CS FOR SENATE BILL NO. 100(JUD) "An Act relating to the payment by indigent persons for legal services and related costs." This was the first hearing on this bill in the Senate Finance Committee. DOUG WOOLIVER, Administrative Attorney, Alaska Court System testified that the bill was introduced at the request of the Alaska Court System. He stated the bill amends the Public Defender reimbursement statutes by requiring those who receive public defender services repay the State for at least a portion of that representation. He noted that under current law, only those convicted of a crime are subject to the repayment provision. This bill would expand the law to require any individual receiving counsel at the State's expense to contribute to the cost of the representation whether they are convicted or not. He pointed out this provision is similar to the situation of an individual obtaining private counsel who is also required to pay the cost of the defense regardless of the outcome. Senator Sean Parnell interrupted posing a scenario of being sued as a private party in a civil matter where the plaintiff lost the case. He asked if, under this bill, he could then seek to recover from the plaintiff. Mr. Wooliver responded that public defenders are not appointed in such civil cases. He clarified that the cases addressed in this legislation are criminal and delinquency cases. Senator Sean Parnell wanted to know if the State brought a "bad case" against an individual, that individual would then be required to reimburse the Public Defenders' Agency (PDA) for their defense under the proposed statute, rather than having the opportunity to recover the defense costs from the state. Mr. Wooliver answered the current system is the same, if someone is charged with a crime, has enough money to hire their own defense counsel and is found innocent that individual is not reimbursed by the State for the cost of their defense. Mr. Wooliver reiterated that this bill provides that when an individual receives benefits from a publicly funded defense counsel, that individual will repay the defense counsel, whether they plead guilty, are convicted or the State defers prosecution. Mr. Wooliver continued qualifying that many individuals who receive public defender services do not have the funds to pay for private attorneys. However, he stated that most individuals have the ability to pay for a portion of their defense or will have that ability over time. This was not the first time this bill has been before the Legislature, Mr. Wooliver told the Committee. The Alaska Court System requested this change in 1993 along with some other changes, he noted. However, he pointed out, the portion of the resulting bill addressing repayment of public defender costs was eliminated before the legislation was adopted. Mr. Wooliver testified that the Division of Legislative Budget and Audit, during a subsequent audit of the PDA made the same request. He quoted the audit report recommending that, "the State statute and court rules be amended to assess judgement against public council defendants not on the basis of if convicted, but rather on the mere fact that services were provided." He noted that the Alaska Court System had done its part in making the necessary court rule changes, but stressed that the legislature needs to make statutory changes before the repayment requirements can be implemented. Mr. Wooliver asserted that although this type of repayment program makes both indigent and non-indigent individuals liable for defense costs, there are significant differences. [TAPE MALFUNCTION] Mr. Wooliver continued detailing the repayment requirements for indigent defendants. One difference, he explained, is that indigent defendants would only have to repay a portion of the costs of their defense subject to schedules found in Criminal Rule 39 and Appellate Rule 209. Furthermore, he pointed out, if repayment would create a financial hardship, the Court can reduce, remit or defer payment or establish a payment plan. He assured the Committee that the cost of the Criminal Rule 39-repayment provision would not be ruined by the practice of alternate payment plans. He noted that the repayment system becomes a civil judgement and therefore protected by the Alaska Exemptions Act. Because of these protections, he avowed SB 100 would not drive poorer individuals further into poverty, but rather it would allow the State to recover a portion of defense costs from those who have an ability to pay. Mr. Wooliver noted that the Senate Judiciary Committee had made several amendments to SB 100; including adding Section 1 to the bill, which restricts the right of an indigent person to be represented by appointed counsel to the level and extent required by the US and state constitutions. Additionally, he stated the Senate Judiciary Committee "made mandatory entry of a judgement for repayment." He explained that under current statutes, the Court has the discretion whether or not to enter a judgement. The Senate Judiciary Committee also deleted the provision in the bill that allows for a stay of the judgement pending an appeal. Mr. Wooliver pointed out that the deleted language is no longer necessary since the legislation requires repayment regardless of a guilty or not guilty verdict. Mr. Wooliver stated that the Senate Judiciary version of the bill clarifies the language relating to the court's discretion on repayment, by stating "only the unpaid portion of a judgement can be reduced, remitted or deferred." A section of the bill was also deleted in the committee substitute, according to Mr. Wooliver, that had allowed the court to remit or reduce the balance owed on a judgement or change the method of payment that would impose a manifest hardship. However, he noted the provision remains that allows an individual to petition the court in times of hardship for a reduction of payment. Amendment #1: This amendment adds a new section to AS 18.85.120 to read: (e) Judgements entered under (c) of this section shall be imposed pursuant to trial and appellate court schedules adopted by the supreme court in consultation with the Public Defender Agency and the Office of Public Advocacy. The schedules shall be reviewed at least biannually and, when appropriate, adjusted to reflect changes in the cost of representation. The trial court schedule shall include provisions to impose additional costs in cases where paid expert witnesses are called on behalf of the defendant. Senator Dave Donley moved for adoption. Co-Chair John Torgerson objected for purpose of discussion. Co-Chair John Torgerson referred to a letter dated March 16, 1999 addressed to Senator Robin Taylor from Mr. Wooliver (copy on file) that answered some questions raised by the Senate Judiciary Committee. The first question reads, "Are the Criminal Rule 39 fees for the repayment of public defender representation in addition to other costs such as travel?" The letter replies, "No. If a court enters a civil judgement against a person to pay for defense costs, that judgement is the full extent of his or her liability for that representation. No additional fees are added for travel or other expenses." The second question answered in the letter asks, "When were the Criminal Rule 39 fees last amended?" The response is, "The fees were adopted in 1992 and have not been amended." Co-Chair John Torgerson pointed out that this amendment directs the courts to review the fee schedules and biannually adjust the rates for charge-backs based on consultation with the PDA and the Office of Public Advocacy (OPA). Co-Chair John Torgerson noted that the current rates are seven years old and he felt the rates should remain current with the amount budgeted to provide the services. He added that the amendment also directs the courts to include the costs paid for expert witnesses in the balance due. Currently, he stated, the state covers the entire cost of expert witnesses for the defense. Co-Chair John Torgerson did not include the matter of travel cost reimbursement in the amendment. He said this is because he was advised that if reimbursement were required for travel costs, there could be a conflict with the equal protection rights of those who had to travel farther distances. Mr. Wooliver concurred with the comments on Amendment #1 given by Co-Chair John Torgerson. He restated the provision requiring the court to biannually review the fee schedule and to make necessary revisions to reflect the actual costs incurred by the PDA and the OPA. Mr. Wooliver explained when the cost repayment rules were initially adopted the fee schedule was based on the projected cost rather than the actual costs. The original rules also took into account that most of the repayment funds came from the Permanent Fund dividend, according to Mr. Wooliver. The revised statute will require the court to take into account extra-ordinary costs for expert witnesses. Co-Chair John Torgerson commented that the bill drafter had some concerns relating to the wording of the amendment. Co- Chair John Torgerson explained that the state statutes have a different interpretation of the court's fee schedules and therefore, if the amendment is adopted, the drafter should be given latitude to clean up language while staying within the intent. Senator Dave Donley moved to conceptually amend the motion to allow the bill drafter to conform the language of the amendment to existing statute and the court schedules. Without objection Amendment #1 as conceptually AMENDED was ADOPTED. Senator Sean Parnell asked how the repayment requirements affect court-ordered restitution. He wanted to know what priority is given to the judgement for attorney fees and if restitution is given a lower priority. He referred to the garnishment of Permanent Fund dividends. Mr. Wooliver replied that public defender costs is sixth on the debt repayment priority list using the Permanent Fund dividend. He explained that the public defender costs are considered a debt owed to the State Of Alaska. Child Support, restitution, college loans and court fines are some of the debts that have a higher priority, according to Mr. Wooliver. BARBARA BRINK, Director, Public Defender Agency, Department of Administration testified via teleconference from Anchorage. Her comments focused on page 1 lines 12 and 13 of the committee substitute, that changes the level of representation required by the PDA. She stated that existing statute requires public defenders to perform their duties at the level and to the extent as an individual could expect who retains private council. The language adopted in the Senate Judiciary committee substitute states that representation by a public defender must be provided, ".at the level and to the extent required under the United States Constitution and the Constitution of the State Of Alaska." She wanted to make sure there was no misperception of this change. She did not want this Committee or any other legislature to think this language change will reduce the level of service the PDA is required to give and that consequent budget needs will decrease. She stressed that the PDA duties are constitutionally defined and she emphasized that the state definition of the effective assistance of council is no different than the federal definition. In her opinion, the main point of the constitutional right to council is so that as a nation, and Alaska as a state, does not create a two-tiered system of justice - one justice system for the rich and one system for the poor. She asserted, "The duties and obligations of a lawyer to ethically, zealously and effectively represent their client don't depend on whether they are retained or appointed." She referred to a letter she sent on March 19, 1999 (copy not on file) and said she would not repeat the comments she made in that letter. DIANE WENDLANT, Assistant Attorney General, Collections and Support, Civil Division, Department of Law testified via teleconference from Anchorage that her section of the department is responsible for collecting the repayment fees. Co-Chair John Torgerson noted that with the adoption of Amendment #1, changes will need to be made to the Department of Law fiscal note. He anticipated that the biannual revision of the fee schedule and the reimbursement for expert witnesses would increase the revenue generated. Ms. Wendlant agreed there would be an increase but she could not speculate on the exact amount. Senator Dave Donley asked Ms. Wendlant to provide him with suggestions on how to increase collections, whether through statutory changes, or other changes to make the collection process easier for the department. Senator Sean Parnell was troubled by the underlying policy allowing a party to bring action against another party and even if the first party fails to win, the second party must bear the cost of defense. He noted that in civil proceedings, a prevailing defendant is allowed to recover a portion of the attorney fees. He understood that the criminal system is different but he wanted to know why the state is allowed to bring a criminal action against someone and that citizen must bear the costs if he or she acquitted or the charges are dropped. Mr. Wooliver responded that the costs the defendants are bearing are the cost of the services provided by the State. He noted that defendants who hire an attorney have to pay for the services provided by the private council as well. Senator Sean Parnell pointed out that in the case of public defenders, the state brought the charges and the state is charging for defense against those charges. He qualified that in America, citizens pay for services, but argued that citizens are also allowed to recover a portion of attorney fees in civil cases when there is a failure to convict. He wanted to know why this wasn't practiced in criminal cases as well as civil cases. Mr. Wooliver replied that the legislature could make a policy decision to not charge those defendants who are not convicted. He pointed out that the majority of the cases affected by this legislation are not ones where the defendant is brought to trial and found not guilty. Most of these cases, he said, involve deferred prosecutions, failure to meet the 120-day Rule or the State drops the charges for a variety of reasons. However, he emphasized, if the legislature wanted, and if the state could afford it, it could establish a system of charge-backs, where the State would refund attorney fees to defendants not convicted. He noted that the charge-backs would apply to private attorney fees as well as absorbing the costs of public defenders. However, he stressed that the Court feels that all criminal defendants should pay their attorney fees. Senator Dave Donley reinforced Mr. Wooliver's argument saying there should be no discrimination between rich or poor. He believed all defendants should pay for the service according to their ability. He also noted there are many reasons why a guilty person is not convicted, citing the 120-day rule, technical reasons, lack of resources to prosecute, inadmissibility of evidence or admissions, etc. It particularly troubled him that judges may appoint counsel regardless of the monetary status of the individual. Regarding the differences between civil and criminal actions, he pointed out that there are different standards and that the state has a higher burden of proof. He told the Committee that there is a safeguard against wrongful prosecution in existing law so if the State was out of line and did not have grounds to prosecute the defendant could initiate a civil action and recoup defense costs. Senator Dave Donley offered a motion to report from Committee, CSSB 100(FIN). Without objection it was reported out with individual recommendations and accompanying fiscal notes from the Department of Law, $68.9 and the Alaska Court System, zero.