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Posted on: December 31, 2019

12-31-19 Internal Auditor Completes Review of Municipal Court Fine Collection

City Auditor Matthew Grady performed an independent examination of the Killeen Municipal Court of Record fine collection process as compared to best practices. He has published his findings for public review.

Killeen Municipal Court of Record was established by the Killeen City Charter for the purpose of trying misdemeanor offenses and upholding the duties prescribed by the laws of the State of Texas. Fine collection is a key component of ensuring ordinance compliance and enforcement.

Grady selected Municipal Court fine collection for audit as a function that had not previously been audited, because of its importance to citation enforcement and delinquency of fine payment noted by external auditors. The review covered fiscal years 2017, 2018 and 2019.

The fine collection process begins when a citation is issued. The citation notifies the recipient that he is to appear at the Court. At the initial appearance, the defendant can pay the fine in full, establish a payment plan or enter a not guilty plea to proceed to trial.

Collection of unpaid fines begins when a scheduled payment becomes at least 30 days late. The defendant is contacted by phone or text notifying him of his past due status. If payment is not made within 30 days, he will receive a mailed formal notice to appear for an Order to Show Cause hearing before the judge to explain his failure to make payment. Failure to appear for that hearing may result in the issuance of an arrest warrant.

Beyond the internal processes, Municipal Court contracts a law firm to perform collections on fines and fees more than 60 days past due. It also participates in the Texas “Failure to Appear” program, which can result in denying driver’s license renewal to those who fail to follow the orders of the court.

The audit found that while the Court has appropriate fine collection processes in place and is working to add new tools, extenuating circumstances have prevented maximum effectiveness. Of particular note during the evaluation period was total Court staff turnover at a rate as high as 52 percent and 82 percent turnover among deputy court clerks, who handled collection efforts. Limited staff resources were consequently reallocated from collections to daily operations. There was also a 33 percent decline in the number of cases filed with the Court largely due to fewer police and animal control officers.

Reduced collection efforts and fewer cases combined to result in a significant decline in revenue. Fiscal Year 2017 saw $2.9 million in fine revenue. That number dropped to $2.5 million in 2018 and to $2.4 million in 2019.

By the time of this audit, Municipal Court management had initiated several fine collection process improvements that correspond with industry best practices. The creation of a full-time collections specialist position elevated fine collection to a primary responsibility and is expected to increase effectiveness and consistency. A skip tracing contract is in process that will help locate persons with unpaid fines who may have moved without updating addresses. The Court is also working to adopt a “scofflaw” program that could deny annual vehicle registration to those with outstanding warrants for traffic law violations.

Grady made specific recommendations based on his findings and national and state best practices. He emphasized the need to continue implementation of the aforementioned collection process improvements. He pointed to the benefits of pre-delinquency notifications and suggested developing a plan to expand the proactive use of text messaging in this process. Finally, he recommended better communication with the departments that issue citations to improve the accuracy of contact information collection and minimize returned mail.

“Although the Court has struggled in the area of collections in recent years, management has done a good job at strengthening the process,” Grady said. “This work should bear fruit in the form of increased compliance with City ordinances and additional revenue for the General Fund.”

The entire Municipal Court Fine Collection Audit is available at killeentexas.gov/auditor.

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