BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 508
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          Date of Hearing:   April 2, 2013

                           ASSEMBLY COMMITTEE ON JUDICIARY
                                Bob Wieckowski, Chair
                AB 508 (Calderon) - As Introduced:  February 20, 2013

                              As Proposed to Be Amended
           
          SUBJECT  :  DEBT COLLECTION:  HOMELESS VETERANS

           KEY ISSUE  :  WHEN, IN THE COURSE OF ITS ROUTINE EFFORTS TO  
          COLLECT FINES, THE COURT OBTAINS INFORMATION INDICATING THAT A  
          PERSON WHO HAS AN OUTSTANDING UNPAID CITATION FOR LOITERING,  
          CURFEW VIOLATIONS OR ILLEGAL LODGING IS A HOMELESS VETERAN,  
          SHOULD THE COURT BE PROHIBITED FROM GARNISHING THE WAGES OR  
          LEVYING AGAINST A BANK ACCOUNT OF THAT PERSON FOR A PERIOD OF  
          FIVE YEARS?

           FISCAL EFFECT  :  As currently in print this bill is keyed fiscal.

                                      SYNOPSIS
          
          According to the author, homeless veterans are often caught in a  
          catch-22 situation where their homelessness inevitably results  
          in citations for offenses like truancy or illegal lodging, but  
          wage garnishment to collect any unpaid fines makes it much  
          harder for these veterans to escape the cycle of  
          homelessness--virtually ensuring that further citations for the  
          same type of offenses will continue to occur.  Proponents of the  
          bill contend that temporarily freezing the authority of courts  
          to garnish the wages of homeless veterans is needed to give  
          these veterans a better chance to establish stable housing to  
          escape the cycle of homelessness.  

          To address this problem cycle, this bill seeks to prohibit  
          courts from wage garnishment of a homeless veteran for  
          outstanding unpaid citations related to loitering, curfew  
          violations, or illegal lodging, for a period of five years from  
          the date that the court, in the course of its routine efforts to  
          collect fines, obtains information indicating the veteran is  
          homeless.  The bill does not exculpate veterans from any  
          offenses for which they have committed, nor does it relieve them  
          of the legal obligation to pay any associated fines or prohibit  
          any ticket from being issued.  In addition, the bill does not  
          require the courts to expend additional resources to obtain  








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          information about the homeless status of veterans-it merely  
          requires court collectors to note information indicative of  
          homelessness in the course of their routine collection efforts.
          Finally, the author contends that temporarily limiting these  
          methods of debt collection in this context makes good financial  
          sense in light of a recent Judicial Council study that suggests  
          collection of delinquent court-ordered debt is not a  
          cost-effective use of court resources in cases where no reliable  
          address information exists for the debtor--as is true of many  
          homeless veterans.  This bill is closely modeled after last  
          year's AB 1111, a bipartisan bill signed into law that enacted  
          similar provisions benefitting homeless youth under age 25, and  
          enjoys support from veterans groups and social workers.

           SUMMARY  :  Prohibits courts from garnishing the wages or levying  
          a bank account of a homeless veteran for outstanding unpaid  
          citations related to loitering, curfew violations, or illegal  
          lodging for a period of up to five years, as provided.   
          Specifically,  this bill  :   

          1)Makes Legislative findings about homeless veterans, the  
            garnishment of their wages and savings for offenses inevitably  
            associated with being homeless; and the negative effect these  
            debt collection practices have on the ability of homeless  
            veterans to escape the cycle of homelessness.


          2)Provides that, notwithstanding any other provision of law, if  
            a court, during the course of its routine efforts to collect  
            delinquent court-ordered debt, obtains information indicating  
            that a person who has been issued a citation for loitering,  
            curfew violations, or illegal lodging that is outstanding or  
            unpaid, served in the military within the last eight years and  
            is homeless or has no permanent address, the court shall not  
            garnish the wages or levy against bank accounts of that person  
            for five years from the date the court obtained the  
            information.


          3)Provides, for the purposes of this act, that a person is  
            considered to be "homeless" or as having "no permanent  
            address" if that person does not have a fixed, regular,  
            adequate nighttime residence, or has a primary nighttime  
            residence that is one of the following:









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             a)   A supervised publicly or privately operated shelter  
               designed to provide temporary living accommodations,  
               including, but not limited to, welfare hotels, congregate  
               shelters and transitional housing for the mentally ill. 

             b)   An institution that provides a temporary residence for  
               individuals intended to be institutionalized. 

             c)   A public or private place not designed for, or  
               ordinarily used as, a regular sleeping accommodation for  
               human beings.


          4)Provides that nothing in this act shall be construed to:


             a)   Prevent a court from engaging in any other lawful debt  
               collection activities;

             b)   Require a court to perform any further investigation or  
               financial screening into any matter beyond the scope of its  
               regular duties; 

             c)   Prevent the Judicial Council from altering any best  
               practices or recommendations for collection programs  
               pursuant to Section 1463.010;

             d)   Prevent a court from garnishing a person's wages or  
               levying against a person's bank accounts if the court  
               subsequently obtains evidence that the person is no longer  
               homeless, or that the court had on a previous occasion  
               suspended garnishment of that person's wages or levying  
               against that person's bank accounts pursuant to these  
               provisions.

           EXISTING LAW  :  

          1)Authorizes a county or court to establish a comprehensive  
            collections program to enhance the collection of delinquent  
            court-ordered debt and improve recovery efforts, and requires  
            the comprehensive collection program to include at least 10 of  
            a possible 16 characteristics, as specified.  Among the  
            characteristics provided are:









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             a)   Monthly bill or account statements to all debtors;
             b)   Telephone contact with delinquent debtors to apprise  
               them of their failure to meet payment obligations;
             c)   Issuance of warning letters to advise delinquent debtors  
               of an outstanding obligation;
             d)   Requests for credit reports to assist in locating  
               delinquent debtors;
             e)   Access to Employment Development Department employment  
               and wage information;
             f)   The generation of monthly delinquent reports;
             g)   Participation in the Franchise Tax Board's Interagency  
               Intercept Collections Program;
             h)   The use of Department of Motor Vehicle information to  
               locate delinquent debtors;
             i)   The use of wage and bank account garnishments.  (Penal  
               Code Section 1463.007.)

          2)Provides that if a court, during the course of its routine  
            process to collect fees, fines, forfeitures, or other  
            penalties imposed by a court due to a citation issued for the  
            violation of a state or local law, obtains information  
            indicating that a person under 25 years of age, who has been  
            issued a citation for truancy, loitering, curfew violations,  
            or illegal lodging that is outstanding or unpaid, is homeless  
            or has no permanent address, the court shall not garnish the  
            wages or levy against bank accounts of that person until that  
            person is 25 years of age or older.  (Penal Code Section  
            1463.011.)

          3)Defines a "homeless person" as any person who lacks a fixed,  
            regular, and adequate nighttime residence, or has a primary  
            nighttime residence in one of the following:

             a)   A supervised publicly or privately operated shelter  
               designed to provide temporary living accommodations,  
               including, but not limited to, welfare hotels, congregate  
               shelters and transitional housing for the mentally ill;
             b)   An institution that provides a temporary residence for  
               individuals intended to be institutionalized;
             c)   A public or private place not designed for, or  
               ordinarily used as, a regular sleeping accommodation for  
               human beings.  (Health and Safety Code Section 50582(b).)

           COMMENTS :  According to the author, homeless veterans are often  
          caught in a catch-22 situation where their homelessness  








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          inevitably results in citations for offenses like loitering or  
          illegal lodging, but wage garnishment to collect unpaid fines  
          makes it more difficult for these veterans to escape the cycle  
          of homelessness--virtually ensuring that further citations for  
          the same type of offenses will continue to occur.  To address  
          this problem cycle, this bill seeks to prohibit courts from wage  
          garnishment of homeless veterans for outstanding unpaid  
          citations related to loitering, curfew violations, or illegal  
          lodging for a period of five years from the date the court  
          obtains information indicating the veteran is homeless in the  
          course of its routine efforts to collect fines.

           Author's statement.   The author contends that wage garnishment  
          of homeless veterans to collect unpaid citations for infractions  
          associated with living on the street perpetuates the cycle of  
          homelessness, making escape more difficult for veterans trying  
          to legitimately work and establish stable housing.  The author  
          states:

               The homeless are frequently ticketed for offenses  
               synonymous with their homelessness, such as loitering,  
               illegal lodging, and curfew violations. The inability  
               of homeless veterans to pay for tickets and subsequent  
               fines for offenses related to their homeless status  
               may lead to the garnishment of their wages and bank  
               accounts, damage to their credit history, and create  
               other barriers to their establishing financial  
               stability and independence. By making it harder for  
               homeless veterans to save money to end their  
               homelessness, such garnishments paradoxically also  
               increase the likelihood that the public safety  
               offenses the tickets are meant to dissuade will in  
               fact occur.  The purpose to this bill is to  
               temporarily prohibit courts from garnishing the wages  
               or levying against bank accounts of a veteran (as  
               specified.)

           Unfortunate facts about the homeless veteran population  .  Sadly,  
          the problem of homelessness among veterans who have proudly  
          served our country is not a minor one.  According to the U.S.  
          Department of Housing and Urban Development's most recent annual  
          survey for point-in-time estimates of homelessness, there were  
          16,461 homeless veterans in California in January 2012, of whom  
          11,949 were considered unsheltered and living on the streets.   
          (Located at:   








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           http://www.hudhre.info/CoC_Reports/2012_ca_pops_sub.pdf  )  A  
          recent national survey of over 23,000 homeless Americans  
          conducted by the 100,000 Homes Campaign found that homeless  
          veterans reported having been homeless for an average of 5.77  
          years as compared to 3.92 years for homeless non-veterans.  In  
          addition, the study found that veterans were 11 percent more  
          likely than non-veterans to suffer from at least one health  
          condition linked to increased risk of death among the homeless  
          population.  ("National Survey of Homeless Veterans in 100,000  
          Homes Campaign Communities" by The 100,000 Homes Campaign.)

           Author's amendments.   In order to incorporate recently released  
          federal data on homeless veterans, the author proposes to make  
          the following amendments:

               On page 2, between lines 8 and 9, insert: "(2) According to  
               the U.S. Department of Housing and Urban Development's most  
               recent annual survey for point-in-time estimates of  
               homelessness, there were 16,461 homeless veterans in  
               California in January 2012, of whom 11,949 were considered  
               unsheltered and living on the streets."

               On page 2, line 9, strike "(2)" and insert "(3)"

               On page 2, line 12, strike "(3) The California Research  
               Bureau has documented that if" and insert "If"
           
           In order to clarify when the suspension of the court's authority  
          to collect begins, the author proposes the following amendment:

               On page 3, line 2, strike "the ticket issues" and insert  
               "the court obtained that information"

          In order to clarify that suspension of court collection efforts  
          under this bill is intended to be a benefit that is  
          administrated only one time, the author proposes the following  
          amendment 

               On page 3, line 29, after "homeless" insert ", or that the  
               court had on a previous occasion suspended garnishment of  
               that person's wages or levying against that person's bank  
               accounts pursuant to subdivision (b)."

           Although this bill suspends collection methods for unpaid fines  
          arising from certain offenses, it does not absolve the veteran  








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          of any offense or discharge any fine.   This bill seeks to  
          prohibit courts from wage garnishment of a homeless veteran for  
          outstanding unpaid citations related to loitering, curfew  
          violations, or illegal lodging for a period of five years-a  
          temporary suspension of the court's authority to garnish the  
          wages or levy the bank account of the veteran.  If the court  
          subsequently obtains evidence that the veteran is no longer  
          homeless before five years have elapsed, then the court may  
          resume wage garnishment or bank levy upon the veteran once  
          again.

          The author notes that the bill does nothing to absolve the  
          veteran of the offense, relieve the legal obligation to pay any  
          associated fine, or prohibit any ticket from being issued.  As  
          such, it does not appear this bill dismisses accountability for  
          so-called "quality of life" offenses committed by homeless  
          veterans as much as it represents an effort to give them a  
          better chance of working to escape homelessness before wage  
          garnishment can resume.

           This bill is intended to minimize any new workload upon the  
          courts and possibly conserve judicial resources.   Under this  
          bill, a court is prohibited from garnishing the wages of a  
          person when "during the course of its routine process to  
          collect" unpaid fees or fines, the court "obtains information"  
          indicating that the person meets the criteria for an eligible  
          homeless veteran.  Section 1463.007 of the Penal Code describes  
          the types of actions that courts already take to enhance the  
          collection of delinquent court-ordered debt where the court runs  
          a comprehensive collections program.  In these debt collection  
          cases, the court will typically attempt to mail an account  
          statement and/or a warning notice to the debtor's address, if  
          known, and also contact the debtor by telephone.  Among other  
          things, the court may request a credit report of the debtor or  
          initiate the use of wage or bank account garnishments.  Under  
          this bill, however, if the court  in the process of its ordinary  
          collection efforts  (emphasis added) obtains information  
          indicating the person is (a) a military veteran who has served  
          within the last eight years; (b) has unpaid citations for  
          offenses associated with homelessness, like loitering, curfew  
          violations, or illegal lodging; and (c) is homeless or has no  
          valid permanent address, only then would the court be prohibited  
          from garnishing the wages of the debtor because such indicators,  
          in all likelihood, demonstrate that the debtor is a homeless  
          veteran covered under the bill.  








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          The author also contends that the bill may actually help  
          conserve judicial resources by reducing debt collection efforts  
          that are empirically cost-ineffective, because of the difficulty  
          and expense involved in garnishing the wages of veterans who are  
          homeless and lack any permanent address.  In a study  
          commissioned by the Judicial Council and published in December  
          2009, researchers from Gartner, Inc., examined the relationship  
          between the "inherent collectability of debt" and factors such  
          as the size of the debt, age at referral, and validity of  
          address information.  They found, generally, that the rate of  
          study cases where collection efforts resulted in the debt being  
          paid-in-full was 13 percentage points below the average, and 19  
          percentage points lower than cases where there was a valid  
          initial address.  (Judicial Council, Report to Legislature on  
          Statewide Collection of Court-Ordered Debt (January 2010) p.10.)  
           As a result, this bill may reduce court debt collection efforts  
          that, according to the Gartner study, would likely prove  
          cost-ineffective for courts because homeless persons by  
          definition lack reliable address information.

          Based on Section 1463.007 and the findings of the Gartner study,  
          it appears likely that every court collector, in the course of  
          current practices, will already obtain information as to whether  
          a debtor meets the applicable definition of homeless.  In  
          addition, the bill specifically provides that nothing in its  
          provisions shall be construed to require a court to perform any  
          further investigation or financial screening into any matter  
          beyond the scope of its regular duties, nor prevent a court from  
          engaging in any other lawful debt collection activities.  As  
          proposed to be amended, suspension of court collection efforts  
          would apply once, at most, to an individual veteran, even if  
          that individual unfortunately becomes homeless again more than  
          five years later.

           Prior Legislation.   This bill is closely modeled after AB 1111  
          (Fletcher and Mitchell), Ch. 466, Stats. 2011, which prohibits a  
          court from garnishing the wages or levying the bank account of a  
          homeless youth under age 25 for outstanding unpaid citations  
          related to truancy, loitering curfew violations, or illegal  
          lodging until the youth is at least 25 years old.

           REGISTERED SUPPORT / OPPOSITION  :   

           Support 








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          National Association of Social Workers- CA Chapter
          AMVETS- Department of California
          VFW- Department of California
          Vietnam Veterans of America, California State Council

           Opposition 
           
          None on file
           
          Analysis Prepared by  :    Anthony Lew / JUD. / (916) 319-2334