An Unprecedented Budget Crisis

Judicature, November/December 2005 | Go to article overview

An Unprecedented Budget Crisis


Underfunding of the federal courts may well affect the balance of power among the government's three branches.

Federal courts confront an unprecedented budgetary crisis, and the future is uncertain. Funding shortages are not new to the judiciary, but current underfunding, now several years underway, may well affect the balance of power among the government's three branches.

One of the judiciary's many responses, commissioned by Chief Justice William Rehnquist, is the CostContainment Strategy for the Federal Judiciary: 2005 and Beyond, a report that quantifies the problem and provides a number of contingency plans to deal with deteriorating support.

As the report explains, tight funding from Congress is not the only problem. The judiciary's budget contains a distinction between mandatory or fixed costs, and "discretionary" costs. Examples of fixed costs are salaries for judges and their immediate staffs (secretaries and judicial clerks) and rent paid to the General Services Administration ("GSA"). All other expenses are "discretionary." These include equipment purchases and salaries for all other employees (e.g., district clerks and their staffs, federal public defenders, and the probation offices). Thus, the term "discretionary" does not mean that these services can be eliminated. Rather, it means that the judiciary has discretion in allocating this money depending on local needs, while it does not have discretion in paying judicial salaries or rent to the GSA.

Judges' salaries account for 9 percent of the total budget and are constitutionally protected. Rent is the other major fixed-cost component. That federal courts even pay rent will surprise most citizens. The GSA, an arm of the executive branch, "owns" most of the buildings that house the federal courts. The GSA sets the rental rate according to its own formula, and as a result, rent has been the largest percentage of the courts' budget growth.

Some critics have argued that the GSA rent exceeds fair market value, although that determination is speculative because of the difficulty of comparing federal court and commercial spaces. That question aside, rent consumes a far higher percentage of the funding of the judiciary (16 percent in FY 2004) than it does, for instance, of the executive branch (0.2 percent). Although there are many reasons for this disparity, a primary reason is that some 32 executive departments/agencies do not come under the GSA and do not pay rent on some or all of their facilities. It is not clear to us why courthouses-with court rooms, judges chambers, marshals holding facilities, and unique security requirements-should be treated differently for these purposes than are military installations, federal prisons, VA hospitals, NIH laboratories, embassies, and post offices, all of which are exempt from rent as "special purpose" facilities. And yet, in fiscal years 2004 and 2005 when the judiciary's budget was cut and it asked for rent relief to avoid having to fire some of its employees, the GSA denied those requests.

Consider the irony. Our federal courts are compromised because we are charging ourselves too much rent. Consider also the threat to judicial independence. The GSA is part of the executive branch. To the extent that any presidential administration chooses to pursue an anti-judicial agenda, the GSA's power to set rates and determine to which facilities they apply is the power to undermine the judiciary.

The problem is not that Congress has failed to increase the judiciary's budget at all. Rather, fixed costs-mostly rent-have risen at a far greater rate than the annual percentage increases, leaving a dwindling allotment for "discretionary" costs. The mandatory costs will increasingly eat up the federal court budget, while essential employees are terminated and essential court services cut. In 2004, 59 percent of the federal judicial budget went to fixed costs and 41 percent to "discretionary" costs. …

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