FISCAL NOTE

Date Requested: February 08, 2016
Time Requested: 02:15 PM
Agency: Public Defender Services
CBD Number: Version: Bill Number: Resolution Number:
2537 Introduced SB546
CBD Subject: Courts, Crime, Finance and Administration


FUND(S):

0226-78800; 0226-00100; 0226-01000; 0226-09900

Sources of Revenue:

General Fund

Legislation creates:

Neither Program nor Fund



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


     The legislation governs the process for payment of the claims for fees and reimbursement of expenses made by court-appointed counsel upon the completion of a case. The approval of the vouchers submitted by the counsel setting forth the claim for fees or the reimbursement of expenses is currently the function of the court that appointed the counsel. In Fiscal Year 2015, the courts approved 36,226 vouchers representing claims for payment and reimbursement of expenses in the amount of $25,890,025. Public Defender Services, Annual Report, Fiscal Year 2015 (“AR”), p. 24. The vouchers are then transmitted together with the court’s order approving payment to Public Defender Services (“PDS” or the “agency”), which processes the vouchers for payment by the Office of the State Auditor.
    
     Under this existing system, court-appointed counsel have submitted since January 1, 2013, claims for payment of legal services that, on 183 dates, exceeded twenty-four hours in a day. Moreover, the agency’s annual reports set forth a substantial number of attorneys who are consistently reporting hours on an annual basis that are simply unattainable.
    
     The legislation would transfer the “approval” function from the circuit courts to the agency, with provisions made for the agency’s consultation with the appointing court in designated circumstances. The agency estimates, conservatively, that the transfer would result in a reduction of expenditures from general revenue in an annual amount of $769,149, although the actual savings might be as much as two million dollars.
    
     The legislation also permits the establishment of conflict public defender corporations in judicial circuits to handle cases that the existing public defender corporations cannot. Currently, private counsel are appointed to handle cases which cannot be handled by the existing public defender corporations due to a conflict of interest or an excessive caseload. The agency estimates that the establishment of such corporations in the more populated judicial circuits would result in a reduction of expenditures from general revenue in an amount of $880,689.
    



Fiscal Note Detail


Effect of Proposal Fiscal Year
2016
Increase/Decrease
(use"-")
2017
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 -1,649,838 0
Personal Services 0 142,260 0
Current Expenses 0 8,832 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 -1,800,930 0
2. Estimated Total Revenues 0 0 0


Explanation of above estimates (including long-range effect):


     A year of 2200 billable hours on court-appointed matters means, generally, that the attorney is fully engaged in court-appointed work and is working extended hours on a daily basis every day of the year. The agency has identified 38 attorneys who billed more than 2200 billable hours in Fiscal Year 2015.
    
     Using the fact that, on average, 84.64% of an attorney’s time is spent on out of court matters at the $45 hourly rate of compensation and the remaining percentage is spent on in-court matters at the $65 hourly rate of compensation, a 2,200 hour billable year would result in compensation in the amount of $105,758.40. AR, p. 71.
    
     The agency believes that its “approval” of vouchers would limit these 38 attorneys to the more realistic level of 2,200 hours, if not less. With the addition of two attorneys, the agency has the means by which to determine an attorneys’ level of billings and has the means by which to examine closely the vouchers submitted by the attorneys.
    
     The 38 identified attorneys billed, collectively, 19,142.97 hours in excess of a 2200 billable hour year. Using the percentages of out of court time and in-court time set forth above, the total reduction in compensation upon the elimination of this excessive billing would be $920,204.85.
    
     Again, this estimate is based only upon the reduction of hours for the 38 identified attorneys with over 2200 billable hours. Over 800 attorneys throughout the state accept court-appointed work and reported, collectively, the performance of 486,726.40 hours of services in Fiscal Year 2015. AR, p. 212. The hours for the 38 attorneys that are expected to be reduced represents 18.63% of the total hours reported by these attorneys. If the agency’s scrutiny of the vouchers for all the appointed counsel results in a commensurate reduction, then the total reduction in expenditures of general revenue would be, based upon the percentages of in-court and out of court work set forth above, $4,080,887.47. While it is unrealistic to expect that every voucher would be reduced by this amount, it is nonetheless realistic to expect that one-half or a comparable percentage of vouchers would be reduced, resulting in a savings of $2,000,000.
    
     The two additional personnel required by the agency would result in increased administrative costs to the agency in the amount of $142,260, assuming a salary of $50,000 for each attorney. The extra cost of office space is estimated to be $8,832.
    
     The resulting decreases in the expenditure of general revenue would be, therefore, $769,148, if the information regarding the 38 attorneys is used, or almost two million dollars if reductions for the entire pool of attorneys are considered.
    
     With respect to the establishment of a conflict public defender corporation, the agency’s data indicate that, in the judicial circuits which encompass Wheeling, Charleston, Huntington, and Martinsburg, the courts made appointments in 7,556 cases due to a conflict of interests in these matters on the part of the existing public defender corporation. If a conflict corporation existed to serve these circuits, then the agency assumes that one half of the cases, i.e, 3778 cases, could be assigned to the conflict corporations.
    
     The agency has calculated that the average cost per case when handled by a public defender corporation is $535.22 and the average cost per case when handled by a private attorney appointed by the court is $768.33. AR, p. 212. Accordingly, a savings per case of $233.11 is realized when handled by a public defender corporation.
    
     If the conflict public defender corporations were created and were assigned to 3,778 cases as discussed, the resulting savings would be the amount of $880,689.58.
    



Memorandum


     The legislation also provides for the potential execution of contracts for legal services in certain situations that would pay an established amount for the handling of matters rather than the payment of an hourly rate. The contracts would be executed only as the opportunities arose to do so and only if a savings could in fact be realized without a diminution in the quality of legal services being provided. Accordingly, no estimate can be made about the amount of such savings to the state.



    Person submitting Fiscal Note: Dana F. Eddy, Ex. Dir., Public Defender Services
    Email Address: Dana.F.Eddy@wv.gov