penalty assessments can range from $7to $13.50 for every $10 of fine, forfeiture orpenalty imposed by the court, depending onthe ~county in which the court is located.Funds generated by penalty assessments fi­nance programs ranging from driver trainingto indemnification of crime victims andcounty criminal justice facility construction.

Specifically,SCR53 requires the LegislativeAnalyst to conduct a study of penalty assess­ments which:

Organization of the Report

The remainder of this report is divided intothree chapters.

Chapter I presents general backgroundinformation on penalty assessments. Specifi­cally, the chapter outlines the historical de­velopment of penalty assessments, definesthem for purposes of this report,. and de­scribes how they are levied, collected, anddistributed.

Introduction

• Compares the "sources" of penalty as­sessment revenues to the "benefits"gained from these funds.

• Recommends other stable revenuesources to finance programs currentlyfunded by penalty assessments.

In addition, SCR 53 requires the LegislativeAnalyst to perform this study in conjunctionwith an advisory committee consisting ofrepresentatives of local government, law en­forcement, court personnel, motor clubs, andother appropriate user groups. The membersof this advisory committee are listed in Ap­pendixI.

This report constitutes our response to thestudy requirements of SCR 53.

Chapter II discusses the sources and bene­fits of penalty assessments. Specifically, thischapter reviews the data available on thefines, penalties and forfeitures which gener­ate penalty assessments. In addition, thechapter discusses the relationship betweenthe underlying offenses which generate pen­alty assessment revenues and the programswhich are financed by them. Finally, it ad-

Pagel

dresses the question of how this relationshipshould be structured and makes a relatedrecommendation.

Chapter III discusses some of the problemsof increased reliance on penalty assessmentsto finance state and local government pro­grams. It also discusses alternatives to thecurrent financing system.

Acknowledgments

The Legislative Analyst's Office gratefullyacknowledges the assistance of the SCR 53advisory committee and the StateController's Office in providing variousbackground information and fiscal data usedin the report.

Introduction

Appendix I lists the members of the SCR 53advisory committee.

Appendix II provides additional back­ground information on the funds which re­ceive revenues from penaltyassessments andthe programs which are financed by the as­sessments.

This report was prepared by AndrewMeyers and Craig Cornett, under the super­vision of Cheryl Stewart. Secretarial serviceswere provided by Lynn Kiehn and VictoriaAlbert, and the report was formatted forpublication by Suki O'Kane.•:.

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ExecutiveSummary

Executive Summary

Executive Summary

)

This report compares the sources ofpenaltyassessment revenues to the benefitsgenerated by these funds, discusses brieflysome of the advantages and disadvantages ofincreased reliance on penalty assessments asa financing mechanism, and examines alter­nate sources of financing available toprograms currently funded by penaltyassessments.

The principal findings of this report aresummarized as follows:

• Penalty assessment revenue is collectedfrom persons who violate Penal and Ve­hicle Code provisions. These revenuesgenerally are used to finance law en­forcement activities, victims' servicesand driver safety programs.

While data limitations significantlyrestricted our ability to make morespecific source-benefit comparisons, ourestimates suggest that penaltyassessment revenues generated byvehicle-related offenses exceed vehicle­related expenditures from this source.For the most part, we were unable todraw conclusions about the linkbetween other penalty assessmentsources and benefits.

• The reliance upon statutory percentagesto distribute penalty assessment reve-

nue to various programs may result inaninefficient allocation of the state's finan­cial resources which, in turn, may re­strict the ability of certain programs tofulfill their legislative mandates. Fur­ther, the present system limits theLegislature's ability to oversee and setpriorities for the expenditure of statefunds.

Accordingly, we recommend that legis­lation be enacted to (l) eliminate the per­centage allocation requirements, and (2)transfer penalty assessment revenue tothe General Fund for allocation to pro­grams on the basis of a review of pro­gram needs through the annual budgetprocess. Due to constitutional restric­tions, however, we recommend thatpenalty assessment revenue generatedfrom fish and game violations be trans­ferred directly to the Fish and GamePreservation Fund.

• There are both advantages and disad­vantages to the continued use and ex­pansion of penalty assessments as a fi­nancing mechanism. Penalty assess­ments generate significant annual reve­nue. They are not levied on the generaltaxpayer, rather, they are imposed onthelaw violator. Furthermore, appropria­tions made from this source are not sub-

Page 3

ject to the state's constitutional appro­priations limit.

On the other hand, there is some evi­dence that penalty assessments may beapproaching a maximum revenue gen­erating level. There is also a possibilitythat further assessment rate increasescould exacerbate the difficulties of pro­jecting penalty assessment revenues,result in an unintended transfer of reve­nues to the state that have traditionallybeen available to local governments,lead to an increase in the already bur­geoning county jail population, result inincreased fine and assessment default

Executive Summary

rates and further complicate court ac­counting records.

These are all factors for the Legislature totake into account when considering anincreased reliance on penalty assess­ments as a revenue source in the future.

• Through our review we were unable toidentify any viable new revenue sourcesthat have (1) a direct relationship to pro­grams currently funded from penaltyassessments, (2) the potential to generatesufficient funds to support these pro­grams, and (3) the stability to be effectiverevenue sources over time.•:.

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Chapter I

Chapter I: Background

Chapter I

Background of PenaltyAssessments

This chapter provides background infor­mation on the system of penalty assessmentslevied in California. Specifically, it outlinesthe historical development of penalty assess-

ments, defines them for purposes of this re­port, and describes how they are levied, col­lected, and distributed.

Development of Penalty Assessments

Penalty assessments were established morethan 30 years ago. Chapter 1877, Statutes of1953, set the penalty assessment "rate" at $1for every $20 of basic fine, or fraction thereof,for most Vehicle Code violations. For ex­ample, a $60 dollar fine generated a penaltyassessment of $3, for a total fine and assess­ment of $63. Money collected from this origi­nal penalty assessment was remitted by thecourts via the counties to the state for depositin the General Fund. The General Fund, intum, reimbursed the State School Fundwhich financed the driver education pro­grams of local school districts.

Since 1953, the penalty assessment rate, thetypes of offenses subject to the assessments,and the number of programs financed bythem have increased significantly. Althoughthebasic structure for collection and distribu­tion of penalty assessments has remained

unchanged since 1980, the Legislature hascontinued to increaseboth the penaltyassess­ment rate and the number and types of pro­grams which are financed by these assess­ments.

A good example of the complexity of thecurrent assessment system is provided byVehicle Code Section 23152, which makes it acrime to operate a vehicle under the influenceof alcohol or drugs. Persons convicted andfined for a violation of this code section aresubject to a maximum base fine of $1,000.When total assessments are added to the basefine, however, persons could actually be re­quired to pay as much as $2,510. This amountincludes the base fine of $1,000, various stateand local penalty assessments totaling$1,350, and$160 in otherfines used to supportvarious programs, such as alcohol abuse anddrug prevention programs.1

I Throughout this reportwe have assumed that the provisions of Chapter 1082, Statutes of1987, that allowed specified counties to increase penaltyassessments for courthouse and criminal justice facility construction funds are in effect. The l?rovisions of this measure, which were to take effectonJanuary1,1988,were chaptered outinerrorby Chapter1239, Statutes of1987. At the timetliis reportwas prepared, legislation wasbeingdraftedto to correct this technical error.

PageS

Chapter I: Background

Definition of Penalty AssessmentsThe term penalty assessment often is ap­

plied broadly to a multitude of specialcharges levied by courts in addition to basicfines and forfeitures. In our judgment, a re­view of all these special charges would gobeyond the mandate of SCR 53 and thetimeframe it establishes. Accordingly, wehave confined our discussion to those assess­ments which are imposed on fines and forfei­tures generally, rather than those which areimposed on fines and forfeitures levied forspecific types of offenses. Using this guide­line, this report will focus on penalty assess­ments which are generated either by the"basic" penalty assessment rate of $7 forevery $10 of fine, or fraction thereof, and theadditional penalty assessments of up to $6.50for every $10 of fine, or fraction thereof, thatcounties may elect to levy on fines imposedfor offenses generally. These assessments aredescribed in more detail later in this chapter.

Generally, the penalty assessments whichwe focus on in this report are leviedunder theauthority of Penal Code Sections 1464, 1465,or Government Code Section 76000. Thesestatutes require that penalty assessments belevied on "every fine, penalty or forfeitureimposed and collectedby the courts for crimi­nal offenses, including all offenses involvinga violation of a section of the Vehicle Code orany local ordinance adopted pursuant to theVehicle Code, except offenses relating toparking or registration offenses by pedestri­ans or bicyclists."

As discussed in detail below, penalty as­sessments are collected by courts and eitherare remitted via the counties to the state tofinance various state and local assistanceprograms, or are retained by the counties inspecial funds.2

Pursuant to a formula established by PenalCode Section 1464, money deposited in thestate Assessment Fund is allocated to sevenseparate state funds. Chapters 1214 and 1232,Statutes of 1987, provide that the first $2 ofevery $7 collected in penalty assessments,plus 22.12 percent of all remaining assess­ment revenue be transferred into the stateRestitution Fund. The remaining balance isthen distributed to six other funds, accordingto percentages specified in Penal Code Sec-

Collection and Distribution of Penalty Assessmentscourts for criminal offenses, including mostoffenses involving a violation of the VehicleCode. Funds collected from these assess­ments are transmittedby the clerkof the courtto the county treasury, where they are in turnremitted to the State Treasury for deposit inthe Assessment Fund.

The penalty assessments which are thesubject of this report may be divided into twocategories-those assessed at the basic rateestablished by Penal Code Section 1464, andthose which may be imposed at county op­tion pursuant to Section 76000 of the Govern­ment Code and Section 1465 of the PenalCode. An overview of the collection and dis­tribution of penalty assessments is presentedin Chart1. As illustrated/each of these catego­ries of assessments is collected and distrib­uted in a different way. Each path and theprograms funded are discussed below.

Section 1464 Assessments. Penal Code Sec­tion 1464 requires that a penalty assessmentequal to $7 for every $10 of fine, or fractionthereof, be levied on each fine, penalty orforfeiture imposed and collected by the

2 In contrast, the money generated by the fines and forfeitures which generate ~alty assessments traditionally has been retained by cities andcounties. This traditionaldistribution offiite andforfeiture moneywas alteredSlgnificantlyby theTrial CourtFundingActof1985,whiChwasmadeoperative by O1apter 1211, Statutes of1987. Under this act, counties electing to participate in the trial court fundingpro~ammust remit most offfieir revenues from these sources to the state. In return, the state will proviae substaniial block grants to help the counties finance the trial courtsyst~. ,For a further discussion of 011211/87, please see Legislative Analyst's Office Report #88-3, The Trial Court Funding Program: FinancialImplications.

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Chart 1

The Overall Flow of Penalty Assessment Revenue

aEach of thesedistributionpercentages applies to Ihebalanceremalnlng in the Assessment Fund after $2 ofevery$7 ofassessmentshasbeen transferred to the RestibJtion Fund.b ProvisionsofCh1 082187which a1lowedspec:ified counties tocollectassessments for courthouseand almlnalJustice facUitvconstrucUon funds at the $2ratewere chaptered outln error byCh1239187. Atthetime this reportwasprepared,legleiationwas

being drafted to correctthtstechnlcal error. Consequendy, throughoutthisreportwehave assumed that the provisionsofCf!1082remain In effect

'-----IIJ Emergency Medical Service Fund.. $1 per $10 of fine .f

&'t":"

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oro;:

5..

Fish and Game Preservation Fund0.38"10'

DISTRIBUTED PURSUANTTO PENALCODE1464STATE

ASSESSMENTFUND

TOSTATECONTROLLER

Penal CodeSection 1464

$7 for every$10 of fine

Penal CodeSection 1465

PENALTYASSESSMENTS

Government CodeSection 76000

GENERATE

Fines imposed andcollected by courts forcriminal offenses, in­cluding most offensesinvolving a violation ofthe Vehicle Code orany local ordinanceadopted pursuant tothe Vehicle Code

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Chapter I: Background

tion 1464. Table 1 displays the seven funds, statutory allocation percentages, and thethe agencies which administer the funds, the most recent actual amounts allocated.

Table!

Summary of Distributions to State Funds from the Assessment Fund

(in~gg:a~s)Administering Statutory 1987-88

Fund Agency AlloCIJtion" 1984-85 1985-86 1986-87 (est.i

Restitution Board of Control 22.12% $26,752 $27,933 $26,583 $39,251

Driver Training Penalty Department of29.73 35,245 37,043 35,433 38,487Assessment Education

Peace Officers' Training Commission onPeace OfficerStandards and Training 27.75 32,882 34,576 33,034 35,924

Corrections Training Board of Corrections 9.12 10,807 11,364 10,874 11,806

Local Public Prosecutors Office of Criminaland Public Defenders Justice PlanningTraining 0.90< 509 750 850 850

Victim-Witness Assistance Office of CriminalJustice Planning 10.00 11,670 12,460 11,918 12,946

Fish and Game Dehartment ofPreservation Fis and Game 0.38 450 474 452 492

Total Distributed 100.00% $118,315 $124,600 $119,144 $139,756

" Under the cu:rrent formula (01 1214/87), each of these percentages applies to the balance remainin~ in theAssessment Fund after $2 ofevery $7 ofassessments depOSited has been transferred to the Restitution FUnd. Prior to the effective date of thIS legislation, Assessment Fund distributions were based onthe same percentage allocations, but the percentages were applied to the Assessment Fund balance prior to any transfer to theRestitution Fund. Percentagesin 1984-85 varied-slightly.

b Source: 1988-89 Governor's Budget.C The Local Public Prosecutors and Public Defenders Training Fund receives 0.90% ofthe funds distributed up to a maximum annual amount of$850,000.

Any balance in excess of$850,000 is transferred to the Restitution Fund.

Section 76000 and 1465 Assessments. Sec­tions 76000 of theGovemment Code and 1465of the Penal Code allow specified counties toimpose up to five separate penalty assess­ments in addition to the basic penalty assess­ment stipulated by Penal Code Section 1464.These additional penalty assessments rangefrom 50 cents to $2 for every $10 in fine, orfraction thereof, and are imposed for thesame offenses specified inPenalCode Section1464.

Money collected from these assessments isdeposited in special funds which generallyare administered by the counties. The money

is used to finance county costs for courthouseand criminal justice facility construction,criminal justice facility transition planning,emergency medical services and automatedfingerprint equipment. Table 2 details thecode sections which authorize these assess­ments, the purpose of the assessments, andthe rates at which the assessments are col­lected.

Appendix II provides more detailed de­scriptions of each of the state and local fundswhich receive revenues from penalty assess­ments.•:.

PageS

Chapter I: Background

Table 2County Funds Which Receive Revenues From Penalty Assessments

COURTHOUSE CONSTRUCTION FUNDS

Robbins Courthouse Construction Fund - Used forcourthouse construction within specified areas ofLos Angeles County

San Francisco Courthouse Temporary ConstructionFund - Used by the City and County of San Francisco for theacquisition, rehabilitation, construction or financing ofcourtroom buildings.

Courthouse Temporary Construction Fund - For specifiedcounties,used for the acquisition, rehabilitation, construction, andfinancing of courtroom buildings or, in certain counties, criminaljustice automated information systems or juvenile justicerehabilitation facilities.

Courthouse Temporary Construction Fund - For specifiedcounties, used to acquire, rehabilitate, construct or financecourtroom buildings.

Government Code76001 8

Government Code760028

Government Code760058

Government Code76006b

$1

$1

$1

$1 or $2

COUNTY CRIMINAL JUSTICE FACILITY TEMPORARY CONSTRUCTION FUND

Used for construction, expansion, improvement, operation ormaintenance of criminal justice and court facilities, and forimprovement of criminal justice automated information systems.

Government Code76004b

$1 or $2

Used for specified emergency medical services. Penal Code1465

$1

8 Available only to specified counties.

Most counties may collect $1. Provisions 01 Ch 1082187 which allowed specnled counties to collect assessments for county construction funds at the $2 rate werechaptered out In error by Ch 1239/87. Althe time this report was prepared. legislation was being drafted to correct this technical error. Consequently, throughout thisreport we have assumed that the provisions of Chapter 1082 remain In e1fecl.

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Chapter II

Chapter II: Sources and Benefits

Chapter II

Sources and Benefits ofPenalty Assessments

In this chapter, we consider both theunderlying offenses, or "sources," whichgenerate penalty assessments and the natureof the programs which benefit from theseassessments. After examining the relation-

ship which exists between these "sources andbenefits" as SCR 53 requires, we address thequestion of how this relationship should bestructured, and make a related recom­mendation.

The Underlying Sources of Penalty Assessment RevenueThis section briefly discusses the available

data on the fines, penalties and forfeitureswhich generate penalty assessments, thelimitations of these data for purposes of ourstudy and, finally, the sources of penaltyassessments that we have been able to iden­tify.

Existing Data on Fine, Penalty and Forfei­ture Collections. In accounting for penaltyassessments and underlying fines, penaltiesand forfeitures, court clerks and, in tum,county auditors, maintain detailed records ofpayment. However, our review finds that theorganization of these records is orientedtowards ensuring that proceeds from fines,penalties and forfeitures are distributed intoproper city, county, and state funds. Gener­ally, court clerks do not record the amount ofmoney collected for specific types ofoffenses.

In other words, a particular statute mayspecify that a fine imposed pursuant to thatstatute should be distributed to three differ­ent county funds. Court records likely would

reflect the amounts distributed to the threefunds, but would not identify the dollarsgenerated by the particular offense.

Given the multitude of offenses whichspecify how fine proceeds are to be distrib­uted, the accounting task faced by courtclerks is substantial. The task is further com­plicated by the fact that fine proceeds gener­ally must be allocated among cities and coun­ties, and these distributions maybealtered onthe basis of the jurisdiction in which the of­fense occurred and the classification (e.g.,sheriff, police, highway patrol, etc.) of the lawenforcement personnel involved.

Once compiled, county auditors annuallysubmit to the State Controller the totalamounts which the county, and cities withinthe county, collect for fines, penalties andforfeitures. However, in accordance with theController's instructions, this information istransmitted to the Controller in a highlysummarized fashion. Table 3 summarizes thestatewide data received by the Controller fortheyears 1983-84 through 1985-86.

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Chapter II: Sources and Benefits

Table 3

Statewide Fine, Penalty and Forfeiture Collectionsa

1983-84 through 1985-86(dollars in thousands)

1983-84 1984-85 1985-86Cities Counties TofJll Cities Counties Total Cities Counties Total

Vehide Code $153,771 $95,855 $249,626 $152,963 $98,130 $251,093 $153,723 $98,275 $251,999

Other Court Fines 90,011 90,011

Forfeitures and Penalties 22,004 22,004 48,436 48,436 52,352 52,352

Superior Court 7,191 7,191 4,778 4,778

Justice Court 2,396 2,396 2,466 2,466

Municipal Court 62,860 62,860 66,627 66,627

Other Fines and Forfeitures 50,327 50,327 55,855 55,855 71,850 71,850----

Totals $204,098 $207,871 $411,969 $208,818 $219,014 $427,832 $225,573 $224,498 $450,072

Percent of Total AnnualCollections 49.5% 50.5% 100.0% 48.8% 51.2% 100.0% 50.1% 49.9% 100.0%

• SOUTCe: State Controller. Detail may not add to totals due to rounding.

Limitations of the Data. While the infor­mation compiled by the Controller is the bestavailable summary of fine, penalty and for­feiture funds collected statewide, it has sig­nificant limitations in its usefulness for thisstudy. Besides the fact that the data reveallittle about the nature of the offenses whichgenerated the funds shown, the data alsocontain a substantial amount of collectionswhich do not generate penalty assessments.For example, the data include probably inexcess of $100 million in collections fromparking fines, and local assessment revenuefor courthouse and criminal justice facilityconstruction funds. State penalty assess­ments are not imposed on these fines andlocal assessments. As a result, it is not pos­sible to estimate the percentage of penaltyassessment revenues which are generated bythe collection categories contained in Table 3from the Controller's data alone.

In addition, our review of the Controller'sdata indicates that there are significant incon­sistencies in the categories used by local enti­ties to report collections. For example, wenoted a significant amount of parking finecollections being reported incorrectly underVehicle Code violations. Again, this type of

data error reduces the usefulness of theController's numbers for purposes of thisreport.

Accordingly, given the manner in whichcourt clerks account for collections, and therestrictive nature of the State Controller'sdata regarding fine, penalty and forfeiturecollections, it is difficult, if not impossiblewithin the resource constraints of this study,to determine the exact nature of the offenses,or sources, which generate penalty assess­ments.

The Sources We Can Identify. Despite therestrictive nature of the collection data avail­able, there are limited categories of sources ofpenalty assessment revenue which we canidentify. Because certain categories of of­fenses generate data specific to those of­fenses, we can make rough estimates regard­ing the penalty assessment dollars associatedwith those offenses. Specifically, we canmake approximations of the amount of pen­alty assessments generated by Vehicle Codeviolations, Fish and Game Code violations,and all other offenses combined.

Vehicle Code Violations. Fine, penaltyandforfeiture collections for Vehicle Code viola-

Page 11

tions generally are identifiable in recordsmaintained by court clerks and county audi­tors. We reviewed available data from severalcounties and, based on that review, we esti­mate that approximately 70 to 80 percent of thefines, penalties and forfeitures which generatepenalty assessments statewide represent VehicleCode violations. Thus, roughly $127 million inpenalty assessments collected statewide dur­ing 1985-86 were related to Vehicle Codeoffenses. (Table 4 shows this amount and itsallocation between state and local funds.)

Fish and Game Code Violations. Article16, Section 9, of the State Constitution speci­fies that "money collected under any statelaw relating to the protection or propagationof fish and game shall be used for activitiesrelating thereto." Because of this constitu­tional requirement, the State Controller'sOffice, inconjunctionwith court clerks, main­tains a record of the amount ofpenaltyassess­ments generated by Fish and Game Code

Chapter II: Sources and Benefits

violations. Based ona review ofthese records,we estimate that in 1985-86 Fish and GameCode violations generated approximately$230,000 in penalty assessment revenues.

Other Violations. Penalty assessmentrevenue generated by "other violations" issimply the difference between the totalamount of penalty assessments collected andthe sum of penalty assessments attributed tothe two categories above. Assessments onnonvehicle criminal fines, etc., account for themajor portion of the "other" category.

Using the categories described above,Table 4 summarizes our estimates of thesources of penalty assessment revenue for1985-86. We emphasize that the categoricalallocations displayed are estimates which webelieve are reasonable. The data availablesimply do not make it possible to make aprecise allocation ofpenaltyassessment reve­nue to the source categories noted.

Table 4

Summary of the Estimated Allocation of Penalty Assessment Revenues by Source1985-86

(dollars in thousands>

State TotalAssessment County Penal~ssessment

Type of Offense Fund FundS" nue

Vehicle $93,450 $33,750 $127,200

Fish and Game 170 60 230

Other 30,980 11,190 42,170

Totals $124,600 $45,000 $169,600

a Includes estimates ofrevenues deposited in courthouse and criminal justice facility construction funds because other county funds which may receive revenuesfrom penalty assessments were only recently established.

Distribution of Penalty Assessment BenefitsAs discussed in Chapter I, penalty assess­

ments support a wide variety of programs atthe state and local level. Although it is diffi­cult to categorize the ''benefits'' of penaltyassessments, the Legislature has generallychosen to finance certain types of programs

with penalty assessment revenues. Theseprograms can be broadly categorized as pro­grams that train and support law enforce­ment, programs that provide assistance tovictims of crime, and programs that areaimed at improving driver safety. Appendix

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II provides a more detailed description ofeach of these programs.

Programs to Train and Support Law En­forcement. Programs designed to train andsupport the activities of law enforcementagencies are the primary beneficiaries ofpenalty assessments. The following trainingprograms administered by the state are in­cluded in this category: peace officer, correc­tions, local public prosecutors and defenders,and fish and game. Local criminal justiceprograms benefiting from optional penaltyassessments imposed by counties include thecourthouse and criminal justice facilitiestemporary construction programs. The stateprograms in this category received $47.2million in 1985-86, while the local programsreceived approximately $45 million.

Victims' Service Programs. The secondmajor category of programs benefiting frompenalty assessments are those that provideservices to victims of crime. These programs

Chapter II: Sources and Benefits

include the Board of Control's Citizens'Indemnification Program (funded by theRestitution Fund) and the Office of CriminalJustice Planning's Victim/Witness Assist­ance Program. These programs receivedapproximately $40.4 million in 1985-86.

Programs to Improve Driver Safety. Thethird major category ofprograms that benefitfrom penalty assessments are those designedto improve driver safety. The DriverTrainingPenalty Assessment Fund, which supportsthis program, received $37 million in 1985-86,although only $19.5 million was spent on theprogram in that year due to statutory limita­tions on the level of state reimbursement forlocal training costs. As discussed in moredetail in Appendix II, these statutory reim­bursement limitations have resulted in onlyabout one-half of the funds available in thefund being appropriated for the program inrecent years.

Comparison of Penalty Assessment Sources and Benefits

As demonstrated by the foregoing discus­sion, the identified categories of offenseswhich generate penalty assessments do nottie directly to the general categories of pro­grams which benefit from penalty assess­ments. Thus, a direct comparison of penaltyassessment dollars generated by particularcategories of offenses to similar categories ofprogram beneficiaries essentially is not pos­sible.

It is possible, however, to make somegeneral statements about the penalty assess­ment source-benefit relationship. As Table 4shows, for example, violations of the VehicleCode represent the major source of penaltyassessment revenue. It is also clear that pen­alty assessments provide support for manydifferent programs which have some link toviolations of the Vehicle Code. The Driver

Training Penalty Assessment Fund, for ex­ample, which supports a program designedto improve driver training and prevent Ve­hicle Code violations, received more than $37million in 1985-86.

In addition, law enforcement trainingprograms, such as those funded by the PeaceOfficerand Corrections TrainingFunds, havea link to theVehicle Code, since peace officersfrequently are required to deal with trafficviolators and local corrections officers pro­vide custodyservices for persons senUo jailfor driving under the influence of alcohol ordrugs. The Restitution Fund which providesbenefits to victims of crime, has a more indi­rect link because it includes some (probablyaminority of) cases which are vehicle-relatedoffenses.

Page 13

The "other category," which consists pri­marily ofassessments on nonvehicle criminalfines, also has a link to law enforcement train­ing and assistance to victims of crimes. Infor­mation, however, is not available whichwould enable us to make a more refinedcomparison between the types of offenseswhich produce the revenues and the uses ofthese funds.

Chapted!: Sources and Benefits

In addition, we know that during 1985-86,approximately $230,000 in penalty assess­ment revenues were generated by fish andgame violations, while the Fish and GamePreservation Fund was allocated $474,000during this same period. These data indicatethat fish and game programs have recentlyreceived a larger allocation of penalty assess­ment revenue than fish and game violationsgenerate.

How Should the Source/Benefit Relationship for PenaltyAssessments Be Structured?

Original Intent. Originally, legislative in­tent regarding the use of penalty assessmentsseemed to center on the concept ofan "abuserfee," the idea that those individuals whobreak or abuse certain laws should help fi­nance programs related to these violations. Inthis initial framework, it appears that assess­ments financed only programs which wererelated directly to the nature of the offensegenerating the assessment.

Specifically, the original penalty assess­ment of $1 for every $20 of fine was leviedonly on fines imposed for Vehicle Code of­fenses, and proceeds from this assessmentwere devoted entirely to financing drivereducation programs. In 1959, the Legislatureappears to have used similar logic when itexpanded the category of offenses subject topenalty assessments to include non-VehicleCode criminal offenses. In this case, fundsgenerated by assessments on non-VehicleCode criminal offenses financed the pro­grams of the Commission on Peace OfficerStandards and Training.

More Recent Developments. However,over time, this relationship between thesource of fines and benefiting programs hasbecome blurred. Distinctions between whichkinds of offenses generate penalty assess­ments generally are no longer tracked bylocal government officials or the State

Controller's Office, and the list of benefitingagencies has been expanded to include suchprograms as public prosecutor and publicdefender training, correctional officer train­ing and rape crisis centers. Today, the intentof the Legislature appears to be that penaltyassessment revenues should be allocated tolaw enforcement, victims' services, anddriver training programs in general, regard­less of the source which generated the assess­ment.

Problems with the CurrentDistribution ofPenalty Assessments. Although penalty as­sessments are currently viewed as a generalrevenue generating mechanism, instead of afinancing vehicle which charges specific vio­lators to fund a specific program, a large partof this funding mechanism has retained avery specific allocation formula. Revenuesdeposited in the state Assessment Fund are dis­tributed to the special funds which support theprograms strictly on the basis of a statutory for­mula, not an annual evaluation ofprogram need.The practice of distributing penalty assess­ment revenues according to statutory per­centages has, in tum, created certain resourceallocation problems or inefficiencies. Theseproblems or inefficiencies are demonstratedby the various deficit and surplus conditionswhich arise in penalty assessment financedfunds.

Page 14

Examples of these surplus and deficitconditions can be seen by examining the re­cent status of the Corrections Training Fundand the Restitution Fund. In the past fewyears, the Corrections Training Fund re­ceived Assessment Fund allocations whichexceeded annual program expenditures by asubstantial portion. Between 1983-84 and1985-86, on a cumulative basis, fund reve­nues exceeded program disbursements byapproximately $3.4 million, or 11 percent.

On the other hand, the Restitution Fundrecently experienced significant programrevenue shortfalls. As previously discus~ed,

the Restitution Fund finances the Board ofControl's Citizen Indemnification program.During legislative hearings on the 1987Budget Bill, it was estimated that the Restitu­tion Fund would experience a 1987-88 fiscalyear deficit of$ll million to $16 milliondue toa projected 20 percent annual growth rate invictim claims. This resulted in the enactmentof Chapters 1214 and 1232, Statutes of 1987,which increased the basic penalty assessmentrate from $5 to $7 for every $10 of fine, withthe proceeds from the additional $2 allocateddirectly to the Restitution Fund.

As these examples indicate, distribution ofpenalty assessment resources based strictlyon statutory percentages can result in re­source allocations which do not accuratelyreflect program needs. In turn, resource allo­cations which are not reflective of programneed may restrict significantly the ability of aprogram to fulfill its legislative mandate.

Recommendation. In order to ensure thatresources generated by penalty assessmentsare allocated on a basis consistent with pro­gramneed, we recommend that legislation beenacted to eliminate Penal Code Section1464's percentage allocation requirementsfor penalty assessment revenues. Instead, werecommend that penalty assessment reve­nues be transferred to the General Fund for

Chapter II: Sources and Benefits

legislative allocation to programs on thebasis of an annual review of program needsduring the budget process. However, becauseof the constitutional requirement that reve­nue collected from fish and game violationsbe used only for fish and game·activities, werecommend that assessments derived fromthis source be transmitted directly to the Fishand Game Preservation Fund, for allocationduring the budget process.

The presentsystem ofmaintaining penaltyassessment revenues in a special fund dedi­cated for specific purposes limits the ability ofthe Legislature to oversee and set prioritiesfor the expenditure of all state funds. Insteadof funding programs based on need, the lawprovides that funds be distributed to pro­grams based on the amount of penaltyassess­ment revenues available within establishedstatutory allocation formulas. In our judg­ment, revenue allocations from the GeneralFund that are based on annual reviews ofprogram need would assist the Legislature inmaking efficient resource allocation deci­sions and ensure that fluctuations in penaltyassessment revenues would not directly af­fect each program's expenditure level.

In addition, funding programs from theGeneral Fund would provide further assur­ance that funding levels for individual pro­grams reflect current legislative priorities byallowing the programs financed from pen­alty assessments to compete for funding withother state programs, such as education,health, and welfare.

Finally, the approach which we recom­mend for allocating penalty assessment reve­nues on thebasis ofprogram need rather thana statutory allocation formula is consistentwith the trend toward using penalty assess­ments asa more general revenue generatingmechanism instead olas a vehicle for financ­ing specific programs. -:.

PagelS

Chapter III

J

Chapter III: Alternate Sources ofFunding

Chapter III

Alternate Sources ofFunding

The penalty assessment concept has anumber of commendable features. It gener­ates a substantial amount of money-exceed­ing $100 million annually in recent years. It isimposed on a limited group of citizens-thelaw violator-instead of the general tax­payer, and in that sense may be viewed as an"abuser fee." Moreover, these revenues arenot subject to the state's appropriations limit(Article XIII B of the State Constitution) be­cause they are considered "nontax" reve-

nues. Thus, they offer the Legislature greaterfiscal flexibility than do general tax revenues.

However, as noted in Chapter II, webelievethat the statutory formula for allocating theserevenues has resulted in the distribution offunds in ways that do not always reflect pro­gram needs or legislative priorities. In thischapter we discuss some additional draw­backs and then, pursuant to the requirementsof SCR 53, we discuss alternatives to the cur­rent financing system.

Problems with Penalty Assessment Financing

First, it has become very difficult to projectthe rate of growth in penalty assessmentrevenues in recent years. Revenues regularlyhave fallen short of the levels that would beexpected, given the level of penalty assess­ments specified in statute and historical col­lection experience. For example, theGovernor's Budget projected that penaltyassessment revenues would total $135.1 mil­lion in 1986-87, while actual penalty assess­ments generated during that year totaledonly $119.1 million. A revenue shortfall ofthis magnitude-$16 million, or 12 percent­can produce significant problems for pro­grams financed entirely by penalty assess­ment funds. Furthermore, between 1985-86and 1986-87, annual revenues generated for

the state Assessment Fund actually decreasedby approximately $5.5 million, or 4.4 percent.

There are a number of possible explana­tions for the recent unpredictability of pen­alty assessment revenues. Some suggest thatthis revenue source is approaching its maxi­mum or peak revenue generating capacity.This would occur to the extent that judgescompensate for assessment rate increases byreducing fines, so that the "total bill" (fineplus penalty assessment) for guilty partiesremains constant. Others suggest that anincreasing percentage of persons required bycourts to pay fines and assessments are"working-off' their debt byspending time incounty jail because of their inability or un­willingness to pay the fines and assessments.

Page 16

Finally, somesuggest that increased fines andassessments have resulted in an increasedrate of default by guilty parties.

While the data needed to verify these expla­nations for revenue decreases do not appearto be available, if the suggestions are accuratethere are a series of unintended conse­quences. First, to the extent that judges re­duce base fines as penalty assessments in­crease, there could be a corresponding effecton the distribution of fine and penalty assess­ment revenue among city, county, and thestate governments. This is because base finerevenues are distributed to cities and coun­ties, whereas most penalty assessments go to

Chapter III: Alternate Sources ofFunding

the state. For example, for a particular of­fense, a judge may wish to impose a "target"total fine and assessment of $220. Table 5demonstrates the effect on state and local finerevenues when the basic penalty assessmentrate is increased from $5 to $7, and the targetfine and assessment total is held constant at$220. As the table shows, in order to achievethis result, the base fine has to be reduced by$16 in order for the total fine and assessmentto remain at $220. The side effects are thatlocal revenues are reduced by $16 whereasstate assessment revenues increase by anequal amount.

Table 5

Example of Local/State Revenue Transfer Resulting From Increasing PenaltyAssessments While Holding Constant Total Payments from Convicted Parties

Target Lead of Penalty Assessment LocalFine aiid Assessment Reuenue To State Fine Reaenue

Penalty Assessment$220 $75 $145at $5 for every $10

Penalty Assessment$91 $129at $7 for every $10 $220

-- --Revenue Gain/Loss $16 -$16

Percent Gain/Loss 21.3% -11.0%

Second, to the extent that persons elect tospend time in jail rather than pay a fine andassessment, local governments face particu­lar problems because they not only lose finerevenue, but also must incur the costs ofjailing the offenders. Furthermore, such atrend would exacerbate an already seriousproblem of overcrowding in local correc­tional facilities.

Finally, to the extent that higher penaltyassessment rates lead to increased defaultrates, this would not only reduce the revenuecollection rate, but could also have the moresubtle effect of fostering disregard for thecourt system.

The difficulty of predicting penalty assess­ment revenue in general, and predicting theeffect of specific increases in penalty assess-

ment rates on revenue collections in particu­lar is further complicated by the previouslycitedTrial Court Funding Program, Ch 1211/87. A matter ofpotential concern is how coun­ties electing to participate in this programwill maintain their fine and forfeiture collec­tion efforts, since these revenues will now betransferred to the state in exchange for blockgrants supporting the trial court system. Anychange in the level of fines collected willimpact net state costs for this program.

Another drawback of the current penaltyassessment system-accounting for theserevenues---emerges as the Legislature placesincreased reliance on penalty assessments asa way to finance various government pro­grams. The imposition of new penalty assess­ments, particularly those which are devotedto specific county funds, further complicates

Pagel7

a court accounting system which is alreadyburdensome in its complexity. The additionof other "special" penalty assessments tofinance specific programs, such as the re­cently authorized 50 cent increase in assess­ment levels for county automated fingerprintidentification activities, the $1 increase foremergency medical services, and a $1 in­crease for county criminal justice facility tran­sition planning needs, only accentuates thisburden.

Chapter III: Alternate Sources ofFunding

Finally, as penalty assessment rates in­crease, the role of the court system becomessomewhat that of a tax collector. The JudicialCouncil has expressed concern with thistrend, and is particularly concerned by theconcept of imposing assessments which sup­port court facilities (courthouse constructionfunds). The Judicial Council wishes to avoidcreating the impression that judges may"personally" benefit from the imposition ofany fine or assessment.

Alternative Revenue Sources for Program Funding

SCR 53 also asked us to explore "...otherstable revenue sources from which variouspenalty assessment programs may befunded...." In carrying out this requirement,we attempted to identify viable new revenuesources which have: (1) a direct relationshipto programs currently funded from penaltyassessments, (2) the potential to producesufficient funds to support these programs,and (3) the stability to be effective revenuesources over time. In our view, these threecharacteristics are necessary in order to havea substitute revenue source which is eitherequal or superior to the existing penalty as­sessment mechanism.

After a review of a number of alternativerevenue sources, we found that we wereunable to identify any new revenue sourcesthat meet our criteria for a viable alternativeto penalty assessment funding. While several

Summary

As a financing tool, penalty assessmentsdisplay both positive and negative character­istics. Penalty assessments generate signifi­cant annual revenues, but they are not leviedon the general taxpayer. Furthermore, appro­priations made from this source are not sub­ject to the state's constitutional appropria­tions limit.

suggestions were made by members of ouradvisory panel, in essence they advocated aredirection of funds from other existing pro­grams. That type of substitution, in our view,would not be a viable solution.

In Chapter II of this report, we recom­mended that all of these statutorily imposedpenalty assessments (excluding those im­posed on fish and game fines) be depositeddirectly into the state's General Fund, andthat the existing percentage allocations to thevarious penalty assessment programs beabolished. If the Legislature adopts this rec­ommendation, then it will have the flexibilityto determine spending priorities amongthese various programs without being re­stricted by the arbitrary limits on the fundingallocations to individual special funds.

On the other hand, there is some evidencethat the penalty assessment structure may beapproaching its maximum revenue-generat­ing potential. There is a possibility that fur­ther increases in the assessment rate couldexacerbate problems of projecting penaltyassessment revenues, resultinan unintendedtransfer ofrevenues to thestate that tradition-

Page 18

ally have been available to local govern­ments, lead to an increase in the alreadyburgeoning county jail population, increasefine and assessment default rates, and furthercomplicate court accounting records. In ourjudgment, these factors should be weighedcarefully when considering any future in­creases in penalty assessments.

To the extent that the state continues to usepenalty assessments as a mechanism for fi­nancing various state and local governmentprograms, however, we recommend that

Chapter III: Alternate Sources ofFunding

legislation be enacted to modify the currentallocation system. Specifically, we recom­mend eliminating the current statutory allo­cationformula, and transferring the revenuesinstead to the General Fund for allocation toprograms on the basis of an annual review ofprogram needs through the budget process.In our view, this approach would assist theLegislature in making efficient resource allo­cation decisions and ensure that fluctuationsin penalty assessment revenues do not di­rectly affect program expenditure levels.•:.

Page 19

Appendix I

Appendix!

Appendix ISCR 53 Advisory Committee Members

"'q\\::4i,iA"Nig:m:m:m:\\::::m:\)',')\/::::::::::::,::::::::::::::::::::::::::::::::,/:::::::::()::·:·::i:::::'::': :..... ::mj:tC.j;IQfH~AN.jZAt'QN:iiff::):m(':

Virgil Anderson ManagerGovernmental AffairsCalifornia State Automobile Association

Steve Birdlebough AttorneyJudicial Council

Norman Boehm Executive DirectorCommission on Peace Officer Standardsand Training

John Dougherty District AttorneySacramento County

Kenneth J. Emanuels Executive DirectorLeague of California Cities

Fred English SupervisorDriver Education and Training, LosAngeles Unified School District

AI Flor Clerk-AdministratorStockton Municipal Court

Richard Foreman Assistant SheriffLos Angeles County Sheriff's Department

Patty Giggins Executive DirectorLos Angeles Commission on AssaultsAgainst Women

Leonard Grimes Assistant DirectorDepartment of General Services

AI Howenstein Executive DirectorOffice of Criminal Justice Planning

Norma Phillips Lammers Executive DirectorBoard of Corrections

Phil McGraw Vice PresidentAcademy of Defensive Driving

Jack L. Skillicorn Auditor-ControllerMonterey County

Pat Valladao ConsultantDepartment of EducationDriver Training

Page 20

Appendix II

Appendix!!

Appendix II

Programs Financed ByPenalty Assessments

This section describes each of the programswhich benefit from penalty assessment reve­nue, and details how the funds are used bythe programs. As previously illustrated inChart I, penalty assessment revenue is dis­tributed to seven different state funds which

support various state and local assistanceprograms. In addition, current law allowslocal governments the option to collect addi­tional penalty assessment revenue to financefive specific local activities.

State Programs Funded With Penalty Assessment RevenueRestitution Fund. In addition to the $2 allo­

cated directly to the Restitution Fund, thefund also receives 22.12 percent of the re­maining penalty assessment revenue. Thepurpose of this fund is to finance the CitizensIndemnification program or "Victims ofCrime" program, which is administered bythe Board of Control. This program paysclaims ofcitizens or their dependents who areinjured or suffer financial hardship as a resultof crimes of violence, or who sustain damageor injury while performing acts whichbenefitthe public. The claims are heard by the boardunder the Victims ofCrime Act and the GoodSamaritan Act.

Penalty assessments generated $26.6 mil­lion to the Restitution Fund in 1986-87 (thelatest year in which actualdata are available)and are expected to generate $39.3 million in1987-88. Contributions from penalty assess­ments account for 77 percent of the total $34.6million in revenue to the fund in 1986-87.

Othersources of revenue include penalties onfelony convictions and civil and criminal lawviolation restitution assessments.

According to the Board of Control, theprogram provides reimbursement for out-of­pocket medical expenses, funeral and burialcosts, wage or support losses, andrehabilita­tion services on behalf of individuals whosustain injury or death due to a crime. Theprogram does not pay non-economic (or"pain and suffering") damages. Current law

. specifies that the maximum award under theprogram is $46,000. The average award in1986-87 was less than $3,000.

Victim/Witness Assistance Fund. The Vic­tim/Witness Assistance Fund receives 10percent of penalty assessment revenues tosupport grant programs that provide assis­tance to local victim/witness assistance andrape crisis centers. The program is admini­stered by the Office of Criminal Justice Plan­ning (OCJP).

Page 21

The Victim/Witness Assistance Fund re­ceived $11.9 million in 1986-87 and is pro­jected to receive $12.9 million in 1987-88 frompenalty assessments. Penalty assessmentsand the income from surplus money invest­ments are the only sources of revenue to thisfund.

Victim/witness assistance and rape crisiscenters, which are located throughout thestate, provide victims of crime with informa­tion on victim's rights, court procedures, andcounseling. According to OCJP staff, grantsfrom the fund provide nearly all of the statesupport for the victim/witness assistancecenters and about 25 percent of the supportfor local rape crisis centers. Staff advise thatsome local governments provide matchingfunds or in-kind services to support the pro­grams at the local level. Centers also acceptprivate contributions from foundations andorganizations, such as the United Way.

Driver Training Penalty Assessment Fund.The Driver Training Penalty AssessmentFund receives 29.73 percent of assessmentrevenue to support the driver training pro­gram. This program, administered by theState Department of Education (SDE), au­thorizes school districts to provide drivereducation through both a laboratory compo­nent (behind-the-wheel training) and a class­room component. Pursuant to the EducationCode, districts offering the laboratory drivertraining component are reimbursed for theiractual costs in the prior fiscal year, up to amaximum of $80 per nonhandicapped pupiland $247 per handicapped pupil. In addition,school districts receive reimbursement forthe cost of replacing vehicles and simulatorsthat are used exclusively in the laboratoryphase of the program.

This fund received $35.4 million from pen­alty assessments in 1986-87and is expected toreceive $38.5 million in 1987-88. Penaltyas­sessments are the only source of revenue tothis fund.

Appendix!!

According to SDE staff, approximately 99percent of the state's high school districtsparticipate in the program. Staff advise thatnew rules and regulations concerning pro­gram requirements and competency-baseddriver training programs that were adoptedin September 1987 will increase the per pupilcost to approximately $110 for nonhandicap­ped pupils. Consequently, any costs abovethe $80 per pupil limitation may have to beabsorbed by other apportionment fundsavailable to school districts.

Because of the statutory reimbursementlimitation, only about one-half of the fundsavailable in the Driver Training Penalty As­sessment Fund have been appropriated forthe driver training program in recent years.Provisions in the annual Budget Act haverequired that the unencumbered balance ofthe fund be transferred to the General Fundsurplus at the end of each year. For example,although the fund is projected to receivealmost $38.5 million in 1987-88, only $20.1million was appropriated for driver trainingin the 1987 Budget Act. The remaining bal­ance will be transferred to the General Fundon June 30, 1988.

Peace Officers' Training Fund. The PeaceOfficers' Training Fund receives 27.75 per­cent of penalty assessment revenue. Thisfund provides total support for the activitiesof the Commission on Peace Officer Stan­dards and Training (POST), which is respon­sible for raising the level of professionalcompetence of local law enforcement agen­cies through establishing recruitment andtraining standards and providing manage­ment counseling. POST reimburses local lawenforcement agencies for peace officer train­ing costs, including per diem, travel, tuition,and participants' salaries.

Penalty assessment revenue generated $33million to the fund in 1986-87and is projectedto generate $35.9 million in 1987-88. Penaltyassessments will provide about 98 percent of

Page 22

the $33.8 million in revenues accruing to thefund in 1986-87. The remaining two percentin revenues includes revenue from surplusmoney investments, sale of documents, andmiscellaneous services to the public.

Commission staff advise that availablerevenues cover about 100 percent of the costsof local peace officer training for per diem,travel, and tuition, and a portion of the par­ticipants' salaries. Local governments areresponsible for paying all remaining costs.Although salary reimbursement rates havebeen budgeted at 40 to 60 percent since 1982­83, POST has been able to reimburse localgovernments at a higher rate because addi­tionalmoneys havebeenavailable in the fundat the end ofeach fiscal year. The 1987BudgetAct provides that POST may reimburse localgovernments for 100 percent of participantsalaries if sufficient revenues are received inthe fund.

Corrections Training Fund. The Correc­tions Training Fund receives 9.12 percent ofpenalty assessment revenues to support theBoard of Corrections' standards and trainingprogram. Under this program, the board es­tablishes minimum standards for recruiting,selecting, and training local corrections andprobation officers, and assists local govern­ments through grants provided from thefund.

The Corrections Training Fund received$10.9 million in 1986-87 and is projected toreceive $11.8 million in 1987-88. Penalty as­sessments are the sole revenue source for thefund.

Grants from the fund are made to local lawenforcement agencies based on a formulathat accounts for the number of local correc­tions and probation officers being trainedand the level of training required under theBoard of Corrections' minimum standards.According to board staff, local governmentsmay use the money in a variety of ways, suchas to support training staff in their own train-

Appendix!!

ing units, pay tuition for training coursesapproved by the board, or substitute for staffin local jails who are being trained. Grantsrange from $500 to $750 per trainee. Theboard advises that actual costs to local gov­ernments for training vary widely, from$1,450 to $6,200 per trainee. The costs that arenot financed under the program are bornetotally by the counties.

Local Public Prosecutors and Public De­fenders Training Fund. Under Penal CodeSection 1464, the Local Public Prosecutorsand Public Defenders Training Fund(LPPPDTF) receives 0.90 percent of penaltyassessment revenues, up to $850,000 annu­ally. The remainder in excess of $850,000 istransferred to the Restitution Fund. TheLPPPDTF supports the public prosecutorand public defender legal training program,which provides statewide programs of edu­cation, training, and research for local prose­cutors and public defenders. The program isadministered by OCJP. Penalty assessmentsand incomefrom surplUS money investmentsare the only sources of revenue to this fund.

The OCJP staff advise that this is the onlystate training program available for localprosecutors and public defenders. Staff esti­mate that the program provides training forabout 65 percent of eligible local personnel,and indicate that other training opportunitiesare provided by local governments and state­wide prosecutor and public defender organi­zations.

Fish and Game Preservation Fund. The Fishand Game Preservation Fund, which wasestablished for protection and propagation offish and game in California, receives thesmallest percentage ofassessment revenue ofthe seven funds - 0.38 percent. Penal CodeSection 1464 specifies that the funds derivedfrom this assessment shall be used for theeducation or training of employees of theDepartment of Fish and Game.

Penalty assessment revenues provided

Page 23

$452,000 to the fund in 1986-87, and are pro­jected to provide $492,000 in 1987-88. Thisamount represents a small portion of the totalrevenues to the Fish and Game PreservationFund. The fund received $62 million from 15

Appendix II

different sources in 1986-87. Thus, penaltyassessments account for less than one percentof the total revenues to the fund. The majorsource of revenue to the fund is fees fromgeneral fish and game licenses.

Local Programs That May Be Funded With PenaltyAssessment Revenue at County Option

As indicated in Chapter I, current law al­lows local governments to collect additionalpenalty assessment revenues to support sev­eral other programs at the local level.

County Courthouse Temporary Construc­tion Funds. Various sections of the Govern­ment Code allow counties to establish aCourthouse Temporary Construction Fundin order to acquire, rehabilitate, or constructcourtrooms or other buildings necessary tooperate the courts.

For those counties electing to establish sucha fund, the current assessment is $1 or $2 forevery $10 of fine, or fraction thereof, collectedbythe courts. Counties authorized to collectan assessment at the $2 rate (see discussion ofSection 76000 assessments in Chapter I) alsoare authorized to levy a surcharge of $1.50 onall fines for parking violations. For a parkingviolation filed in a county court, the countiesdeposit $1.50 into their courthouse fundswhether or not the court collects the fine andsurcharge. For each parking violation notfiled in a county court, the counties deposit$1.50 into their courthouse funds after thefine and surcharge are collected by a city orother agency in the counties.

The most recent information available. onthe number of counties that collect this as­sessment is contained in a 1984 report by theAuditor General. According to that report, atthat time 36 counties had establisheda Court­house Temporary Construction Fund. Table

6 lists those counties and the revenue gener­ated by both assessments and surcharges tothe funds through May 1984.

Counties use a variety of sources to fundcourthouse construction, including countygeneral fund moneys and proceeds from thesale of bonds. In addition, Chapter 1211, Stat­utes of 1987, established a Trial Court Im­provement Fund and provided that it receivea General Fund appropriation of $20 millionannually for court improvement projects atthe local level. Chapter 1211 specified that upto $10 million of the annual appropriationcould be used for construction of local courtfacilities.

County Criminal Justice Facility Tempo­rary Construction Funds. Current law alsoallows counties to establish a County Crimi­nal Justice Facility Temporary ConstructionFund for construction, reconstruction, ex­pansion, improvement, operation, or mainte­nance of county criminal justice or court fa­cilities and for improvement of criminal jus­tice automated information systems. The lawpermits San Bernardino County to use thefund for juvenile justice rehabilitation facili­ties as well. Criminal justice facilities includejails, detention facilities, juvenile halls, andcourts.

For counties making the election, theamount of assessment on fines for criminaloffenses is the same as the assessment for thecourthouse fund: $1 or $2for every $10 offine

Page 24

Appendix II

Table 6Courthouse Temporary Construction Funds

Summary of Revenues, Expenditures, and Fund Balances (Unaudited)January 1,1982 through May 31,1984

Alameda a

Amador

Butte

CalaverasContra Costa

Fresno

Humboldt

Kern

Kings

LakeLos Angelesa

Marin

MariposaMono

Monterey

NapaNevada

Orange

Placer

RiversideSacramentoSan Bernadino

San Diego

San Francisco

San Joaquin

Santa BarbaraSanta Clara

ShastaSiskiyou

Solano

Sonoma

Stanislaus

TrinityTulare

Yolo

Yuba

$273,5313,5679,9052,772

140,52845,39420,666

131,40723,604

5,16133,432,000

83,969

8465,732

61,4915

1,859404,825

16,245186,320

95,999115,712241,325427,362

6,43390,624­49,48213,906

3133,38420,30844,459

1,18476,022

1,7506,502

$15,17115,881

8,820,000

7,500

$273,5313,5679,9052,772

125,35729,51320,666

131,40723,604

5,16124,612,000

83,969846

5,73261,491

51,859

404,82516,245

186,32095,999

115,712233,825427,362

6,43390,62449,48213,906

3133,38420,30844,459

1,18476,022

1,7506,502

a Source: AuditorGeneral, A Review of County Construction Funds for Courthouses and Criminal Justice Facllttles, 1984. Accordi'!9 to the Auditor General, thesecounties' revenues and fund balances may be slightly overstatedbecause they deposited into their courthouse funds and criminalJustice funds money that shouldhave been remitted to the state.

Page 25

or fraction thereof, collected by the courts.Counties that establish both funds can collecta separate assessment for each fund. Theamount deposited into the fund for parkingviolations differs slightly: $1 for each parkingviolation filed in a county court and $1.50 foreach surcharge collected by a city or otheragency in the county. Counties that establishboth funds can collect a separate surchargefor each fund.

The most recent information available onthe number of counties that collect this as­sessment is contained in the same 1984 Audi­tor General's report mentioned above. Ac­cording to that report, at that time 54 countieshad established a County Criminal JusticeFacility Temporary Construction Fund.Table 7 lists those counties and the revenuegenerated by both assessments and sur­charges to the funds through May 1984.

Unlike the situation with respect to court­house construction, the state has providedcounties with sizeable sums of money in re­cent years for construction of local criminaljustice facilities. Since 1985, the state hasprovided more than $1 billion to countiesfrom three state bond measures and a Gen­eral Fund appropriation for jail design andconstruction. In addition, one of the bondmeasures set aside $20 million for design andconstruction of local juvenile facilities.

The bond measures generally provide thatthe state pay for 75 percent of the costs ofconstructing new facilities with a 25 percentmatch from counties. Local governments usea variety ofsources, including general countyrevenues and county bond funds, to supportthe 25 percent requirement and the costs thatare not covered by the bond measures. TheBoard of Corrections, which administers thestate bond funds, advises that penalty assess­ment revenue collected in County CriminalJustice Facility Temporary ConstructionFunds may also be used to meet the matchrequirement.

Appendix II

County Automated Fingerprint Identifica­tion Fund. Chapter 1239, Statutes of 1987, al­lows counties to establish County Auto­mated Fingerprint Identification Funds forthe purchase, lease, operation (includingpersonnel and related costs), and mainte­nance of automated fingerprint equipmentand the replacement of existing automatedfingerprint equipment. Counties that estab­lish the fund may collect an additional pen­alty assessment of50 cents for each $10 fine orfraction thereof, to generate revenues for thisfund.

Because the legislation authorizing coun­ties to create these funds did not take effectuntil January I, 1988, it is not known howmany counties will choose to establish thesefunds.

The Legislature also has provided directfunding to local governments for the pur­chase of automated fingerprint equipment.Specifically, Ch 1234/85 appropriated $7million and the 1986 Budget Act appropri­ated an additional $5.5 million for local agen­cies to purchase equipment needed to accesstheDepartment of Justice's California Identi­fication System (CAL-ID). Local govern­ments also use their own funds for this pur­pose.

Emergency Medical Services Fund. Chapter1240, Statutes of 1987, allows counties to es­tablish Emergency Medical Service Funds.Chapter 1240 requires two-thirds of themoney in each fund to be used to reimbursephysicians for a percentage of the losses theyincur in providing emergency medical serv­ices. One-third of the money in eachfund is tobe used for other emergency medical servicesas determined by the county. Counties thatestablish the fund may collect an.additionalpenalty assessment of $1 for each $10 in fine,or fraction thereof, to generate revenues forthis fund.

Page 26

Appendix II

Table 7County Criminal Justice Facility Temporary Construction Fund

Summary of Revenues, Expenditures, and Fund Balances (Unaudited)January 1, 1982 through May 31, 1984

Alameda a

AlpineAmadorButteCalaverasColusaContra CostaDel NorteEI DoradoFresnoGlennHumboldtImperialInyoKernKingsLakeLos Angelesa

MaderaMarinMariposaMendocinoMercedMonoMontereyNapaNevadaOrangePlacerPlumasRiversideSacramentoSan BernadinoSan DiegoSan JoaquinSan Luis ObispoSan MateoSanta BarbaraSanta ClaraSanta CruzShastaSierraSiskiyouSolanoSonomaStanislausSutterTehamaTrinityTulareTuolumneVenturaYoloYuba

$4,070,6353,111

44,609119,17139,95173,792

1,376,87124,658

230,5801,002,825

74,606285,802291,288

64,0701,379,794

170,13271,736

24,060,000159,644890,149

10,023134,878199,34440,358

1,297,651104,248279,759

6,837,634288,127

24,4961,858,8461,867,5331,701,3044,697,412

707,506290,719

2,213,407795,112

3,492,046739,169222,927

8,760118,221546,264128,227234,643

40,445127,077

12,612574,329

23,369858,926

44,97735,247

$2,493,816 $1,576,8193,111

22,352 22,25760,000 59,171

5,447 34,50410,937 62,855

888,462 488,40915,810 8,848

230,580522,144 480,681

74,60644,849 240,953

8,590 282,69864,070

995,947 383,847170,132

68,869 2,8678,660,000 15,400,000

159,644368,848 521,301

10,02314,891 119,987

199,34440,358

630,000 667,651104,248

1,877 277,882207,537 6,630,097

42,642 245,48524,496

417,705 1,441,1411,735,865 131,668

1,701,3042,028,674 2,668,738

707,506290,719

2,502,033 -288,626249,310 545,802

3,137,396 354,650185,017 554,152219,300 3,627

2,140 6,620118,221

350,873 195,391128,227

5,220 229,42312,447 27,99820,000 107,077

12,612116,406 457,923

23,369858,926

17,030 27,94720,000 15,247

Source: Auditor General, A Review of County Construction Funds for Courthouses and Criminal Justice Facilities, 1984. According to the Audilor General, thesecounties'revenues and fund balances maybe slightly overstatedbecause they deposiled into their courthouse funds and criminalJustice funds money that shouldhave been remitted to the state.

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Because the legislation authorizing coun­ties to create these funds did not take effectuntil January 1, 1988, it is not known howmany counties will choose to establish funds.

County Transition Planning Trust Fund.Chapter 300, Statutes of 1987, allows Solanoand Orange counties to establish TransitionPlanning Trust Funds to finance county

Appendix II

criminal justice facility transition planningneeds. In Solano and Orange counties, thefund may collect an additional penalty as­sessment of $1 for each $10 in fine, or fractionthereof, to generate revenues.

Although this legislation took effect in July1987, no data were available on these funds atthe time this report was prepared.•:.

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