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The 2023-24 Budget: Department of Justice Budget Proposals
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2023-24 BUDGET
The 2023-24 Budget:
Department of Justice Budget Proposals
GABRIEL PETEK | LEGISLATIVE ANALYST | FEBRUARY 2023
SUMMARY
In this brief, we analyze Governor’s budget proposals for the Department of Justice (DOJ) related to (1) the
Bureau of Forensic Services (BFS), (2) firearms workload, and (3) legal workload.
Recommend Requiring BFS Users to Partially Support BFS and Providing Requested General Fund
Backfill for Only One Year. The Governor proposes an ongoing $53.4 million General Fund backfill to the
fund supporting BFS to address declines in the fund’s revenues from criminal fines and fees. We find that
requiring users of BFS services to partially support BFS operations is a better option for maintaining support
for the bureau as it minimizes the impact on the General Fund and results in the users having incentive to
prioritize what workload is submitted to BFS. Accordingly, we recommend the Legislature require (1) users of
BFS services to partially support BFS beginning in 2024-25 and (2) DOJ develop a plan for calculating each
agency’s share of the BFS services it uses. To allow for this new funding structure to be implemented, we
recommend the Legislature provide the proposed General Fund backfill—but only for one year.
Recommend Supporting Firearm Workload From Dealers Record of Sale (DROS) Special Account
Rather Than General Fund. The Governor’s budget proposes $6.9 million in 2023-24 ($6.3 million General
Fund and $573,000 from the DROS Special Account), declining to $3.5 million annually in 2026-27, to support
seven budget proposals related to increased firearm workload. We find the proposals reasonable, but
recommend that they be funded by the DROS Special Account as it appears to be an allowable use of the
fund and the fund can support the proposals.
Recommend Requiring Annual Reporting on Legal Workload and Providing Requested Funding on
a Two-Year Basis. The Governor’s budget proposes $24.5 million in 2023-24 ($15 million General Fund and
$9.5 million special funds), decreasing to $20.6 million annually in 2027-28, to support 18 budget proposals
implementing enacted legislation and increasing legal activities in key areas (such as pursuing more antitrust
litigation). We find that implementing the enacted legislation and increasing legal activities in key areas would
increase DOJ’s workload. However, we also find that there is insufficient information on how DOJ prioritizes
its existing resources and the extent to which litigation proceeds are available to support DOJ workload.
This makes it difficult for the Legislature to determine whether DOJ truly needs additional resources or if the
workload could be supported with existing resources or litigation proceeds. Accordingly, we recommend the
Legislature (1) direct DOJ to report annually on its legal workload beginning January 2025 and (2) provide the
requested funding on a two-year basis to support the increased workload while the recommended report is
completed and analyzed to determine appropriate funding levels in the future.
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2023-24 BUDGET
OVERVIEW
Under the direction of the Attorney General, As shown in Figure 1, the Governor’s budget
DOJ provides legal services to state and local proposes $1.2 billion to support DOJ operations
entities; brings lawsuits to enforce public rights; in 2023-24—an increase of $9 million (less
and carries out various law enforcement activities, than 1 percent) over the revised amount for
such as seizing firearms and ammunition from 2022-23. About half of the proposed funding
those prohibited from owning or possessing supports DOJ’s Division of Legal Services,
them. DOJ also provides various services to local while the remainder supports the Division of
law enforcement agencies, including providing Law Enforcement and the California Justice
forensic services to local law enforcement Information Services Division (CJIS). Of the total
agencies in jurisdictions without their own crime amount proposed for DOJ operations in 2022-23,
laboratory. In addition, the department manages nearly 40 percent—$486 million—is from the
various databases including the statewide criminal General Fund. This is an increase of $18 million
history database. (or 3.9 percent) from the revised 2022-23 General
Fund amount.
Figure 1
Department of Justice Budget Summary
(Dollars in Millions)
Change From 2022-23
2021-22 2022-23 2023-24
Actual Estimated Proposed Amount Percent
Legal Services $553 $645 $659 $14 2.1%
Law Enforcement 252 319 327 8 2.5
California Justice Information Services 250 264 252 -13 -4.7
Totals $1,056 $1,229 $1,238 $9 0.7%
DNA IDENTIFICATION FUND BACKFILL
Background Funding for BFS. BFS receives support from
various sources, but primarily from the DNA
Overview of BFS. BFS provides criminal
Identification Fund—a state special fund that
laboratory services—such as DNA testing,
receives criminal fine and fee revenue—and
alcohol and controlled substances analysis, and
the state General Fund. As shown in Figure 2,
on-site crime scene investigative support. Ten
the amount of criminal fine and fee revenue
regional laboratories provide services generally
deposited into the DNA Identification Fund has
at no charge for local law enforcement and
steadily declined over the past decade—from a
prosecutorial agencies in 46 counties that do not
high of $69 million in 2013-14 to $34 million in
have access to those services. BFS also assists
2022-23 (a decline of 51 percent). To help address
the 12 counties and 8 cities that operate their
this steady decline and to maintain the level of
own laboratories where BFS offers services their
services provided by BFS, the state has provided
laboratories lack. (Local agencies also contract
General Fund support to backfill the reduction in
with private or other governmental laboratories for
criminal fine and fee revenue deposited in the DNA
services.) Additionally, BFS operates the state’s
Identification Fund since 2016-17.
DNA laboratory as well as the state’s criminalistics
training institute.
2 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
DOJ Required to Report in 2022 on Potential similarly is supported by criminal fine and fee
Funding Options Other Than State General revenue and forensic science is important to courts,
Fund. The 2021-22 budget package required and (5) requiring nonlocal government entities
DOJ to provide a report by March 10, 2022 that (such as the California Department of Corrections
identifies various options—other than the state and Rehabilitation or CDCR) pay for their share
General Fund—to support BFS annual operations. of BFS services. Additionally, DOJ discussed the
The budget package specifically directed DOJ benefits and drawbacks of various methods for
to consider an option that would require sharing implementing a cost-sharing model with local
costs with local agencies that make use of BFS agencies. Such methods included establishing:
services based on the specific type of forensic (1) an hourly rate for services provided, (2) a flat
services sought, the speed of the service, the size fee by type of service provided, (3) a flat fee by
of the agency, and any other factors DOJ chooses county, and (4) a hybrid flat fee-hourly rate model.
to include. After its assessment of the cost-sharing model
In response to the above requirement, and alternative funding options, DOJ maintained
DOJ provided a report to the Legislature on that it believes a General Fund backfill is the best
March 10, 2022. The department identified the approach for supporting BFS annual operations.
following options to support BFS operations: (1) a
Governor’s Proposal
general tax increase, (2) allowing the surcharge
added to criminal history background check fees to Increases DNA Identification Fund Support
also cover BFS costs (and adjusting the surcharge for BFS. The Governor’s budget proposes
$17.3 million in increased annual funding from
accordingly), (3) increasing the specific fee added
the DNA Identification Fund to support BFS.
when individuals are convicted of criminal offenses
This amount includes $10 million to restore BFS’s
which generates the revenue deposited into the
historical level of spending authority from the fund.
DNA Identification Fund, (4) requiring the judicial
In prior years, the budget partially addressed the
branch to provide funding to support BFS as it
DNA Identification Fund’s shortfall by reducing the
bureau’s expenditure authority
from the fund by $10 million and
Figure 2
redirecting $10 million General
Steady Decline in Criminal Fine and Fee Revenue Fund previously budgeted for CJIS
Deposited Into the DNA Identification Fund to support BFS. CJIS then received
(In Millions) a backfill from the Fingerprint Fees
Account (FFA). (The FFA could
not directly backfill BFS due to
$90
statutory limits on how the funds
General Fund Backfill
80 in FFA can be used.) As such
Criminal Fine and Fee Revenue
70 actions are no longer sustainable
due to the condition of the FFA,
60
the Governor’s budget proposes
50
to restore the DNA Identification
40 Fund to its historical expenditure
levels. The proposed increase also
30
includes $7.3 million for BFS to
20
support equipment replacement
10 ($5.8 million) and facility
maintenance ($1.5 million).
2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24
(estimated) (projected)
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2023-24 BUDGET
Provides General Fund Backfill of DNA Specifically, we find that directing local
Identification Fund. The Governor’s budget governments to partially support BFS operations
proposes to transfer $53.4 million General Fund merits consideration for the following reasons:
on an ongoing basis to the DNA Identification
• BFS Provides Certain Local Governments
Fund to backfill reductions in criminal fine and fee
Substantial Benefits. City and county law
revenue deposited into the fund and to support
enforcement and prosecutorial agencies
the increased BFS funding levels discussed above.
are predominantly responsible for collecting
The Governor’s budget also proposes provisional
and submitting forensic evidence for testing
budget language authorizing the Department of
as well as using the evidence to pursue
Finance to transfer additional General Fund to the
criminal convictions in court. However, certain
DNA Identification Fund if revenues deposited
counties and cities benefit significantly more
into the fund decline further and are insufficient
than others. Specifically, while 12 counties
to support BFS. This transfer could only occur
and 8 cities currently use their own resources
30 days after written notification is provided to
to support local criminal laboratories,
the Legislature. To the extent that this proposed
46 counties generally do not have to use
language is included in the annual budget act, the
any of their resources for criminal laboratory
General Fund would be permanently responsible
services. This is because BFS is effectively
for backfilling the DNA Identification Fund to ensure
subsidizing the agencies in these counties
there is sufficient funding to support BFS.
with tens of millions of dollars in services
annually. As such, the current system
Assessment
is inequitable.
Governor’s Proposal Would Permanently
• Local Governments Lack Incentive to
Address Ongoing Decline in DNA Identification
Use BFS Services Cost-Effectively. BFS’s
Fund Revenues. The Governor’s proposal
current funding structure provides the
would fully address the ongoing decline in DNA
agencies it serves with little incentive to use
Identification Fund revenues and provide BFS
its services in a cost-effective manner. Since
with a stable level of funding. This is because the
BFS does not charge for its services, these
General Fund would be permanently responsible for
local agencies lack incentive to prioritize what
supporting any BFS costs that cannot be supported
forensic evidence is collected and submitted
by the DNA Identification Fund.
for testing. Their submissions instead are
Increased DNA Identification Fund Support
generally only limited by BFS’s overall capacity
for BFS Reasonable. We find that the Governor’s
and service levels, as determined by the
proposed level of funding for BFS generally
amount of funding provided to the bureau in
appears reasonable as DOJ has provided sufficient
the annual state budget. In contrast, counties
workload justification for the total level of funding
and cities that use their own resources to
provided for the bureau’s operations as well as
support their labs—or those that decide they
the ongoing need for equipment replacement and
want to pay a private laboratory for testing—
facility maintenance.
have greater incentive to carefully prioritize
Requiring Users of BFS Services to Partially
what evidence should be tested and how
Support BFS Merits Consideration. As noted
quickly it should be done.
above, DOJ was directed to provide the Legislature
Similarly, we find that requiring nonlocal
with funding alternatives to support BFS that did
government entities pay for their share of BFS also
not include the General Fund. Upon our review
merits consideration. As previously mentioned,
of DOJ’s March 2022 report on such alternative
this was a funding option identified in DOJ’s
funding options, we conclude that requiring users of
March 2022 report. Specifically, DOJ notes that
BFS services to partially support BFS operations is
nearly 34 percent of BFS workload in 2020 was for
the best option.
4 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
nonlocal governmental entities—with the California is collected. Given the fund’s priority order
Highway Patrol and CDCR as major users. in this formula, it is not certain that it would
Requiring nonlocal government entities pay for their receive the expected revenues as funds with a
share of services encourages entities to consider higher-priority order could receive the bulk of
what evidence is submitted, why it is submitted, any additional revenue collected.
and whether it should be submitted to DOJ or • Requiring Judicial Branch Support. While
another entity. We note that this could require some forensic science is a key component of
level of increased resources for state agencies that evidence in criminal cases, the judicial branch
receive BFS services. However, this would reduce is not responsible for determining whether a
the General Fund backfill needed to support BFS. criminal case is to be filed and the type and
Most Other Potential Alternative BFS Funding quality of evidence provided to prosecute
Options Identified by DOJ Raise Concerns. such cases. In fact, this is a responsibility of
In our review of DOJ’s March 2022 report, we local prosecutors and law enforcement rather
identified various concerns about the viability of than the judicial branch who is responsible for
some of the potential funding options identified. fairly and objectively adjudicating such cases.
Specifically, we have concerns related to the
following options: Recommendations
• General Tax Increase. A general tax increase Forensic services are important to various
would effectively be an increase in General agencies in the investigation and prosecution of
Fund resources as such taxes are typically criminal cases. Accordingly, it is important that
deposited into the state’s General Fund to BFS receives relatively stable funding to process
support various purposes. As such, this does its workload. This has been challenging in recent
not represent an alternative other than simply years due to the continual decline in revenue
using the General Fund. As noted above, the in the DNA Identification Fund. The Governor’s
Legislature requested options other than the budget proposes to stabilize funding by providing
General Fund to support BFS. an ongoing General Fund backfill to the DNA
Identification Fund. In contrast, we recommend
• Criminal History Background Check Fee
below an alternative approach that minimizes the
Increase. These fees are typically assessed
impact on the General Fund and results in users
to cover DOJ’s costs for providing criminal
of BFS services having incentive to prioritize the
history information for employment, licensing,
workload that is submitted.
or certification purposes—including the
maintenance of the systems from which Specifically, we recommend the Legislature
the criminal history information is obtained. require (1) users of BFS services to partially support
BFS work does not seem as if it would be BFS beginning in 2024-25 and (2) DOJ to develop
consistent with the intent of these fees. For a plan for calculating each agency’s share of the
example, it is unclear the extent to which BFS services it uses. To allow for this new funding
applicants seeking background checks would structure to be implemented, we recommend
benefit from BFS services. the Legislature approve the total funding level
proposed in the Governor’s budget to support BFS
• Criminal Conviction Fee Increase. Given
and provide the proposed General Fund backfill—
the state’s complex formula for distributing
but only for one year. We discuss each of our
criminal fine and fee revenue, there is no
recommendations in greater detail below.
guarantee that increasing this specific fee
will actually increase the amount of revenue Require Users of Forensic Services to
deposited in the DNA Identification Fund Partially Support BFS Beginning in 2024-25.
annually. This is because the complex formula Given the substantial benefit that local agencies
dictates the order in which special funds receive from BFS services, we recommend the
receive criminal fine and fee revenue that Legislature require local governments to partially
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2023-24 BUDGET
support BFS beginning in 2024-25. Agencies that part of the 2024-25 budget. We also recommend
receive services from BFS would be required to the Legislature provide DOJ with direction on how
pay for a portion of the services they receive— much of BFS operation revenues should come from
providing greater incentive to prioritize workload local, state, and other agencies (such as one-third
to DOJ. Additionally, this would also be more or one-half) as well as whether the Legislature
equitable than the existing system in which certain plans to directly appropriate a specific General
local governments receive services at no charge, Fund amount to support a certain level of services
while others pay to operate their own laboratories. for state agencies. This would generally reduce the
Delaying this change to 2024-25 provides time amount of General Fund needed to support BFS
for the implementation of a new funding structure costs on an ongoing basis.
and to allow agencies to adapt to the new DOJ would have flexibility in calculating each
funding framework. agency’s share of the BFS services it uses—
Similarly, we recommend the Legislature including operation and facility costs—based
require nonlocal government agencies to partially on consultation with stakeholders and after
support BFS by paying for a portion of the services considering various factors (including equity
they receive from their operational budgets. concerns). For example, DOJ could require
For example, CDCR could be directed to pay for agencies pay more or less based on various
their share of BFS services from their operational factors—such as the specific type of forensic
budget. This would provide CDCR with incentive service sought, the speed of the service, or the size
to consider what evidence, and the amount of of the agency.
evidence, that is submitted. (We note that this We acknowledge that developing such a plan
would be similar to the DOJ Legal Division billing may be difficult. However, our recommendation
state agencies for the costs of providing legal would increase users’ incentive to ensure such
advice and service.) Alternatively, the Legislature BFS services are used cost-effectively and
could designate specific portions of the General would promote equity among local governments.
Fund it provides to BFS as being exclusively Additionally, under such a plan, the amount of
to provide services for each entity—effectively General Fund backfill needed in 2024-25 and in
capping the amount of service the entity would future years would be less than currently proposed.
receive. Because this amount would be limited,
Approve Funding Level and Provide Backfill
it would similarly provide an incentive for these
for One-Year. We recommend the Legislature
entities to consider what evidence is submitted and
approve the total funding level proposed in the
why it is submitted.
Governor’s budget to support BFS. However,
Require DOJ to Develop Plan for Calculating to provide DOJ and the agencies receiving BFS
User Share of BFS Support. We recommend services time to implement and adapt to a new
the Legislature direct DOJ to submit a plan for funding structure, we recommend only approving
calculating each agency’s share of the BFS the requested $53.4 million General Fund for
services it uses—including operating and facility one year. This would ensure existing BFS service
costs—and report on this plan no later than levels are maintained as the new funding structure
October 1, 2023 to allow for its consideration as is implemented.
6 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
FUNDING FOR FIREARM-RELATED WORKLOAD
Background to $55.7 million in 2022-23—an increase of
$24.4 million (or 78 percent). During this period,
Overview of DOJ Firearm and Ammunition
BOF also shifted from being fully supported by
Responsibilities. DOJ’s Bureau of Firearms (BOF)
various special funds and began receiving General
is primarily responsible for the regulation and
Fund support in 2019-20. Of the total $55.7 million
enforcement of the state’s firearm and ammunition
provided to BOF in 2022-23, $22 million (or
laws. This includes conducting background checks
40 percent) was from the General Fund and
for individuals seeking to purchase firearms and
$33.6 million (or 60 percent) was from various
ammunition, licensing firearm and ammunition
special funds. Most of the General Fund is used
vendors, conducting vendor compliance
to support the enforcement teams—which has
investigations, ensuring lawful possession of
been the case since 2019-20 when the budget
firearms and ammunition, and administering
packaged shifted full support of these teams
various other firearms and ammunition programs.
over to the General Fund. (We also note that CJIS
BOF engages in various activities related to
separately receives millions of dollars annually
these responsibilities. For example, BOF has
from various fund sources to maintain and update
enforcement teams who are primarily responsible
various databases, such as the Automated Firearms
for investigating the illegal purchase or possession
System which tracks firearm serial numbers,
of firearms and ammunition, as well as seizing them
needed to support BOF’s activities.)
from individuals who are prohibited from owning or
possessing them. DROS Special Account. State law authorizes
DOJ to charge various fees related to firearms and
Overall BOF Funding and General Fund
ammunition that are deposited into one of several
Support Increased Over Past Decade. As shown
state special funds to support BOF programs and
in Figure 3, support for BOF has increased over
activities. For example, an individual purchasing
the past decade from $31.2 million in 2013-14
Figure 3
Bureau of Firearms Funding Increased Since 2016-17
(In Millions)
$60
General Fund
50
Special Funds
40
30
20
10
2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24
(estimated) (projected)
www.lao.ca.gov 7
2023-24 BUDGET
a firearm currently pays fees totaling $37.19—a Governor’s Proposal
$31.19 fee deposited into the DROS Special
The Governor’s budget proposes $6.9 million
Account (the “DROS fee”), a $5 fee into the Firearm
in 2023-24 ($6.3 million General Fund and
Safety and Enforcement Special Fund, and a $1 fee
$573,000 from the DROS Special Account)—
into the Firearm Safety Account. State law also
declining to $3.5 million annually beginning
authorizes DOJ to administratively increase some of
in 2026-27 ($3.3 million General Fund and
these fees to account for inflation as long as the fee
$179,000 from the DROS Special Account)—to
does not exceed DOJ’s regulatory and enforcement
support DOJ firearm workload. As shown in
costs. State law authorizes revenues deposited
Figure 5, the proposed funding would support
into each of these special funds to be used for
seven budget proposals, including five related to
various purposes.
workload resulting from recently enacted legislation.
State law authorizes the DROS Special Account
Assessment
to support a wide range of BOF programs and
activities (as well as CJIS activities needed to Proposals Reasonable, but Could Be Funded
support BOF workload). As shown in Figure 4, by DROS Special Account Rather Than General
revenues often fluctuate from year to year, generally Fund. We find the level of funding requested in the
reflecting changes in fee levels and the number of Governor’s proposals to be generally reasonable to
firearms sold. DROS Special Account expenditures support increased workload and/or is necessary to
routinely exceeded revenues prior to 2019-20— implement enacted legislation. However, we believe
resulting in the use and decline of the fund balance. that all of the requested resources could be funded
To help ensure sufficient revenues would be by the DROS Special Account rather than the
available to support BOF workload, Chapter 736 of General Fund. This is because the workload appears
2019 (AB 1669, Bonta) enabled DOJ to increase the to be allowable uses of DROS Special Account
DROS fee charged from $19 to $31.19. This resulted revenues. Additionally, there appears to be sufficient
in DROS Special Account revenues generally DROS Special Account revenues and fund balance
exceeding expenditures in recent years—thereby to support this workload. Specifically, DROS
allowing the fund balance to steadily increase. Special Account annual revenues are currently
The Governor’s budget estimates $35.9 million in about $5 million higher than expenditures and the
DROS Special Account revenues in 2023-24 and fund balance is estimated to be $35.9 million at
expenditures of $30.9 million, resulting in a fund the end of 2023-24. This is sufficient to support
balance of $35.9 million at the end of the year. the $6.3 million in increased support requested
Figure 4
DROS Special Account Fund Balance Increasing in Recent Years
(In Millions)
$50
45
40
Revenues
35
Expenditures
30
25
20
15
10
Fund Balance
5
2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24
(estimated) (projected)
DROS = Dealers Record of Sale.
8 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
Figure 5
Summary of Governor’s Firearm Workload Proposals
Workload Proposed Resources Description
Recently Enacted Legislation
Chapter 76 of 2022 (AB 1621, 21 positions (11 limited term) and AB 1621 requires any person possessing an unserialized
Gipson) $2.8 million General Fund in 2023-24, firearm, as well as new residents within 60 days of arrival
declining to $1.2 million annually in in the state, to apply to DOJ for a unique identification
2025-26 mark. The legislation also modifies the definition of
firearm precursor parts and generally prohibits the sale or
possession of unserialized firearm precursor parts. DOJ
seeks resources to address this increased workload.
Chapter 142 of 2022 (AB 2156, $911,000 General Fund in 2023-24 AB 1621 prohibits any person from manufacturing firearms
Wicks) without being licensed by the state and requires people
manufacturing between 4 and 49 firearms in a calendar
year now be licensed. The legislation also prohibits any
person who is not licensed as a firearm manufacturer
from manufacturing any firearm or precursor part using
a 3D printer. DOJ requests resources to update firearms
systems to enforce these provisions.
Chapter 138 of 2022 (AB 228, 5 positions and $797,000 General Fund AB 228 requires DOJ generally inspect firearm dealers at
Rodriquez) in 2023-24, declining to $738,000 least every three years and audit a sampling of
annually in 2024-25 25 percent to 50 percent of each record type. DOJ seeks
resources to address this increased workload.
Chapter 696 of 2022 (AB 2552, 1 limited-term position and $408,000 AB 2552 requires DOJ conduct enforcement and
McCarty) ($12,000 General Fund and $396,000 inspections at a minimum of one-half of all gun shows or
DROS) in 2023-24, declining to events in the state, public posting of certain violations,
$191,000 ($12,000 General Fund and and annual reporting to the Legislature on enforcement
$179,000 DROS) annually in 2025-26 activities. Also authorizes inspection of any firearm
precursor part vendors at gun shows or events. DOJ
seeks resources to address this increased workload.
Chapter 995 of 2022 (SB 1384, 1 limited-term position and $177,000 AB 1384 requires licensed firearms dealers to have a digital
Min) DROS in 2023-24 and $164,000 in video surveillance system on business premises and
2024-25 to carry a general liability insurance policy. DOJ seeks
resources to develop regulations for dealers to certify
these conditions are met.
Other Workload
Firearm Compliance Support 3 positions and $342,000 General Fund DOJ requests resources to support increased carry
Section Workload in 2023-24, declining to $307,000 concealed weapons licensing and Automated Firearms
annually in 2024-25 System workload.
Microstamping and Law 5 positions and $1.5 million General DOJ requests additional resources, above the level
Enforcement Transfera Fund in 2023-24, declining to provided as part of the 2021-22 budget, to complete
$1.1 million annually in 2026-27 changes to existing firearms databases in order to
implement previously enacted legislation related to the
microstamping of handguns and the tracking of unsafe
handguns.
a Continued implementation of Chapters 289 of 2020 (AB 2699, Santiago) and 292 of 2020 (AB 2847, Chiu).
DOJ = Department of Justice and DROS = Dealers Record of Sale Special Account.
in 2023-24 as well as the $3.3 million in requested Furthermore, we note that funding such workload
ongoing support. We note that DOJ indicates that from the DROS Special Account instead of the
it is seeking General Fund resources to support General Fund means that additional General Fund
these proposals in order to ensure that there are would be available to support other legislative
sufficient resources in the DROS Special Account to priorities. This includes helping to balance the state
support future proposals—most notably a project to budget in 2023-24 as well as to address projected
replace 17 firearms and ammunition databases and out-year deficits under the Governor’s budget.
systems, which is currently in the planning process.
However, those proposals have not been presented
to the Legislature for consideration at this time.
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2023-24 BUDGET
Recommendation General Fund support relative to the Governor’s
budget—$6.3 million in 2023-24, declining to
Fund the Proposals Entirely From DROS
$3.3 million ongoing beginning in 2026-27. This
Special Account. We recommend the Legislature
is helpful as the Legislature may prefer a different
approve the request for additional funding support
package of budget solutions to balance the 2023-24
as such monies are needed to support increased
budget than the ones proposed by the Governor
workload and to implement enacted legislation.
or need to consider additional solutions given the
However, we recommend the Legislature provide
heightened risk of revenue shortfalls, as well as the
the requested resources entirely from the DROS
projected out-year deficits that would occur under
Special Account, as the account has sufficient
the Governor’s proposed budget.
revenues to support them in the near term.
This recommendation would “free up” ongoing
ADDITIONAL RESOURCES FOR LEGAL WORK
The Governor’s budget includes 18 proposals state laws. For example, the Attorney General
for increased resources to support DOJ legal is authorized to enforce state laws prohibiting
workload. In this section, we first an provide an unlawful, unfair, or fraudulent business practices as
overview of these proposals, some overarching well as false or misleading advertising.
comments assessing the proposals collectively, DOJ Division of Legal Services Responsible
and recommendations to address our identified for Most DOJ Litigation. DOJ consists of three
concerns. We then provide some more specific major divisions: Legal Services, Law Enforcement,
comments related to two of the proposals. and California Justice Information Services. The
Division of Legal Services is responsible for most of
DISCUSSION OF GOVERNOR’S DOJ’s litigation activities. In 2022-23, $645 million
OVERALL PROPOSALS (or 53 percent) of DOJ’s budget supported
this division. This funding comes from various
Background sources—about 40 percent from reimbursements
Attorney General Designated as State’s (generally from state agencies receiving DOJ legal
Chief Law Officer. The California Constitution services), 35 percent from the state General Fund,
designates the Attorney General—who leads 16 percent from state special funds (including
DOJ—as the state’s chief law officer and specifies litigation proceeds, which are generally payments to
various duties for the Attorney General. One the state in exchange for the state ending its pursuit
duty is to prosecute violations of state law when of legal action), and 9 percent from federal funds.
the Attorney General believes state law is not The Division of Legal Services is further divided
being adequately enforced. In addition, state law into four subdivisions—Civil Law, Criminal Law,
generally requires the Attorney General to represent Medi-Cal Fraud and Elder Abuse, and Public Rights.
state agencies and their employees in judicial Of the total amount of funding provided to support
proceedings. Unless specifically exempted by state the division in 2022-23:
law (as is the case for the University of California
• $241 million (or 37 percent) supported
Board of Regents and the California Department
Civil Law.
of Transportation), state agencies must generally
• $139 million (or 21 percent) supported
obtain written consent from the Attorney General
Criminal Law.
before using in-house counsel (meaning their own
• $73 million (or 11 percent) supported Medi-Cal
legal staff) or contracting with outside counsel.
Fraud and Elder Abuse.
Additionally, statute authorizes the Attorney General
to investigate and prosecute violations of certain • $193 million (or 30 percent) supported
Public Rights.
10 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
As shown in Figure 6, the sources of such • DOJ can self-initiate legal actions, as well
funding supporting each subdivision varies. as defend or represent the state as a whole
For example, Civil Law is predominantly supported in actions filed by others. These costs are
by reimbursements in contrast to the other generally paid for from DOJ’s budget through
three subdivisions. Each of these subdivisions General Fund dollars or special funds.
then generally has its own sections or units.
DOJ Has Flexibility Over Legal Workload. DOJ
For example, the Public Rights Subdivision
has flexibility over its litigation workload, particularly
includes an Antitrust Law Section and Consumer
with respect to self-initiated litigation, within
Protection Section.
existing resources. This is because DOJ is the sole
DOJ Litigation Initiated in Two Major Ways.
decision-maker on which cases it pursues based
DOJ legal workload can be initiated in two primary
on its priorities. Specifically, DOJ has flexibility in
ways. Specifically, litigation can be initiated
determining whether to initiate a case, how the case
as follows:
is initiated, and how cases are resolved. In contrast,
• State agencies can request DOJ initiate DOJ has less flexibility over litigation workload
legal action, defend or represent them in legal initiated by state agencies. This is because
actions filed by others, or provide legal advice. decisions on whether to pursue legal action and
DOJ typically bills state agencies for their how such cases are resolved are either determined
costs, which are reflected as reimbursements by the state agency, or in partnership with the
in DOJ’s budget. (These reimbursements state agency. This means DOJ cannot fully control
are deposited into a special fund, the Legal such workload.
Services Revolving Fund [LSRF].) State DOJ Administers State Litigation Deposit
agencies generally pay for these costs from Fund (LDF). The LDF is a state special fund created
their own budgets, which can consist of to receive litigation proceeds in cases where the
General Fund and/or special fund dollars, state is a party to the legal action and no other state
such as licensing fee revenue. statutes specifically provide for (1) the handling
and investing of the money and (2) how any earned
interest is distributed. (The state
Figure 6 generally earns interest from the
investment of monies that are
Funding for Division of Legal Services by
held prior to allocation.) The fund
Subdivision in 2022-23
primarily supports payments to
(In Millions) individuals and entities harmed
by those breaking the law, as well
as transfers to DOJ special funds
Civil to support DOJ litigation-related
costs. State law requires that
any monies remaining in the
Criminal LDF that are not needed to satisfy
court-ordered payments as
General Fund
Special Funds documented in legal agreements
Medi-Cal Fraud and Federal Funds or to support DOJ’s litigation costs
Elder Abuse Reimbursements
be transferred to the state General
Fund no later than July 1 of each
Public Rights fiscal year.
Deposits of litigation proceeds
50 100 150 200 250 $300 into the LDF, as well as the
amount of funds actually allocated
from the LDF, vary over time.
www.lao.ca.gov 11
2023-24 BUDGET
As shown in Figure 7, the LDF fund balance—or the exclusively support the enforcement of consumer
amount of money remaining in the fund at the end of protection laws by the Attorney General. Most
the year after all revenues have been received and all transfers to these DOJ special funds support work
allocations have been made—has grown significantly of roughly a dozen sections within the Public Rights
and relatively steadily over the past decade. As of the Division as well as the Medi-Cal and Elder Abuse
end of December 2022, the LDF fund balance was Division. As shown in Figure 8, these sections
just under $1.1 billion.
Because the LDF was created to
hold monies as a trust fund, it is not Figure 7
reflected in or considered part of the
LDF Fund Balance Continues to Grow
state budget, similar to other state
(In Billions)
funds with this status. Instead, DOJ is
only required to report quarterly to the
$1.2
Legislature on the number of deposits
received, the amount of interest
1.0
received, the amount disbursed to
claimants, and the amount used to 0.8
support DOJ litigation costs. State law
0.6
places the fund under the control and
administration of DOJ. Specifically, 0.4
state law requires DOJ maintain
accounting records for the fund and 0.2
generally authorizes DOJ to make
allocation decisions whenever, and to 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
(Through
whomever, it deems appropriate as December
2022)
long as the decisions are consistent
LDF = Litigation Deposit Fund.
with the terms of underlying legal
agreements or state law. Until such
allocations are made, monies remain Figure 8
in the LDF fund balance.
DOJ Sections Supported by LDF Litigation Proceeds
LDF Monies Used to Support
Also Receive Support From Other Fund Sources
Some DOJ Litigation Activities.
2021-22
Tens of millions of dollars in LDF
monies are regularly transferred
each year to four DOJ special funds:
Federal and Other Funds
the Unfair Competition Law (UCL)
State General Fund
Fund, the False Claims Act Fund, the
Antitrust Account, and the Public
Rights Law Enforcement Special
Fund (PRLESF). State law specifies
what types of litigation proceeds
can be transferred into these funds Legal Services
Revolving Funda
and provides guidelines for how
Unfair Competition
such proceeds are to be used. For Law Fund
example, state law requires the state’s Public Rights Law
Enforcement Special Fund
share of litigation proceeds from
Antitrust Account False Claims Act Fund
cases related to unlawful, unfair, or
fraudulent business practices, as well a Reflects legal services costs billed back go to state agencies. While eligible for LDF transfers, there were no LDF
as false or misleading advertising, transfers to the Legal Services Revolving Fund in 2021-22.
DOJ = Department of Justice and LDF = Litigation Deposit Fund.
be deposited into the UCL Fund to
12 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
generally receive support from other funds as well, to pay for private legal services to assist DOJ in
including the state General Fund. The specific level defending the state in two pending cases related
and mix of funding for these various sections can vary to state pandemic eviction-related laws. The
annually based on DOJ funding decisions. remaining three proposals would provide the Public
Rights Division with additional legal resources for
Governor’s Proposal
housing-related legal workload for its Housing
Additional Resources to Support Increased Strike Force, for antitrust legal workload for its
Legal Workload. The Governor’s budget proposes Antitrust Law Section, and for wage theft criminal
$24.5 million in 2023-24 ($15 million General Fund prosecutions by its Worker Rights and Fair Labor
and $9.5 million from the LSRF, Antitrust Account, Section. (We provide more specific comments for
and UCL Fund)—decreasing to $20.6 million two of these proposals—increased resources for
annually in 2027-28—to support increased legal the Housing Strike Force and the Antitrust Law
workload. As shown in Figure 9 on the next page, Section—later in this analysis.)
this amount would support 18 proposals across the
Assessment
Civil Law, Criminal Law, and Public Rights Divisions.
A description of each of these proposals is in Legal Workload Would Increase Due to
Figure 10 on page 16 and 17. Enacted Legislation and Other Factors... As
Fourteen Proposals Seeking to Implement noted above, some of the budget proposals to
Legislation. The Governor’s budget proposes implement recently enacted legislation direct DOJ
$11 million General Fund in 2023-24 (decreasing to engage in certain new activities that are expected
to $10.4 million annually in 2027-28) to support to generate ongoing workload. For example,
Criminal Law Division and Public Rights Division Chapter 326 allows for any law enforcement
implementation of 14 pieces of enacted legislation. agency to request DOJ review its use of force
Some of these proposals require DOJ take certain policies and requires DOJ to provide individualized
actions. For example, beginning July 2023, recommendations. This is new workload that is
Chapter 326 of 2020 (AB 1506, McCarty) requires likely to persist into the future given the number of
DOJ review law enforcement agencies’ use of law enforcement agencies in the state. Similarly,
deadly force policies (upon agency request) and DOJ has demonstrated that the state can benefit
provide specific and customized recommendations. from increased legal activity in certain areas—such
Other proposals authorize—but do not require— as housing and wage theft—as it could reduce
DOJ to take action. For example, beginning potential harm to Californians. For example, wage
July 2023, Chapter 857 of 2022 (SB 301, Skinner) theft-related legal action can address business
requires online marketplaces to mandate their practices (such as employee misclassification
high-volume, third-party sellers to (1) report specific or tax evasion) that are harmful to workers. DOJ
information, (2) verify the provided information, has provided sufficient workload justification
(3) suspend future sales of third-party sellers for these proposals that suggests additional
that do not comply with reporting and other resources appear to be needed. As such, it would
specified conditions, and (4) comply with certain be reasonable to provide the requested funding to
recordkeeping procedures. DOJ is authorized to support this workload on the assumption that all
seek civil penalties, reasonable attorney’s fees and funding provided for legal activities is currently used
costs, and preventative relief (such as an injunction) efficiently and effectively.
for violations. Other budget proposals to implement recently
Four Proposals for Two Specific Cases and enacted legislation authorize—but do not require—
Other Legal Workload. The Governor’s budget DOJ action. This provides DOJ with discretion on
proposes $13.4 million in 2023-24 ($4 million how much workload is generated—such as whether
General Fund and $9.5 million from various special DOJ pursues investigations and litigation as well as
funds)—decreasing to $10.2 million annually in how many such cases are initiated. For example,
2027-28—for four budget proposals supporting Chapter 857 authorizes DOJ to seek civil penalties
DOJ legal workload. One proposal would provide and other remedies if online marketplaces do not
General Fund resources for the Civil Law Division comply with state law. It is important that DOJ has
www.lao.ca.gov 13
2023-24 BUDGET
Figure 9
Summary of 2023-24 Legal-Related Budget Proposals by Requested Fund Source
(In Millions)
2027-28
Legal Section and
Budget Proposal and Division 2023-24 2024-25 2025-26 2026-27 Ongoing
General Fund
Outside Co-Counsel Torts (Civil) $3.0 $3.0 $3.0 $3.0 —
Chapter 739 of 2022 (AB 256, Kalra): Criminal AWT (Criminal) 2.2 2.1 0.8 0.8 —
Procedure Discrimination
Chapter 806 of 2022 (AB 2778, McCarty): Race- Various 0.8 2.4 2.4 2.4 $2.4
Blind Charginga (Criminal)
Chapter 98 of 2022 (AB 1594, Ting): Firearm Civil Consumer 0.6 0.6 0.6 0.6 0.6
Suits (PRD)
Chapter 269 of 2022 (AB 587, Gabriel): Social Consumer 0.7 0.6 0.6 0.6 0.6
Media Companies Terms of Service (PRD)
Chapter 320 of 2022 (AB 2273, Wicks): California Consumer 0.9 1.2 1.1 1.1 1.1
Age-Appropriate Design Code Act (PRD)
Chapter 642 of 2022 (AB 1837, Bonta): Residential Consumer 0.2 0.2 0.2 0.2 0.2
Real Property Foreclosure (PRD)
Chapter 700 of 2022 (AB 2879, Low): Consumer 0.3 0.4 0.4 0.4 0.4
Cyberbullying Online Content (PRD)
Chapter 857 of 2022 (SB 301, Skinner): Online Consumer 0.8 0.8 0.8 0.8 0.8
Marketplaces (PRD)
Chapter 326 of 2020 (AB 1506, McCarty): Police CRES (PRD) 1.8 1.8 1.8 1.8 1.8
Practices Division
Chapter 555 of 2022 (AB 1287, Bauer-Kahan): CRES (PRD) 0.3 0.3 0.3 0.3 0.3
Gender Price Discrimination
Chapter 750 of 2021 (AB 1084, Low): Gender CRES (PRD) 0.3 0.5 0.5 0.5 0.5
Neutral Retail Departments
Chapter 854 of 2022 (AB 655, Kalra): California CRES (PRD) 0.3 0.3 0.3 0.3 0.3
Law Enforcement Accountability Reform Act
Chapter 986 of 2022 (SB 863, Min): Domestic CRES (PRD) 1.5 1.1 1.1 1.1 1.1
Violence Death Review Teams
Chapter 475 of 2022 (AB 923, Ramos): IGLS (PRD) 0.3 0.3 0.3 0.3 0.3
Government-to-Government Consultation Actb
Housing Strike Force Land and CRES 1.0 0.9 0.9 0.9 0.9
(PRD)
Subtotal, General Fund ($15.0) ($16.6) ($15.2) ($15.2) ($11.4)
Special Funds
Legal Services Revolving Fund
Housing Strike Force Land and CRES $0.4 $0.4 $0.4 $0.4 $0.4
(PRD)
Antitrust Account
Antitrust Gasoline Pricing, Agriculture, and Antitrust (PRD) $4.0 $3.9 $3.9 $3.9 $3.9
Technology Enforcement
Unfair Competition Law Fund
Antitrust Gasoline Pricing, Agriculture, and Antitrust (PRD) $4.0 $3.9 $3.9 $3.9 $3.9
Technology Enforcement
Wage Theft Criminal Prosecutions WRFLS (PRD) 1.1 1.1 1.1 1.1 1.1
Subtotal, Special Funds ($9.5) ($9.2) ($9.2) ($9.2) ($9.2)
Totals, All Funds $24.5 $25.8 $24.4 $24.4 $20.6
a Also reflects associated Research Center Costs.
b Adjusted to reflect only legal-related portion of the request.
Consumer = Consumer Protection Section; Torts = Torts and Condemnation Section; CRES = Civil Rights Enforcement Section; AWT = Appeals, Writs and
Trials Section; PRD = Public Rights Division; Land = Land Use and Conservation Section; WRFLS = Worker Rights and Fair Labor Section; and IGLS = Indian
and Gaming Law Section.
14 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
the ability to enforce such laws and that it do so if that were not effective or did not meet legislative
the law is violated. However, it is unclear the extent expectations or priorities would demonstrate that
to which sufficient workload would be generated on ongoing funding was not merited.
an ongoing basis. For example, businesses would However, this flexibility can make it difficult
likely adapt their business practices to comply with to monitor how resources provided to support
Chapter 857 in the coming years. This—along with DOJ’s legal workload are used over time. Some
the threat of potential DOJ litigation—could reduce DOJ budget requests seek additional funding
illegal activity and require little resources for DOJ for particular purposes. However, over time, it is
litigation on an ongoing basis. unclear whether such resources are still being
...But Unclear Whether Requested Resources used for that purpose or if the resources have been
Are Needed. As we discuss below, the Legislature redirected to other workload that has become
currently lacks information on how DOJ prioritizes a greater priority. For example, DOJ received
its workload, how it uses its appropriated funds, $6.5 million in increased annual General Fund
and the extent to which LDF or offsetting revenues resources and 31 positions beginning in 2017-18
are available to support DOJ workload. This for increased workload related to challenging or
makes it difficult for the Legislature to determine responding to various federal directives that could
whether additional resources are truly needed or significantly impact California in a negative manner.
if the Legislature could instead redirect existing With a different federal administration issuing fewer
resources to support this workload. such directives, it is unclear how this ongoing
Difficult for Legislature to Monitor How funding is currently used or whether the activities
Funding for Legal Workload Is Used Over Time. it is supporting are consistent with legislative
Annual budgets since 2009-10 have typically priorities. Similarly, while DOJ budget requests
appropriated funding to the entire Legal Division seeking additional resources typically focus on a
from various fund sources. This means that particular section, this flexibility could allow DOJ
DOJ has flexibility on how such resources are to shift resources between its subdivisions and
specifically used across the division. This includes sections. A lack of transparency on how legal
how the legal division is organized (such as how funding is used across the Legal Division broadly
staff are divided into sections) as well as what legal makes it difficult for the Legislature to assess
investigations and litigation are pursued based on whether additional resources are truly needed or if
DOJ priorities. funding could instead be redirected from other DOJ
legal workload on an ongoing or temporary basis.
Such flexibility can be a major benefit to the
state as it allows DOJ to pivot quickly to address Unclear Whether LDF Could Support
the issues most likely to significantly impact Workload Given Limited Opportunity for
Californians as well as to focus resources where Legislative Oversight of LDF. As noted above,
necessary (such as if a case or investigation moves DOJ legal workload is supported from various
forward suddenly due to court action). It also fund sources—including the General Fund and
allows DOJ to “test” the use of resources in a various special funds that receive transfers from
particular way before approaching the Legislature litigation proceeds deposited into the LDF. It is
to seek ongoing funding. For example, because unclear the extent to which funds in the LDF are
it was a priority for the Attorney General at the eligible for transfer to support DOJ workload.
time, DOJ established the Bureau of Children’s (We define funds eligible for transfer to include
Justice in 2014-15—to focus on legal workload all litigation funds that DOJ has decision-making
related to children (such as school discrimination)— authority over. Ineligible funds would be monies
using one-time settlement revenues and existing pending allocation to specific individuals or
positions redirected from the Public Rights narrowly defined purposes, as well as funds
Division. The bureau’s work was then used to tied to cases that are awaiting final resolution.)
justify DOJ’s subsequent 2018-19 budget request, For example, it is possible that LDF funds are
which was approved, for $3.6 million on an available for transfer to the UCL Fund to support
ongoing basis from the PRLESF and 14 positions. the 2023-24 budget requests for the Consumer
In contrast, such a test that generated outcomes Protection Section—in lieu of the General Fund.
www.lao.ca.gov 15
2023-24 BUDGET
Figure 10
Description of 2023-24 Legal-Related Budget Proposals
Budget Proposal Description
Recently Enacted Legislation
Chapter 739 of 2022 Authorizes people to file a petition alleging that the state sought or obtained a criminal conviction or
(AB 256, Kalra): sentence on the basis of sex, ethnicity, or national origin and for the court to impose specified remedies
Criminal Procedure (such as vacating the conviction). Also authorizes the use of nonstatistical evidence to demonstrate racial
Discrimination bias and requires the court to consider systemic and institutional racial bias and racial profiling when
assessing evidence of racial bias. The Department of Justice (DOJ) requests resources to address such
petitions from past convictions that are subsequently appealed.
Chapter 806 of 2022 Beginning January 2024, requires DOJ develop and publish “race-blind charging” guidelines for agencies
(AB 2778, McCarty): prosecuting felonies or misdemeanors to implement a process which redacts suspect, victim, or witness
Race-Blind Charging racial identifying information from charging documents received from law enforcement agencies.
Beginning January 2025, requires such prosecuting agencies implement versions of the DOJ guidelines.
DOJ requests resources to develop these guidelines and to complete redaction and race-blind reviews of
DOJ criminal cases.
Chapter 98 of 2022 Beginning July 2023, requires firearm industry members comply with a specified standard of conduct—
(AB 1594, Ting): such as to implement reasonable controls to prevent firearm-related loss or theft. Prohibits firearm
Firearm Civil Suits industry members from manufacturing, marketing, importing, or selling firearm-related products that
are abnormally dangerous and likely to create an unreasonable risk of harm to public health and safety.
Authorizes a person suffering harm because of a firearm industry member’s conduct to seek court relief.
Authorizes DOJ, city attorneys, and county counsel to bring civil actions for violations and allows the court
to award damages, attorney’s fees and costs, and injunctive or other relief. DOJ requests resources to
investigate and pursue such cases.
Chapter 269 of 2022 Requires a social media company post their terms of service, including certain specific information, for each
(AB 587, Gabriel): social media platform it owns or operates and report certain information semiannually to DOJ beginning
Social Media Companies January 2024. Requires DOJ make such reports publicly available on its website. Authorizes DOJ and
Terms of Service select city attorneys to seek civil penalties. For DOJ actions, penalty revenues are split equally between
the state General Fund and the county in which the judgment was entered. DOJ requests resources to
post reports on its website as well as to investigate and pursue such cases.
Chapter 320 of 2022 Beginning July 2024, requires businesses that provide an online service or product likely to be accessed
(AB 2273, Wicks): by children comply with certain privacy requirements—including the completion of a data protection
California Age- impact assessment for any new service or product which must be provided to DOJ within five business
Appropriate Design days upon written request. Authorizes DOJ to seek civil penalties for any violations and requires that any
Code Act penalties, fees, and expenses recovered be deposited into the Consumer Privacy Fund, with the intent
that they be used to fully offset costs incurred by DOJ. DOJ requests resources to conduct investigations
and pursue cases, to review complaints and impact assessments, and other activities.
Chapter 642 of 2022 Makes various changes to processes and requirements related to the sale of residential properties. Requires
(AB 1837, Bonta): a trustee or its authorized agent send specific information to DOJ if the winning bidder at a trustee sale
Residential Real of property pursuant to a power of sale under a mortgage or deed of trust is an eligible tenant buyer,
Property Foreclosure prospective owner-occupant, or other eligible bidder and requires DOJ publish a summary of such
information on its website. Authorizes DOJ, county counsel, city attorneys, and district attorneys bring
legal action to enforce specific residential property foreclosure sale procedures and requirements. DOJ
requests resources to process the submitted data, respond to requests for information, and assist with
investigations and legal cases.
Chapter 700 of 2022 Requires social media platforms disclose all cyberbullying reporting procedures in its terms of service and
(AB 2879, Low): provide an online mechanism to report cyberbullying or any content that violates existing terms of service.
Cyberbullying Online Beginning September 2023, authorizes DOJ to seek civil penalties and injunctive relief for violations. DOJ
Content requests resources to investigate and pursue such cases.
Chapter 857 of 2022 Requires online marketplaces to require their high-volume third-party sellers report certain specific
(SB 301, Skinner): information, to verify the provided information, to suspend future sales of third-party sellers that do
Online Marketplaces not comply with reporting and other specified conditions, and to comply with certain recordkeeping
procedures. Beginning July 2023, authorizes DOJ to seek civil penalties, reasonable attorney’s fees and
costs, and preventative relief (such as an injunction) for violations. DOJ requests resources to investigate
and pursue such cases.
(continued)
16 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
Name of
Budget Proposal Description
Chapter 326 of 2020 Requires DOJ investigate officer-involved shootings resulting in the death of an unarmed citizen. Also
(AB 1506, McCarty) requires DOJ review, upon the request of a local law enforcement agency, the agency’s use of deadly
force policies and make recommendations. DOJ requests resources to review use of force policies and
make recommendations.
Chapter 555 of 2022 Prohibits a person or business from charging a different price for any two goods that are substantially similar
(AB 1287, Bauer-Kahan) if the difference is based on the gender of the people for whom the goods are marketed and intended.
Authorizes DOJ to seek a court order, after providing 5-day notice to the defendant, to prevent the
continuation of such practices and allows the court to impose civil penalties. DOJ requests resources to
investigate and pursue such cases
Chapter 750 of 2022 Requires retail department stores physically located in the state with a total of 500 or more employees that
(AB 1084, Low) sells childcare items or toys to maintain a gender neutral section area in which a reasonable selection
shall be displayed. Beginning January 2024, authorizes DOJ, district attorneys, or city attorneys seek
civil penalties and reasonable attorney’s fees and costs for violations of the law. DOJ seeks resources to
process, investigate, and pursue such cases as well as any other legal violations that emerge.
Chapter 854 of 2022 Requires public agencies investigate any complaint alleging its employed peace officers engaged in
(AB 655, Kalra) membership in a hate group, participated in hate group activity, or advocated public expressions of hate
and requires DOJ develop guidelines for investigation and adjudication of these complaints by local
agencies. DOJ requests resources to develop such guidelines, responding to inquiries, providing technical
assistance to local agencies, and enforce compliance.
Chapter 986 of 2022 Authorizes interagency domestic violence death review teams to assist local agencies identify and review
(SB 863, Min) domestic violence near-death cases. Subject to available funding, requires DOJ develop by January
2025 a protocol to facilitate communication between persons conducting autopsies and those involved
in domestic violence case to ensure such domestic violence incidences, near-deaths, and deaths are
recognized and surviving family members receive appropriate services. Adds near-deaths to the domestic
violence related data that may be collected and reported annually. DOJ requests resources to develop
this protocol, to collect near-death domestic violence data, to facilitate the sharing of data, and to issue an
annual report on an ongoing basis.
Chapter 475 of 2022 Encourages state agencies to consult on a government-to-government basis with tribes within 60 days
(AB 923, Ramos) of a tribal request and designates specific state officials (including the Attorney General) authorized to
represent the state in such consultations. Requires these designated state officials complete an annual
training on such consultations. DOJ seeks additional resources to provide legal advice and representation
in tribal issues.
Special Funds
Outside Co-Counsel DOJ requests resources to pay for private legal services to assist in the state’s defense in two pending
cases related to state pandemic eviction-related laws.
Housing Strike Force DOJ requests resources to support increased housing-related litigation workload--specifically related to land
use, conservation, and civil rights—of its Housing Strike Force.
Antitrust Gasoline Pricing, DOJ requests resources to support increased workload to investigate and prosecute antitrust violations in
Agriculture, and the technology, gasoline and oil, and agriculture sectors.
Technology Enforcement
Wage Theft Criminal DOJ requests resources to support increased workload for wage theft criminal investigations and
Prosecutions prosecutions as well as other labor-related violations.
www.lao.ca.gov 17
2023-24 BUDGET
This uncertainty is generally because current projected out-year deficits in the $4 billion to
state law and DOJ practices related to the LDF $9 billion range. Reducing the amount of General
limit the opportunity for the Legislature to conduct Fund needed to support such requests on an
effective oversight of the LDF. (Please see our ongoing basis would provide additional General
2021 report, Increasing Oversight of the State Fund relief in the budget and future years relative to
Litigation Deposit Fund, for a more detailed the Governor’s budget.
discussion on these issues. We summarize our Unclear How DOJ Accounts for Offsetting
findings in the nearby box.) Based on a review of Revenue. Several of the proposed budget requests
high-level, DOJ-provided data, we estimated that pertain to implementing legislation that authorizes
nearly 60 percent of the LDF fund balance could DOJ to seek civil penalties and/or reasonable
be eligible for transfer to various special funds. attorney fees and costs—some of which is intended
The status of the remaining 40 percent is unclear, to offset DOJ costs. For example, Chapter 320
as shown in Figure 11. requires businesses that provide an online service
Maximizing Use of LDF Monies Would Reduce or product likely to be accessed by children comply
Need for General Fund Resources. To the extent with certain privacy requirements and authorizes
LDF monies were available to support DOJ legal DOJ to seek civil penalties for any violations.
activities, it would reduce the cost pressure on the Chapter 320 further requires that any penalties,
General Fund. This is notable as the Governor’s fees, and expenses recovered be deposited into the
budget proposes various budget solutions to Consumer Privacy Fund, with the intent that they
address the estimated budget problem for 2023-24. be used to fully offset costs incurred by DOJ. DOJ,
However, our estimates suggest the budget however, is requesting General Fund resources
problem is likely to be larger in May. Moreover, to implement Chapter 320. While General Fund
even under Governor’s budget assumptions, the or other funds could be needed to initially pursue
proposed solutions also are insufficient to keep such cases, litigation proceeds should be available
the state budget balanced in future years, with to reimburse or offset such funds in the future.
Summary of LAO 2021 Report Findings on the Litigation Deposit Fund (LDF)
Our January 2021 report—Increasing Oversight of the State Litigation Deposit Fund—found
that current state law and the Department of Justice (DOJ) practices related to the LDF limit the
opportunity for the Legislature to conduct effective oversight of the LDF. Specifically, we found
that there is:
• Little meaningful information provided in statutorily required LDF quarterly reports, which
makes it difficult for the Legislature to assess and draw conclusions about DOJ litigation
activities.
• Little transparency on the level of resources available for transfer from the LDF to the
General Fund, special funds, or other funds means the Legislature lacks the necessary
information to determine what fiscal resources could be available as it makes budget
decisions.
• Little incentive for DOJ to transfer LDF monies to the special funds that support its
self-initiated litigation as these funds are included in the annual budget process and subject
to greater oversight.
• Limited opportunity for ongoing legislative oversight over legal workload initiated by DOJ,
which means that this workload is not as rigorously evaluated.
• Significant flexibility for DOJ in determining the use of legislatively appropriated funding over
time, which can make it difficult to track how DOJ is using provided resources over time.
18 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
In discussions with DOJ, it is unclear the extent Require DOJ to Report on Legal Workload
to which such penalty revenues and attorneys’ Annually. We recommend the Legislature direct
fees will be sought, how much might be obtained, DOJ to report annually beginning January 1, 2025
and the extent to which they will be used to offset on its (1) planned legal workload, position count,
this workload. and allocation of resources for the upcoming fiscal
year and (2) actual legal workload, position count,
Recommendations
and allocation from the preceding fiscal year and
As discussed above, the lack of information on how it compares with its initial plans for that year.
how DOJ prioritizes its workload, how it uses its Such reporting could include broad descriptions
appropriated funds, and the extent to which LDF or of pending and upcoming workload by legal
offsetting revenues are available to support DOJ section, when cases were initiated, the estimated
workload make it difficult for the Legislature to or actual number of hours required for these cases,
determine whether existing DOJ funding levels for the number of hours estimated to be available to
the Legal Division are appropriate. This, in turn, take on new cases or workload, and the potential
makes it difficult to determine whether additional remedies sought or achieved (such as the seeking
resources are truly needed, or if resources could and/or receipt of attorney fees or civil penalties).
be redirected, to address the workload needs The information would enable greater legislative
identified in the Governor’s budget proposals, oversight to monitor DOJ’s legal workload and
as well as whether state funding is being used ensure the fiscal resources provided to support it
consistently with legislative priorities. To address are used accountably. This includes helping the
these concerns, we recommend the Legislature Legislature determine whether additional resources
require DOJ to report on legal workload annually are needed for legislative or Attorney General
and provide the requested funding only on a priorities or if existing resources should be
two-year basis. reprioritized within the office to accommodate
new workload, such as the
new workload identified in the
Figure 11 Governor’s proposals.
Provide Requested Funding
Nearly 60 Percent of LDF Fund Balance Could Be
on Two-Year Basis. Given that
Eligible for Transfer to Other Special Funds
the requested resources would
As of January 2023
support the implementation of
recently enacted legislation,
as well as workload that could
UCL reduce harm to Californians,
we recommend the Legislature
provide funding to support the
identified workload until it receives
the above report. As such,
Unspecified we recommend approving the
requested funding on a two-year
basis. This would provide DOJ
FCA with the necessary resources to
implement enacted legislation
without delay, to continue its
Antitrust Account defense of two existing legal
Other
Multiple DOJ Funds PRLESF cases, and to increase its legal
activities in key areas while the
a Includes funds eligible to be distributed to more than one of DOJ's special funds supporting litigation activities.
LDF = Litigation Deposit Fund; UCL = Unfair Competition Law Fund; FCA = False Claims Act Fund; recommended report is completed
PRLESF = Public Rights Law Enforcement Special Fund; and DOJ = Department of Justice.
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2023-24 BUDGET
and analyzed. The recommended report could be DISCUSSION OF BUDGET
enhanced by the Legislature also implementing the
PROPOSALS FOR THE HOUSING
recommendations from our 2021 report on the LDF
STRIKE FORCE AND ANTITRUST
to improve legislative oversight of the fund. (We
LAW SECTION
summarize these recommendations in the nearby
box.) These LDF recommendations would provide In this section, we discuss two specific budget
more oversight on the level of litigation proceeds proposals for increased legal resources—
available to support DOJ legal workload. specifically, to support increased workload for the
In combination, the recommended report, Housing Strike Force and the Antitrust Law Section.
as well as implementation of our prior LDF
Governor’s Proposals
recommendations, would provide the Legislature
with the necessary information to (1) conduct Increased Housing Strike Force Workload.
meaningful oversight of DOJ’s legal workload, The Housing Strike Force was created by
(2) make informed decisions on what level of the Attorney General in November 2021 as a
funding (and the sources of such funding) would partnership of four sections within the Public
be appropriate on an ongoing basis to support Rights Division—the Land Use and Conservation
legislative and Attorney General priorities, and Section, the Civil Rights Enforcement Section, the
(3) monitor how provided resources are used and Consumer Protection Section, and the Environment
what outcomes are obtained. This includes where Section. As shown earlier in Figure 9 on page 14,
ongoing funding is provided for these specific the Governor’s budget proposes four positions
budget requests. and $1.4 million in 2023-24 ($973,000 million
General Fund and $402,000 LSRF)—decreasing
to $1.3 million annually in 2024-25—for increased
housing-related litigation workload pursued by the
Housing Strike Force. Specifically, the resources
Summary of Recommendations From LAO 2021 Report on the Litigation
Deposit Fund (LDF)
Our January 2021 report—Increasing Oversight of the State Litigation Deposit Fund—
offered several recommendations to increase legislative oversight of the LDF and how LDF
funds transferred to the Department of Justice (DOJ) special funds are used. Specifically, we
recommended:
• Requiring DOJ to transfer all eligible funds from the LDF to the appropriate DOJ special
funds rather than continuing to allow DOJ to retain funds in the LDF.
• Requiring LDF allocations occur within a specified amount of time, which would ensure the
Legislature receives timely information on the total level of litigation proceeds potentially
available for use and prevent the re-accumulation of funds in the LDF.
• Reconsidering existing state law requiring an automatic transfer from the LDF-supported
Antitrust Account to the state General Fund when monies in the account exceed $3 million,
thus providing the Legislature with more choices on how Antitrust Account monies are used.
• Requiring increased LDF reporting, such as information on the costs and litigation proceeds
associated with each resolved case and how proceeds may be used.
• Increasing oversight of the use of LDF monies transferred to DOJ special funds, such as
by requiring robust annual reports by each DOJ litigation section or unit supported by
litigation proceeds.
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2023-24 BUDGET
would be for the Land Use and Conservation will pursue certain legal activities separate from
Section as well as the Civil Rights Enforcement HCD under the Attorney General’s broad authority.
Section to pursue housing-related litigation. (The Pursuing action in this manner can sometimes be a
other two sections are not requesting additional cost-effective method of enforcing state laws. For
resources and are supporting Housing Strike example, if a local jurisdiction seeks to implement
Force workload within their existing budgets.) state law in a manner that DOJ interprets to be
As mentioned above, the LSRF is a special fund inappropriate and HCD believes it does not have
that receives reimbursements from state agencies the authority to pursue legal action, immediate DOJ
billed for services. For this request, the state legal intervention can deter such implementation by
agency that would be billed for DOJ legal services other local jurisdictions as well as limit the amount of
is the Department of Housing and Community litigation generated. Such work would be supported
Development (HCD)—the state agency tasked by the proposed General Fund resources.
with the mission of promoting safe and affordable For the proposed increase in resources for the
housing and inclusive and sustainable communities. Antitrust Law Section, DOJ was able to identify
Increased Antitrust Law Section Workload. recent and potential legal workload in particular
As shown in Figure 9 on page 14, the Governor’s sectors which could benefit California. For example,
budget proposes 20 positions and $8 million in California is the home of a significant number
2023-24 ($4 million Antitrust Account and $4 million of technology firms where antitrust violations
UCL Fund)—decreasing to $7.8 million annually can result in harm to consumers. Additionally, to
in 2024-25—for increased workload within the demonstrate the potential impact of dedicating
Antitrust Law Section. The additional resources resources to this workload, DOJ temporarily
would be used to support increased investigations redirected six existing unfunded attorney positions
and prosecutions of antitrust violations in within the Public Rights Division to the Antitrust
technology, gasoline and oil, and agriculture Law Section in 2021-22 and supported them using
sectors. Under the Governor’s proposal, the a total of $1.4 million in General Fund, Antitrust
section’s staff would increase from 36 positions to Account, and UCL Fund savings. According to DOJ,
56 positions—a 56 percent increase. this redirection allowed DOJ to conduct one new
major investigation in the technology industry which
LAO Comments on Proposals
is anticipated to conclude in 2022-23 and result in
Additional Resources Could Potentially Be litigation or a significant settlement. In combination,
Needed. As noted in the previous section, due to this suggests that additional, dedicated resources
the lack of information for the Legislature to monitor could be needed and benefit the state.
how funding provided to support legal workload is
Ongoing Workload and Outcomes for Housing
used over time, it is difficult to determine whether
Strike Force Unclear. In recent years, there has
existing funding is currently being used efficiently
been an increase in housing-related laws which is
and effectively and if additional resources are
expected to continue in the near future as it remains
truly needed. When analyzing these two requests
a significant area of concern for the Legislature,
separately, we find that additional resources could
state and local government entities, and members
potentially be needed for these proposals. For the
of the public. This could result in disagreements
Housing Strike Force request, the department has
over how such laws are or should be implemented
been able to identify recent workload, as well as
and enforced, which could then result in litigation
potential forthcoming workload, related to ensuring
workload for DOJ. However, it is unclear whether
compliance with recently enacted housing-related
the ongoing workload would remain high enough
laws. Part of this work would be conducted in
to justify the requested resources on an ongoing
partnership with HCD to ensure HCD’s expertise is
basis. Additionally, we would note that it is unclear
utilized. This part of the work would be supported
the extent to which such workload may be impacted
by the LSRF portion of the budget request as DOJ
by HCD’s new Housing Accountability Unit in the
would bill HCD for this workload. In addition, DOJ
future. This new unit was created in 2021-22 to hold
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2023-24 BUDGET
jurisdictions accountable for meeting their housing Unclear Whether Sufficient Revenue to
commitments and complying with state housing Support Ongoing Antitrust Law Section Costs.
laws. As a result, the new unit could result in more While additional resources could potentially be
reimbursable DOJ workload being pursued in needed for increased antitrust legal activities which
coordination with HCD due to increased violations could benefit the state, it is unclear if sufficient
being referred to DOJ for legal action. As this unit revenue will be generated for the Antitrust Account
and DOJ’s Housing Strike Force becomes fully and UCL Fund to support the ongoing cost of
operational, it will be important to ensure legal increased investigations and prosecutions of
activities are pursued in the most efficient and antitrust violations. This is because the two funds
effective manner. Similarly, it is possible that DOJ’s partially rely on revenue generated through litigation
workload could be impacted by the activities of the proceeds from antitrust cases that typically are
Civil Rights Department (formerly the Department of complex, technical, resource-intensive, and can
Fair Employment and Housing), which is tasked with take quite a bit of time to resolve. While DOJ
protecting Californians from unlawful discrimination currently has sufficient Antitrust Account and UCL
in housing and other areas. For example, the Fund revenues to support the increased workload
department could increase its enforcement costs temporarily, it is unclear whether these
actions, which could have the effect of reducing funds will receive sufficient proceeds from cases
the workload of DOJ. This is because a portion pursued by the Antitrust Law Section to support the
of the requested resources would support DOJ’s section’s workload costs on an ongoing basis.
Civil Rights Enforcement Section, which could
work on issues similar to those handled by the Civil
Rights Department. Given this housing workload
uncertainty, the Legislature could consider whether
annual reporting to monitor DOJ work in this area
would be beneficial to conduct ongoing oversight
over state legal activities in this area.
22 LEGISLATIVE ANALYST’S OFFICE
2023-24 BUDGET
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2023-24 BUDGET
LAO PUBLICATIONS
This report was prepared by Anita Lee, and reviewed by Drew Soderborg and Anthony Simbol. The Legislative
Analyst’s Office (LAO) is a nonpartisan office that provides fiscal and policy information and advice to the Legislature.
To request publications call (916) 445-4656. This report and others, as well as an e-mail subscription service, are
available on the LAO’s website at www.lao.ca.gov. The LAO is located at 925 L Street, Suite 1000, Sacramento,
California 95814.
24 LEGISLATIVE ANALYST’S OFFICE