November 19, 2019

As you’ll read throughout this issue of Liberty & Law, IJ is fighting—and winning—against cities’ use of fines and fees to raise revenue. Now, thanks to new IJ research, we know that “taxation by citation”—relying on traffic and other code enforcement to generate fines and fees revenue, rather than to protect public health and safety—can easily become business as usual, jeopardizing people’s rights and public trust.

In October, IJ published The Price of Taxation by Citation, a report that studies three metro-Atlanta cities that have historically relied heavily on fines and fees revenue from code violations: Morrow, Riverdale, and Clarkston. We dug deep to learn as much as we could about taxation by citation in these cities. Among other things, we analyzed public data and records, surveyed and interviewed residents, and even visited the cities to observe them and their court systems in person. What we found was revealing.

On average over five years, the three cities reaped between 14% and 25% of their revenues from fines and fees—well above the 3% garnered by similarly sized Georgia cities. Many of the tickets generating this revenue were for violations that presented little threat to the public, suggesting a desire for revenue outweighed concerns for public safety.

The cities also leaned most heavily on fines and fees during difficult times: Fines and fees peaked as a share of total revenues in 2012 before declining as the economy—and tax revenues—recovered from the recession. Yet even after the recovery, fines and fees remained the cities’ second largest revenue source. That suggests that once cities take up taxation by citation, they have a hard time letting it go.

The taxation by citation we saw in Morrow, Riverdale, and Clarkston is made possible by two factors. First, all three cities have their own courts, which depend on the cities for funding, creating a conflict of interest that may lead to more fines. And, in fact, the courts process far more citations than similarly sized cities’ courts and returned guilty verdicts in 97% of the cases we observed. Second, the cities have few legal provisions to prevent them from using code enforcement to raise revenue—or from violating people’s rights in the process.

As reliance on fines and fees becomes entrenched, cities may pay a price, too. We surveyed city residents and found that those with recent citations reported lower levels of trust in city government than those without, suggesting that what cities gain in fines and fees revenue, they may lose in community trust and cooperation.

Morrow, Riverdale, and Clarkston aren’t alone. Nationwide, scores of other cities rely on fines and fees for comparably large revenue shares. We’ll be using our new research to encourage reporters and concerned citizens to investigate those cities’ fines and fees behavior. We’ll also be using it to promote reform—to make the case that cities should find other ways to balance their budgets and save citations for when public safety is on the line.

Kyle Sweetland is a researcher at IJ.

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