BILL ANALYSIS
SENATE JUDICIARY COMMITTEE
Senator Joseph L. Dunn, Chair
2005-2006 Regular Session
AB 1435 A
Assembly Member Evans B
As Amended June 23, 2005
Hearing Date: June 28, 2005 1
Government Code 4
GMO:cjt 3
5
SUBJECT
Courthouse Construction Funds
DESCRIPTION
This bill would make several technical amendments to the
Trial Court Facilities Act of 2002 (TCFA), including
correction of technical errors, clarification of the
appropriate use of courthouse construction funds, and
simplification of the process for modifying the
distribution of penalty assessments for the benefit of the
courthouse construction fund. It would provide that
certain uses of a county's Courthouse Construction Fund,
which was established prior to passage of the TCFA, are
declaratory of existing law.
BACKGROUND
The Trial Court Facilities Act of 2002 provides that the
Administrative Office of the Courts (AOC) or the
Department of Finance may audit each county's Courthouse
Construction Fund (CCF) and notify a county that an
expenditure made from the fund was not permitted under
Government Code 76100, the provision that defines the
appropriate use of those funds. Under the Act, the county
must pay any inappropriate expenditure to the State Court
Facilities Construction Fund (SCFCF). Also, beginning
January 1, 2004, no county may make an expenditure or
encumber future funds from its courthouse construction
funds without the approval of the AOC.
(more)
AB 1435 (Evans)
Page 2
Apparently, 76100 could be interpreted in light of TCFA
to make most county expenditures of CCFs inappropriate.
This interpretation, according to the Administrative Office
of the Courts, is not consistent with negotiations that
have occurred between the AOC, the California State
Association of Counties, and counties regarding the
transfer of court facilities from counties to the state.
This bill would cure the problem by clarifying that use of
CCFs for rehabilitating, acquiring, constructing, or
financing court facilities or excess court facilities is
appropriate under Gov. Code 76100.
CHANGES TO EXISTING LAW
1. Existing law authorizes each county to establish in
the county treasury a Courthouse Construction Fund to
receive penalties collected by the counties from fines
for criminal offenses for the purpose of assisting the
county in the acquisition, rehabilitation, construction,
and financing of courtrooms or of a courtroom building or
buildings containing facilities used by the justice
system. [Government Code 76100.]
Existing law , the Trial Court Facilities Act of 2002,
requires counties to make reports to the Administrative
Office of the Courts (AOC) and to the Department of
Finance for the receipt and expenditure of those funds,
and provides that expenditures for other purposes than
specifically permitted are to be repaid.
This bill would clarify that courthouse construction
funds may also be used for court facilities or excess
court facilities in the same manner and that this is
declarative of existing law.
This bill would require the Judicial Council to submit a
report on county receipts and expenditures in connection
with these funds to the Legislature on or before January
1 of each year.
2. Existing law governing the State Court Facilities
Construction Fund specifies that the penalty distribution
established for a local CCF will change each time a
AB 1435 (Evans)
Page 3
county facility is transferred to the state. Existing
law , the TCFA, allows for the transfer of facilities from
county to the state on a facility-to-facility basis.
This bill would require the change in penalty assessment
distribution to occur only once per year for all
facilities that transfer in a given county.
3. This bill would make other technical, conforming
amendments.
COMMENT
1. Need for the bill
The Judicial Council sponsors this bill to correct what
has surfaced as an interpretation of Government Code
76100 that is inconsistent with the negotiations that
have occurred for the transfer of court facilities from
county to state under the Trial Court Facilities Act of
2002.
The TCFA requires the AOC and the Director of Finance to
audit a county's CCF to determine whether expenditures
from the fund were consistent with Gov. C. 76100. Any
inappropriate expenditure is to be repaid to the State
Court Facilities Construction Fund. Apparently, during
audits of CCF expenditures and the development of
procedures for the Administrative Director's review of
future expenditures, staff of the AOC determined that
76100, if interpreted narrowly, unnecessarily restricts
the use of the CCF. In the AOC's view, a literal reading
of the statute supports the narrow interpretation that
CCFs can only be used to renovate buildings being vacated
by the court or to build excess courtrooms or
courthouses. The broader interpretation allows use of
CCFs for these limited purposes, in addition to
acquisition, rehabilitation, construction or financing of
court buildings. The AOC regards this broader
interpretation as the legislative intent when 76100 was
enacted in the first place, and has used this
interpretation in its negotiations with the counties for
the transfer of court facilities to the state.
For example, Contra Costa County built a parking
structure with CCF funds even though only a portion of
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Page 4
the parking structure would be used by the courts. Under
existing law, the entire cost of the parking structure
could be charged back to the county since the expenditure
would not have been allowable under the current language
of 76100. Under the less restrictive interpretation of
76100 (which Judicial Council and the counties use) the
county fouls be charged back for the cost of the parking
structure less the portion of the cost attributable to
the courts' use of the parking structure. (A proposed
amendment would ensure that the state or the CCF funds
does not pay the entire cost of that structure or other
structures similarly paid for.) Another example is
Sonoma County's ADA upgrade costs for the front counter
at the courthouse. Since the ADA compliance project
would not fit directly into the language of 76100 (i.e.,
it is not a renovation or rehabilitation of the building,
just the counter), the county could be charged back the
cost of the ADA upgrade even though the project is
clearly the responsibility of and benefits only the
court.
The Judicial Council states that there are a number of
projects just like the above that could cause liability
on the counties' part, but could easily be negotiated in
the context of the transfer of facilities from county to
state, when the less restrictive interpretation of
76100 is applied.
However, use of the less restrictive interpretation of
76100 should be tempered with caution if the courthouse
construction funds have been misused by a county for
projects that were unnecessary, inappropriate, or badly
conceived, for example, or that had little nexus to court
operations and facilities. The Administrative Office of
the Courts would not have had approval authority over
these projects prior to passage of the TCFA, but it could
and should exercise some judgment when it comes to
misused CCF funds.
Suggested amendment : The Judicial Council has agreed to
an amendment that would ensure CCF funds that were
misused on projects prior to the passage of the TCFA are
charged back to the counties under 76100 or other
provisions.
AB 1435 (Evans)
Page 5
In addition to clarifying 76100, the bill also would
require the Judicial Council to report on these
expenditures on January 1 of each year. This, however,
would not provide the Legislature any information on the
charge-backs to the county that may be "forgiven" as a
result of the less restrictive interpretation of 76100
to the CCF funds expenditures.
SHOULD THE JUDICIAL COUNCIL ALSO REPORT ON THE "FORGIVEN"
CHARGE-BACKS TO THE COUNTY RESULTING FROM THIS BILL?
2. Change of penalty assessment distribution to occur
only once a year
Under current law, the penalty distribution established
for a local CCF will change each time a facility is
transferred. This could result in several changes of the
penalty distribution in a given fiscal year (through June
2007) especially for large counties as each facility is
transferred individually. AB 1435 would require that the
change in penalty assessment distribution only occur once
per year for all facilities that transfer in a given
county. According to proponents of the bill, this change
will prevent significant staff workload for the State
Controller's Office, counties, and the Administrative
Office of the Courts.
Support: State Association of County Auditors; California
State Association of Counties; Fresno County; Placer
County; Sacramento County; Tulare County
Opposition: None Known
HISTORY
Source: Judicial Council
Related Pending Legislation: None Known
Prior Legislation:SB 1732 (Escutia, Chapter 1082, Statutes
of 2002) enacted the Trial Court Facilities
Act of 2002. The Act provides for the
transfer of court facilities from a county
to the state.
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Page 6
SB 256 (Escutia, Chapter 592, Statutes of
2003) followed up SB 1732 with procedures
for how counties may use their courthouse
construction funds during the process of
transferring facilities from the county to
the state.
Prior Vote: Asm. Jud. (Ayes 8, Noes 1)
Asm. Approps. (Ayes 13, Noes 5)
Asm. Flr. (Ayes 50, Noes 29)
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