Governor’s plan doesn’t include any new judges

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Gov. Bob McDonnell may not plan on funding any new judges next year, despite his request last month that the Virginia State Bar hand over $5 million for general state spending.

Although his remarks to state lawmakers state he wanted to use $1.7 million “to fill longstanding priority judicial vacancies,” McDonnell’s budget presentation indicates that money is only to cover costs of judges who have remained on the bench longer than expected.

Katya Herndon, spokesperson for the Supreme Court of Virginia, said she has been told the $1.7-million figure represents only the amount needed to pay salaries for judges who did not retire at the rate projected during 2010 budget sessions. “My understanding is the $1.7 million is to allow us to continue to pay the judges that did not retire despite projections,” Herndon said.

VSB President Irving M. Blank said he was told that money represents “unrealized savings” because judges have stayed on the bench in greater numbers than expected. He believes it is because many judges, who may have planned to retire, are staying on to avoid leaving their courts shorthanded on the bench. “That’s clearly what’s happening,” Blank said.

The governor’s office has not responded to a request for details about the governor’s judicial spending plans.

Herndon, the court spokesperson, said she could not offer any comment from the court on the proposal to use VSB money for general spending. She said both Chief Justice Leroy Rountree Hassell Sr. and Executive Secretary Karl R. Hade were away from the office for the holidays.

A statement from the governor’s office termed the targeted VSB money “excess funds.”

“All agencies have been asked to reduce their expenditures, including the VSB,” said McDonnell spokesperson Stacey Johnson. “The excess funds transferred from VSB merely reflect the Governor’s decision to fund current priorities within the judicial system.”

But VSB officials say they remained “stunned” and unhappy over the request.

“This transfer, if passed by the General Assembly, would be an unprecedented appropriation of dues and fees paid by Virginia’s lawyers to fund protection of Virginia’s citizens and the regulation of lawyers,” said VSB President Irving M. Blank in a statement released by the VSB.

Blank said he believes officials at the Supreme Court of Virginia, like him, had no advance warning about the McDonnell proposal. Blank said he talked to Hade the day the governor released his budget plans. “He was clearly surprised,” Blank said.

Blank said the VSB was called the day before by the governor’s office about the budget proposal. There was no discussion and no explanation of any motive for targeting VSB money. “We just got told this is what he was going to do,” Blank said. “It wasn’t like a conversation.”

Blank, who sent a mass e-mail calling on lawyers to contact legislators about the need to fund judgeships, does not believe McDonnell was retaliating for his activism on the judgeship issue. “I don’t think it had a thing to do with it. I think the governor was just looking for a source of money and took our money,” he said.

Blank said the reaction he’s received from lawyers is “flat outrage.” He said legislators he’s talked to have been supportive. “I’ve not heard from a single legislator that favors doing this. Not one,” he said. “I know they’re out there, but I’ve not heard from them.”

Blank said language in the 2010 appropriation act prohibiting the Governor from transferring unspent money in the State Bar Fund, as well as provisions in the state code, show a “longstanding legislative intent” to protect the VSB money from being used for anything other than administration of the VSB.

At least one fellow Republican agrees with Blank on that issue. Despite his criticism of what he saw as VSB lobbying, Del. David Albo, R-Fairfax, chair of the House Courts of Justice Committee, disapproves of the plan to use VSB money for general spending. “I don’t think professionals should be taxed to pay for general fund expenditures,” he said. He compared the McDonnell proposal to charging doctors to pay for hospitals.

Others who commented agreed. “It’s turning our bar dues into a lawyer tax,” said Del. Scott A. Surovell, D-Fairfax.

“Not only is this idea bad on the merits, but to propose it without a word of discussion with Bar leaders is rude and unprofessional,” wrote Kevin E. Martingayle of Virginia Beach in a comment on the VLW website. “We deserve and expect better, and a lawyer-governor should know better.”

Colonial Heights lawyer Neil Kuchinski said he’d be willing have his dues doubled if it would put more judges on the bench. “If you’re going to take this money, for God’s sake, let’s at least have a good result – access to justice for the clients and attorneys,” he said.

Albo said he saw the governor’s plan as a rebuke to the VSB for “playing politics,” as he put it. Albo said he had not discussed the issue with McDonnell’s office, but he believes the VSB overstepped its mission in trying to “lobby” the legislature for more judicial spending.

“It probably never would have happened if the bar had stuck to their mission,” Albo said. “I wish the State Bar would get back to regulating lawyers and not playing politics.”

Blank justified speaking out for judicial funding by noting the VSB’s mission includes protecting access to legal services and improving the quality of the judicial system. Albo said he talked with Blank about the matter, but he said the VSB fails to appreciate the pressure on legislators to maintain spending for other worthy services. “It’s just a difference of opinion,” Albo said.

Blank downplayed the disagreement, but indicated he would leave the active lobbying to voluntary bar groups such as the Virginia Bar Association, the Virginia Trial Lawyers Association, and the Virginia Association of Defense Attorneys. “We obviously applaud their leadership on this issue,” Blank said.

The VSB operates solely on the annual fees paid by Virginia lawyers. According to Va. Code § 54.1-3913, the fees are paid to the state treasury, maintained in a special fund, and appropriated to the VSB.

The VSB has an $11.5 million operating budget, which averages $960,000 per month in operating expenses, according to Blank. “As an agency with no source of taxpayer revenue, the bar must maintain cash balances to prepare for unpredictable expenses and needed capital expenditures,” he wrote.

As of June 30, 2010, the State Bar Fund had approximately $5 million in unspent cash reserves, which included $4.67 million with the state treasury and $352,000 in an administration and finance account.
Since 2007, the VSB’s cash balances grew by $2 million for two reasons, according to Blank. First, he said, the bar instituted efficiencies and cost-cutting measures to avoid increasing members’ dues.

Second, by Supreme Court directive, VSB salaries were frozen for three years. The salary freeze alone added $1 million to the cash reserve.

The reserve equals less than five months of operating expenses and includes approximately $77,000 dedicated to the expenses of the Supreme Court’s Mandatory Professionalism Course, Blank said. “The reserve is the bar’s only source of funding for unpredictable expenses,” he said. Such costs include receivership expenses, employee benefit costs; unemployment compensation costs; and attorney’s fees and litigation costs in pursuit of its regulatory mission.

For example, Blank said, in the last five years, receivership expenses have ranged from less than $100,000 to more than $513,000. In addition, the reserve will fund staff salary increases when permitted; technology improvements (currently projected at $1 million-plus); and additional staff in the discipline department (currently projected at approximately $170,000 per year).