Graduating Economic Sanctions According to Ability to Pay

This article focuses on a potential reform with increasing bipartisan support: the graduation of economic sanctions according to a person’s financial circumstances, also known as “day fines” or “means-adjusted fines.” While much attention has been paid to the back-end of the justice system, and particularly limitations on punitive responses for failure to pay fines and fees due to poverty, graduated economic sanctions address the problem of fines and fees from the front-end.

The article explores several key considerations essential to designing a day fines system, relying heavily on largely-forgotten day-fine pilot programs conducted in seven geographically, demographically, and politically diverse jurisdictions in the late 1980s and early 1990s by the Vera Institute and the National Institute for Justice (among other organizations).

A day-fine is calculated by assigning a numeric penalty unit to each offense based on its seriousness. The penalty unit is then multiplied by the defendant’s adjusted daily income to determine the day-fine amount. The result is an economic sanction adjusted to offense seriousness and simultaneously graduated to the defendant’s financial condition. This article mines the historical record of American day-fines pilot programs—complemented by recent interviews with people involved in the design and implementation of the pilots. For perspective on the design of graduating economic sanctions, Colgan includes research on the use of means-adjustment in the consumer bankruptcy, tax, and public benefits contexts. Colgan’s research provides evidence that a properly designed and implemented system for means adjusted sanctions is consistent with efficient court administration, revenue generation, and equality in sentencing.

You can read the full article here.

Key Findings

• Fines and fees have become increasingly commonplace across America, and because they bring in revenue, a wide range of stakeholders have a financial interest in maintaining the status quo.
• Day fines can stabilize, and perhaps even improve revenue intake, while also leading to reduced expenditures overall.
• Day fines reduce the number of delinquent accounts and related expenditures.
• Day fines can reduce crime (and therefore reduce overall criminal justice costs) by reducing recidivism and avoiding the criminogenic effects of flat fines.
• Studies show that defendants accurately self-report their income—and, if error is present, it’s more likely that a defendant will over-report their income.

Recommendations

• Courts should avoid speculation about a defendant’s income and determine ability to pay solely based on available evidence.
• A well-designed system should be flexible enough to allow for departure from standard formulas in the subset of cases where there is evidence that the defendant’s actual ability to pay is not adequately captured through standardization.
• A day fines system should apply to fees as well as fines, so that the entire package of monetary sanctions can be calibrated according to the severity of the offense and the defendant’s ability to pay.
• To avoid punishing family members of defendants, lawmakers can exclude from ability to pay determinations resources that are intended to promote societal benefits, such as education and the support and care of people with disabilities.