Across the county, local governments are generating substantial revenues through law enforcement. While there are many legitimate uses of monetary penalties in the criminal justice system, their use can become exploitative when governments rely on law enforcement as an essential source of revenue.
The primary responsibilities of the legal system are to promote public safety and to provide for justice. Pressure to raise revenue, at best, undermines and, at worst, directly conflicts with those responsibilities. When incentives are misaligned, police departments and court systems become more concerned with taxation by citation than carrying out their core functions. Such conflicts of interest can undermine the legitimacy of the criminal justice system.
Using data from the Census Bureau’s Annual Survey of State and Local Government Finances, Reason Foundation created this data visualization tool to shed some light on the amount of revenue generated through fines and fees in 2020, the most recent year for which data is available.
In 2020, local governments across the United States collected just under $9 billion in fines and fees. Local governments in three states—New York ($1.4 billion), California ($1.26 billion), and Texas ($1.17 billion)—collected well over a third of the $9 billion in fines and fees in 2020.
Local governments in New York, California, Texas, Illinois, Florida, Georgia, Ohio, New Jersey, Washington, and Pennsylvania** collected the most fines and fees in 2020. In all, 20 states saw their local governments bring in more than $100 million in fines and fees in 2020.
On a per capita basis, local governments in New York, Illinois, Texas, and Georgia collected more than $35 per resident in fines and fees in 2020. In contrast, local governments in New Hampshire, Connecticut, Maine, Nebraska, and Kentucky* collected less than $3 in fines and fees revenue per resident in 2020.
Local governments use fines and fees as a significant source of revenue
In 2019, local fines and fees revenue accounted for less than 2% of pre-pandemic state general revenue in all 50 states. The year 2017 is the most recent year for which comprehensive local revenue data are available. In 2017, 28,159 U.S. cities, townships, and counties reported a total of $4,975,608,000 in revenue from fines and fees after excluding jurisdictions without sufficient data (see data and methodology notes below). In most places, fines and fees accounted for less than 5% of general revenue.
However, a sizable minority of jurisdictions in the United States appear to be highly dependent on criminal justice and court-related fines and fees. At least 482 local governments derived 10% or more of their general revenue from fines and fees in 2017.
In fact, in 176 local U.S. jurisdictions, the money from fines and fees accounted for 20% or more of that government's total general revenue in 2017.**
Going further, there were 42 municipalities where fines, fees, and forfeits made up 50% or more of the general revenue.
Rural areas with relatively small populations tend to be the most dependent on fines and fees. Along major roadways, so-called speed-trap towns appear common. Due to data limitations, these numbers understate the scope and scale of the revenue generated by local fines and fees in many states.
U.S. cities, townships, and counties getting more than 5% of their revenue from fines and fees in 2017
For more information, please see Reason Foundation's recently released policy brief, "Fines and fees: Consequences and opportunities for reform."
Recommendations for reform
Fines and fees have turned many courts into revenue centers for state and local governments. While most governments do not derive a significant portion of their general revenues from fines and fees, some are almost entirely dependent on them. Nonetheless, fines and fees are not a reliable source of revenue.
Moreover, using fines and fees to directly fund courts, law enforcement agencies, or other government activities can result in undesirable conflicts of interest. In addition to these fiscal considerations, fines and fees have devastating consequences on low-income individuals, racial minority groups, and juveniles and their families.
The following policy recommendations address the primary fiscal considerations associated with fines and fees, ensure accountability, and promote fairness within the justice system.
Eliminate user fees and poverty penalties
User fees effectively transfer costs away from taxpayers and onto individual users of government services. While user fees are appropriate and desirable in many contexts, they do not make sense in the justice system. The rule of law benefits all members of society, and the users of courts—particularly defendants—are often those who are least likely to be able to pay for their operations. Funding law enforcement and court systems through user fees make access to justice regressive—costing the poor far more relative to their income or wealth than the middle class or wealthy. That is fundamentally unjust. Funding the legal system through user fees also reduces the opportunity for lawmakers to weigh funding priorities, rein in excess, and ensure that the system is funded appropriately.
Poverty penalties, including interest fees, late fees, payment plan fees, and collection fees are particularly regressive. These fees punish individuals for their financial status rather than their crimes, and this undermines the objective of fairness within the justice system. Moreover, such punitive financial penalties may hinder the ability of former offenders to reintegrate, contributing to high recidivism rates.
Fully fund courts from state budgets
Eliminating user fees in the justice system may require states to assume greater responsibility in funding their court systems. Allocating funds from general revenues would protect against potential conflicts of interest. The particular structure of court systems in each state may complicate this process, especially in states without unified court systems. This obstacle is worth overcoming to ensure that courts are adequately and equitably funded.
Develop standardized tools to determine the ability to pay and scale fines accordingly
Determination of a defendant's ability to pay fines should not be left solely to the subjective assessment of an individual judge. This can result in wildly different outcomes for otherwise comparable defendants. Establishing standard practices would ensure that individuals are treated equally under the law. Scaling fines according to an individual's ability to pay would also reduce the administrative costs associated with pursuing uncollectable debts.
Affidavits, bench cards, or ability-to-pay calculators may be used to standardize ability-to-pay determinations. Income-based fines, or day fines, could also be used to scale penalties according to an individual's financial status. There is room for experimentation among the states in this area. Still, state law should clarify the factors that are considered when determining an individual's ability to pay. Defendants should be made aware of these factors and what documentation they will be expected to provide.
Provide alternatives to monetary sanctions
Indigent defendants should be able to receive alternatives to monetary sanctions. Community service is one possible alternative to fines but it may prove overly burdensome for some. For example, community service may conflict with work schedules or family obligations. Such conflicts should be avoided, as maintaining employment and social ties are critical to reducing the risk of recidivism. Courts should be able to consider a range of alternatives, including waivers, job training, and drug or mental health treatment. Incarceration should never be considered an alternative to monetary sanctions, and fees should never be charged for alternatives to monetary sanctions.
Eliminate all fines and fees in juvenile cases
The objective of the juvenile justice system should be to rehabilitate young offenders and avoid future escalation in their criminality. Fines are a purely punitive measure and do not serve any rehabilitative function. They do, however, place undue financial burdens on youth and their families. Juveniles should be considered indigent by default, and their families should not be held responsible for any monetary sanctions they incur.
End driver's license suspensions for failure to pay
Driver's license suspensions are an inefficient and counterproductive penalty for failure to pay fines and fees. There are significant administrative costs associated with the enforcement of suspensions. Driver's license suspensions also inhibit the ability of individuals to secure and maintain employment necessary to fulfill their legal financial obligations.
Collect and publish data on court debt and collection practices
Data on fines and fees is needed for transparency, accountability, and fiscal responsibility. Without sufficient information, lawmakers, advocates, and other stakeholders are less able to understand the problems related to fines and fees and identify possible policy reforms.
Currently, most states do not adequately track the imposition and collection of fines and fees. When information is available, it is often dispersed among local governments, individual courts, and private collections firms. This practice not only undermines the ability of lawmakers to make informed policy and budgetary decisions but also contributes to the broader perception that the justice system is unfair and unaccountable. Enabling citizens to access information related to fines and fees would help restore the justice system's legitimacy and allow them to hold their lawmakers more accountable.
At a minimum, states should collect and publish information related to fines and fees, including:
- The monetary amount of fines and fees levied annually;
- The revenue generated by fines and fees;
- How fines and fees revenue is allocated;
- And the costs associated with the collection of the fines and fees.
*Correction: A previous version of this post misstated Kentucky's fines and fees data as $31 per capita rather than $2.50 per capita.
**Correction: A previous version of this data incorrectly displayed data for Jamestown, South Carolina, where Jamestown, Pennsylvania, is located. Jamestown, Pennsylvania, should not have appeared on the map, "U.S. cities, townships, and counties getting more than 5% of their revenue from fines and fees in 2017," above, which shows municipalities that get more than 5% of their general revenue from fines and fees. As reported by the Census Bureau, Jamestown, Pennsylvania, collected approximately $2,000 in fines and forfeits revenue in 2017, which accounted for less than 5% of the town's general revenue that year.
The correct data for Jamestown, South Carolina, is as follows:
Fines and Forfeits: $105,000
Percent of revenue: 64.4%
General Revenue: $163,000
Per Capita: $1,313
This error was made in the GPS settings of the "U.S. cities, townships, and counties getting more than 5% of their revenue from fines and fees in 2017" above, but the error was not made in any state-level calculations.
Notes on data and methodology
In general, there is a severe lack of data regarding the revenue generated from fines and fees. This lack of data can make it difficult for policymakers to assess the scale of the problem and the potential impacts of reform. In the absence of data, perceived reliance on fines and fees revenues to fund court systems and other government activities can present a significant obstacle to reform.
The Annual Survey of State and Local Finances includes a line item for "Fines and Forfeits." According to the Census Bureau's classification manual, Fines and Forfeits includes revenue from:
- Penalties imposed for violations of the law
- Civil penalties (e.g., for violating court orders)
- Court fees, if levied upon conviction of a crime or violation
- Court-ordered restitution to crime victims where the government actually collects the monies
- Forfeits of deposits held for performance guarantees or against loss or damage (such as forfeited bail and collateral)
The Census Bureau's survey of state and local government finances has been administered annually since 1957. A census is conducted every five years (years ending in '2' and '7'). In the intervening years, a sample of state and local governments is used to collect data. A new sample is selected every five years (years ending in '4' and '9'). Even in census years, many values are imputed rather than being collected directly.
In our analysis of individual local governments, we excluded any city, county, or township whose "fines and forfeits" value was imputed. We also excluded any jurisdiction that reported zero general revenues or for whom more than 50% of line items were imputed. As a result of those data filters, approximately 8,330 cities, townships, and counties were excluded from our analysis.