Behind the curtain: Even a small federal district court is a big and complex business

I remember the conversation. It was probably the most important talk I had when I served as Chief Judge.

Judge Bataillon and I were talking. Both of us felt that we did not understand the budget process well enough, and that unintentionally the Clerk’s office, the Probation office, the Pretrial Services office had become fiefdoms where the less the judges knew the better. The more we talked the more a structural image began develop. What if we developed a “shared services” department. That is, a department that would provide the Chief Judge and all the other judges with detailed financial management information and require the court units to shares services with each other while keeping the court units’ operational missions intact.

I asked Joe whether he would head up such an effort. He agreed. Now, I will digress for a moment. Judge Bataillon is a legend back in Washington. If you ask anyone back there about Joe you hear nothing but raves. Joe is known for tackling tough problems and dealing with them in an effective manner. That is why Joe has served on the advisory committee for the national budget and that is why Joe chaired a judicial conference committee on space and facilities. The confidence placed in Joe by the Chief Justice and the Administrative Office of the United Courts is a testament to Judge Bataillon. In short, Joe gets things done with a minimum of strife and a maximum of consensus.

So, Joe set off. He gathered the court unit executives (Clerk of Court, Chief Probation Officer and Chief Pretrial Services Officer) together plus their deputies and pitched the idea to them. Those folks were understandably hesitant, but agreeable to pursuing the matter as long as no commitments were required. They trusted Joe. About a year later, after a lot of research, travels throughout the country to see how other court’s functioned, and a lot of bargaining our “shared services” department became a reality. In fact, it has now become a national model. This is due entirely to Judge Bataillon and our unit executives who have labored long and hard to make this new approach work seamlessly.

“Shared services” works like this.  The court unit executives sit as joint managers of the business side of the court. Many services are now shared between the units (take IT for example) and each unit contributes a portion of their budge to receive those service. Additionally, the budget of each unit is essentially collapsed into one integrated budget for the entire court. Money can be moved back and forth as the need arises. Financial controls were instituted* and a budget committee of the active district judges was established. Each quarter the budget committee meets with the court unit executives and our financial staff to review the budget and to determine future planning scenarios.

A word about budget decentralization is in order. Each federal district court receives an annual allotment from Washington for the entire operation of the court except for rent* and several other minor categories. With certain minor restrictions, the local court can do with the allotment as that district thinks best. There is a huge problem however. Congress almost never gives the federal judiciary an appropriation until it is too late to plan. The shared services staff is therefore tasked with predicting the future. This is an enormously difficult task, and it requires the aid of real financial professionals. Luckily, and as you shall see, we have two men who fit that bill perfectly.

Let’s talk scale. We are categorized as a “small” court back in Washington. Nonetheless, our budget runs into the tens of millions of dollars. $11,331,875 to be precise this year. Excluding the Executive Summary, the active judges receive on a quarterly basis a packet of information in Excel form that typically runs 30 pages or so long. It pinpoints where we are now on spending compared to our budget and forecasts out for two years (using complex alternative scenarios) where we will be in the future. It is a very sophisticated document that allows the judges and the court unit executives to make plans without guessing (too much). The quarterly meeting with the judges and the court unit executives (the Budget Committee Meeting) has become, in my opinion, the single most important effort our court engages in when it comes to management of the business side of our court.

Of course, the “Shared Services” department also helps the court units “share” services. Need a cellphone? Call the fellow who does procurement for the entire court. He knows the procurement regulations, and he is an expert at getting you what you need, in compliance with the regulations, at a cost that is good for the taxpayer in a speedy manner.

OK. Now you have a sense of “shared services.”  I next want to introduce you to the two men who have significant overall management responsibilities in that area. I asked these men to prepare their own statements, and I reproduce them below.

Pat and Terry work in the shared services structure of the United States District Court, providing support to District, Pretrial Services, and Probation. On behalf of the Court Unit Executives, Pat and Terry develop and present budget reports to the Active Article III Judges on a quarterly basis. Reports included in the budget package include an executive summary; a financial oversight report showing the budget condition of each separate court unit and as a combined entity; a workload report showing trends in staffing; as well as spending and discretionary plans for each court unit. In addition, one of their most challenging tasks is forecasting and presenting reports on future-year allotment projections (salaries, in particular), which are subject to partisan politics, the economy, and an ever-changing allotment distribution structure.

Terry Brownfield has a B.S. in both Accounting and Business Administration. He has the Certified Management Accountant designation and has passed the Certified Public Accounting examination. He has 35 years of accounting experience including as a Controller for a manufacturing company and the last ten years as a budget analyst for the court. His responsibilities for the court include budget preparation and monitoring as well as payroll forecasting and reconciliation. He also performs internal control reviews for various court departments, adhering to the motto “ In God we trust… all others get audited”.

Terry

Terry

Terry takes pride in providing management with accurate and substantive information to allow management to make good decisions and in applying his accounting background to business situations.

Pat

Pat

Pat Williamson is the administrative supervisor for the shared services units and has worked for the courts for 22 years, including stints in procurement and budget. Pat has a B.S. in Finance from the University of Nebraska–Lincoln. Pat manages the business functions of the court, including managing professional staff in finance, budget, procurement, property, space and facilities, internal controls and audits. Pat has worked with the Administrative Office of the U.S. Courts as a subject-matter expert and court mentor for the national implementation of the Internal Control Evaluation (ICE) system and development of the Self-Assessment modules used by courts during their annual internal audits.

Pat and Terry are treasures. But we would have no need for them without Judge Joe Bataillon and our court unit executives. Without them, “shared services” would not have been implemented. They had the courage and foresight to create and then implement a truly unique method of managing the business side of our little court. Like Nebraskans of the 19th century, they are pioneers.

RGK

*From time to time, our court, like all other district courts, is audited by outside auditors without hardly any advance notice. These audits are stressful and similar to audits one is familiar with at banks or other large businesses. Did you know that there are “Generally Accepted Government Auditing Standards?” We were given a completely clean bill of health at our last audit–no exceptions. That is a huge and virtually unheard of achievement. In a moment, you will meet our “internal auditor” who pushes the managers to be prepared for an outside audit any time.

**Our buildings are “owned” by GSA. Rent to the GSA is paid annually out of funds held in Washington. Thus, we don’t have to budget for rent, although maintenance and upkeep costs are sometimes shifted to the local court.

3 responses

  1. RGK,
    I love hearing about stories like this. Your “little” federal district sounds like it would be a pleasure to practice in. I love learning about people who solve problems like these fellas have. Keep these stories coming!

    SLS

  2. Can we please borrow Pat and Terry to help Congress figure out how to do a budget without government shutdowns? They could probably figure it out in a day or so and then go back to your court in Nebraska.

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