Director's Annual Report

Funding the Federal Judiciary

FY 2005 Budget Supplemental Requests
      -Booker/Fanfan and Judicial Security
      -Hurricane Katrina
FY 2006 Budget
FY 2007 Budget

Each year, the Administrative Office works to secure adequate funding for the Judiciary so the federal courts can continue to fulfill their mission of providing the American public a competent, fair, and impartial system of justice. In 2005, the courts' unflagging commitment to serving the public faced mounting funding challenges.

Congress continued to grapple with a growing gap between federal government needs and available resources. During FY 2005, courts nationwide faced increased workloads as a result of the Supreme Court decisions in the U.S. v. Booker and U.S. v. Fanfan, and passage of the Class Action Fairness Act and the Bankruptcy Abuse Prevention and Consumer Protection Act. This increased workload came on the heels of a difficult FY 2004, when insufficient funding forced the loss of 1,350 jobs throughout the courts.

During FY 2005, the AO devoted countless hours to securing funds to improve judicial security, with positive results. As the year closed, Hurricanes Katrina and Rita brought massive destruction to the Gulf Coast, forced temporary closings of courts in Louisiana and Mississippi, and resulted in relocation of court operations for many weeks. Hundreds of court employees lost homes and personal possessions in the storms, yet demons trated their undaunted spirit as they returned to their jobs and continued to serve the public. Costs escalated as the Judiciary funded court relocations, equipment replacement, and travel expenses for court employees as they returned to work and re-established their lives.

Fiscal Year 2005 Budget Supplemental Requests

Booker/Fanfan and Judicial Security. Substantial new costs were estimated for additional workload stemming from the Supreme Court's decisions in U.S. v. Booker and U.S. v. Fanfan ($91.3 million) and the newly enacted Class Action Fairness Act of 2005 ($10.5 million). On behalf of the federal Judiciary, AO Director Mecham in February transmitted to the President and the Office of Management and Budget a $101.8 million emergency supplemental request to cover these expenses. In addition, the Judicial Conference sent a request to the President and Congress in April 2005 requesting that the U.S. Marshals Service (USMS) receive $12 million in supplemental 2005 funds for the purchase, installation, and maintenance of home security systems for judges, following the March 2005 murders of Judge Joan Lefkow's husband and mother.

During conference deliberations, Congress, at the AO's request, provided the USMS with $11.9 million to address offsite judicial security enhancements, such as home intrusion detection systems, and directed the USMS to work with the Administrative Office to develop a spending plan for the funds—a significant accomplishment for the Judiciary. The plan is complete and a contract is now in place for the services. The President signed P.L. No. 109-13 on May 11, which did not address workload increases resulting from the Supreme Court decisions or recently enacted legislation. As the fiscal year ended, it appeared anticipated workloads in the district courts and courts of appeal were indeed increasing as a result of the decisions. Sentence-related cases in the federal courts were up by 13,000 over the previous year.

Several technical provisions included in the law were important to the operation of the courts, in particular, corrections to language in the new bankruptcy law specifying how bankruptcy fee revenues would be distributed. The Judiciary now will receive $27 million in new fee revenue instead of losing $48 million over the next five years, a net improvement of $75 million.

Federal buildings and U.S. courthouses damaged by Hurricanes Katrina and Rita will be cleaned up and repaired with supplemental funding provided by GSA in FY 2006.

Hurricane Katrina. Projected expenses to support the courts following Hurricanes Katrina and Rita led the Judiciary to transmit a supplemental funding request to the President in September 2005. Initial estimates found that travel and per diem for relocated staff, lease of temporary space, furniture and equipment replacement, and other incidental expenses would cost the Judiciary about $65 million.

These estimates were refined prior to Congressional action on the supplemental. Due to the outstanding efforts of the Gulf Coast courts to minimize expenses, the AO was able to reduce its request to $18 million for direct hurricane recovery costs. In the revised estimate, the AO also requested an additional $10.6 million to address the costs of future preparedness activities.

The conference report accompanying the FY 2006 Defense Appropriations Act included $18 million in supplemental funding for the Judiciary's hurricane relief efforts. Report language was included directing that the Judiciary make available $10.6 million for future preparedness activities in the FY 2006 Financial Plan.

The Defense Appropriations Act included $38 million in supplemental funding for the General Services Administration for emergency building operations in support of cleaning, assessing damage, and repairing federal buildings and United States courthouses damaged in the wake of Hurricanes Katrina and Rita. The President signed P.L. No. 109-148 at year's end.

FY 2006 Budget

Judge Julia S. Gibbons, chair of the Judicial Conference Budget Committee, testified in April on behalf of the Judiciary.

The fiscal year 2006 appropriations process began in February, 2005, when the President transmitted his budget to Congress. Both the House and Senate reorganized the appropriations committee structure, moving the Judiciary to new subcommittees. Judge Julia Smith Gibbons, chair of the Budget Committee of the Judicial Conference and Director Mecham testified before the House Appropriations Subcommittee on behalf of the Judiciary. No hearings were held in the Senate, despite several visits with key members.

In June, the President transmitted to Congress on behalf of the Judiciary an FY 2006 budget amendment totaling $18.5 million. This request was to fund the 28 new bankruptcy judgeships authorized by the new bankruptcy bill, as well as costs to bankruptcy courts to implement the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.

By mid-year, the House Appropriations Committee approved a 6.3 percent increase for the Judiciary over the prior year, with a 5.4 percent increase for the Salaries and Expenses account that funds court operations. While the funding level provided was fair given the major funding issues facing the subcommittee, the recommended funding did not address significant increases in uncontrollable expenses, including rent, and only provided for current staffing levels. It did not fully fund court operating expenses or pay for congressionally mandated workload increases or needed new initiatives.

The Senate Appropriations Committee approved $5.7 billion for the Judiciary in July—nearly $11 million more than the House provided, with an overall increase for the Judiciary of 6.5 percent and an increase of 6.1 percent in the Salaries and Expense account over fiscal year 2005.

Fiscal year 2006 began with the first continuing resolution (CR). The Executive Committee of the Judicial Conference in August had approved an interim financial plan for the period covered by the CRs, based on best assumptions about the appropriations that the AO could provide at the time. Temporary allotments were issued on October 1, 2005, with instructions to all courts and federal defender organizations to restrict hiring and refrain from purchasing non-essential goods and services until a final financial plan was in place.

The Judiciary fared very well in its funding bill, receiving an overall increase of 6.1 percent above the FY 2005 appropriations level. The agreement included the authority necessary to provide a 1.9 percent cost-of-living increase (COLA) for judges on January 1, 2006, and a 5.4 percent increase for the salaries and expenses appropriation that funds court operations.

Language also was included that extends to the judicial branch fiscal and procurement law authorities currently available to the executive branch for multi-year contracting.

Subsequent to the enactment of the FY 2006 appropriation for the Judiciary, a one percent government-wide across-the-board reduction (recission) to discretionary funding in FY 2006 was enacted as part of the Defense Appropriations Act (P.L. No. 109-148). As such, the Judiciary's final salaries and expenses appropriation represents a 4.9 percent increase over FY 2005. When all revenue sources are considered, the courts will receive the highest increase in funding since 2002 and will be able to hire up to 1,500 personnel.

In contrast, overall federal appropriations declined by almost two percent from FY 2005 to FY 2006.

Fiscal Year 2007 Budget

The Judicial Conference approved a budget request for FY 2007 of nearly $6 billion for the Courts of Appeals, District Courts, and Other Judicial Services—including the Salaries and Expenses, Defender Services, Court Security, and Fees of Jurors accounts. This budget request represents the culmination of significant and difficult work by the Budget Committee and its Economy Subcommittee, the program committees of the Conference, and AO staff. The request protects the core mission of the courts and includes funding for additional court support staff to handle critical workload increases.