D.C. Courts

GAO testified before Congress recently on the District of Columbia Courts' financial operations in fiscal year 1998--its first year of operations with direct federal funding. (See GAO/T-AIMD/OGC-99-176, May 1999.) GAO reported that D.C. Courts had had difficulty in planning and budgeting during this transition year. GAO found that D.C. Courts had potentially overobligated its resources, which could violate the Anti-Deficiency Act. This report (1) supplements GAO's testimony, providing additional details on its finding, and (2) provides recommendations to Congress and the D.C. Courts. GAO answers the following questions: What were D.C. Courts obligations for fiscal years 1996, 1997, and 1998? Did D.C. courts have a spending plan for fiscal year 1998 and obligate money in accordance with available resources? Why did D.C. Courts defer payments to court-appointed attorneys from late July 1998, and were those payments made in fiscal year 1998 processed in accordance with policies and procedures?

GAO noted that: (1) DC Courts incurred obligations of $115.4 million, $119 million, and $125.6 million in fiscal years 1996, 1997, and 1998, respectively; (2) FY 1998 obligations reflect a different scope of activities than prior year obligations, primarily because of changes necessitated by the Revitalization Act of 1997; (3) these changes include the transfer of a DC Courts function to another entity and increased costs of employee benefits during FY 1998; (4) DC Courts also gave its nonjudicial employees a 7-percent pay raise and assumed responsibility for judges' pension costs as part of its FY 1998 appropriation for court operations; (5) DC Courts did not prepare and execute a budget based on amounts appropriated for fiscal year 1998; (6) records showed that throughout the year, DC Courts was aware that its spending was on pace to exceed available resources; (7) rather than managing within its available funds, DC Courts incurred obligations in anticipation of receiving additional resources from Congress and others to cover the difference; (8) faced with an impending shortfall in operating funds, DC Courts officials deferred payments totalling $5.8 million owed to court-appointed attorneys and expert service providers during the last 3 months of FY 1998; (9) Congress transferred $1.7 million in FY 1998 funds to DC Courts that was used for deferred court-appointed attorney payments and authorized DC Courts to use the FY 1999 appropriation to fund the remaining deferred amount of $4.1 million; (10) as of May 25, 1999, GAO found that DC Courts FY 1998 obligations exceeded available resources by $4.6 million, in violation of the Anti-Deficiency Act; (11) this funding shortfall reflected the $4.1 million in deferred payments to court-appointed attorneys that should have been recorded as FY 1998 obligations and GAO's assessment of deobligations for FY 1998 submitted by DC Courts; (12) DC Courts treated $773,000 in interest--earned primarily on the bank balances from quarterly apportionments of its FY 1998 appropriation--as an available budgetary resource for court operations without having legislative authority to do so; (13) DC Courts processed vouchers for court-appointed attorneys and expert-service providers in accordance with established policies and procedures; (14) however, its policies did not: (a) include timeframes for processing the vouchers and making payments; or (b) require that judges document decisions to reduce claimed voucher amounts; and (15) DC Courts did not have procedures for retaining data on vouchers reported as lost or missing.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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