United States GAO General Accounting Office Washington, D.C. 20548 Accounting and Information Management Division B-281408 June 7,1999 The Honorable Ernest J. Istook Chairman The Honorable James P. Moran Ranking Minority Member Subcommittee on the District of Columbia Committee on Appropriations House of Representatives Subject: District of Columbia Courts: Chronoloex of Events Associated with DC Courts F’inancial-Related Issues for F’iscal Year 1998 When we testified before your Subcommittee on May 18,1999, you requested that we provide a timehne of events and communications related to the District of Columbia Courts’ (DC Courts) fiscal year 1998 financial issues, as a supplement to the information provided in our testimony.1 To respond to your request, the enclosure provides a chronology of events containing data on points made in our testimony. The events included date from June 15,1997, when the District of Columbia Financial Responsibility and Management Assistance Authority transmitted the DC Courts budget submission to the Congress, through October 21,1998, when DC Courts received its fiscaI year 1999 annual appropriation from the Congress. We shared a draft of this chronology with DC Courts officials and incorporated their comments as appropriate. We are sending copies of this letter to Representative Thomas Davis, Chairman, and Representative Eleanor Holmes Norton, Ranking Minority Member, Subcommittee on the District of Columbia, House Committee on Government Reform; Senator Kay Bailey Hutchinson, Chairwoman, Subcommittee on the District of Columbia, Senate Committee on 4propriations; Senator Richard Durbin, Ranking Minority Member, Subcommittee on the District of Columbia, Senate Committee on Appropriations, and Subcommittee on Oversight of Government Management, Restructuring and the District of Columbia, Senate Committee on Governmental Affairs, and Senator George Voinovich, Chairman, Subcommittee on Oversight of Government Management, Restructuring and the District of Columbia, Senate Committee on Governmental Affairs. We are also sending copies to ‘District of Columbia Courts: Financial Related Issues for F’iscaI Year 1998 (GAO/T- AIMD/OGC-99-176, May 18,1999). GAO/AIMD-99-204R DC Courts F’Y 1998 Chronology of Events B-281408 the Honorable Annice Wagner, Chairwoman, Joint Committee on Judicial Administration, DC Courts; the Honorable Jacob J. Lew, Director, Office of Management and Budget; and Grace Mastelli, Deputy Assistant Attorney General, Department of Justice. Copies will be made available to others upon request. If you have any questions, please contact me or Steven Haughton at (202) 5124476. Key contributors to this assignment were Marcia Washington, Lou Fernheimer, and Richard Cambosos. Gloria L. Jarmon Director, Health, Education, & Human Services Accounting and Financial Management Issues Enclosure Page 2 GAO/AIMD-99-204R DC Courts FY 1998 Chronology of Events Enclosure Chronoloev of Events Associated With DC Courts Financial-Related Issues for Fiscal Year 1998 6-15-97 The District of Columbia Financial Responsibility and Management Assistance Authority (Authority) transmitted to the Congress the District’s fiscal year 1998 budget submission, which included the Authority’s recommendation that DC Courts be funded at $117.8 million. It also contained DC Courts’budget request of $123.5 million, including a proposed 3 percent pay raise for nonjudicial employees. 8-5-97 President Clinton signed the National Capital Revitalization and Self- Government Improvement Act of 1997 (Revitalization Act). Under the Revitalization Act, DC Courts was to receive direct federal funding from the Congress. The act directed changes in DC Courts employee benefits and transferred responsibility for the adult probation function from DC Courts to the DC Court Services and Offender Supervision Agency (COSA) Trustee. 8-1497 The President submitted to the Congress proposed amendments to the fiscal year 1998 appropriations requests to provide resources for the implementation of the Revitalization Act. The proposed amendments contained $123 million for DC Courts operations, including up to $2 million for the Truth-in-Sentencing Commission. 9497 The Deputy Attorney General, Department of Justice, testified on the Revitalization Act before the House Appropriations Subcommittee on the District of Cohunbia. At this hearing, he stated that DC Courts estimated the cost of the adult probation function at $7 million. 9-9-97 The Senate Appropriations Committee reported S.1156 recommending funding of $116 million for operation of DC Courts for fiscal year 1998, including up to $750,000for the Truth-in-Sentencing Commission. (In October 1997, a Department of Justice Revitabzation Task Force estimated the cost of the adult probation function at about $20 million. According to a member of the Task Force, the estimate was submitted to the Office of Management and Budget (OMB) and relevant Congressional Subcommittees.) 10-6-97 The House Appropriations Committee reported H.R. 2607 recommending funding of $121 million for court operations and an additional $2 million for the Truth-in-Sentencing Commission. 10-g-97 The House amended and passed H.R. 2607 authorizing funding of $121 million for DC Courts and up to $2 million for the Truth-in-Sentencing Commission. H-28-97 DC Courts Executive Officer was informed by a Department of Justice official that DC Courts’fiscal year 1998 appropriation would be $108 million, including judges’pension costs. Page 3 GAO/Al&ID-99-204R DC Courts FY 1998 Chronology of Events . Enclosure (DC Courts officials told us that they wrote to and met with OMB and Department of Justice officials regarding the cost of the adult probation function during the months of October and November 1997). 1 l-9-97 The Senate amended and passed H.R. 2607 authorizing funding of $108 million for DC Courts, including pension costs and up to $750,000for the Truth-in-Sentencing Commission. 11-12-97 The House agreed to the Senate amendment to H.R. 2607 authorizing funding of $108 million for DC Courts, including pension costs and up to $750,000for the Truth-in-Sentencing Commission. The House also made an additional amendment to H.R. 2607 and disagreed with a Senate amendment to H.R. 2607. 11-U-98 The Senate agreed to the House amendment to H.R. 2607 and receded from the Senate amendment disagreed with by the House. U-1497 DC Courts Executive Officer issued a memo to court employees stating that at a November 13,1997, meeting, the Joint Committee on Judicial Administration approved comparability of DC Courts compensation schedule with the federal court’s schedule, to be achieved over 2 fiscal years, provided adequate funding was appropriated. DC Courts estimated the cost of the pay raise at $2.9 million. The first sakry adjustment was to be effective December 7,1997, at 7 percent per annum, for all nonjudicial employees. 11-19-97 The President signed the District’s F’iscal Year 1998 Appropriation Act (Public Law 105100), which provided $108 million for DC Courts’fkcal year 1998 funding, including pension costs and up to $750,000for the Truth-m-Sentencing Commission. 12-7-97 DC Courts’ 7 percent pay raise became effective. DC Courts Fiscal Officer later calculated the actual cost of this pay raise at almost $2.8 million for fiscal year 1998. 12-l 1-97 DC Courts submitted an analysis to OMB projecting a $9.5 million shortfall for fiscal year 1998. 12-17-97 ‘DC Courts confirmed an agreement with the COSA Trustee that 171 full- time equivalents would be transferred from DC Courts to the COSA Trustee, and estimated the cost of the adult probation function at $11.5 million. 12-2497 The COSA Trustee estimated the cost of the adult probation function at $18.3 million and informed OMIT that $1.7 million should be transferred from the COSA Trustee’s appropriation to DC Courts (see October 7, 1998). (In December 1997, OMB proposed a settlement between DC Courts’estimate of $11.5 million and the COSA Trustee’s estimate of $18.3 million. OMB proposed $16 million as Page 4 GAO/AIMD-99-204R DC Courts FY 1998 Chronology of Events Enclosure the cost of the adult probation function. We have not identified any action resulting from the proposal.) l-29-98 OMB advised DC Courts that it could not continue to incur obligations for the adult probation function without reimbursement. It further stated that DC Courts was incurring obligations at a rate that could exceed the fiscal year 1998 appropriation, and risked a violation of the Anti-Deficiency Act if it continued to pay sabrries and expenses for the adult probation function. 2-13-98 In a letter to OMB, DC Courts projected a $8.3 million budget deficit and informed OMB that most of its operations would have to be discontinued by the end of the fiscal year unless substantial supplemental resources were received. 2-27-98 The DC Courts and the COSA Trustee executed a Memo of Understanding (MOU). The MOU identified the adult probation employees to be transferred and other terms and conditions. 3-2-98 A letter from the COSA Trustee to DC Courts noted the transfer of over $5.9 million to DC Courts in reimbursement for adult probation costs incurred by DC Courts and estimated for the remainder of the 2& quarter of fiscal year 1998. Between March and June of 1998,DC Courts received additional net reimbursements totaling $1.9 million from the COSA Trustee for the 3” and 4”’quarters of fiscal year 1998. 3-13-98 DC Courts requested $8.3 million in supplemental funding for fiscal year 1998 in a letter to the Director of OMB. The letter stated that the request was based on the $8 million over-estimation of the annual cost of the adult probation function, $3 million in unanticipated costs associated with implementing the Revitalization Act, and $300,000for emergency costs caused by a court fire, less $3 million that DC Courts planned to absorb through cost containment measures. DC Courts also sent letters to the Chairman of the Subcommittee on the District of Columbia, Senate Committee on Appropriations, the Chairman of the Subcommittee on the District of Columbia, House Committee on Appropriations, and the Ranking Minority Member of the Subcommittee on the District of Columbia, House Committee on Government Reform and Oversight, asking for assistance in securing the supplemental funding. 42-98 OMB advised DC Courts that it was operating at a rate that if continued through the remainder of the fiscal year, would necessitate a deficiency or a supplemental appropriation of about $8 million. OMB also requested that DC Courts submit a spending plan by 41-d 10,1998, that demonstrated how it would utilize the balance of its available resources at a rate that would ensure continuity of essential functions throughout the fiscal year. 41598 DC Courts submitted a spending plan to OMB and stated that drastic reductions would be required to operate without supplemental funding of Page 5 GAO/AJMD-99-204RDC Courts FY 1998 Chronology of Events Enclosure over $8 million. These planned reductions consisted primarily of over $5 million from the furlough of employees for 26 business days. 5498 Based on a request from OMB for a revised spending plan, DC Courts provided a plan reflecting the reduction of nonpersonnel costs, principally the deferral of payments to court-appointed attorneys. 5-2 l-98 A letter to DC Courts from OMB underscored its concern that DC Courts was operating at a‘rate that if continued through the remainder of the fiscal year, would necessitate a deficiency or supplemental appropriation of over $8 million. OMB also stated that DC Courts’ adjusted plan should maintain personnel spending at current levels, assure the projected level of personnel obligations, and reduce nonpersonnel spending. (DC Courts officials told us that they met in May and June with OMB officials in an attempt to secure additional funding.) 7-2498 DC Courts stopped making payments to court-appointed attorneys. 7-29-98 DC Courts sent a letter to a staff member of the Subcommittee on the District of Columbia, House Committee on Government Reform and Oversight, stating that budgets for court-appointed attorney payments had not been depleted and that DC Courts would continue making these payments to the extent feasible. 8-2-98 DC Courts’ letter to OMB outlined cost reduction measures taken, including the deferral of payments to court-appointed attorneys estimated at over $5 million through the end of the fiscal year. 8-&98 DC Courts requested Byrne Grant funding of $6.7 million for court- appointed attorney payments, court personnel expenses, and Year 2000 (Y2K) remediation from the Department of Justice. &2498 DC Courts received a Byrne Grant totaling $1.1 million from the Department of Justice that was to be used for court personnel expenses and Y2K remediation. N-7-98 The F’iscal Year 1999 Energy and Water Development Appropriations Act transferred to DC Courts’fiscal year 1998 appropriations account from the COSA Trustee’s fiscal year 1998 account $1.7 million to be used solely to pay court-appointed attorneys for obligations deferred from fiscal year 1998. Page 6 GAO/AIMD-9%204RDC Courts FY 1998 Chronology of Events Enclosure N-21-98 The District of Columbia Appropriations Act of 1999 (Public Law 105-277) appropriated $121 million to DC Courts for operations for fiscal year 1999. Of the amount appropriated, the act provided that not more than $31.9 million may be used for payments to court-appointed attorneys for fiscal year 1999. The Conference Committee report accompanying the act directed DC Courts to immediately pay ah obligations for court-appointed attorneys carried over from fmcal year 1998 ($4.1 million) using other funds from its fiscal year 1999 appropriation. 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District of Columbia Courts: Chronology of Events Associated with DC Courts Financial-Related Issues for Fiscal Year 1998
Published by the Government Accountability Office on 1999-06-07.
Below is a raw (and likely hideous) rendition of the original report. (PDF)