Governmental Affairs

Report shows county circuit court deficit Governmental

Last August Legislative Audit contacted the Association of Arkansas Counties to discuss the cost of circuit courts. June Barron, deputy legislative auditor for counties and municipalities, met with us to develop a plan for all 75 counties to report their findings. This was one of June’s last big projects with the counties. Since the completion of this project, June retired and was succeeded by Marti Steel. The AAC would like to thank June for her service to the counties and the dedication she has shown to the state of Arkansas. We understand the importance of having a good working relationship with Legislative Audit and have confidence in Marti moving forward.

Legislative Audit was tasked by the legislature to produce a report with information regarding the structure and history of the Arkansas Supreme Court, court of appeals and circuit courts. The revenues and expenditures were broken down into three separate categories: state, county and prosecuting attorney. Annualized revenues for the state’s trial and appellate courts totaled $166.2 million, while annualized expenditures totaled $201.8 million. Of course, the state’s revenue is the largest coming in at $142,633,153, with $132,781,697 in expenditures. The large majority of these expenditures are salaries for prosecuting attorneys, deputy prosecuting attorneys, circuit judges and public defenders. Prosecuting attorney revenues consist primarily of hot check fees and drug-control funds. Their revenues totaled $5.1 million, with $5 million dedicated to expenditures. These expenditures include general office expenses, victim witness assistance and violence against women. All of the revenue mentioned above is dedicated to each respective entity, and you may notice that the revenue covers all expenditures.

The county revenue and expenditure report paints a different picture. County revenues totaled $18,379,069, with expenditures totaling $64,060,086. The dedicated revenue amount includes $13.7 million in circuit court fines, fees and costs retained by the counties, $1.8 million in prosecuting attorney-related fees and cost and $1.5 million in fees and cost related to public defenders. Expenditures include any costs accrued by the county towards circuit court. As a result of Amendment 80, circuit courts became the general jurisdiction trial courts for the state, hearing civil, criminal, domestic relations, probate and juvenile cases. As you can see, the counties dedicated revenue comes up short to the tune of $45.7 million.

This deficit is primarily absorbed through the counties’ general funds (county general). If you follow the state legislature, the acronym GR (general revenue) comes up a lot. This base revenue is what most services are funded from, and it’s always a fight to redirect any GR. County quorum courts have to be careful, as well when appropriating out of county general. The best words a justice of the peace can hear are, “This does not affect county general funds.”

One fund that helps out on the lack of dedicated revenue towards circuit court is the county recorder cost fund. This fund was set up to purchase, maintain and operate an automated records system (ACA 21-6-306). The word operate allows quorum courts to appropriate dollars from this fund at the discretion of the recorder to salaries of employees who operate circuit court. This fund alone cannot cover the $45.7 million deficit the counties have to navigate to operate the court system.

I testified in front of the Legislative Joint Audit Committee on this report in December. Most of the questions stem from the topic of fine collection. A substantial portion of the state and county revenue comes from fine collection. Counties can handle fine collection in many different ways. The quorum court of each county of the state shall designate a county official, agency or department that shall be primarily responsible for the collection of fines assessed in the circuit courts of this state (ACA 16-13-709). It’s common for the collection of fines assessed in circuit court to be assigned to the sheriff, prosecutor or the circuit clerk. Other counties may have the collector, treasurer or county clerk designated to collect fines. The AAC is currently looking at ways to streamline fine collection. This would include a partnership with the counties to increase fine collection.

One other fact this report points out is the money that flows from the county aid fund to pay for deputy prosecuting attorneys. Throughout the year, funds are transferred from the county aid fund to the Auditor of State for payment of deputy prosecuting attorney salaries (approximately 20 percent). The county aid fund was cut by 1 percent last session, however it turned out that it was a little more than a percent due to this $5 million going directly toward salaries of deputy prosecuting attorneys. This cut was manageable due to the increase in the county jail reimbursement rate. State revenue outweighs expenditures by nearly $10 million. This would be the perfect time to transfer the responsibility of deputy prosecuting attorney salaries directly to the state. Counties bear the burden in lack of revenue, and the state is $10 million in the black. Shifting this responsibility would go a long way in helping the counties pay for circuit court.

I would like to thank the counties for the timely response they provided for this report. The county treasurers, clerks and circuit clerks all contributed to the results of this report.

Affairs Josh Curtis Governmental Affairs Director

On the Web:

Look for the Arkansas Legislative Audit Special Report “Information Regading the Arkansas Supreme Court, Court of Appeals and Circuit Court” at www. arcounties.org. Search “Court.”