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Cost Containment and the Federal Judiciary
In April 2004, it was estimated that within five years the federal
Judiciary’s operating requirements—the money needed to pay staff, juror’s fees,
courthouse rent, phone bills and all the other expenditures that keep the courts
running—would exceed the funding provided by Congress by close to $850 million.
In fact, such a deficit would threaten thousands of court jobs.
Instead, the federal Judiciary regards its future with cautious optimism,
largely because of an aggressive cost-containment program begun three years ago,
along with an equally aggressive outreach program to Congress. Thanks to the
Judiciary wide cost-containment initiative, it is estimated that hundreds of
millions of dollars in costs will be saved or avoided over the next decade.
It was a much different story in 2004. All of government faced a stringent
budget environment. For the Judiciary, funding increases from Congress had
shrunk below the level needed to continue the courts’ business as usual.
Meanwhile, the Judiciary’s costs were rising for rent, personnel, and
drug-testing and treatment programs, as the court system absorbed record numbers
of criminal defendants, appeals, civil, and probation and pretrial services
caseloads, and a near-record caseload in the bankruptcy system.
“You couldn’t look at those trends without realizing they were very adverse,”
says Judge Carolyn Dineen King, who chaired the Judicial Conference Executive
Committee from 2002 to 2005. “The federal budget deficit was soaring. It seemed
that we were in a position that was just untenable. We had to get a grip on our
costs so that we could have a better shot at living within our appropriation.”
In 2004, the Judicial Conference did just that. It approved a comprehensive
strategy for controlling costs in the Judiciary. The Cost-Containment
Strategy for the Federal Judiciary: 2005 and Beyond was developed by the
Executive Committee with input from other Conference committees and from judges
and managers across the Judiciary.
“Cost containment is about restraining our costs, restraining our growth, so
that our requirements and our appropriations will more closely approximate each
other,” explained Budget Committee Chair Judge Julia Gibbons. “Each of the
Judicial Conference committees with spending authority scrutinized various
policies, practices and customs within their jurisdiction,” she said. “They
developed a working list of areas in which savings might be possible.”
Here’s how the Judiciary refocused its future.
Space and Facilities Cost Control
time, the Judiciary annually paid the General Services Administration (GSA)
about $900 million in rent for court facilities, which represented 22 percent of
the Judiciary’s budget. GSA rent charges increased each year for existing
facilities. Between rising rent bills and new space, it was anticipated that
rent would increase about 6 to 8 percent a year.
To help reduce the rate of growth in rental expenses, in September 2004, the
Judicial Conference agreed to delay 42 courthouse projects on the Conference’s
five-year courthouse project plan for 24 months, giving the Judiciary time to
re-evaluate whether courts could satisfy their additional space needs at lower
“It was a drastic measure,” said Chief Judge Joseph F. Bataillon (D. Neb.),
chair of the Committee on Space and Facilities. “We had to make a choice between
having enough people to do the work and having facilities. The consensus was it
was more important to maintain our staff. The moratorium effectively contained
costs and slowed down the rate of growth for future years. It also helped us
renegotiate a number of issues with GSA that have been financially beneficial
Rent validation was one of those issues. Rent bills across the country were
re-evaluated following the discovery of serious rent overcharges to the
Judiciary in the Northern and Southern Districts of New York. “The courts in New
York deserve a lot of credit for getting the ball rolling in this regard,” said
Bataillon. Under the initiative, space assignment drawings were compared to
court occupied space in all federal buildings and rental rates were examined to
ensure that the Judiciary was charged for space the courts legitimately
occupied. In total, these initiatives resulted in almost $52.5 million in credit
and cost avoidance savings for the Judiciary.
The Conference also acted to control rent growth. In September 2006, it set
an annual cap for all future rent requirements at an average annual growth rate
of 4.9 percent for fiscal years 2009 through 2016. At its September 2007
session, the Judicial Conference endorsed the circuit-level rent budget
allotment program in order to stay within the 4.9 percent cap on rent. Under
this program, circuit judicial councils will receive an annual rent budget that
will cover current space, project-specific funding for new courthouses, and a
discretionary allotment to pay for their expansion space actions and space
alteration projects, which enable more efficient use of space. All new
courthouses or annexes, build-to-suit lease projects, requests for GSA
feasibility studies, and prospectus-level repair and alterations projects must
still be approved by the Committee on Space and Facilities and the Judicial
“This is a sea change from how we’ve done business in the past,” said
Bataillon. “We’re giving the circuit judicial councils more fiscal
responsibility for the rent in their circuits. Now it will be incumbent upon the
circuit councils to make sure they spend their dollars as wisely as possible.”
In addition, a major overhaul of the U.S. Courts Design Guide was
recently completed with reductions in space requirements for judges’ chambers
and staff. A courtroom utilization study is underway. The need for additional
courtrooms is a primary factor in determining a need for additional facilities.
Thanks to these initiatives, the rate of growth in the Judiciary’s rental
payments has slowed in comparison to pre-cost-containment projects. In 2004, the
total cost of rent was estimated to rise 37 percent to $1.2 billion by 2009.
Because of cost control actions, in January 2007 the projected rent expense for
2009 fell by 13 percent from the original estimate to $1.09 billion.
Judiciary Personnel Costs
projections, staffing formulas, and compensation policies call for a growth of
almost $1.4 billion in court support staff costs above current levels by fiscal
year 2017. Long-range budget projections will not support this level of funding.
Reducing the rate of growth in the number of staff is one way to reduce those
costs, but another option is to reduce the growth in compensation.
At its September 2007 meeting, the Judicial Conference approved
recommendations for a major court job classification and compensation study,
which will affect staff positions nationwide. The Conference also voted to give
local courts greater autonomy in managing and paying their personnel, to limit
the number of career law clerks—who are typically paid more than term law
clerks—and to modernize its Court Personnel System benchmarks, which will affect
the classification and grading of staff positions nationwide. The approved
measures may save up to $300 million from FY 2009 through FY 2017.
“What we’re doing,” said Judge W. Royal Furgeson (W.D. Tex.), who chaired the
Judicial Resources Committee until October 1, 2007, “will not necessarily take
one employee off the rolls. What it will do is constrain the growth of salaries
in our system and arrest some of the trends that have had us spending more money
toward the top range of our salary structure.”
The Judicial Resources Committee has endorsed a comprehensive and rigorous
work-measurement process to update court unit staffing formulas. The resulting
formulas will help define future staffing requirements. In addition, the
Criminal Law Committee proposed and the Conference approved modifications to
work requirements of probation and pretrial services offices. These changes
reduced staffing needs.
Effective Use of Technology
“We are not
spending money on gadgets,” said Judge Thomas I. Vanaskie (M.D. Pa.), chair of
the Judicial Conference Information Technology Committee, “we’re spending money
on technology that makes us more productive.”
Containing information technology costs while still pursuing useful
advancements is the challenge. The key is to invest funds for infrastructure,
applications and devices that will deliver these benefits.
The Judicial Conference has linked investments in information technology to
service improvements and efficiency savings. For example, the Conference
endorsed the rapid implementation of the Case Management/Electronic Case Files
system, which has made staffing efficiencies possible and even affected the size
of clerk intake areas and records storage.
Although IT is only about 6 percent of the total Salaries and Expenses
account, cost pressures are substantial due to constant demands for more
advanced technologies. In 2004, a key cost driver was the delivery of many
national applications by installing them on servers in every court location.
Improvements in the national data communications network have allowed the
consolidation of servers, which is already saving money. Running the Jury
Management System (JMS) on the same server with CM/ECF has produced a savings of
$2 million in the first year.
“Servers are expensive pieces of equipment,” said Vanaskie. “In the case of
JMS, you were eliminating 94 servers and their cyclical replacement. And we’ve
also seen that with PACTS, the case management systems used in probation and
pretrial services offices. All of the probation and pretrial services offices in
the nation now are running their PACTS systems on consolidated servers, with a
projected savings in the same magnitude as JMS.”
A significant savings also is expected from the consolidation of the servers
for the Judiciary’s accounting system, FAS4T.
“I think we have to recognize that we’re investing when we spend on
technology,” Vanaskie said. “It’s intended to have a positive impact on how work
Program Modifications Produce
Probation and pretrial services:
costly drug-testing methodologies and treatment services are being pursued,
along with ways to improve program evaluation data. Co-payments may be required
from defendants and offenders who have the ability to pay for services.
Prior to the cost-containment effort, law enforcement-related costs were
projected to increase 10 percent per year, reaching $130 million by 2009. With
these cost-containment measures, in January 2007 it was estimated that law
enforcement-related requirements will be $94 million in 2009.
Law Book Expenditures: Computer assisted legal research is
expanding and law book collections are being limited. In 2004, it was estimated
that law books requirements would increase 19 percent to $45.6 million by 2009.
With cost containment, law books requirements are now estimated to be $38.4
million in 2009.
Defender Services: Among the cost containment initiatives
underway is a pilot project to assess the extent to which case budgeting advice
may help reduce appointed counsel costs in capital and non-capital high-cost
cases. Economies in defense representation are being promoted by the adoption of
policies in capital cases—one to reduce the compensation rate when a case ceases
to be death-eligible and another to encourage more timely Justice Department
decisions about whether to seek the death penalty.
Estimates in 2004 indicated that defender services budget requirements would
rise 72 percent by 2009, reaching $1.1 billion. The January 2007 long-range
budget estimate is $970 million in 2009, $130 million less than initially
Magistrate Judges System: The recommended number of new
magistrate judges has been sharply reduced by the Judicial Conference Committee
on the Administration of the Magistrate Judges System, and courts with lower
workloads are urged not to fill vacant positions.
Court Security: Cost-containment efforts in the area of
court security have saved approximately $20 million with a district-wide review
of Federal Protective Service charges.
Judge Gibbons lauds the
Judicial Conference committees, court staff, and the AO for their efforts. “With
cost containment we can take a look at what is important in terms of our
function and our mission,” she said, “and make reasonable policy decisions that
make sense for the Judiciary. Cost containment is a strategy that helps us plan
for our future.”
And what does the future look like?
“Thanks to these efforts, the anticipated gap between estimated budget
requirements and funding levels has shrunk,” said Administrative Office Director
Jim Duff, “but continued vigilance will be necessary for the long term.”
“I think we’re going to be living in a very challenging budget environment,”
Gibbons adds. “Without cost containment, we’re not going to be able to get
enough money from Congress to meet our needs. Cost containment happens to be the
right strategy—and the right thing to do. We have an obligation to be good
stewards of the taxpayers’ money.”