It’s been over two years since the SEC report came out, detailing the overreach and the wastefulness of the AOC/Judicial Council staff. The report’s authors concluded that the organization “must refocus on providing service to the courts; that a fundamental restructuring of the organization is needed; that the AOC must be down-sized to correspond with its core functions; and that its internal processes need to be improved.” Our leaders “took ownership” of the report and promised change. Said Justice Douglas Miller of the Executive and Planning Committee, “We are fully committed to this report and our process, and take full responsibility for preserving its integrity.” His remarks are documented here.
So did anything happen?
Not much. Not nearly enough. We’ve now had a day to read the California State Auditor’s detailed review of how the Judicial Council staff handles the money entrusted to it. The Alliance thanks Assembly Member Reginald Jones-Sawyer, who led the charge for this audit. We commend him for his efforts to ensure that, in his words, “funding meant for the judicial branch gets to the trial courts.”
Among the State Auditor’s conclusions:
· The Judicial Council has failed in its oversight function, particularly when it comes to AOC spending: “Because the Judicial Council is not effectively overseeing the AOC—namely its spending decisions—the Judicial Council is falling short in its responsibility to ensure access to justice through effective management of judicial branch funds.” (p. 37.)
· The AOC hasn’t surveyed the trial courts—its customers—to find out what they really need; as a result, much of what it does is unnecessary. Each trial court on average uses only 55 percent of the services that the AOC provides. “If the AOC does not focus its efforts on improving services and being proactive in offering only those services that the courts need, it cannot provide assurance that it uses its resources in the way that best serves the courts.” (p. 57.)
· The AOC has too many executives and pays them too much. Eighty-eight AOC employees get more than $130,000 a year; eight directors make more than the Governor. “[W]e question whether the AOC’s salary levels are justified.” (p. 20.)
· The AOC maintains a fleet of 66 cars “for which it has not conducted any cost-benefit analyses or provided any justification.” (p. 32.)
· The AOC could have paid for various services using its own funds, but has chosen instead to siphon money away from the trial courts. For example, the AOC used local assistance funds to pay for AOC employees’ travel expenses and to pay for outside legal services related to CCMS. (p. 39.)
· At a time when local courts were laying off valued employees and shuttering courtrooms, the AOC was not sharing in the sacrifice: “[T]he budget cuts to the judicial branch in response to the State’s financial crisis significantly affected the trial courts. However, the AOC did not take adequate steps to minimize its expenditures and thereby ease the effect on the trial courts. In particular, although the AOC reported that it reduced its staffing levels and laid off employees, until fiscal year 2012–13 it backfilled its vacant positions with temporary workers and contract staff. Specifically, . . . between fiscal years 2009–10 and 2010–11, the AOC decreased its filled positions from 875 to 854 but increased its total staff size from 1,066 to 1,106 because it hired contractors and temporary agency employees.” (p. 48.)
· The AOC distorted 57 of the SEC report recommendations when it translated them into “directives,” and then went on to exaggerate its compliance rate. The Judicial Council website claims that as of January 7, 114 “directives” have been completed. The State Auditor, however, takes a dimmer view: “Specifically, we determined that only 51 recommendations were completed.” (p. 49.) The Auditor concludes, “Most recently, the AOC has not been transparent or accurate in its reporting on the status of implementing the recommendations from the evaluation committee’s 2012 report.” (p. 48.)
· Although the AOC’s headquarters are in San Francisco, none of the AOC’s top four executives are based there. “It is unclear whether any of the four executive officers can effectively and consistently oversee the 481 staff who collectively report to them yet work in the San Francisco location.” (p. 26.)
Moving the AOC to Sacramento would save $5 million a year in rent (p. 29), and would eliminate many travel expenses—such as the $22,000 spent over the last three fiscal years by the chief financial officer (p. 26).
This latest devastating audit follows the 2012 Pegasus Global Holdings review of the AOC’s construction program, which found that “the policies, procedures, and process that are currently in place . . . do not provide for the level of accountability expected for a megaprogram the size and complexity of the Court Capital Construction Program”; the 2013 report by the State Auditor, which blasts the AOC for “pervasive deficiencies” in procurement reporting; the 2012 Legislative Analyst's Office report on the Long Beach Courthouse, which concludes that the AOC based its financing scheme on faulty assumptions and may have overspent by up to $160 million; and, of course, the State Auditor’s 2011 audit of the CCMS project, which led to its cancellation after $500 million had been spent.
These condemnations of the AOC aren’t the rants of a handful of “dissident” judges. These are the considered assessments of the California State Auditor, the Legislative Analyst’s Office, and a leading business consulting firm. The verdicts are in: The Judicial Council and AOC can’t manage our branch’s money well; they're overstaffed; their financial data can’t be trusted; they finance and manage construction projects badly; they allowed a single IT project to bankrupt the branch; they provide services that the trial courts don’t need, and they fail to meet the needs of the courts they were meant to serve. In the words of one prominent retired judge, “How much more of a failure can the AOC be?”
The most damning conclusion, however, is that the AOC/Judicial Council staff cannot be trusted to fix itself. The State Auditor concludes: “We are concerned that without significant changes, the Judicial Council and AOC will continue to publicly embrace addressing the weaknesses that we and others have identified but fail to take the steps necessary to actually repair those weaknesses in a meaningful and transparent way.” (p. 4.)
This, then, is the current state of the judiciary: We’re building ornate courthouses at a time when we’re closing existing ones for lack of staff; we’re denying local courts access to their own paltry reserves while paying too many AOC executives too much money; we have a fleet of cars for no apparent reason. Two chief justices and three administrative directors have had ample time to restore balance, and ample guidance. But the system itself is broken. Our governance structure—the way in which our branch is run—is keeping those of us in the trial courts from providing the public with the level of service it deserves. And the public is suffering.
The reaction of the Chief Justice to the audit was predictable—she formed yet another committee to “study” the report. Her supporters dismissed the report as insignificant. Enough is enough. As Assembly Member Jones-Sawyer said yesterday, “The people of California have suffered enough.” We don’t need more commissions, committees, or studies to pinpoint the problem. The Judicial Council, as currently constituted, has failed in its two primary missions: the oversight of the judiciary’s administration and the management of its money.
It’s time for a different approach. The State Auditor stated the matter plainly: “Given the lapses in the Judicial Council’s oversight and the AOC’s decision making that we identify in this report, we believe significant change is necessary to ensure that the State’s courts receive the critical funding they require to provide access to justice to all Californians.” (p. 10.) It’s time for governance by a body elected by the state’s judges from among their number, not appointed from the same small cadre of judges.
In the near future, we will be proposing reforms that will restore accountability and transparency to our branch’s administration. We ask for your support. Join us. Join the 500 of your colleagues who have been raising these issues and calling for reform since 2009. With your support we can restore balance and accountability to the administration of our branch.
Directors, Alliance of California Judges