Dayton pitches increased spending on courts

Posted: 10:59 am Fri, February 1, 2013
By Barbara L. Jones

PDs, legal aid see smaller bumps

It is a truism that a budget reflects priorities and values. Governor Mark Dayton released a budget that suggests that the judicial system and its partners are valued, although some could be said to be more valued than others. Or, simply have a greater need.

Governor Dayton recommended a one-time 33 percent increase for the Board on Judicial Standards, a 20 percent increase for the Tax Court and a 5.9 percent increase for the state court system. He also values legal aid and public defenders because he increased their budget, although not by as much as they requested.

Legislative committees are now conducting hearings in preparation for their own budget proposals.

Legal services and public defenders

Cathy Haukedahl, executive director of Mid-Minnesota Legal Services, said she was glad to see the governor supports an increase for legal services, even if it’s about 4 percent. Demand is increasing and resources are diminishing, she said. “The justice gap has gone from big to huge,” she said.  The approximately $500,000 increase in the governor’s budget would allow service to about 800 families around Minnesota, she said.

Kevin Kajer , the chief administrator for the state board of public defense, called the governor’s 6 percent increase for public defenders “a good start.”  He said that he and John Stuart, state public defender, are talking to the legislative leadership about what board should do about requesting an extension of the attorney registration fee to fund public defenders, as the Supreme Court has been ordering since 2009, although quite reluctantly. A fee increase petition filed by the board in Oct. 2012 was withdrawn by the board.

Kajer said that he has no idea how far the governor’s proposed $8.5 million increase would stretch. Negotiations with employees are coming up, and the office doesn’t know how much the insurance costs will increase, he explained.

Judicial branch

The courts requested a 5.9 increase, and got it. It breaks down into four areas (see chart), and about 42 percent of the increase is for employee (non-judge) compensation increases. About $6.3 million is for judicial compensation increases.

In her budget letter to the governor, Chief Justice Lorie Gildea reminded him that salaries of judicial employees and judges have been frozen for four years.

It also asks for $1.743 million to “shore up” the Judge Pension Fund. Ramsey County District Court Judge Gregg Johnson, who is president of the Minnesota District Judges Association, said that the fund is only 60 percent funded. The judges have a defined benefit plan funded by ongoing contributions, since the invested money is not making a return, Johnson said.

The 2008 stock market crash stressed the fund, and more judges and their spouses are living longer and thus receiving more payments, Johnson said.

According to Gildea’s letter to the governor, legislation will be introduced this session to increase the employer contribution to the pension fund by 2 percent. Johnson said that “everybody’s taking a hit,” in that judges will contribute more, the multiplier used to determine their benefit will be reduced, and retired judges will get smaller cost-of-living increases.

“This is a long-term fix. We felt it was the responsible thing to do,” Johnson said. “We’re trying to get the pension to 80 percent funded.”

Tax Court

The governor is requesting a 20 percent increase to the tax court’s budget, which would be used to hire two law clerks, pay continuing legal education costs and fund access to Westlaw. The money will allow the Tax Court issue orders in a more timely and efficient fashion, the governor said in his budget. The Tax Court’s caseload has swollen since 2000 (see sidebar).

“We would expect to use the clerks as all judges do.  Overall I would anticipate a court more efficient, better prepared for trial and with a higher quality of written decisions,” said Chief Judge Bradford Delapena.

With his budget request, the governor recognizes that the court has been functioning under some systemic deficiencies.  Delapena’s comments also acknowledged that the court would become more efficient with better resources.

Board on Judicial Standards

The Board of Judicial Standards also did well under Dayton’s budget, with a $300,000 or 33 percent increase, much of which apparently is expected to go to one case.  The governor’s report says that he recommends $300,000  be made available for immediate expenditure to conduct a formal disciplinary hearing and a disability matter.  (David Paull, executive director of the BJS, told Minnesota Lawyer there are two pending disability matters.)  The board has one formal matter open right now, concerning Tax Court Judge George Perez.  Perez is charged with handling cases slowly and inefficiently.

That amount of money for the Perez case, even deducting for possible disability matters, has some people wondering about fundamental fairness.  Can one judge compete with those kinds of resources?

Hennepin County District Court Judge Kevin Burke doesn’t think so.  In an email to Minnesota Lawyer he said, “I obviously know nothing about the merits of the cases the Board is pursuing but the amount of money in legal fees should surely raise structural questions. Judges who are subject to prosecution by the Board must pay their own legal fees. Faced with several hundred thousands of dollars in legal fees judges may represent themselves. These are difficult cases with an inherent challenge the public trust in the judiciary will be undermined regardless of the outcome on the merits. Self represented judges enhance the risk that in the final analysis the public will have even more questions about Minnesota’s judiciary and that is good for no one.”

Perez’s attorney, Fred Finch, wonders about the fees for a different reason. “I’ve been completely baffled by the resources thrown at this case,” he said, noting that at many stages in the case there have been two lawyers, or two lawyers and an investigator, present.

“This case is being badly overstaffed. They have boxes and boxes of records that have nothing to do with George Perez.  When I sent a subpoena for almost exactly the same materials, I got a letter saying it was overbroad and unreasonable. Quite frankly, I have no idea why they made a federal case out of this case,” Finch said.

But Paull said the fee request was based on a comparison to other cases. “It’s an appropriate amount of money based on other cases.  It’s an estimate but [our estimates] come pretty darn close,” he said.

Minneapolis attorney Doug Kelley, who represents the BJS,  said that he makes no apologies for his costs and is billing the board at less than one half his normal rate of $650 per hour.  Everyone in the firm gives a similar discount and the firm does not bill for redundant work, he said.

Kelley also said that he issued a subpoena to the Tax Court and the documents revealed a pattern, so they requested documents for a 10-year period. “Fred issued a subpoena for another judge and went back 10 years. Fred dealt directly with the attorney general’s office.  His problem is with the AG and not with me,” Kelley said.

“The judge has denied the charges and has a right to a fair trial.  The complaint is not about an isolated incident. It talks about an intentional pattern of willful noncompliance with a statutory mandate over a 10-year period of time.  And, the complaint alleges that these [instances of noncompliance] are complicated by Judge Perez’ pattern of false certifications to the state, false statements to litigants and their counsel, and false pleadings created to hide his behavior,” Kelley said .

“We recognize the fundamental importance of these cases not only to the judge who is being investigated but also to the judiciary as a whole and the general public’s perception of the integrity of the justice system. We do not approach these cases casually,” he said.

Judges describe booming case load for tax court

Chief Judge Bradley Delapena  and Judge Joanne Turner testified before the House Judiciary Finance and Policy Committee on Jan. 22 about the Minnesota Tax Court’s need for resources.

Delapena told the committee that tax court filings had swollen from 1,300 cases in FY 2000 to  5,870 in 2010, a 350 percent increase. About 4,800 cases were filed in 2012. The means the number of new cases filed per judge has spiked from  430 in 2000 to about 1,950. The court now collects in filing fees approximately twice its annual budget, he said.

Turner told the committee that the court expects its heavy caseload to continue for the foreseeable future.  She said the court expects 4,800 new cases to be filed in the first four months of 2013 alone, because that is the deadline for property tax challenges.

Those new cases have to be manually entered into the court’s management system, which is not compatible with the state’s system, she said.

Minnesota Judicial Branch FY14-15 Biennial Budget Request

Request: FY 14 / FY15 / Total

Insurance Increases: $3,488,000 / $7,479,000 / $10,967,000

Employee Compensation: 4,614,000 / 9,367,000 / 13,981,000

Judge Compensation: 2,085,000 / 4,254,000 / 6,339,000

MSRS – Judges 2%: 855,000 / 888,000 / 1,743,000

Total: $11,042,000 / $21,988,000 / $33,030,000

Source:  State Court Administration