Trends in State Courts
<>
2013
25th Anniversary Edition
A nonprofit organization improving justice through leadership and service to courts.
OREGON COURTS TURN CRISIS
INTO OPPORTUNITY
TREND
The economic downturn
and state budget cuts
David T. Moon
have left the Oregon
Division Director, Business and Fiscal Services Division, Oregon Judicial Department
Circuit Courts with
T
he Oregon Judicial Department (OJD) is a unified system of state trial courts and
appellate courts, including the Oregon Supreme Court, Court of Appeals, and Tax
Court. There are 36 Oregon Circuit Courts in 27 judicial districts. Early in 2010, in
response to widespread and long-term budget reductions, which involved laying off 8
percent of the state court workforce, Oregon’s chief justice created the Court Reengineering
and Efficiencies Work Group (CREW), which comprised a cross-section of judges and staff
from around the state, and the Judicial Council’s Collections Work Group to identify ways
to improve business processes and create further efficiencies in trial and appellate courts.
Members of the judiciary and OJD employees were asked to suggest efficiencies that could
be implemented statewide to benefit the entire judicial department while considering the
current constraints of budget cuts and reduced staffing. CREW reviewed more than
1,400 responses.
inadequate funding
for essential services.
This crisis creates an
opportunity for court
leaders to look closely
at court processes and
make systemic changes
to reengineer the court
business model to be
more efficient and
sustainable long-term.
As a result of this effort, CREW recommended that higher-level court-accounting
functions and many collection activities be moved from local trial courts to the State Court
Administrator’s (SCA’s) office in Salem, thereby freeing courts to focus their limited resources
on delivering judicial services. This recommendation was made while fully considering
concerns expressed by presiding judges and court administrators. Moving accounting
functions away from local trial courts was seen by some as diluting local control. Presiding
judges and their trial court administrators are statutorily responsible for the administration
of their courts, and outsourcing some of their business functions to the SCA’s office makes
management oversight more difficult. Some courts felt working with a remote central
office would slow down or compromise accurate case financial processing.
These concerns were barriers to implementing
successful, statewide central accounting and
collections programs, and each concern was
addressed with solutions that allowed for local court
metrics for measuring the quality of work. Developing
relationships facilitated good communications
between local court staff and central accounting
staff. Designing new workflow and business
processes, which took advantage of electronic
document management and new case and financial
Turning Crisis into Opportunity
51
management software (eCourt), helped ensure a smooth transition for centralizing
accounting functions and providing transparent accountability to court administrators.
The Central Services Unit was created to be an ancillary service provider to the courts.
Responsibility for accounting functions is delegated to the Central Services Unit, but
ultimately the court maintains authority and control. This unit uses fewer staff to process
court financial business more efficiently, consistently, and accurately.
The best time to be a
court administrator
is when we have the
resources to do what
needs to be done. But
when there are budget
limitations you need
to look at the work in
an organization-wide
way, and see what
you can do with what
you have. It moves
you out of “business as
usual” mode and helps
determine the priorities
of tomorrow, rather
than today.
Oregon eCourt implementation began in June 2012 and is scheduled to continue over the
next four years, with rollout to all courts completed by June 2016. Oregon eCourt provides
an additional opportunity to leverage technology to provide virtual courthouse services
like eFiling, ePayments, and further centralization of court accounting, central printing, and
collections functions. The Oregon eCourt system was configured to take advantage of
efficiencies and best practices that have been developed over the past two years.
CENTRAL SERVICES UNIT
In April 2010, the new Central Services Unit was formed to analyze the potential benefits
of centralizing or automating accounting functions, check printing, collection processes,
and violations bureau activities. The directive was to determine if it was possible to increase
efficiency, improve internal controls, and relieve some of the workload of the courts.
-Richard Moellmer
Trial Court Administrator
Washington County
Circuit Court
Accounting. Centralizing high-level accounting functions was the first project and began
in August 2010. Josephine County Circuit Court piloted central accounting by transitioning
disbursements, adjustments, return check processing, end-of-month close, the escheatment
process, and bankruptcies. The Josephine
County pilot proved that OJD could provide
Monthly Hours by Accounting Duties
a 65 percent overall savings in staff time by
transferring these accounting functions from the
69
Verification and Balancing
23
local court level to the Central Services Unit.
66
Adjustments
10
13
20
Fund Transfers
Month-End Processing
12
15
3
14
Division of State Lands
Miscellaneous
Twenty courts transitioned their accounting
functions to Central Services in the first two-anda-half years. The remaining courts will follow in
the next few years (through mid-2016), as they
prepare to transition to eCourt following the
implementation schedule set by the eCourt
executive sponsors.
35
Disbursements and Check
Printing
7
5
5
52 Trends in State Courts – 2013
Josephine
Central Services
Before the Central Services effort, OJD spent
17.92 full-time equivalents (FTEs) performing the
high-level accounting functions for
20 courts (Coos and Curry courts
are combined into one judicial
district). The Central Services
Unit is currently spending 6.28
FTEs on the same functions. This
represents a total savings of 11.64
FTEs (65 percent). Statewide
implementation of Central Services
will save an additional 37.94 FTEs
for a total statewide savings of
49.58 FTEs. To provide perspective,
in 2011-13 the circuit courts
lost 159.04 FTEs due to budget
reductions, and many of those
positions may never be restored.
Cumulative Full Time Equivalent (FTE) Savings
Josephine
0.9
Lincoln
1.5
Tax
1.5
Appellate
Malheur
Union
Wallowa
Jefferson
Crook
Polk
Clatsop
Tillamook
Coos/Curry
Linn
1.6
1.7
2.1
2.2
2.6
3.1
3.9
4.2
5.0
5.8
6.1
7.1
Douglas
8.5
Washington
9.5
Deschutes
10.7
Jackson
11.6
Yamhill
Central Services also reconciles
electronic payments, accepts
phone payments by credit card
and cash-tender payments by mail, corrects processing errors, and provides help-desk
support to the users of the ePayment system. The bulk of this work is still performed
by each individual circuit court; however, by providing these services centrally, OJD
can leverage efficiencies from an economy of scale and create consistency and
standardization in our business process.
Check Printing. OJD also studied the practice of printing checks, court notices, and
financial reports at the courts to identify ways to streamline processes and reduce costs.
OJD reviewed the option of contracting with the Oregon Department of Administrative
Services (DAS) to print and mail all court-generated notices and checks and found there
could be significant cost savings and efficiencies to print checks through DAS. In 2012
all 36 state courts started the transition to central check printing. The statewide annual
savings from this change is 116.7 staff hours and $22,344 in postage, check stock, and
envelopes. OJD is currently studying options to print all court notices through DAS.
Collections. Currently, the OJD has $1.4 billion in total outstanding receivables. This
amount includes debt for which collection efforts have been exhausted, as well as debt
that has current payment plans or has been assigned to a third party for collection.
In response to a detailed revenue management study in 2009 to improve debt and
collections management, the OJD has centralized most of the debt management.
We passed the work
to the SCA’s office and
the transition was
seamless. However
reluctant our supervisor
was to move to the
centralized accounting
model, within a few
months she reported
that the work was done
quickly and consistently
without any errors.
-Bonnie Savage
Trial Court Administrator
Lincoln County Circuit Court
Turning Crisis into Opportunity
53
During the past two years, OJD
began exploring options to manage
Tax Intercept Revenue
the delinquent debt portfolio more
260% Increase From 2009-11 to 2011-13
effectively. As local collections staff
were reduced or eliminated because
$6,346,936
of budget reductions, OJD began
to develop automated systems that
could outsource delinquent debt to
the Oregon Department of Revenue
$2,408,105
(DOR) and private collection agencies
with less court intervention. Cases
with delinquent debt are now kept in
a perpetual collections cycle until the
judgment remedies expire. Before the
2009-2011
2011-2013
implementation of these automated
collection processes, delinquent
debt would be returned from a third
party as uncollectible and would not
automatically be sent to another third-party agency that might be able to collect the debt.
Consequently, courts accumulated a large volume of “stale” debt that had no collection
“Another huge time
activity for years. Courts simply did not have the staff resources to work old, uncollectible
saver for my court. . . .
debt and to refer the cases back to third-party agencies. Because of these efforts and the
I think that this could
efficiencies created through automation, the OJD has nearly 76 percent of the outstanding
be an even bigger time
debt portfolio assigned to third-party agencies for collections ($960 million as of June 2012,
saver for courts than
as reported to the Legislative Fiscal Office of the Oregon State Legislature). The relatively
central accounting
small percentage of debt that is retained at the court is for debtors who enter into a
has been.”
voluntary payment plan with the court and keep current on their payments.
-Bonnie Savage, Trial Court
Administrator Lincoln
County Circuit Court
In addition to automating the referral of delinquent debt to DOR and private collection
agencies, OJD is now managing the volume and type of debt assigned to each thirdparty agency. “Load balancing” of the debt portfolio assigned to each third-party agency
allows OJD to gauge collection performance more accurately and evaluate which agency
performs the best on different types of debt.
The central debt management effort has created efficiencies by using technology to
automate processes that were once done manually by court staff. This has allowed OJD
to keep most of its delinquent debt portfolio assigned to third-party agencies, rather than
remaining at the court with no collection activity. If the debt is not being worked it cannot
be collected. OJD is projecting a $9 million increase in third-party collections over the
2009-11 biennium, $3.9 million of which is projected to be collected through tax intercepts,
a process of sending all debt to the Department of Revenue to intercept state tax refunds.
Changes to automate the tax-intercept referrals have resulted in more than a 260 percent
54 Trends in State Courts – 2013
THIRD-PARTY COLLECTIONS REVENUE IN DOLLARS: 2009-11 VS. 2011-13 (PROJECTED)
2011-13 PARTIAL BIENNIUM — JULY 2011- DEC. 2012
2009-2011 (actual)
2011-2013 (projection)
Tax Intercept
Department of
Revenue
2,408,105
6,346,936
Biennium Data
Regular Collections Program
Department
Alliance One
Municipal
Line Barger
of Revenue
Services Bureau
47,594,581
8,017,035
352,345
103,974
49,256,851
7,703,632
2,224,114
1,637,212
Quarterly Trends
Total Third-Party
Collections
58,476,040
67,168,745
Tax Intercept
Millions
$3.0
Tax Season
Dept of Revenue
$2.0
$1.0
$0.0
Quarterly, 2011-2012
Regular Collection Program
$7.5
Tax Season
Dept of Revenue
$5.0
$0.5
Millions
Millions
$10.0
Municipal Services Bureau
$0.3
$2.5
$0.0
$0.0
Quarterly, 2011-2012
Quarterly, 2011-2012
$1.0
$0.5
Alliance One
$0.5
Millions
Millions
$1.5
Line Barger
$0.3
$0.0
$0.0
Quarterly, 2011-2012
Quarterly, 2011-2012
Turning Crisis into Opportunity
55
increase in tax-intercept revenue this biennium. This would
possibly increase further with the creation of federal legislation to
allow states to intercept federal tax refunds.
Court Debt Collection and New Media
Courts feel increased pressure to collect fines, costs,
and restitution due to the economic downturn—
coupled with a decreased ability to pay for most
offenders. New media could provide a way for
courts to improve their debt collection.
Cell Phones and Smart Phones. Mobile devices
allow people to be reached almost anytime,
anywhere. Nebraska uses texting, with the
permission of the defendant, to send a reminder of
payments due or obligations to be met. This has
reduced the number of no-shows at court.
Blogs and Wikis. The Government Revenue
Collection Association operates a blog with
discussion threads on various topics, such as
collector performance measures and new
legislation. Court-debt-collection agents of a state
or large jurisdiction could also do this to share
information.
Microblogging. Just as texting can remind a
court debtor, a court could broadcast messages on
compliance-related matters via a service like Twitter.
Social Networking. Facebook could provide
courts with another avenue for sharing general
information about collections and compliance.
Collectors in a state or large jurisdiction could use a
Facebook page to share ideas and information.
Video Sharing. Michigan has developed collection
video training for judges and collection staff on the
judiciary Web site. This training could be posted on
a site such as YouTube, along with other collectionand-compliance-related information.
John Matthias, National Center for State Courts
56 Trends in State Courts – 2013
Central Violations Bureau Pilot. The newest project for
the Central Services Unit is a centralized violations bureau,
which is currently being piloted in one circuit court. Oregon
Circuit Courts use local violation bureaus to reduce fines using
a uniform fine schedule and then accept payment by phone,
mail, or in person. Centralizing the violations bureau functions
provides one statewide number for the public to request a
fine reduction and pay their fine over the phone, online, or by
mail. This approach provides a convenient and uniform enduser experience for the public, reduces court workload, and
decreases the overall number of staff needed to operate the
violations bureau for all 36 circuit courts.
OBSTACLES TO IMPLEMENTATION
Even with the successful implementation of these programs,
there remain significant staffing and cultural obstacles to
statewide adoption of centrally provided services. OJD has
lost 201 permanent FTEs since the 2007-09 biennium, a 12
percent reduction in staff. Centralizing many accounting and
collections functions that were previously done at the courts
was a necessary reorganization of our workload that allowed
us to maintain some of our current functions with less staff.
After wringing out all possible efficiencies, the current central
office staff has now reached its capacity to take on more
courts, so additional funding is required to provide resources
for centralized accounting functions to support Oregon eCourt
processes and for a central violations bureau. These services
generally become the new standard of operations as courts
go live on the new Oregon eCourt system, creating efficiencies
across the department and allowing circuit courts to support
their increased workload associated with added functionality
and public-access abilities. Without additional staffing,
complete statewide adoption of even these highly efficient
programs will be difficult to achieve.
CONCLUSION
Ongoing budget reductions have devastated many OJD programs and operations.
In an effort to respond, survive, and thrive in the future, the chief justice established
the Court Reengineering and Efficiencies Workgroup (CREW) as a vehicle to
continually evaluate, assess, and improve. Using ideas brought to CREW’s attention
through solicitation of feedback from judges and staff and operating under the
OJD’s guiding principles, mission, and vision, the CREW is tasked with generating,
proofing, and piloting innovative ideas. This has resulted in the centralization
of higher-level accounting functions and many collections activities, which has
allowed courts to focus their limited resources on delivering judicial services. These
programs are well on their way to saving the department 3 percent of current staff
resources and generating $9 million in additional revenue. Barriers to creating these
types of programs and realizing success are more cultural than technological, but
can be overcome by creative solutions, open communication, and demonstrated
success that highlights advantages for all of the parties involved. This change
management process, while uncomfortable, has allowed OJD to make innovative
and far-reaching improvements that directly benefit the communities we serve and
the state as a whole.
25
YEARS AGO
Court Collection of
Fines and Fees
Twenty-five years ago,
courts in twelve states
(Alaska, Arkansas,
California, Colorado,
Hawaii, Maine, Nevada,
New Jersey, North Dakota, Ohio, Virginia, and
Washington) accepted
credit cards as payment
for court fines, fees, and
bail forfeitures. Dade
County, Florida and
Lansing, Michigan both
attempted to simplify
fine payment by installing drive-in windows in
their courthouses. Despite efforts to be more
accommodating, courts
still faced problems
collecting delinquent
fines. As such, California
passed legislation permitting the Department
of Motor Vehicles to stop
issuing driver’s licenses
to applicants with outstanding parking tickets.
Turning Crisis into Opportunity
57