Evidence First Podcast

Leigh Parise: Policymakers talk about solutions, but which ones really work? Welcome to Evidence First, a podcast from MDRC that explores the best evidence available on what works to improve the lives of people with low incomes. I’m your host, Leigh Parise.

Every jurisdiction in the United States administers fines and fees as part of its criminal legal process. Fines can accrue from a nonviolent misdemeanor such as jaywalking or bouncing a check, or during arrest, incarceration, or parole. These fines carry legal or financial consequences if not paid on time, which can trap people in cycles of debt and financial burden. In addition to questions about equity, there’s also a growing question of the effectiveness of fines and fees and their purported goal: raising money and providing restitution to victims.

In 2021, MDRC partnered with Alabama Appleseed Center for Law and Justice, the University of Alabama at Birmingham, and the 10th Judicial Circuit Court of Alabama for the Jefferson County Equitable Fines and Fees Project (or JEFF). The goal of the project is to better understand how residents of Jefferson County—encompassing the city of Birmingham, Alabama—are impacted by court debt from fines and fees. This project is unique in that researchers will have unprecedented access to case-level data (granted by the Jefferson County Circuit Court) to explore these questions.

Today I’m joined by Leah Nelson, research director at Alabama Appleseed Center for Law and Justice, and Sarah Picard, director of the MDRC Center for Criminal Justice Research, to discuss their research partnership and what they’re learning. Sarah, Leah, welcome to Evidence First.

Leah Nelson: Thank you.

Sarah Picard: Thank you. Great to be here.

Leigh Parise: You’ve recently coauthored a commentary in the Alabama Daily News called Crime and Garnishment, and I’m excited to dig into some of the details that you’ve laid out and learn more from the two of you. To start off, what is actually meant by “fines and fees”? Can you give us some examples?

Leah Nelson: I’ll take that one. As you said, fines and fees are basically a sentence that is imposed after somebody is adjudicated guilty of anything from a traffic offense all the way up to the most serious felonies. Pretty much any criminal offense anywhere in the United States carries a financial penalty, sometimes as the sole component of the sentence, sometimes along with probation or incarceration or some other form of supervision. Fines and fees go together as one package. We talk about them separately because fines are intended to be a sanction and fees are intended to cover some type of cost the system incurred as a result of the individual using the justice system. Although that difference matters in terms of where the money is intended to go, if it’s collected, it doesn’t really matter that much in the life of the person who owes the money. They have to pay it until it’s done, and it doesn’t matter whether what they’re paying is a fine, a fee, or a cost.

There is one other element of financial obligation that a person might have after they’re adjudicated guilty that is different, and that is restitution. Say I steal your TV, and the TV was worth $500 on top of the fines and fees that I’m assessed after I’m adjudicated guilty of some degree of theft: I’m also going to owe $500 to you. That money is quite distinct in the sense that that’s intended to make the victim whole.

Leigh Parise: I’ve heard this term before: “Taxation by citation.” Can you say a little bit about how we got here? What’s the historical context for that?

Leah Nelson: That, again, depends a little bit on where you are. I can speak mostly to Alabama, although the phenomena that I’m going to describe exist around the country in different ways. Fines and fees are a sanction but they’re also a form of revenue, unlike terms of incarceration—although we have found ways to monetize incarceration through things like prison labor, generally, that is not something that is forward-facingly intended to be a source of revenue for the state. It does cost money to incarcerate people. 

But fines—although their sanctions are also money—over time, jurisdictions realized that they were sometimes a very good way of raising money in a pinch. You might find that small municipalities that need to fund something suddenly do a lot of roadblocks or issue lots of parking tickets, where they weren’t doing that previously, in order to generate money or fill budget holes. In fact, for a period of time, my understanding is that bond underwriters and ratings agencies saw, for municipalities, the ability to sort of turn up the volume and start assessing and then collecting more fines and fees as a way of mitigating economic cycles like recessions.

That started to change in 2014 after the shooting death of Michael Brown, a teenager in Ferguson, Missouri. He was an unarmed young Black man whose death received an enormous amount of attention in the United States. When the Department of Justice went in and started looking around at what was happening in Ferguson (which is a small suburb of St. Louis), they realized that a lot of the community’s frustration with law enforcement stemmed from code enforcement, from just massive amounts of fines and fees that were issued for very low-level violations that were disproportionately affecting mostly Black residents who didn’t have very much money.

Fast forward almost 10 years: We saw a similar problem of predatory policing in Brookside, Alabama. There was not, thank goodness, a shooting death that precipitated this investigation. This was instead initiated by a two-time Pulitzer Prize winner from Alabama named John Archibald, who started looking into what was going on in Brookside’s courts because they were notorious and they were right in his backyard. What he found—through investigative journalism and records requests and court watching—was that the city of Brookside, which has about 1,200 people in it, was raising half of its budget from fines and forfeitures. And they were mostly doing that by stopping people on a three-mile stretch of interstate highway that went through the town. They were inventing offenses like Driving in the left lane is illegal in Brookside, Alabama, and they would pull people over, ticket them, tow their cars.

It was nightmarish for people because they would be stranded on the side of the highway, which is not supposed to be the consequence of a speeding ticket or a traffic violation, typically. But then also they would owe these fines and fees afterward. That’s, in sum, what we mean when we say, “Taxation by citation.” It’s another way of filling public coffers that’s maybe politically more palatable to the most powerful people who tend to oppose tax increases but do want public services to be adequately funded.

Leigh Parise: Thank you. Getting that historical picture is really helpful. I know Brookside is in Jefferson County; in comparison to Jefferson County, do you have a sense for what the national picture looks like and how much this is a problem across the country?

Leah Nelson: Yes and no because there’s not that much information available. We know Brookside made the news. We know that there are other places that make the news when they are speed traps, or otherwise doing something really visible and ridiculous and there’s a local journalist to cover it. But I don’t think that the absence of visible places means that there are not other places that are doing this because, just like we don’t have great consolidated statistics on policing behavior as it pertains to any other element of the criminal legal system, we don’t really have a comprehensive way of understanding this phenomenon either. That’s been one of the unique things about this partnership, the JEFF work: We got all of this data and are able to start answering questions.

I want to be clear, since I am in Alabama: The fact that we’re able to describe some of these issues in Jefferson County—this is an unusual case where it’s not because an investigative journalist got a hot tip that bad things were happening, this is because judges agreed to open their books. Some of the things that we found are pretty troubling, but I do think that it’s to the judges’ credit that they were willing to say, “You know what, Brookside was right in our backyard.” They don’t have jurisdiction over Brookside. The judges we’ve been working with are not municipal judges in Brookside, but they were troubled enough by that, and by other information they had, to make this decision to allow us access to their data.

So anything bad we find is almost to their credit [because they allowed] us to look for it and I hope will be useful to the field as folks think through what should happen instead, what would be better.

Leigh Parise: Yeah, for sure. It’s a really unique and exciting opportunity. All right, so take us closer to what’s happening in Jefferson County. Can you walk us through the average experience of someone who’s assessed a fine or a fee in Jefferson County? How does a single fine escalate to have a real exponential impact on that individual?

Leah Nelson: They’re assessed at sentencing. Whatever it is that you’re adjudicated guilty of—whether it is a moving violation or a rolling stop or driving on a suspended license or possession of marijuana (which is still a felony in Alabama) or even something very serious like drug trafficking that carries prison time—it’s also going to come with these financial penalties.

But I’m going to turn it over to Sarah to talk about how the amount that you owe can actually increase after it’s assessed and what that means for people and for communities.

Sarah Picard: We were seeing that the cumulative balances that people held were disproportionately affecting Black individuals and also Black and poor communities in Jefferson County. We started out feeling confused about why we were seeing this, because all of the fines and fees that are imposed are imposed by statute and should be imposed equally across different groups. One of the first things we did that we showed the judges is we mapped this out and we could see the concentration of Black people by neighborhood and then the concentration of debt by neighborhood and the concentration of leftover cumulative balances by neighborhood—so debt assessed, debt paid.

That was the beginning and one of the first things we wanted to investigate was why an individual who had the same charge and the same statutory fine—but who happened to be Black—would owe more money than someone who had the same charge and happened to be White. At the risk of being overly simplistic, the answer is that Jefferson County imposes a one-time interest fee if you have not paid anything after the course of three months. So you may pay for two months, [then] stop paying. If you stop paying for three months, you get a 30 percent one-time upcharge on your cumulative balance. Nonpayment patterns are different in Black groups as opposed to White groups. You may see that Black people have a higher likelihood of not paying for three months and then having the D99 (which is a collections fee) imposed. Additionally, you may see a different pattern once the D99 is imposed [depending on] the ability of people to pay toward that increased amount.

Our current research that we have on the website and that we used in our op-ed shows, very big picture, what are our takeaways: inequity, inefficiency. But as we move through the research, we’re doing some more granular tracking of payment patterns over time. We’re looking not only at the racial composition of neighborhoods, we’re also looking at indicators of cumulative disadvantage. We’re looking at the rate at which people—individuals or communities—are being assigned public defense. There are all these different markers that would help explain why cumulative balances are higher over time for Black people as opposed to White people.

Leah Nelson: I want to jump in and give some local context. One thing that we saw, because we were able to use indigence almost like a demographic marker— In any criminal case where there might be incarceration as a consequence, you are entitled to a lawyer. So nearly all of the people in this data set had a lawyer. Most of them had a public defender because it is common for people in criminal court to be indigent. Judges make an assessment of indigence: You can’t afford counsel so one will be appointed for you. And so thinking about why it would be that Black people are more likely to accumulate that collections fee and less likely to pay on time than White people: They are also more likely, in our data set, to be indigent than White people. This is a really important thing to flesh out because we can make the connection between Okay, this is a person who a judge has determined cannot afford a lawyer for themselves and It is then not surprising that the same person struggles to pay fines and fees after the fact.

I wanted to say that out loud because I think that it’s easy to say, “Okay, Black people are less likely to pay on time. What does that say about them?” Well, the question is What does that say about society? We’re in Jefferson County, Alabama. It is a place that has a long history of making it very difficult for Black individuals and communities to build wealth. So overrepresentation of Black folks in the indigent population and therefore also overrepresentation in the people whose court debt basically goes into collections—are assessed this collections fee—is a reflection of structural racism.

Leigh Parise: I appreciate you articulating that clearly and helping people draw those lines and making sure that that’s where they land and [that they] understand that history and the context. Thank you. All right, I think one of the arguments that you both make in the commentary you published in the Alabama Daily News is that these fines and fees don’t actually accomplish what they’re designed to do, which is to raise money. Can you talk a little bit about that?

Leah Nelson: It’s more complicated than Fines and fees don’t raise money because obviously money is raised, otherwise the system would raise zero dollars and everybody would know that. I want to credit Dr. Peter Jones, who’s an associate professor of public administration at the University of Alabama at Birmingham. Dr. Jones has public finance expertise, which has been really invaluable to doing this analysis and understanding what we were seeing. All of that being said, we found that about 54 percent of people pay zero dollars toward their fines and fees, which is incredibly troubling. That means that more than half of these court-ordered sentences go completely ignored.

Now, I think there’s a lot of evidence to indicate that the reason people don’t pay is because they don’t have the money, but regardless, we see that 54 percent of people pay zero dollars. About a quarter of people pay everything that they owe quite quickly, all at once or within a month. Those people are more likely to be White and they are more likely to have lower balances assessed at sentencing. That second part’s not surprising, because if you came to me and said, “Leah, you owe me $200 for that misdemeanor, do you want to pay today or do you want to pay over time?” I’m going to find the $200 and just get it over with so that I don’t have to keep up with it and risk consequences for not paying.

But if you said, “I need $20,000 from you today”—and there are offenses that carry assessments even higher than that—it doesn’t matter how eager I am to be [done] with it, I will not get you $20,000 today. I will have to go on a payment plan and that sets me up for the likelihood of missing payments and starting to accrue consequences. More than half of people pay nothing, about a quarter of people pay everything all at once (but those are the lower balances), and then the other 20-ish percent of people pay some, but not all, of what they owe over time. And those balances tend to go up over time so that when people are paying, the money all goes into that collections bucket—so that 30 percent that’s assessed on top of their initial assessment (because they were late) becomes the only thing that is paid. It’s a collections fee that, at best, pays for itself and doesn’t generate additional revenue that goes into any other bucket, including restitution that’s owed to victims.

Because a big finding of this research was understanding and describing how the money flows. It is not prorated across all of the buckets that are intended to receive funds. Instead, it operates on what’s called a cascade system, where the first bucket has to be filled completely before additional buckets get any dollars at all. The collections fee is at the top, if it’s assessed. If there’s not a collections fee, it’s a different court fee. And at the bottom, after everything else, is restitution. So that TV that I stole from you and I owe you $500, I have to pay every other dollar that I owe before you’re going to get any money.

Now, to their credit, judges in Jefferson County remember—more than 50 percent of the time—to order restitution to be number one. But they have to remember to make that order, which, given the volume of cases, slips through the cracks fairly often. And they have to know about it, so new judges may not do this. Then the clerk has to basically do a little hack in the software that operates this system in order for you to be priority number one instead of something else. And this is a centralized system, so even though everything we’re describing is happening in Jefferson County, everything from the priority system to the 30 percent collections fee is all centralized. Although we don’t know it for sure because we haven’t seen data from other counties, we can assume that something like this is happening in other counties. These are not choices that are being made by Jefferson County to operate in this way. This is how the system is set up.

Sarah Picard: The only thing I would add is [that] I think we’re beginning to triage our evidence to a point where we have fairly strong support that people don’t pay because they don’t have the money, rather than [that] people don’t pay because they choose not to pay. One trend that we’re seeing that makes this very concrete is that we do see a very small jump in the likelihood of payment after the interest fee is imposed. When people receive a letter that says, “You owe us this,” and there may be legal consequences to you not paying—at that point people attempt to pay. But the assessment of the interest fee, on average, is around $700. The amount that gets paid during that bump, on average, is around $15.

It seems that there are people who never pay at all, and then there are people who pay. Among those people who pay, it’s clear that they can’t afford to pay because if they were incentivized by this D99, they would just pay it all. That’s not what’s happening. And the poorer people whose cumulative balances are increasing over time—[that] is associated with a lot of the factors that we assumed it would be associated with: being indigent, the cumulative disadvantage indices in that person’s neighborhood.

I think Leah would agree that we figured that we would see some version of this story, but the story was much more intense and troubling than even we thought it might be.

Leah Nelson: I would definitely agree with that. Our hypotheses were borne out, but in a really upsetting and stark way. I’ve done a lot of work in Alabama to talk with people who owe this type of debt, and that’s been something we’ve continued through the JEFF project; Sarah’s been in some of those conversations. People who owe this debt desperately want to be free of it. Even though Jefferson County very rarely issues warrants when people can’t pay— You might be called to court to explain why you haven’t paid, particularly if it’s restitution, because victims are also calling and saying, “I haven’t gotten my money.” So judges do sometimes issue those warrants. But in many jurisdictions those warrants are issued very frequently, so people who owe this money—and they do commonly owe it in more than one jurisdiction—know that they could be picked up at any time and be, at the very least, expected to come to court. Many of them may have spent time in jail as a result of nonpayment.

Again, that is not a practice that is common or maybe even happening at all in Jefferson County, but because of the density of municipalities there (including Brookside, which did have a debtor’s prison)—people aren’t [such] discerning consumers of the criminal legal system that they know Oh well, I’m in Jefferson County Court and they don’t do that. So people live in dread of the consequences of not paying this debt. I think that’s additional evidence that the reason they don’t pay is because they can’t, and they don’t see a finish line. Again, when it’s a lower amount of money, it’s not surprising to see people who don’t have very much going without the little that they have to be done with a small payment of a few hundred dollars. But when you have thousands of dollars ahead of you and it looks like you’re never going to be done, that also disincentivizes paying much more. That’s why you see people pay $15 if they get that letter and then they give up because they still have a lot more to go and they’re never going to have that money.

Leigh Parise: You can imagine how, over the long term, those consequences and living in that sense of What’s going to happen? or having that show up if—do these kinds of things show up if you have a credit report run, if you wanted to rent an apartment or get a car?

Leah Nelson: No, but many of the consequences of this make it very hard to do those things. This doesn’t get referred to private debt collectors, but if you have a warrant and they run a background check on you it will be visible that you have got some legal situations going on. This kind of debt also does drive people to predatory lenders, to payday lenders, title loans, and other places that will mess up your credit. So it indirectly does affect people’s credit, their ability to get approved for rentals. It has many, many collateral consequences.

Leigh Parise: Leah, you’ve had a lot of conversations with people within Alabama and I know that you’ve worked closely with judges and other justice officials in Alabama. I’m curious for you to say a little bit about how they’ve responded to what you’ve found in this work.

Leah Nelson: Nobody is proud of how the system looks once you look under the hood. The judges have responded appropriately because everything Sarah and I have shared with you today is pretty upsetting. This is not how we imagine our criminal legal system functioning. I think judges—or anybody that runs for political office and engages the way that they do—they tend to be pretty idealistic. They think they’re executing justice. They know it’s not perfect. These are not naive people. They were horrified and they asked us what they could do and they continue to ask what they can do. I’ve also talked with people outside of Jefferson County, including folks in Alabama’s finance department and in other areas of government. Universally, there is a sense that we do need to do something about this. The fact that victims are at the bottom of the list of priorities doesn’t sit well with anyone. The fact that so muchk of this debt goes uncollected, but courts are expending resources trying to monitor these people—that doesn’t sit well with anyone.

Even the idea, once you make it real for people that this is a sentence that lasts the rest of someone’s life if they can’t pay— The person who owes this debt, they’re not incarcerated, and I think it’s very easy for us to imagine why being incarcerated is horrifying: You’re in prison, you’re not at home, you don’t have liberty. We don’t have a lot of space in our brains necessarily—[especially] people who haven’t been in debt for long periods of time; it’s harder to imagine. But once it is made clear that this is something that follows people for a long time, costs court resources to monitor, and costs people who are trying to reenter [society] after incarceration or move on with their lives after a misdemeanor or a traffic offense (which are not supposed to be things that follow you for the rest of your life)—once we spell [that] out for officials (whether they’re judges or prosecutors, defense attorneys, law enforcement, or public finance officials), nobody is good with this.

That doesn’t mean there’s an easy solution; there’s not for anything that involves [these issues]. Basically, tax policy and criminal justice policy are not fun cocktail topics. But we’re moving to a place where many different people and officials are on the same page about this being a topic that’s worth some mental energy to think through and at least reduce [its] harm.

Leigh Parise: Understandable that you don’t have “Here’s your silver-bullet answer.” But when people say to you, “Leah, this is horrifying; what do you suggest we do?” or “What are some of the next steps?” or “What’s a starting place?” what are the things that you tell them?

Leah Nelson: I have a billion ideas. The easiest thing to do (that I think is inarguably the right thing to do) is move restitution that’s owed to victims to the top of the priority list because it just doesn’t make sense. It is not fair. Those are individuals; all of the other creditors, all of the other entities that are owed money, are government entities. Obviously, we do need to fund government, but individuals that are out [of] money because they’re crime victims should be paid first.

I think we need to do a version of this research statewide because Jefferson County is just one jurisdiction and although it follows the same rules—because it uses the same software and is governed by the same statutes—as the rest of Alabama, we really don’t know how much money we’re even talking about. Anytime you propose a reform in any state, you’re going to have people say, “Well, how much is this going to cost us? How much money are we going to lose and who’s going to lose it?” That’s not an answerable question right now, so we need to count the money.

We also need to make it easier for people to pay. In our qualitative conversations, we learned that, for instance, the Jefferson County Court—and I’ve found that this is true in other courts—will only take exact change if you walk through the doors. So if you owe $37.50 and you walk in with two $20 bills, too bad for you, you can’t pay. And they won’t take an overage either. We need to make it easier for people to pay, increase opportunities for online payment. I would also say that the fact that only about 25 percent of what is owed is collected year [over] year indicates that the demand for money exceeds the supply of money, so we should demand less money. That would, again, be a project for the state and it would require legislation.

It doesn’t make sense to assess people amounts of money that they will never [pay], unless the goal of this is to create a situation where people—in some cases for the rest of their lives—are in debt to the government and the court has to monitor them and periodically send them letters or issue warrants. Unless we think that’s good public policy, we should be finding ways to reduce the amount [that is] assessed to a more realistic amount.

Sarah Picard: In our thinking there’s a short game and a long game on the policy front. We’re pretty optimistic about it because we do have the partnership of judges and they do have the ability to rearrange payment structures and remit fines, and they have a willingness to do those things. But ultimately, the real solutions that Leah’s talking about require convincing people in other counties and people in the state legislature that something needs to be done. I think we’re thinking that both things should and possibly can happen.

Leigh Parise: Sarah, Leah, you both have done research in this space for a long time, and it sounds like this was a really unique opportunity to look at the data and see what was happening within Jefferson County. It would be good to hear you say, from a research perspective, a little bit more about what’s significant about the fact that Jefferson County Circuit Court partnered on this and allowed access to case-level data. It sounds like that’s pretty unique.

Sarah Picard: I think it’s very unique. I have mostly worked on fines and fees specifically with Leah, but I have done a lot of research on the criminal legal process in jurisdictions around the country. To receive five years of detailed case-level data to do your analysis— That’s almost a longitudinal data set, which we almost never receive; sometimes [we] receive cross-sectional [data]—one year of data, one year before a program, two years after. To see, over this much time, what’s happening with a phenomenon is very unusual.

I think that we also have a unique situation [given that we’re able to collect the kind of qualitative data to set the context for how we interpret what we’re seeing because of Leah’s prior work surveying and interviewing people across the state of Alabama who are in this situation [and] the effect of that work on the judges who made the decision to share the data. We truly get something that is kind of a dream thing for a researcher, which is [that] we get both the breadth of this situation and we get the depth of the situation.

The only other thing I’ll say is that when it comes to policymaking and problem-solving, for a wide group of stakeholders—I think that five years ago, Leah and I were saying, “This story is so compelling, but we need to show these decision-makers the breadth of the problem.” Now we can.

Leah Nelson: That’s why the multidisciplinary nature of this team has been so fantastic. I have a journalism background. I am a good qualitative researcher. I am good at talking with people and letting them tell me what they’re feeling, but I had no ability to do this type of data analysis. I didn’t even have a framework for it. So Sarah and Dr. Jones—Pete—at UAB [the University of Alabama at Birmingham] have been just unbelievable in helping plumb the depths of this data and understand what it meant from the two different disciplinary areas that you need to look at it. Because you look at it one way and it’s a form of punishment, and you look at it another way, it’s a form of public revenue. If you don’t have answers for people who are concerned about the consequences of changing both of those things, then you’re really going to lose. Because it is both of them, which is its own mess. It’s very troubling to me to think about the fact that we found a way to monetize and generate public revenue from criminalizing people. I guess America is very entrepreneurial in that way.

Leigh Parise: Well, yes. Maybe that’s quite the place to end. The combination of skills that this team brought clearly has helped you tell a really compelling story to help people understand and make the connections both to the system and to the real people who are experiencing it (and what the consequences are). Thank you for that. Thanks to you both for joining me. This was a great conversation. I hope that other jurisdictions will listen to this and think, We want to partner in this way too and have researchers help us understand what’s happening for us locally, because some really important lessons, it’s clear, are being learned.

Thank you, Leah and Sarah, for joining me. This was a really great conversation, and I think that future findings from this work are going to have big implications and really important lessons for the country.

Sarah Picard: Thank you, Leigh. It was great to be here.

Leah Nelson: Thanks. It was my pleasure to be here.

Leigh Parise: To learn more, check out Leah and Sarah’s commentary in the Alabama Daily News and visit MDRC.org.

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