The audit released in January strongly suggested the council move its headquarters from pricey San Francisco, where the median price of a two-bedroom apartment is now $5,000 a month, to Sacramento and save $5 million annually. The auditors also noted that the move would save in both travel and salary costs. One administrator spent $22,000 over three years in travel between the offices, the audit noted.

But the council has refused to make the move, instead opting to close its small Burbank operation, which it claims will save between $10 million and $12 million.

The council, which operates California’s state and local courts, is given fiscal autonomy to a degree, but has forever lamented that it lacks the proper funding from the state to handle its caseloads.

Records show that while the council has pruned its employee ranks since 2009, its pension costs have increased 15 percent and its wages have jumped 7 percent. Thirty percent of the agency’s 786 employees in 2014 received six-figure salaries.

The legacy costs have been among the forces driving increased fines and fees in the courts for taxpayers, as well as the closing of over a dozen courthouses in the state since 2012.

Earlier this year, Martin Hoshino, administrative director of the Judicial Council, told San Francisco NPR affiliate KQED that closing the courts causes “great concern among a lot of the judicial officials or court administrators that I speak to in terms of what are the real impacts of saying that a courtroom or courthouse is closed and really unavailable.”

But when it comes to moving his own headquarters out of one of the most expensive cities in the world, Hoshino cites the need for further analysis.

He’s known of the money sap the San Francisco office has been since at least 2012, according to an evaluation done by the judicial State Evaluation Committee.

“From a strictly economic standpoint, lease costs are generally lower in Sacramento than San Francisco,” reads the report, which, like this year’s audit, was critical of the cost of the court system. “Labor costs generally are lower as well. The [Judicial Council] partly recognizes this through its geographic pay differential system, whereby some Sacramento region employees are paid 7 percent less than San Francisco-based employees performing the same type of work.”

Reacting to Audit

Hoshino in March appeared before an Assembly budget subcommittee and explained that the office had taken some steps on the heels of the audit.

“The office directors, which are eight in total, will no longer receive the option of receiving reimbursement for parking at their office headquarters,” he said. “That also would be effective July 1, 2015.”

But changing the location of the headquarters was never broached. Union representatives spoke of the effect of cutbacks on their ranks. Marsha Slough, presiding judge in San Bernardino County, noted that her staff had been cut 27 percent.

The Alliance of California Judges, which backs the move of the headquarters, said in a statement last week, “… San Francisco is now the world’s most expensive place for visitors to spend the night. Parking, gasoline, groceries — everything costs more in the city. So why does the [Judicial Council] insist on staying there? Why won’t it move to Sacramento, thereby freeing up millions of taxpayer dollars that could go to our cash-strapped trial courts?”

In an interview with CalWatchdog, Alliance member Judge Maryanne Gilliard noted that many judges refer to the Judicial Council’s San Francisco headquarters as the “crystal palace.”

“They do not desire to give up those plush digs for a more modest utilitarian building in Sacramento, where there would also be a greater ability for the Legislature to have fiscal oversight of what they are doing,” Gilliard said.

The council, which has been criticized for poor handling of public money, will also be forced to use funds on deposit as payment on a $231 million courthouse in Santa Clara County that was supposed to open this summer but is now running at least six months behind.

The Judicial Council, like other state agencies, often rents buildings from the State Public Works Board, which issues bonds to pay for construction.

The State Public Works Board will have to pay for debt service on the Santa Clara courthouse from another fund as a result of the delayed opening, according to a financial disclosure filing last month.

Thereafter, the Board “intends to take steps as necessary to apply lawfully available funds from March 1, 2016 until rent on the facility commences to accrue,” the state reported on the disclosure.

In an email, Judicial Council spokesman Peter Allen said:  “The first rental payment is due in August 2016 … and is for rent during the 6 month period from 3/1/2016 to 8/30/2016.  We are currently projecting that we will be in the building by 4/14/2016… .”

But when it takes years, even decades, do work through the court system, then that itself is a punishment.

But State Auditor Elaine M. Howle has found the courts don’t efficiently spend the money they already get. The long study title includes the conclusion: “Judicial Branch of California: Because of Questionable Fiscal and Operational Decisions, the Judicial Council and the Administrative Office of the Courts Have Not Maximized the Funds Available for the Courts.”

Howle first noted:

Public confidence in the judicial system stems, in part, from confidence that the system’s administrators manage its operations efficiently and appropriately. This report concludes that questionable fiscal and operational decisions by the Judicial Council and the AOC [Administrative Office of the Courts] have limited funds available to the courts.

State law affords the Judicial Council a significant amount of autonomy related to developing budgets and approving expenditures on behalf of the trial courts. With this autonomy, the Judicial Council has an obligation to act in the best interest of the public, especially during times of fiscal hardship.

Right. If you go to court over a property dispute, say, you want to be assured the court itself understands fiscal prudence. Especially in what still are tough economic times for many people, despite the economic recovery.

To maximize funding available to the courts, we expected that the Judicial Council and the AOC would have carefully scrutinized their operations and expenditures to ensure they were necessary, justified, and prudent. However, we found that this was not always the case. Specifically, the Judicial Council failed to adequately oversee the AOC—its staff agency that assists it in managing the judicial branch budget and provides administrative support to judicial branch entities. In the absence of such oversight, the AOC engaged in about $30 million in questionable compensation and business practices over a four-year period and failed to adequately disclose its expenditures to stakeholders and the public.

Furthermore, although state law authorizes the Judicial Council and the AOC to spend state funding appropriated for the trial courts on behalf of those courts, we have concerns regarding the appropriateness of some of the expenditures. Over the past four years, the AOC spent $386 million on behalf of the trial courts including $186 million in payments to consultants, contractors, and temporary employees using the trial courts local assistance appropriations; however, the AOC could have paid a portion of these costs using its own appropriation. If it had done so, some of those local assistance funds would have been available to support the courts.

As the third, independent branch of government, it is crucial that the courts operate efficiently and without scandal. Otherwise they invite interference by the legislative branch, which holds the purse strings, and the executive branch, which has investigative powers.

Howle recommended:

Given the lapses in the Judicial Council’s oversight and the AOC’s decision making, we believe significant change is necessary to ensure that the State’s courts receive the critical funding they require to provide access to justice for all Californians. As such, we made numerous recommendations that we believe will improve operations, increase transparency, and ensure accountability within the judicial branch.