Budget woes prompt 7 state courts to reduce operations

First the cuts, then the closures.

In recent weeks, courts across the state announced reduced hours and closure days because of budget constraints. The Judicial Council website shows seven counties have posted notices of reduced services for a 60-day public comment period, with many of the proposed changes soon set to go into effect.

On Tuesday, the Riverside County Superior Court announced it intends to close every third Friday through the end of the fiscal year next June 30. The changes come months after the Judicial Council ordered most courts in the state to shut down because of the threat of COVID-19. For the same reason, Gov. Gavin Newsom shut down most of the state's economic activity and blew a massive hole in the state budget.

"Due to the State of California's $54 billion deficit as a result of the COVID-19 pandemic, the Riverside Superior Court will experience a revenue shortfall in Fiscal Year 2020/2021 of $12 million," stated a public notice issued by the court. It went on to say, "Closing courthouses, freezing staff positions and reducing operating costs ... will not be enough to cover the anticipated shortfall."

"We've dipped into the playbook we had during the Great Recession," said Riverside County Assistant Presiding Judge John M. Monterosso.

For instance, he said, about 80% of the court's budget goes to personnel costs. This influenced the decision to shut down all operations for a day at a time, Monterosso said, because it is easier to manage from a personnel perspective. Others learned similar lessons during the last downturn.

"In subsequent fiscal years, we found that just closing the entire courthouse down was easier for us to manage as far as staffing," said Robert Sherman, assistant court executive officer for Ventura County.

Improvements in remote technologies in recent years have lessened the workload of the clerk's office, allowing it to cut hours, said Orange County Superior Court spokesman Kostas Kalaitzidis.

"The impact to the public is not as great as such a cutback would have been prior to electronic filing," said Kalaitzidis.

Santa Clara County Superior Court spokesman Benjamin T. Rada said his court learned to act preemptively, with reduced hours and some courtroom closures.

"Fairly early on we recognized the issues that our court would be facing as far as budget constraints," Rada said.

But the current situation could be worse than the Great Recession. The pandemic created additional costs, Judge Monterosso in Riverside said, including for protective equipment and barriers. The monthslong court shutdowns also created a backlog of cases.

"I think there is a dark cloud hanging over the court system in California," said Gerald L. Sauer, a partner with Sauer & Wagner LLP in Los Angeles.

Sauer cited the backlog of 7,000 cases identified by Los Angeles County Superior Court Presiding Judge Kevin C. Brazile -- a number that is now a month out of date.

"What I've learned is that the game plan is to try to recruit civil judges to handle the criminal trials as they get going," Sauer said. "Anyone who is practicing in civil litigation these days has to now recognize that the ability to go to trial in a timely fashion is not going to happen."

Lawmakers designed the state budget so courts could receive additional money later if more support came from the federal government. Those hopes took a hit on Tuesday when President Donald Trump tweeted he was suspending talks with Democrats in Congress over another stimulus package.

"We are one of very few large-sized courts in the state that are not planning to furlough, lay off or close court business this FY for budget reasons," said Sacramento County Superior Court spokeswoman Kim Pedersen by email.

Pedersen added, "We understand that the Governor intends to review the trial courts' current year budget in January, so it is possible that we may have to take another hit. ... We have graver concerns about the next budget year."

If there are any winners in this situation, its arbitration and mediation companies -- some of whom are explicitly citing the courts backlog in their marketing. For instance, ADR Services Inc. recently posted an essay on its website saying the company offers "antidotes to the COVID-19 caused delays."

"Most civil cases, long ready for trial, will not even receive potential trial dates until next year, with their trials tentatively set well into 2021 and in 2022," wrote retired Los Angeles County Superior Court Judge Allan J. Goodman, now a neutral with the company.

Sauer said his practice is doing more mediations and fewer trials -- and it appears many other attorneys are in the same situation.

"Your top mediators already are booked out towards the end of the year, and you've got mediators who would [normally] have a lot of dates who don't have very many," he said.

Rosemarie C. Drohan, executive vice president of business development with Judicate West, said her company's business is down compared to last year. But the private judging and mediation business is up 30% since the pandemic began, she added, driven in part by an influx of civil rights and defamation cases.

For the past three months, Drohan said, the mediation side has also been booking a lot more business, in part because the civil courts backlog has become more obvious. Her company could quickly ramp up remote technology offerings, she added.

Kimberly Taylor, senior vice president with JAMS, said that company dropped by as much as 40% in March and April. But by July and August, she said, it was back "up above 2019 levels." She said litigants have grown more comfortable with remote technology -- and more pessimistic about the courts.

"Once they became accustomed to it and realized it was effective and there were actually benefits to not traveling, to ease of scheduling, that started to drive more participation," Taylor said. "And people realized we're not going back to quote-unquote 'normal' anytime soon."