BEYOND THE NUMBERS
Why States and Localities Rely More on Criminal Justice User Fees
State and local governments increasingly charge criminal defendants for services ranging from a public defender to room and board in a prison or jail, as a Brennan Center for Justice report explains. This growing dependence on fees, along with burdensome criminal fines, encourages poor policing practices — such as those a U.S. Justice Department investigation uncovered in Ferguson, Missouri — and disproportionately harms low-income residents and communities of color.
States and localities rely more on criminal justice user fees largely because they need to raise new revenue since they’ve made other fiscal policy decisions that have squeezed their budgets:
- The Great Recession damaged state finances, but states caused more damage by cutting taxes. State revenues have rebounded from the recession but are only about 5 percent above pre-recession levels, after adjusting for inflation. Meanwhile, needs have grown. States have hundreds of thousands more K-12 and public college students than before the recession, for example. Making matters worse, a number of states — such as Kansas, North Carolina, and Ohio — have slashed taxes at the expense of shoring up state and local budgets.
- States have sharply cut funds for local services. Local governments rely on states to help fund basic services such as schools, police and fire departments, libraries, and parks. Yet 30 states provided less school funding per student in the 2014-15 school year than before the recession, and other state support for local budgets has also fallen. For example, Ohio’s Local Government Fund shrank by $280 million between 2010 and 2015. While state aid has been falling for many years, the recession accelerated this trend. Meanwhile, cuts in federal aid have squeezed local budgets further.
- States have placed tough restrictions on property taxes — localities’ main source of revenue. Many states limit the annual increase in local governments’ property tax revenue. When these caps are too rigid or poorly designed, they can make it hard for localities to raise the resources necessary to pay teachers and police officers, cover fuel costs for buses and garbage trucks, and maintain parks and roads. Wisconsin, for example, limits the growth in property tax revenue to the growth in property values due to new construction, so communities without new construction can’t raise the revenue to cover increases in fuel costs, salaries, or other costs of providing services.
- Many local governments have given companies costly tax abatements. Hoping to attract businesses, many municipalities offer to restrict or eliminate their property taxes. These tax abatements can cost state and local governments large amounts of tax revenues that they could have invested in important services.