As state public defense office emerges from nearly $4 million deficit, attorneys raise other concerns about mismanagement

The Oregon Office of Public Defense Services was essentially out of money.

The state agency, which funds contracts for defense attorneys and others in the public defense system, announced June 4 it was short almost $4 million and that some contractors would be waiting at least a month to get paid for their work.

A bill signed by Gov. Kate Brown in early July will replenish the agency’s pocketbooks, allowing it to emerge from a troubled year marked not only by cashflow problems but also a leadership change.

The office leaders have acknowledged that they largely dug the hole themselves with an inaccurate forecast of how much a new contractor payment system would cost.

The problems may not end there, however: The Legislature has signaled it will withhold $100 million from the agency unless it follows a series of recommendations.

Administrators from the state public defense office have promised they will meet the legislative requirements, which include a reorganization of their business structure and a financial and performance audit.

If they fail, their budget for 2021-2023 will fall 4.5{b530a9af8ec2f2e0d4045baab79c5cfb9bfdc23e498df4d376766a0b44d3f146} short of what it was during the previous two-year budget cycle, likely prompting another shortfall that would prevent lawyers and other contractors from getting paid.

But as the state’s public defense office tries to recover, public defenders have repeatedly complained about a lack of transparency surrounding payments and raised concerns about mismanagement and retaliation by agency leaders.

Public defenders also said their payment problems predate the budget shortfall by nearly two years.

Those billing issues, both recent and ongoing, have left attorneys and other contractors increasingly worried about their capacity to take on new cases, potentially threatening the constitutional rights of people accused of crimes.

“Nobody has time to take cases at the rate they’re paying,” said Ryan Scott, a longtime criminal defense lawyer based in Portland. “Court-appointed attorneys are asked to work exceptionally long hours to do a good job and still not get paid enough. Now they’re balking and good attorneys are leaving the practice.”

Bridget Budbill, the agency’s legislative director, said the office currently has 102 public defense contracts, funding 605 full-time attorneys and other staffers. In 2020, contractors with the state public defense agency took on about 93,500 cases.

The number of cases was down from about 130,500 in 2019, Budbill said, because many cases were delayed because of the COVID-19 pandemic.

Ed Jones, the interim director of the state public defense office, did not respond to repeated requests for comment about the budget shortfall or about attorneys’ other complaints.

MONEY PROBLEMS MOUNT

The budget shortfall, while spurred by multiple factors, was primarily brought on by reforms intended to improve the payment system for attorneys, investigators, court interpreters and others who work throughout the public defense system, Budbill said.

The agency funds the contracts of most public defenders in the state, including those from large nonprofit agencies like Metropolitan Public Defender in Washington and Multnomah counties.

It paid contractors with a fixed-fee system until the end of 2019, essentially compensating public defenders at flat rates that didn’t account for the severity of their cases, how much work the cases required or other factors such as travel.

A 2019 report by the Sixth Amendment Center, a Boston-based national nonprofit that examines public defense systems, deemed the payment model unconstitutional and said it pushed attorneys to take on as many cases as possible, negatively affecting them and their clients.

The 238-page report recommended Oregon’s Office of Public Defense Services pay attorneys an hourly rate that considers factors such as the workload, the resources that attorneys might need for a case and whether the case is in an urban or rural area.

The office implemented the new system at the beginning of 2020.

But between a cumbersome computer system for implementing billing information and the increased costs of the new payment approach, office financial staff inaccurately predicted how much the system would cost, Budbill said.

“The short version is that we have kind of an outdated financial tracking system — the data system for our case counts didn’t pan out to be as accurate as we hoped,” she told The Oregonian/OregonLive.

“It was intended to be revenue-neutral — to use the same amount of money we had in the budget to do the contract model differently. Unfortunately, that didn’t turn out to be the case.”

Budbill said the shortfall primarily affects court interpreters, mitigators and investigators — not contracted attorneys.

But others, like James Comstock, a longtime private investigator and independent contractor, said payments began lagging about two years ago. Contractors are now averaging more than a month between payments, he said.

The delay pushed some investigators out of the business. Comstock said he knows of colleagues who have taken side jobs with companies like DoorDash and Uber.

“We have been working to try and fix that and get some sort of consistency since that time, and we have not seen improvement,” he said.

Comstock said contractors want the office to commit to a time limit of 30 days on paying them.

“If we could get that, it would solve the majority of cash flow problems with OPDS,” he said.

Other factors contributing to the budget shortfall include a backlog of court cases stalled by the coronavirus pandemic and hundreds of new cases filed on behalf of inmates who were exposed to or sickened by COVID-19 in Oregon’s prisons.

LEGISLATION ALLOCATES FUNDING

House Bill 5030, which passed the Senate on June 26 and was signed by Brown on July 2, allocates nearly $340 million for the agency’s 2021-2023 budget.

It also provides the public defense office a one-time $3.78 million sum to cover the shortfall.

The latter sum will likely be accessible this month, allowing the agency to begin paying contractors whose paychecks are weeks or months late.

The nearly $340 million does not include the $100 million contingent on the recommended reforms. Those changes include reorganizing the agency’s budget structure, auditing several aspects of the agency’s management and performance, and creating new positions in financial management, leadership and other areas.

If the $100 million comes through, the Public Defender Services budget would increase from the previous biennium. If it doesn’t, the current budget would be a 4.5{b530a9af8ec2f2e0d4045baab79c5cfb9bfdc23e498df4d376766a0b44d3f146} drop from the previous biennium’s budget of nearly $356 million.

The office will submit its audits to the Legislature before the 2023 session, Budbill said, and lawmakers will determine whether officials had earned the additional $100 million.

“The agency has every intention of meeting those expectations and is working on a detailed plan to make sure that happens,” Budbill said.

The agency has little choice. It needs the money to pay people, Budbill said.

But public defenders have expressed ongoing frustration with the new payment model, saying it’s still opaque and inequitable.

Defense attorney Rachel Philips wrote letters to her state representatives last September, highlighting ways she said the agency is failing Oregonians, including inconsistent attorney pay rates.

Attorneys qualified to work on capital murder cases are paid at $105 per hour, she wrote, but attorneys who work on other murder case are paid only $70 per hour — an increase from a previous hourly rate of $45 to $55. Philips noted an “unwritten policy” that attorneys can ask for higher rates for their work on certain cases. But the agency doesn’t inform attorneys of that option, she wrote.

In another letter to state representatives, Philips described inequalities in the funding model for the entire public defense system.

“Police departments are the investigative arm for prosecutors, and yet they operate out of a budget that is separate and set apart from a District Attorney’s budget,” she wrote. “This is not the case for public defense investigators. The OPDS budget encompasses attorneys, investigators, mitigators, interpreters and all manner of experts.”

Budbill said the agency plans to launch a “stakeholder engagement process” to listen to contractors and understand their needs.

“I think the agency would definitely acknowledge that we need to improve the means of communication so our providers and other critical folks are always in the know and understand what’s happening,” she said.

WIDESPREAD COMPLAINTS

The tension comes months after the resignation of the agency’s boss, Lane Borg, whose performance has dissatisfied several attorneys contacted by The Oregonian/OregonLive.

Portland-based attorney Bear Wilner-Nugent said in a March letter that Public Defender Services’ slow payments would drive attorneys away if left unaddressed.

His letter to the Public Defense Services Commission, a nine-member commission that oversees the office, also alleged former executive director Borg was not taking the concerns of attorneys and other contractors seriously.

He also claimed in a second letter to commissioners a month later that agency leaders have retaliated against contractors who have raised billing and payment concerns and appear to be harder on female lawyers.

“This isn’t simply about minor delays in payment for one lawyer — this is about major, systematic problems, and not everyone may feel safe speaking up,” Wilner-Nugent wrote.

Leaders from 10 public defense organizations — including the American Civil Liberties Union of Oregon, Metropolitan Public Defender and Oregon Justice Resource Center — also wrote a March letter to commissioners, urging them to thoroughly review the agency’s practices before launching a nationwide search for a top leader who could best address the problems. That search is ongoing.

Borg, who led the agency for roughly three years, resigned in March but stayed on to help train his temporary successor: Ed Jones, a retired Multnomah County Circuit Court judge. Jones did not respond to a request for comment.

That work wrapped up at the end of June, but Borg’s tenure with public defense services will continue. His separation agreement stipulated that the agency would provide him a one-year contract to practice criminal defense in Clatsop and Tillamook counties.

The agreement didn’t identify any reasons for his departure and said his employment would “mutually end.” Both he and the state office of public defense declined to comment on the circumstances of his resignation.

Per Ramfjord, chair of the commission that oversees the agency, characterized Borg’s departure “as a joint decision based on the needs of the agency and the fact that Mr. Borg had accomplished much of what he set out to do.”

That included, Ramfjord said, “reforming the contract model for public defense providers in accordance with the Sixth Amendment Center report and adding a significant number of public defense providers throughout the state.”

Ramfjord declined to comment on whether it was typical for an outgoing director to have a yearlong contract written into a separation agreement.

The separation marks the second time Jones has taken over a leadership role held by Borg. He was tapped to lead Metropolitan Public Defender, the state’s largest public defense provider, after Borg resigned from the organization’s top job in 2018 amid complaints of budget mismanagement, according to a Willamette Week report from 2019.

IMPACT ON PUBLIC

The money problems have directly affected those who have been charged with crimes and need the help of public defenders, said Kelly Simon, the ACLU of Oregon’s legal director.

When the government brings its resources to bear against people accused of crimes, it should ensure the accused have ample resources to defend themselves, she said.

“When the government is not providing enough financial resources to support the public defense system but continuing to bring a large volume of charges against members of our community, the government is totally rigging the system,” Simon said.

The effects of the budget shortfall have become even more evident since Oregon inmates last year began pursuing habeas corpus cases — essentially lawsuits challenging their imprisonment — over conditions during the COVID-19 pandemic, she said.

Many prison rights advocates organized to try to ensure prisoner rights to medical care and a safe environment. Public defenders also began taking on cases of inmates who sued the state over what they alleged were unsafe conditions that exposed them to the coronavirus.

“For some reason, whether it was OPDS mismanagement, a lack of funding or something else, that system was broken,” Simon said. “That’s the type of failure that OPDS and other government officials have set up. What that means is that people who are extremely vulnerable — and a disproportionate number who are BIPOC — are going to be hurt. And in the case of the habeas cases, it can be truly life-threatening.”

Attorney Tara Herivel said Public Defense Services hired her on a temporary contract to train a team of about 30 attorneys to take on more than 400 cases representing incarcerated people exposed to or sickened by COVID-19, but the contract ended in spring with more than half of the cases unresolved.

She said she had trouble getting a straight answer from the office about her project’s growing caseload and the budget to cover it.

“They had never budgeted for this project, and I think that’s extraordinary,” Herivel said. “It most certainly impacts the quality of representation that anybody is going to be able to get following the end of this contract.”

Budbill said the Oregon Post-Conviction Consortium had always taken on non-coronavirus-related habeas corpus cases and that most of the COVID-19-related cases “became moot” because inmates were offered vaccines.

Herivel said the Public Defender Services budget troubles and lack of transparency not only fail the agency’s contractors but also those who need its help.

“What we’ve lost sight of in this picture are the clients,” she said. “Our duty, when you enter the realm of public defense, is providing adequate assistance to counsel indigent people. The people running the show are not as committed to [that] as they should be.”

—Jayati Ramakrishnan; 503-221-4320; [email protected]; @JRamakrishnanOR