Unholy Alliance:
California Courts' Use of
Private Debt Collectors

CALIFORNIA REINVESTMENT COALITION

Unholy Alliance: California Courts’ Use
of Private Debt Collectors
California Reinvestment Coalition
May 2018

Prepared by:
Paulina Maqueda Escamilla
UC Berkeley Goldman School of Public Policy
Assistance provided by:
Paulina Gonzalez and Nehama Rogozen

The California Reinvestment Coalition builds an inclusive and fair economy
that meets the needs of communities of color and low-income communities
by ensuring that banks and other corporations invest and conduct business
in our communities in a just and equitable manner.
California Reinvestment Coalition
474 Valencia Street, Suite 230
San Francisco, CA 94103
415-864-3980
www.calreinvest.org

2

EXECUTIVE SUMMARY
Government-created debt through criminal fines
and fees creates financial insecurity and income
inequity for already overburdened communities,
with a disproportionate impact on low-income
communities of color. California has tried several
approaches to reform the system of fines and
fees, such as ceasing suspension of drivers’
licenses as a method of collecting traffic court
fines and fees. 1,2 However, California counties’
use of government-contracted third-party private
vendor debt collectors is especially troublesome:
private debt collectors are not subject to the
consumer protection laws, and accumulated debt
can spiral out of control for consumers who are
unable to pay. A full overhaul of this system is
urgently needed to protect low-income
communities and communities of color.
In an effort to better understand the relationship
between state and county courts and private
debt collection agencies, the California
Reinvestment Coalition (CRC) conducted
evaluations of private debt collections agencies
that contract with state and county courts to
collect data on delinquent court debt. CRC
reviewed Master Agreements from the California
Judicial Council and Participating Agreements
from counties that set the terms between the
counties and contracted debt collectors. Data
Associated Press. (2017, June 29). California no longer will
suspend driver's licenses for traffic fines. Retrieved from
http://www.latimes.com/local/lanow/la-me-ln-driverlicense-fees-20170629-story.html
2 Lawyers’ Committee for Civil Rights of the San Francisco
Bay Area. (2017, May). Paying More for Being Poor: Bias and
Disparity in California's Traffic Court System. Retrieved from
https://www.lccr.com/wp-content/uploads/LCCR-ReportPaying-More-for-Being-Poor-May-2017.pdf
3 Private Agency: A private entity employed or contracted to
collect court-ordered fines, fees, forfeitures, assessments,
and penalties, Judicial Council of California. (2017,
November 7). Judicial Council Report to the Legislature:
Statewide Collection of Delinquent Court-Ordered Debt for
Fiscal Year 2016–17. Retrieved from
1

was also collected to evaluate Ability-To-Pay
(ATP) programs in 17 California counties. Such
programs evaluate each person’s ability to pay
fines and fees before determining the amount to
be paid.
Our research showed that the collection of fines
and fees is a regressive form of income
generation for municipalities. Private debt
collectors profit from fines and fees assessed on
poor people, facilitated by the state of California.
However, the revenue to counties from collecting
these fines and fees is miniscule; this system only
benefits the private debt collectors.
Findings further showed that:
• Court-ordered debt collected by private
agencies 3 makes up an insignificant
amount of a county’s total revenue. 4 It
ranges from 0.001-0.46%, meaning none
of the studied counties derive even half
of a single percent of their revenue from
the collection of court-ordered debt by
debt collectors.
• No court-ordered debt, nor its collection
practices, are covered under the Fair
Debt Collection Practices Act (FDCPA), a
federal law passed in 1977 to protect
consumers from unfair debt collection
practices. California has its own version
http://www.courts.ca.gov/documents/lr-2017-collectionsdelinquent-court-ordered-debt.pdf; Only 15 counties use
private agencies to collect debt.
4 Total County Revenue/Overall Revenue: Financial
resources collected by a local government to finance
operations and services including, but not limited to,
revenue received from federal government, local
government fines and forfeitures, intergovernmental
(including state and federal sources), licenses, permits, and
franchises, miscellaneous (from the sale of real or personal
property), in-lieu taxes, property taxes, use of money or
property, sales and use taxes, state aid, taxes, transient
lodging taxes, utility user taxes, etc. Retrieved from:
https://bythenumbers.sco.ca.gov/stories/s/guqp-d3wf

3

•

•

•

•

•

of FDCPA, called the Rosenthal Fair Debt
Collection Practices Act (RFDCPA). Like
the FDCPA, the RFDCPA does not cover
court debt. Some of the debt types not
covered by FDCPA and RFDCPA include
traffic fines, fees and charges from
commitment and probation orders,
criminal restitution, or court fine
resulting from an arrest. 5
The process by which debt is collected
varies widely by county and by court,
creating an uneven system of justice
whereby the consequences of courtimposed debt, and the financial burden
of repaying it, largely depend on which
county court system imposed the fine or
fee.
Out of the 17 counties studied, two
counties, San Bernardino and Kern, do
not contract with private debt collectors.
This indicates that it is possible for
counties to collect debt without the use
of private debt collectors.
Private debt collections agencies make
commissions off the debt they collect,
ranging from 12%-18% for newly
delinquent debt 6 to 14.9-25.8% for
delinquent debt over five years old.
Of the 17 counties studied, only one
private collections agency was subject to
a Code of Ethics in their service
agreement.
The majority of counties have no public
information available regarding their
Ability-To-Pay evaluation policies and
procedures, making it difficult to evaluate
their programs and assess whether they
are made available to debtors in an
equitable way.

National Consumer Law Center. (2016, September).
Confronting Criminal Justice Debt: A Guide for Litigation.
Retrieved from http://www.nclc.org/images/pdf/criminaljustice/confronting-criminal-justice-debt-2.pdf

5

Based on these findings, CRC
recommendations include the following:
County-Level Recommendations:
1) Counties should end contracts with
debt collectors.
2) For those counties that do contract
with private debt collectors, courtimposed debt collection practices
should be subject to debt collection
protections outlined in FDCPA and
RFDCPA to ensure debt is collected
fairly. This debt should not be
reported to credit bureaus.
3) Counties should discharge debt
before sending it to private debt
collectors.
Statewide Recommendations:
4) The State of California and County
Courts should increase transparency
about debt collections practices,
contract negotiations for Master
Agreements and Participating
Agreements, and Ability-to-Pay
programs; and institute a public
process for communities to give
feedback.
5) Delinquent debt should not be
transferred to the California Franchise
Tax Board.
6) California should create statewide,
uniform and accessible Ability-to-Pay
evaluations and processes, regardless
of type of court.
Newly Delinquent=Accounts not fully paid 30 days past its
stated due date, or on which an installment payment has not
been paid 30 days past its stated due date.

6

4

THE DISPROPORTIONATE IMPACT OF FINES AND FEES
DEBT IN CALIFORNIA
The California Reinvestment Coalition is a
statewide network of 300 community-based
organizations that work together to build a more
inclusive and fair economy that meets the needs
of low-income communities and communities of
color. For more than 30 years, CRC has helped to
ensure that banks and other corporations
conduct business in a just and equitable manner.
CRC advocates for policies and practices that
promote economic opportunity and prevent
corporate practices that cause financial harm to
historically marginalized communities.
For this report, we were particularly interested in
learning how harmful collection practices of fines
and fees perpetuate a cycle of poverty in
communities of color, particularly in counties
with high percentages of adults of color. This
report considers the processes by which
delinquent court-ordered fines and fees (focusing
on criminal fines and fees) are collected by a
jurisdiction and referred to private debt
collection companies. It also considers the
process by which someone who is unable to pay
is evaluated through an Ability-To-Pay program.

Author calculation, including ages 18 and older.
Information from: Department of Justice. (n.d.). Data Portal.
Retrieved March 20, 2018, from
https://openjustice.doj.ca.gov/data
8 Asante-Muhammad, D., Nieves, E., Collins, C., & Hoxie, J.
(2016, August). The Ever-Growing Gap Without Change,
African-American and Latino Families Won't Match White
Wealth for Centuries. Retrieved from
https://prosperitynow.org/files/resources/The_Ever_Growin
g_Gap-CFED_IPS-Final.pdf
9 Miller, T. R., Lawrence, B. A., Carlson, N. N., Hendrie, D.,
Randall, S., Rockett, I. R., & Spicer, R. S. (2017, January 20).
7

In California, 64.4% of adults
arrested, and therefore subject to
fines and fees, are adults of color. 7
The imposition of these criminal, municipal, and
civil fines and fees disproportionately impact
communities of color due to systemic race and
criminal justice issues that hurt communities of
color, such as higher rates of economic
instability, 8 the over-policing of neighborhoods, 9
and higher traffic stop rates. 10 For example,
67.9% of the probation caseload, and the
relevant fines and fees, in the California
Probation System consists of people of color,
overrepresented by African Americans. 11

Perils of police action: A cautionary tale from US data sets.
Retrieved from
http://injuryprevention.bmj.com/content/injuryprev/23/1/2
7.full.pdf
10 East Bay Community Law Center. (2016, April). Stopped,
Fined, Arrested - Racial Bias in Policing and Traffic Courts in
California. Retrieved from http://ebclc.org/wpcontent/uploads/2016/04/Stopped_Fined_Arrested_BOTRC
A.pdf
11 Nguyen, V., Grattet, R., & Bird, M. (2017, August).
California Probation in the Era of Reform. Retrieved from
http://www.ppic.org/wp-content/uploads/r_0817vnr.pdf

5

“This system perpetuates a cycle
of debt and poverty that
disparately affects people of color;
people of color are
disproportionately represented in
the criminal justice system in
California and this involuntary
debt can affect the building of
intergenerational wealth.”
Theresa Zhen, Staff Attorney, East
Bay Community Law Center
This issue affects not just individuals, but families
as a whole. A study on juvenile probation in
Alameda County found that “a family with an
African American youth serving average
probation conditions is liable for more than twice
the juvenile administrative fees ($3,438) as a
family with a white youth serving average

Kaplan, A., Lavalais, A., Kline, T., Le, J., Draznin-Nagy, R.,
Rodriguez, I., . . . Selbin, J. (2016, March 26). High Pain, No
Gain: How Juvenile Administrative Fees Harm Low-Income
Families in Alameda County, California. Retrieved from
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2738
710
13 Silver-greenberg, J., & Dewan, S. (2018, March 31). When
Bail Feels Less Like Freedom, More Like Extortion. Retrieved
12

probation conditions ($1,637)… Families are
doubly harmed by current practices-their children
are overrepresented within the system, and they
are liable for higher fees because of longer
probation conditions”. 12
Within the civil debt world, regulators continue
to receive complaints in regards to bail laws, even
though California is perceived to have strong
consumer protections in this area. 13 In an analysis
of 100 bail contracts, it was found that “bail bond
agents profit off their poor clientele through late
fees and interest payments, they charge
numerous fees-some of which may not be legal,
they may skirt reporting requirements when
charging extra fees, and discounts were availableto wealthier people.” 14 The collection of these
fees and the little awareness of fee waivers and
alternative payment programs further
exacerbates financial instability within
communities of color, which increases the
inequality of wealth between communities of
color and white communities.

April, from https://www.nytimes.com/2018/03/31/us/bailbonds-extortion.html
14 UCLA School of Law: Criminal Justice Reform Clinic. (2017,
May). The Devil in the Details: Bail Bond Contracts in
California. Retrieved from
https://static.prisonpolicy.org/scans/UCLA_Devil
_in_the_Details.pdf

6
Our research focuses on counties with higher numbers of adults 15 of color 16 than the state’s average. The
counties studied were:
Alameda, Colusa, Fresno, Imperial, Kern, Kings, Los Angeles, Madera, Merced, Monterey, Riverside,
San Benito, San Bernardino, San Joaquin, Santa Clara, and Tulare. San Francisco 17 was included,
even though its proportion of adults of color is less than the state’s proportion.
In these counties, adults of color arrested made up 55% to 83.4% of the total adults arrested. 18

Table 1: Proportion of Adults of Color to Non-Hispanic White Adults in Studied Counties
County
Imperial
Los Angeles
Merced
San Bernardino
Tulare
Fresno
Alameda
Santa Clara
Monterey
Kings
San Joaquin
San Benito
Kern
Madera
Colusa
Riverside
State of CA
San Francisco

Adults Total
117,217
7,071,965
171,586
1,414,191
287,805
628,133
1,152,242
1,325,841
289,832
102,617
471,143
39,524
570,742
101,753
14,408
1,548,431
26,856,280
671,592

Number of Non-Hispanic White
Adults
17,914
2,303,159
63,103
527,350
110,392
243,467
447,938
524,531
114,959
40,847
198,264
17,229
250,422
45,776
6,536
716,542
12,437,054
316,966

Number of Adults of Proportion
Color
99,303
84.7%
4,768,806
67.4%
108,483
63.2%
886,841
62.7%
177,413
61.6%
384,666
61.2%
704,304
61.1%
801,310
60.4%
174,873
60.3%
61,770
60.2%
272,879
57.9%
22,295
56.4%
320,320
56.1%
55,977
55.0%
7,872
54.6%
831,889
53.7%
14,419,226
53.7%
354,626
52.8%

Ages 18 through 85 and older are “adults.” Working age adults were chosen as a proxy for the age when criminal, municipal, and
civil fines and fees would be applied, not considering ability to work. According to author’s calculation and information from the
Department of Finance, the State of California’s estimated proportion of “adults” of color is 53.7%.
16 Adults of Color includes African-Americans, Hispanics, Asians, Native Americans, and anyone who is not categorized, or has not
identified themselves as non-Hispanic whites.
17 The San Francisco municipality is the City and County of San Francisco.
18 Author calculation, including ages 18 and older. Information from: Department of Justice. (n.d.). Data Portal. Retrieved March 20,
2018, from https://openjustice.doj.ca.gov/data
15

7

HOW DEBT COLLECTION OF FINES AND FEES WORKS IN
CALIFORNIA
California ranks 8th among US states in the
number of criminal fees imposed on people. 19

California has a total of 684
criminal justice financial
penalties, 20 of which 597 are
fines 21 and 58 are fees. 22
Base fines and certain surcharges are set in state
law for each criminal offense. State law also gives
counties and courts the authority to levy
additional charges depending on the specific
violation. Additionally, courts, at the discretion of
judges, can reduce the total amount owed by
waiving or reducing certain charges. 23 Counties
can submit for the collection of debts owed for
property taxes, delinquent fines, bail, vehicle
parking penalties, court-ordered payments, and
other permitted debts. 24

The process in which debt is collected by an
agency before being sent to debt collection varies
throughout California’s counties. Courts are
currently the primary administrator of collection
programs in about two-thirds of the state’s
counties. 25 Collection can happen through trial
courts, county agencies, the Franchise Tax Board,
the Department of Motor Vehicles or
Metropolitan Transportation Authority, and
private debt collectors. 26
Counties are required to report on the collection
of court-ordered debt to the Legislature through
the Judicial Council of California, using the
Collections Reporting Template. 27 This report
includes an overview of money collected from
delinquent court-ordered debt within county
governments and their Superior Courts in
California’s 58 counties, and is used to determine
if the counties and courts meet the Judicial
Council’s Best Practices for Collection, which
includes 25 practices. Of greatest relevance to
this research were A) the effectiveness and

Criminal Justice Policy Program at Harvard Law School: 50-State Criminal Justice Debt Reform Builder. (2018). Retrieved from
https://cjdebtreform.org/national-comparison
20 Criminal Justice Policy Program at Harvard Law School. (2018). Fees and Fines. Retrieved from https://cjdebtreform.org/dataexplorer/fines-and-fees?deff[0]=state:89
21 Fines: Financial obligations imposed as a penalty after a criminal conviction or admission of guilt. Criminal Justice Debt Reform
Builder: Definitions and Methodology. (2018). Retrieved from
https://cjdebtreform.org/sites/criminaldebt/themes/debtor/blob/Definitions-for-Web-Tool.pdf
22 Fees (including Surcharges and Supervisory Fees): Financial obligations imposed as a way for jurisdictions to recoup costs of the
“use” of the criminal justice system, including, but not limited to, costs associated with public defenders, GPS monitoring, court
proceedings, imposed as a flat fee or percentage added to a fine to fund a particular government function or a general fund, and/or
user fees that are imposed to recoup the cost of parole or probation supervision., Criminal Justice Debt Reform Builder: Definitions
and Methodology. (2018). Retrieved from https://cjdebtreform.org/sites/criminaldebt/themes/debtor/blob/Definitions-for-WebTool.pdf
23 Legislative Analyst's Office. (2017, February 22). Overview of Criminal Fine and Fee System. Retrieved from
http://www.lao.ca.gov/handouts/crimjust/2017/Fine-and-Fee-Overview-022717.pdf
24 Franchise Tax Board. (2017, May 15). Interagency Intercept Collections Program – Client Participation Basics Webinars. Retrieved
from https://www.ftb.ca.gov/aboutFTB/media/webinars/05162017-Text.pdf
25 Legislative Analyst's Office. (2014, November). Restructuring the Court-Ordered Debt Collection Process. Retrieved from
http://www.lao.ca.gov/reports/2014/criminal-justice/debt-collection/court-ordered-debt-collection-111014.pdf
26Ibid.
27 [Insert link to Collections Reporting Template]
19

8
efficiency of external collection agencies or
companies to which court-ordered debt is
referred to collection, and B) the impact of
financial screening to assess each individual’s
ability to pay prior to processing installment
payment plans and account receivables. 28
County governments and their courts contract
directly with private debt collectors through
Participating Agreements. Our review of these
Participating Agreements indicates several
problematic aspects. For example, private debt
collectors may report unpaid debt to credit
bureaus, potentially affecting peoples’ credit
scores and future opportunities to access credit.
Whether or not counties allow private debt
collection agencies to report outstanding debt
from fines and fees to credit bureaus varies
county-by-county. One county court states:
“Contractor to perform credit reporting only
if/when Court asks Contractor to perform that
task.” Two of the country courts ensure that
“contractor[s] will not report outstanding
[accounts] on behalf of the Court to any credit
history reporting databases (credit bureaus).”
Private debt collectors may also employ skip
tracing 29 and other techniques to locate debtors

28Judicial

Council of California. (2016, June 9). Judicial
Council Approved Collections Best Practices. Retrieved from
http://www.courts.ca.gov/partners/documents/collectbp.pd
f
29 “If a collection agency is seeking data on a debtor to
collect a debt, it may first check some large data brokers for

anywhere within the United States, and may use
Spanish or other languages to do so. Private debt
collectors can also provide staff at public counter
areas to assist the public with accepting
payments, answering questions, and setting up
payment arrangements. This means they are
legally using county buildings or courthouses to
collect on debt, potentially using unfair practices.
For example, there is a bank of telephones in a
San Francisco courthouse that goes directly to
Alliance One, which is contracted with the City
and County of San Francisco to collect on
delinquent debt.
Only one Participating Agreement provides a
Code of Ethics for court employees to the private
debt collector. Although private debt collectors
cannot represent themselves as court employees,
the Code of Ethics they shared promotes
behaving “towards all persons with respect,
courtesy, patience, and responsiveness, acting
always to promote public esteem in the court
system”.
This system perpetuates a cycle of debt and
poverty that disparately affects people of color;
people of color are disproportionately
represented in the criminal justice system in
California and this involuntary debt can affect the
building of intergenerational wealth.

consumer information related to the debtor, such as current
address, phone or employment information to ‘skip trace’
the debtor.” Williams, J. (2016 [Pending]). U.S. Patent No.
US15085267. Washington, DC: U.S. Patent and Trademark
Office.

9

PROFILE OF COUNTY-LEVEL DEBT COLLECTION OF FINES AND FEES
In 2016-2017, in the 17 studied counties, we found that:
• There are 15 counties that contract with private debt collectors. Only two counties, San Bernardino and Kern,
do not contract with a private debt collector.
● 13 of these 15 county governments and/or their courts contract with one private debt collector. Fresno
County & Courts contracts with two private debt collectors and Riverside County & Courts contracts with three.
○ 4 of 15 county governments (those that collect on water bills, property taxes, etc.) contract with one
or more private debt collectors.
○ 14 of 15 county courts contracts with one or more private debt collectors.
● 15 of 15 counties “contract with local, regional, state, or national skip tracing or locator resources or services
to locate delinquent debtors.”
● 15 of 15 counties “attempt telephone contact with delinquent debtors for whom the program has a phone
number to inform them of their delinquent status and payment options.”
● 14 of 15 counties “notify delinquent debtors for whom the program has an address in writing of their
outstanding obligation within 95 days of delinquency.”
● 11 of 15 counties “sends monthly bills or account statements to all delinquent debtors.”
● 10 of 15 counties “use Department of Motor Vehicles information to locate delinquent debtors.”
● 6 of 15 counties “sends delinquent debt to the Franchise Tax Board's Court-Ordered Debt Collections
Program.”
● 5 of 15 counties report that their private debt collection agency is where their majority of their delinquent
debt is initially referred.
● 3 of 15 counties “coordinate with the probation department to locate debtors who may be on formal or
informal probation.”
● 2 of 15 counties “use Employment Development Department employment and wage information to collect
delinquent debt.”
● 2 of 15 counties “establish wage and bank account garnishments where appropriate.”
● 1 of 15 counties “places liens on real property owned by delinquent debtors when appropriate.”

10

REVENUE FROM PRIVATE DEBT COLLECTION OF FINES
AND FEES IS AN INSIGNIFICANT PORTION OF COUNTIES’
BUDGETS
Overall, revenue from court-ordered fines and fees does not make up a significant portion of total county
revenue. In 2016-2017, the amount of all Fines, Forfeitures and Penalties (FFP) revenue either collected by
private debt collectors or directly by counties, ranged from 0.297%-4.22% of overall county revenue.

Table 2: Revenue from FFP Compared to Total County Revenue
County
Total County Revenue (TCR)
Fines, Forfeitures, and
Penalties (FFP) Revenue
Alameda
$2,968,239,000
$36,698,000
Colusa
$57,312,392
$616,683
Fresno
$1,466,927,000
$11,944,000
Imperial
$458,138,000
$5,879,000
Kern
$1,688,744,000
$21,826,000
Kings
$230,037,528
$1,914,646
Los Angeles
$15,268,481,000
$153,014,000
Madera
$239,860,000
$4,865,553
Merced
$455,917,763
$13,726,140
Monterey
$1,070,600,000
$8,978,549
Riverside
$4,300,678,000
$71,196,000
San Benito
$82,992,000
$3,502,470
San Bernardino
$3,344,596,000
$14,326,000
San Francisco
$10,357,120,000
$30,798,000
San Joaquin
$1,475,090,000
$12,694,533
Santa Clara
$5,398,909,000
$55,746,000
Tulare
$758,638,000
$7,517,000

FFP: TCR
1.24%
1.08%
0.81%
1.28%
1.29%
0.83%
1.00%
2.03%
3.01%
0.84%
1.66%
4.22%
0.43%
0.30%
0.86%
1.03%
0.99%

Court-ordered debt collected by private agencies makes up an even less
significant portion of county revenue, ranging from 0.001%-0.46% of the
overall revenue 30 collected by the counties.
Furthermore, fines and fees revenue collected from private agencies varied greatly county by county,
ranging from .002% to 55.25% of counties’ Fines, Forfeitures, and Penalties (FFP) revenue line item.
Overall Revenue: Financial resources collected by a local government to finance operations and services including, but not
limited to, revenue received from federal government, local government fines and forfeitures, intergovernmental (including state
and federal sources), licenses, permits, and franchises, miscellaneous (from the sale of real or personal property), in-lieu taxes,
property taxes, use of money or property, sales and use taxes, state aid, taxes, transient lodging taxes, utility user taxes, etc.
Retrieved from: https://bythenumbers.sco.ca.gov/stories/s/guqp-d3wf

30

11

Table 3: Revenue Collected by Private Debt Collectors Compared to Total FFP Revenue and Total
County Revenue
County
Alameda
Colusa
Fresno
Imperial
Kern
Kings
Los Angeles
Madera
Merced
Monterey
Riverside
San Benito
San
Bernardino
San Francisco
San Joaquin
Santa Clara
Tulare

Total County
Revenue (TCR)
$2,968,239,000
$57,312,392
$1,466,927,000
$458,138,000
$1,688,744,000
$230,037,528
$15,268,481,000
$239,860,000
$455,917,763
$1,070,600,000
$4,300,678,000
$82,992,000
$3,344,596,000

Fines, Forfeitures, and
Penalties Revenue (FFP)
$36,698,000
$616,683
$11,944,000
$5,879,000
$21,826,000
$1,914,646
$153,014,000
$4,865,553
$13,726,140
$8,978,549
$71,196,000
$3,502,470
$14,326,000

Private Agency Gross
Revenue Collected (PA)
$6,241,129
$9,707
$3,765,889
$811,762

$10,357,120,000
$1,475,090,000
$5,398,909,000
$758,638,000

$30,798,000
$12,694,533
$55,746,000
$7,517,000

$3,506,510
$4,987,870
$5,663,901
$1,606,052

$1,057,888
$69,233,129
$356,034
$692,426
$507,598
$4,346,218
$755

PA: FFP
17.01%
1.57%
31.53%
13.81%
0.00%
55.25%
45.25%
7.32%
5.04%
5.65%
6.10%
0.02%
0.00%

PA:
TCR
0.21%
0.02%
0.26%
0.18%
0.00%
0.46%
0.45%
0.15%
0.15%
0.05%
0.10%
0.00%
0.00%

11.39%
39.29%
10.16%
21.37%

0.03%
0.34%
0.10%
0.21%

The harmful, often predatory collection practices employed by private collection agencies combined with
the negligible returns to counties for contracting with these private actors leads to a lose-lose scenario;
vulnerable residents who often are the least able to pay court-imposed fines and fees are subjected to
collection practices that trap them in a cycle of poverty and debt, while counties gain little revenue from
these practices. The only winners in this scenario are the private collections agencies that profit from their
contracts with county court systems.

“Both counties and state-wide governments need to take steps to ensure
that revenue is not being made off the backs of those who can afford it
least. It is heartening to see the progress that has been made in reforming
our criminal justice system, but fines and fees must abolished so that
counties are not looking to raise revenue from those who can afford it
least.”
Aila Ferguson, Legal Fellow at the ACLU of Southern California.

12

Recommendation #1:
Counties should end contracts with private debt collection agencies.
Municipalities can choose to end contracts with
private debt collectors. Instead of using private
debt collectors, existing collection programs
through individual counties and courts can take
on the role of collecting on delinquent debt.
Revenues from increased collections from these
departments can be used to improve processes
such as faster payment processing, offering
alternative ways to pay, and increasing
awareness about Ability-To-Pay programs,
discussed later. Dedicated staff should be
available to help individuals throughout this
process.
County governments and/or courts in Kings, Los
Angeles, Riverside, and Tulare counties do not
collect on debt. 31 This does not release the
debtor from responsibility. California has led
efforts to no longer suspend licenses for unpaid
traffic fines because it doesn't help the state
collect unpaid fines and hurts low-income people
as they can experience job loss or more poverty
from not having a valid license. 32 Additionally,

Based on Collections Reporting Templates from the
"Judicial Council Report to the Legislature: Statewide
Collection of Delinquent Court-Ordered Debt for Fiscal Year
2016–17" requested from Judicial Council pursuant to
California Rules of Court, rule 10.500, “public access to
judicial administrative records.”
32 Bollag, S. (2017, June 29). California to stop suspending
licenses for traffic fines. Retrieved from
31

California recently ended the assessment and
collection of fees charged to parents and
guardians with children in the juvenile justice
system, a policy which disproportionately hurt
communities of color. 33 While there is a debate
regarding relieving people from paying fines or
fees from violent crime, discharging delinquent
court-ordered debt with a history of nonpayment
should be feasible.

REAL LIFE STORY: In January 2018, John Doe
(pseudonym to protect privacy), a legally blind
African American resident of Alameda County,
got his entire bank account wiped clean by a
traffic court debt that AllianceOne (the court’s
private debt collections agency), erroneously
reported to the Franchise Tax Board. Because
his income was solely based on a small amount
of public assistance every month, this bank
levy jeopardized his housing and food security,
and caused a great deal of confusion and
anxiety.

https://www.apnews.com/9723bf702b3d4fb0b11d052229b
26614
33 California Legislative Information. (2017, October 12).
Senate Bill No. 190 CHAPTER 678. Retrieved from
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?
bill_id=201720180SB190

13

CALIFORNIANS WHO OWE FINES AND FEES ARE NOT
PROTECTED FROM ABUSIVE, UNFAIR, OR DECEPTIVE
COLLECTION PROCESSES
Under the Fair Debt Collections Practices Act
(FDCPA), debt collectors are prohibited from
using abusive, unfair, or deceptive practices
towards debtors when collecting on a range of
consumer debt such as credit card debt or
student loan debt. 34 Often debtors are lowincome and at risk for the negative effects of
debt such as depression, anxiety, and stress. 35
Debt collection in general has the second-most
number of complaints in the Consumer Financial
Protection Bureau’s Consumer Complaint
Database. 36
Interestingly, none of the criminal fines and
“nonconsensual” municipal fines that are sent to
private debt collectors are covered by FDCPA.
Traffic fines and other criminal and municipal
fines and fees, 37 are excluded from the term
“debt” within the FDCPA. 38 The reason for this is
that these debts are “involuntary” debts arising
from tickets, fines, or the nonconsensual
imposition of a monetary penalty. 39 This includes
“nonconsensual” municipal fees, fines for
nonpayment for waste collection services,
parking fines, private parking lot fines, fees and
charges from commitment and probation orders,

Federal Trade Commission. (2018, March 13). Debt
Collection. Retrieved from
https://www.consumer.ftc.gov/articles/0149-debt-collection
35 Fitch, C., Mamo, E., & Campion, J. (2014, April). Primary
Care Guidance on Debt and Mental Health. Retrieved from
https://www.rcpsych.ac.uk/pdf/factsheet_debtandmentalhe
alth.pdf
36 Consumer Complaint Database. (n.d.). Retrieved from
https://www.consumerfinance.gov/dataresearch/consumer-complaints/
34

towing and storage charges, homeowners’
association fines, criminal restitution, and court
fines from an arrest. 40 This loophole allows for
private debt collectors contracted with
municipalities through counties and courts to
collect on debt in unfair ways, since they are not
required to follow FDCPA.

REAL LIFE STORY: In March 2018, Virginia H.
submitted a signed statement to the Alameda
County Superior Court indicating that she is a
disabled African American senior living on a
fixed income without the ability to pay court
fees for a traffic violation. After submitting this
statement, the court forwarded her debt to
AllianceOne, which immediately issued her a
Demand for Payment commanding her to pay
the debt in full within 10 days. The notice
warns her if she does not pay in full in 10 days,
that the fees “can be entered as a Judgment
against you by the court” and that her
“account may be referred to the Franchise Tax
Board for involuntary collection.” This has
caused Ms. Hall anxiety and emotional
distress.

Other transactions excluded from FDCPA debt protections
include: Taxes, child and other family support; Shoplifting
civil claims & theft; Claims related to the theft of services or
goods; License fees; Car accidents; Homeowner’s association
non-fee obligations and fines; Employment compensation
claims; Torts; & Other claims.
38 National Consumer Law Center.
39 Gulley v. Markoff & Krasny, 664 F.3d 1073, 1074 (7th Cir.
2011).
40 National Consumer Law Center.
37

14

Recommendation #2:
For those counties that contract with private debt collectors, court-imposed debt collection
practices should be subject to debt collection protections outlined in FDCPA and RFDCPA, to
ensure debt is collected fairly. In addition, this debt should not be reported to credit bureaus.
There must be legislative changes to ensure
that debt collectors have to comply with
FDCPA so that debtors are protected against
unfair, abusive, or deceptive collection. The
regulations include rights such as ability to
dispute a debt, harassment and call
restrictions, prohibiting debt collectors from
contacting employers or other people,
restrictions on credit reporting, and ability to
report complaints. 41

Additional protections would increase
accountability to correctly collect debts and
could supersede items in contracts, such as in
bail bond contracts. Many bail bond
contracts “require the accused to give up
substantial privacy rights without any ability
to opt out of bail bond agents’ invasive
techniques, [in addition to] sacrificing the
privacy rights of friends and family of the
accused.” 42

THE REAL WINNERS: PRIVATE DEBT COLLECTION
AGENCIES
The Participating Agreements also include
commission fee structures that perpetuate
perverse profit incentives for collections.

Commission fees 43 are based on
the length of time the debt has
been delinquent, ranging from
12%-18% for newly delinquent
debt 44 to 14.9-25.8% for
delinquent debt over five years
old.
Office of the Attorney General. (2018, January). Debt
Collectors. Retrieved from
https://oag.ca.gov/consumers/general/debt-collectors#top
42 UCLA School of Law: Criminal Justice Reform Clinic.
43 With No On-Site Staff. Not including restitution-related
debt.
41

Only one private debt collection agency has
a protection built in for the consumer in their
Master Agreement. In this agreement,
“Commission fee is determined by age of
account at date of referral and remains at the
same rate regardless of aging after referral.
This prevents a collection vendor from
allowing accounts to age so that the fee rises
over time.” 45 Commission fees encourage
private debt collectors to collect on debt over
five years old, and to allow debt to age so
that they can collect on it later and receive
higher commission fees.

Newly Delinquent=Accounts not fully paid 30 days past its
stated due date, or on which an installment payment has not
been paid 30 days past its stated due date.
45 Information and contracts obtained from Public Records
Act requests and Judicial Council of California. (n.d.).
Procurement Services: Collections LPA Master Agreements
44

15

Alarmingly, we found that a couple of these
county courts use these private debt
collectors to also collect on Non-Delinquent
Accounts (or on non-delinquent criminal
accounts) and even charged a 9.9%
commission fee. Another startling finding
from one of the county courts was that they
provided a budget to the private debt
collector. They shared that the maximum
budget for commission fees for the collection
service was about $3.6 million for a previous

term. For February 1, 2018 through January
31, 2019, that same county court allocated
$5.3 million for commission fees. While it is
unknown how much was collected in
commission fees by the private debt
collector, this could be a perverse incentive
for private debt collectors to collect on
accounts using any means necessary, in order
to receive the maximum money allocated to
them.

Recommendation #3:
Discharge all debt more than 5 years old.
CRC recommends discharging all court-ordered
fine and fee debts more than five years
delinquent. This would most benefit those who
cannot afford to pay these debts, nor deal with
the consequences from private debt collectors
trying to collect. This would also save money for
counties and their courts, who currently try to
collect debt that is unlikely to be paid. Courtordered debt collection from private agencies is

insignificant to total county revenue, as we will
show in the next section of the report. Private
debt collectors are incentivized (through higher
commissions) to collect on debt over five years
old; this creates more costs for counties and
courts.

HOW COUNTY CONTRACTS WITH PRIVATE DEBT
COLLECTORS ARE AWARDED
Many of the Master Agreements between the
Judicial Council and the “pre-approved” private
debt collectors are set to expire at the end of
December 2018. These master contracts set the
stage for participating agreements for counties.
CRC filed an information request with the Judicial

Council to receive records on contract
negotiations, but were told that they had no
requirement to provide us with records, and that
“all records of and related to contracts with thirdparty vendors are exempt until negotiations have
been completed.” 46

and Amendments (including Amnesty). Retrieved from
http://www.courts.ca.gov/procurementservices.htm

46

Public Records Act requests and Judicial Council of
California. (n.d.). Procurement Services.

16

Recommendation #4:
The State of California and counties should increase transparency about debt collections
practices, contract negotiations with debt collectors for Master Agreements and Participating
Agreements, and Ability-to-Pay programs; and institute a public process for communities to give
feedback.
The details of these negotiations and their
impacts on communities are of interest to the
public. When asked about the Request for
Proposals (RFP) process for these contracts, the
Judicial Council stated, “if an RFP is issued, it will
be provided.” The public has a right to know
about the status of negotiations for Master
Agreements and Participating Agreements, and
to push for community-supported, consumer
protection requirements. CRC calls for a public
process in which communities can give feedback
on the RFP process, details of contracts, and
negotiations with debt collectors.
There is also a lack of information made publically
available about Ability-to-Pay programs.
Information about how many people have
benefitted from ATP evaluations, fines and fees
payment releases, reductions in fines and fees,
alternative payments, and which communities
have benefitted from these policies is important.

Overall data about who is affected by the
collection of fines and fees and for which
infractions, is also needed to see how different
communities are affected by these policies.
Courts declined to provide researchers with data
on infraction/offense type, household size,
income, gender, and race/ethnicity
demographics. Some information was available
for ATP evaluations, however, the cost for this
data was prohibitively expensive (over $500 in
one case). This data is critical in order to
understand if alternative payment options are
being distributed equitably. A solution to this is
for the Judicial Council to add access to this
information through existing reporting
requirements. Making this information available
will make it easier to evaluate to what extent
collection practices are disproportionately
impacting communities of color and low-income
communities.

THE CALIFORNIA FRANCHISE TAX BOARD AS DEBT
COLLECTOR
Debt accounts for the collection of fines and fees
can also be transferred to other government
collection programs. In most cases, this is the
Franchise Tax Board (FTB) Court-Ordered Debt
Collection and Interagency Intercept programs,
where the private debt collector will be
responsible for the associated costs. Additionally,
depending on the Participating Agreement, 2All information in this section from a Participating
Agreement obtained from Public Records Act requests.

47

50% of the net debt collected from FTB transfer
services (or a flat fee of $10) is provided to the
private debt collector as a commission fee.
Participating Agreements between county courts
and private debt collectors include the following
information47 about transferring debt to the
Franchise Tax Board.
• Government Collection Programs

17
o

o

Court Ordered Debt (COD)
Program. “Contractor will refer
Accounts it receives to the FTBCOD Program, liaise with FTB
regarding such Accounts, and
administer such Accounts under
the terms and conditions set
forth in Exhibit A. Statement of
Work, of the Master Agreement.
Upon such a referral to the FTB.
Contractor will cease all
collection work on the account
but will remain responsible for
canceling and adjusting all
accounts, as appropriate and
answering inquiries related to the
FTP from debtors.”
Tax Intercept Program (FTB-TIP).
“In addition to other Services
provided hereunder. Contractor
shall prepare an electronic file
transfer for those accounts
forwarded from Court that are
eligible for the FTB-TIP.
Contractor will forward eligible
Accounts to the FTB, liaise with
FTB regarding such Accounts, and
perform the equivalent
administrative functions
regarding such Accounts as that
set forth in Exhibit A, Statement
of Work, of the Agreement. Upon
such a referral to the FTB,
Contractor will remain
responsible for collecting,
canceling and adjusting allaccounts, as appropriate and

Rodriguez, G., California Taxpayers Association. Re: 2014
Taxpayers’ Bill of Rights Hearing [Letter written December 4,

48

o

answering inquiries related to the
FTP from debtors.”
In addition to the commission
back to private debt collectors,
while “the Court will not pay
Contractor any commission for
these cases, the Court does agree
to pay a 2% transfer fee for cases
transferred and collected to FTB
COD and FTB TIP.” Some county
courts won’t pay commission
fees for accounts transferred to
FTB at all.

This transfer can be problematic. All but one of
the counties studied use FTB collection programs.

According to community
advocates and direct service
providers, the FTB has more
power to affect someone’s
financial life than private agencies,
since they can garnish wages and
withhold tax refunds.
FTB also has a backlog of work which delays
payment processing and can result in debtors
being assessed late payment fees in addition to
what is already owed, or being subject to a
warrant for Failure to Pay. 48

2014 to Steve Sims, Franchise Tax Board]. Retrieved from
http://www.caltax.org/action/2014CalTaxBOR.pdf

18

“The Franchise Tax Board’s ability to garnish wages, intercept taxes and
levy bank accounts is extremely detrimental to individuals’ financial and
emotional health. By virtue of wage garnishments, people’s privacy is
impacted, notifying their jobs of their financial struggles. By virtue of tax
interceptions, people are denied the ability to apply much needed
predicated money towards personal needs and through bank levies
individuals are held to the whims of their bank, who also becomes privy to
their personal struggles but also to those of the FTB. There are very little
safeguards against abuse when these systems go awry.” Brandon Greene,
Staff Attorney, East Bay Community Law Center
Recommendation #5:
Delinquent debt should not be transferred to the California Franchise Tax Board.
Discharging debt should also happen for debt collection through the Franchise Tax Board’s (FTB) CourtOrdered Debt Collection and Interagency Intercept programs. FTB revenue from collecting court-ordered
debt is fairly insignificant. During 2016-2017, the revenue collected from FTB collection programs made up
1.393%-61.931 of an applicable county’s Fines, Forfeitures, and Penalties (FFP) revenue line item. Again, the
FFP revenue for the applicable counties do not make up a significant portion of the total county revenue,
ranging from 0.297%-4.220%. Court-ordered debt collected through FTB collection programs made up an
insignificant amount ranging from 0.006%-0.666% of the total county revenue 49 collected by the counties.

Table 4: Revenue Collected by FTB Programs Compared to FFP Revenue and Total County
Revenue
County
Alameda
Colusa
Fresno
Imperial
Kern

Total County
Revenue (TCR)
$2,968,239,000
$57,312,392
$1,466,927,000
$458,138,000
$1,688,744,000

Fines, Forfeitures,
and Penalties
Revenue (FFP)
$36,698,000
$616,683
$11,944,000
$5,879,000
$21,826,000

FTB Program (FTB) FTB: FFP
Gross Revenue
Collected
$11,016,357 30.02%
$381,916 61.93%
$2,404,607 20.13%
$1,252,728 21.31%
$3,578,386 16.40%

FTB: TCR
0.37%
0.67%
0.16%
0.27%
0.21%

Overall Revenue: Financial resources collected by a local government to finance operations and services including, but not
limited to, revenue received from federal government, local government fines and forfeitures, intergovernmental (including state
and federal sources), licenses, permits, and franchises, miscellaneous (from the sale of real or personal property), in-lieu taxes,
property taxes, use of money or property, sales and use taxes, state aid, taxes, transient lodging taxes, utility user taxes, etc.
Retrieved from: https://bythenumbers.sco.ca.gov/stories/s/guqp-d3wf

49

19
Kings
Los Angeles
Madera
Merced
Monterey
Riverside
San Benito
San Bernardino
San Francisco
San Joaquin
Santa Clara
Tulare

$230,037,528
$15,268,481,000
$239,860,000
$455,917,763
$1,070,600,000
$4,300,678,000
$82,992,000
$3,344,596,000
$10,357,120,000
$1,475,090,000
$5,398,909,000
$758,638,000

$1,914,646
$153,014,000
$4,865,553
$13,726,140
$8,978,549
$71,196,000
$3,502,470
$14,326,000
$30,798,000
$12,694,533
$55,746,000
$7,517,000

$175,478
$2,130,915
$398,217
$980,311
$3,235,179
$1,876,194
$315,032
$213,290
$4,278,410
$8,730,401
$4,572,628

9.17%
1.39%
8.18%
7.14%
36.03%
2.64%
8.99%
1.49%
13.89%
0.00%
15.66%
60.83%

0.08%
0.01%
0.17%
0.22%
0.30%
0.04%
0.38%
0.01%
0.04%
0.00%
0.16%
0.60%

There is more harm done to people through FTB debt collection programs than the amount of revenue a
county obtains from this collection. Discharging debt would alleviate debt-related stress for those who
cannot afford to do so. This is the most favorable, and perhaps least costly option for improving California’s
system for the collection of fines and fees. 50

ABILITY-TO-PAY (ATP) PROGRAMS ARE A STEP FORWARD
FOR CONSUMER RELIEF EFFORTS
Despite a lack of public information about ATP
evaluations, such programs are a step forward in
providing relief to consumers, yet further
improvements are needed. The 1983 Bearden v.
Georgia federal ruling holds that a judge must
first consider whether the defendant has the
ability to pay prior to incarcerating them for
failure to pay, in an effort to prohibit jailing poor
people who cannot pay the fines and fees
assessed to them. “When possible and
appropriate, base fine and fee amounts should be
based on an individual’s ability to pay, to ensure
consequences are equitable”. 51

ATP evaluations should determine someone’s
ability to pay the fines and fees imposed on them
through evaluating their income and assets. This
would lead to the “establishing of payment plans,
providing payment alternatives, enforcing courtordered financial obligations, and identifying
uncollectible debts”. 52 For example, the San
Francisco County Superior Courts and the San
Francisco Municipal Transportation Agency are
implementing ATP processes that offer discounts
and reductions to citations imposed on San
Franciscans with incomes at or below 200% of the
Federal Poverty Line (FPL) or those who receive
public benefits through programs like the

Legislative Analyst's Office. (2016, January 5). Improving California’s Criminal Fine and Fee System. Retrieved from
http://www.lao.ca.gov/reports/2016/3322/criminal-fine-and-fee-system-010516.pdf
51 The Financial Justice Project. (2017, May). SAN FRANCISCO FINES & FEES TASK FORCE: Initial Findings and Recommendations.
Retrieved from http://sftreasurer.org/sites/default/files/SF Fines & Fees Task Force Initial Findings and Recommendations May
2017.pdf
52 Legislative Analyst's Office. (2014, November). Restructuring the Court-Ordered Debt Collection Process.
50

20
Supplemental Nutrition Assistance Program
(SNAP). 53

Although Bearden v. Georgia set a
precedent for the right to an
assessment, ATP programs vary
across states, counties, and even
between courts in the same
county.
While standards exist, there are no set guidelines
for such evaluations. In July 2017, California
established a Rule of Courts whereby courts are
required to provide notice to defendants about
ATP and have outlined a procedure to determine
ATP for traffic violations only. 54 To be considered
for an ATP evaluation, the defendant has to
appear before a judge before an evaluation of
their income is processed. After assessing the
individual’s ability to pay, the court has the
option to reduce a defendant’s fines or fees or

The Financial Justice Project. (2017, October 10). Progress
Update Memorandum. Retrieved from
http://sftreasurer.org/sites/default/files/Six month Task
Force update 2017.10.11.pdf
54 Information in this paragraph from California Rules of
Court. (2017, July 1). Rule 4.335. Ability-to-pay
determinations for infraction offenses. Retrieved from
http://www.courts.ca.gov/cms/rules/index.cfm?title=four&li
nkid=rule4_335
53

provide alternative forms of payment. These
include implementing a payment plan, requiring
community service in lieu of payment, or
suspending the fine. However, policies,
procedures, and forms vary across county courts.
Only some counties have staff assigned to review
ATP requests prior to a judge, which increases
capacity for evaluating people’s ability to pay.
More importantly there are no clear guidelines
for how evaluations should be conducted.
Anecdotal evidence shows that people have had
to negotiate directly with county officials to
establish and agree upon the terms of a payment
plan. Often, such negotiations are not written
down, meaning that debtors cannot hold debt
collectors to the agreed-upon plan. Negotiating
without legal representation can be difficult,
especially considering racial 55 and gender 56 biases
against communities of color and women in
negotiation, as well as possible language barriers.

Kubota, J.T., Li, J. Bar-David, E., Banaji, M.R., & Phelps, E.A.
(2013). The Price of Racial Bias: Intergroup Negotiations in
the Ultimatum Game. Psychological Science, 24 (12), 24982504. http://doi.org/10.1177/0956797613496435
56 Busse, M., Israeli, A., & Zettelmeyer, F. (2013). Repairing
the Damage: The Effect of Price Expectations on Auto-Repair
Price Quotes. Journal of Marketing Research, 54(1), 75-95.
Doi:10.3386/w19154
55

21
ATP Process Example 57
A process document in the Appendix shows the complexity of what can happen when someone requests
an ATP evaluation. There are a number of outcomes from this process; the graphic below shows a
simplified version:

58

At any of these stages if the person FTA/FTP, they
can be sent to debt collection. Of courts in the 17
studied counties:
• All “impose a civil assessment for failure
to appear on infraction cases.”
• 16 of 17 “impose a civil assessment for
failure to pay on infraction cases.”

•
•

16 of 17 “impose a civil assessment for
failure to pay on misdemeanor cases.”
10 of 17 “impose a civil assessment for
failure to pay on felony cases.”

Process according to Judicial Council of California, legal, and community organizations.
A judge can also be a Judicial Office or a Court Commissioner. A clerk can also be a Legal Clerk, Clerk Staff, Court Collector, Court
Specialist, Courtroom Assistant, or Enhanced Collections Officer.

57
58

22
Our research revealed a number of concerns
about the process of requesting an ATP
evaluation:
Change of Address: Low-income communities
often go through unpredictable address changes
due to job loss, eviction, changes in household
size, rising housing cost, or prioritization of other
expenses, such as medical payments brought
about by illness. 59 Sending a notice of
nonpayment and stating that one can request
ATP evaluations or fee waivers may not reach
community members who have frequent changes
of address. However, those charged with fines
and fees should be given the option to request an
ATP evaluation and citations should have explicit
information on them about the ATP evaluation
process.
Court’s Limited Capacity to Conduct ATP
Evaluations: Few counties and courts have
dedicated staff members in roles conducting full
financial capability evaluations. This means that
judges, with already large caseloads, cannot
dedicate enough time to comprehensively
evaluate someone’s inability-to-pay or even the
accuracy of the amount owed. For example, in
terms of bail, “instead of performing an
independent analysis to determine the amount of
bail required to ensure compliance, many courts
simply require payment of the full judgement
owed.” 60
Barriers to Requesting an ATP Evaluation:
Explanations have been offered about low takeup rates for ATP programs such as informational
barriers like eligibility requirements, transaction
American Civil Liberties Union. (2018, February 23). A
Pound of Flesh: The Criminalization of Private Debt.
Retrieved from https://www.aclu.org/report/pound-fleshcriminalization-private-debt
60 Ibid.
61 Palfrey, Q. (2017, July 24). Getting Public Benefits to the
People Who Need Them. Retrieved from
http://www.governing.com/gov-institute/voices/col59

costs associated with enrollment like onerous
documentation collection, and the stigma
associated with participation (which could be a
form of a transaction cost). 61 If higher take-up of
ATP programs is the goal, then removing barriers
like having to appear in person before a court
during the arrear process would be beneficial. For
example, the San Joaquin Court has attributed
their increase in collections to the
“communication of outstanding fines and fees to
our customers, coupled with the Court's typical
installment plans, the ability for customers to
reappear before the Bench to discuss reasonable
methods of satisfying delinquent debt and the
additional revenue collected through the
Amnesty/Reinstatement programs”. 62
Problematic Alternatives to Payment: There has
been concern among stakeholders about
community service as an alternative form of
“payment” in lieu of monetary payment of fines
or fees. Considerations include accommodations
for lactating participants, 63 people with
disabilities, people experiencing homelessness,
and those with caregiving responsibilities. A
potential solution proposed for the homeless
community, introduced through San Diego’s
Homeless Court Program, gives “credit for time
served for participants that accomplish shelter
support activities such as life skills, chemical
dependency or AA/NA meetings, computer and
literacy classes, training or searching for
employment, medical care (physical and mental),
and counseling.” 64

improving-low-take-up-rates-benefit-programs-earnedincome-tax-credit.html
62 Information obtained from Public Records Act requests
63 Letter from ACLU of Northern California to Merced County
Probation Office regarding Lactation Accommodations
64 San Diego Homeless Court Program (HCP). (2018). Home |
Homeless Court Program. Retrieved from
https://www.homelesscourtprogram.org/

23
ATP Policies and Procedures 65
Judicial Council collection best practices call for
the inclusion of “financial screening to assess
each individual’s ability to pay prior to processing
installment payment plans and account
receivables” for county courts, and reports claim
that all but two of the studied counties follow
this practice. 66 Yet, there are county
governments or county courts without
responsive records regarding policies and
procedures. For the 12 county courts that do
have supporting documentation, processes
regarding ATP evaluations seem to happen
mostly through fee waiver templates provided by
the Judicial Council. Furthermore, the majority of
these waivers, and therefore evaluations for ATP,
are only applicable for traffic infractions. 67
• Initial reviewers vary from county
collections officers, legal clerks, court
collectors, and judges/court
commissioners.
• Letters are sent regarding the denial or
approval of alternatives of full payment
of fines or fees after an ATP evaluation;
given that low-income individuals tend to
have frequent changes of address, this
method of communication can be
ineffective.
• Notice times vary between five days to
four weeks. Often along with the notices,
requestors have only five to 10 days to go
to a hearing to provide supporting
documents or provide verbal
explanations for the requests. The time

Information obtained from documents provided through
Public Records Act requests for 12 county courts
66 Judicial Council of California. (2016, June 9). Judicial
Council Approved Collections Best Practices.
65

•

•

•

and date of the hearing is determined by
the court and imposed on a requestor.
This makes it difficult for people to take
off work, arrange childcare, and find
transportation.
If someone is denied alternatives to full
payment due at once, only 2 of 12 county
courts make it clear on their forms that
another request can be filed.
o In some cases, full payment is
due within 10 days of the denial
letter. If alternatives are denied
at a hearing, full payment is due
15 days from when a denial letter
was mailed or 15 days from the
date the judge orders the first
payment paid.
4 of 12 county court forms make it clear
on their forms that an ATP evaluation can
be requested at any stage of appellate
and trial proceeding. Only one county
court makes it clear that this is available
even if you are sent to collections.
Fees for evaluations can include a $40-50
payment plan set-up fee, a $50 additional
administrative fee for a subsequent
financial evaluation, or a $300 civil
assessment if a person fails to pay.

It is often dangerously unclear when these debts
are sent to private debt collection agencies upon
failure to pay. Some county evaluation forms
share a timeline but most do not.

California Rules of Court. (2017, July 1). Rule 4.335. Abilityto-pay determinations for infraction offenses. Retrieved
from
http://www.courts.ca.gov/cms/rules/index.cfm?title=four&li
nkid=rule4_335

67

24

Recommendation #6:
California should create statewide, uniform and accessible Ability-to-Pay evaluations and
processes, regardless of type of court.
Counties vary in how they assess Ability-to-Pay
and how they interpret those results. ATP
evaluation forms or waivers ask for different
sources of income, assets, and expense
statements. Only a few counties have a space for
applicants to explain emergency expenses. These
variations can lead to vastly different results for
the same person in assessing their economic
situation.
CRC advocates for a uniform ATP evaluation for
counties and courts throughout California. Such
an evaluation should consider regional cost of
living and all other debt the individual owes. This
would allow for proper evaluation of an
individual’s economic situation, which would be
used to provide accurate fine or fee reductions,
alternative payment methods, or a payment plan.
Harvard Law School’s Criminal Justice Policy
Program also recommends prohibiting additional
interest or other costs incurred during
incarceration and making hardship deferments
available for times of economic hardship. 68
Ability-to-Pay hearings must be more accessible.
Availing of ATP evaluations requires knowing
about the opportunity and appearing at a hearing
or sentencing to request it. Transportation,
childcare, medical, or immigration barriers may
deter people from appearing. They may opt to
pay even if they cannot afford it, or not pay at all.
To make ATP programs more accessible,

Criminal Justice Policy Program at Harvard Law School.
(2016, September). Confronting Criminal Justice Debt: A
Guide for Policy Reform. Retrieved from
http://cjpp.law.harvard.edu/assets/Confronting-CrimJustice-Debt-Guide-to-Policy-Reform-FINAL.pdf

68

individuals should be able to request an ATP
evaluation during fining and prior to arraignment.
Individuals may be asked to attend an eligibility
hearing with only 10 days’ notice or asked to
gather ATP documentation that can be difficult to
access, such as income verifications, public
benefit verifications, paystubs, or letters from
employers. Systems that require online log-ins to
access these documents can also present a
barrier to those without technical skills or access.
Fee waiver processes need to address these
barriers and make it easier for those who are
eligible to access them.
One impactful way to increase enrollment in ATP
programs is to provide information and
assistance in applying, not just information about
the program. 69 ATP evaluations should occur at
the beginning of the sentencing process, even as
early as the receipt of a ticket or notice of
infraction. Defendants should then be able to
immediately get application assistance from a
clerk or financial hearing officer. It also should
also be better publicized that people may request
an ATP determination at any time, even after
their case has been referred to collections. 70 Such
publicizing should happen online, through
posters in court buildings, and in other ways that
are likely to reach people where they are.
Other process improvements can break down
barriers within the collection system. For
example, Alameda County’s probation
Finkelstein, A., & Notowidigdo, M. (2018, February). SNAP
Take-Up Evaluation. Retrieved from
https://www.povertyactionlab.org/evaluation/snap-takeevaluation
70 Judicial Branch of California. (2018). Payment of Bail /
Fines. Retrieved from http://www.courts.ca.gov/9581.htm
69

25
department only has jurisdiction over fines and
fees debt while probation files are active. In the
case of delinquency, cases are closed and sent to
collection, meaning that the court cannot
conduct a new ATP assessment for someone
whose financial circumstances has changed or
who has only recently decided to apply for an
assessment.

These recommendations are consistent with
those put forth by the “Back on the Road”
coalition to “create a statewide ability to pay
process in traffic courts that makes fines more
equitable and payable for Californians who are
low income… when fines were adjusted to
account for ability to pay, more people paid and
the courts collected more total revenue.” 71

RECOMMENDATIONS
Our research into fines and fees debt creation
and collection in California has shown us the
urgency of reforming the system. This debt and
the means in which private debt collectors collect
upon it causes financial insecurity and income
inequity for low-income communities and
communities of color. Such policies don’t just
affect communities today; they have an effect on
intergenerational wealth-building.
It is clear that these policies are low-gain for
counties. In this system, the ones who benefit are
the private debt collectors, who are incentivized
by perverse profit incentives, and are not subject
to fair debt collection practices.
California prides itself on its remarkable ability to
approach long-standing problems with innovative
approaches to problem-solving. This is no less
true in the area of criminal justice reform.

Throughout this research process, we have seen
counties and municipalities taking bold and
creative steps to address some of the most
egregious aspects of what’s broken with the
current system of fines and fees, and the
collection of court-imposed debt.
We recognize that not all of our
recommendations can be implemented right
away: each one is designed to address a specific
problem within the system that will benefit those
most at risk from the harms of court-ordered
debt and its collection. For reform to be
successful at both the county and statewide level,
additional information should be uncovered and
shared. Transparency and public negotiations are
a critical piece of the democratic process.

ACKNOWLEDGEMENTS
CRC would like to thank the following organizations for their assistance on this report, and whose shoulders
we stand on as we embark on this work: ACLU of Southern California, East Bay Community Law Center,
Financial Justice Project/San Francisco Office of the Treasurer & Tax Collector, Lawyers’ Committee for Civil
Rights of the San Francisco Bay Area, Legal Services for Prisoners with Children, Policy Advocacy Clinic/UC
Berkeley School of Law, Public Good Law Center, Western Center on Law and Poverty.
Lawyers’ Committee for Civil Rights of the San Francisco
Bay Area.
71

APPENDIX
Contract examples for GC Services, a collections agency, can be found here:
Master Agreement between the Judicial Council and GC Services for the state: https://bit.ly/2IJ6lio
Participating Agreement between GC Services and Merced County: https://bit.ly/2IY5zxD