The United States has long viewed debtors’ prisons,1 understood as incarceration for failure to repay commercial debts, as contrary to public policy.2 By contrast, debts stemming from criminal proceedings — such as restitution payments, fines, and court costs — present more complex questions.3 But when the debtor is genuinely unable to repay, several reasons support the same nonincarceration policy: punishment for poverty seems unfair, deterrence is less effective when indigence is out of the debtor’s control,4 smoking out assets is pointless,5 and alternatives to incarceration may meet state goals more cost-effectively.6
Recently, a number of states have been revisiting their ability-to-pay inquiries in the wake of reports accusing them of jailing indigent debtors.7 A series of on-the-ground investigations and impact litigation cases8 has set off a wave of concern in both academic9 and popular media10 circles, decrying the perceived resurrection of the once-interred “debtors’ prison.” On May 9, 2014, Colorado Governor John W. Hickenlooper signed House Bill 14-106111 into law, requiring Colorado courts to conduct on-the-record indigency hearings before incarcerating debtors for failing to pay debts owed to the state.12 Laudably, the new law will prevent many of the more flagrant errors, but it may not shield less obviously indigent debtors from incarceration, as the substantive definition of indigence for the purposes of criminal debt remains unclear. And without clarification, lower-court discretion will still largely govern incarceration decisions. Still, the law will force indigency determinations onto paper, providing the raw legal material necessary for analysis by reviewing courts or legislators.
H.B. 14-1061 came on the heels of a troubling investigation by the American Civil Liberties Union (ACLU) of Colorado,13 following scathing investigations of other states’ practices by civil rights organizations.14 The ACLU discovered that various Colorado municipalities were jailing defendants for contempt of court for failure to pay fines.15 Under prior Colorado law, courts could jail defendants for failure to pay until a request for a hearing — which, when held, would not have been documented, at least in most municipal courts.16 Relying on precedent establishing that the Fourteenth Amendment bars states from revoking probation for failure to repay criminal debt if the defendant makes bona fide efforts to do so, unless no other sanction would serve the states’ purposes,17 the ACLU asked Colorado lawmakers to put in place indigency inquiry procedures that would meet minimal constitutional standards.18
The facts the ACLU uncovered were less than flattering. In one case, the defendant, Jared Thornburg, had pleaded guilty to driving a defective vehicle, a nonjailable offense, and owed the court $165 in fines and costs.19 Although a workplace injury and subsequent layoffs had left Mr. Thornburg “penniless and homeless,” he was told he had to pay the debt in full or a warrant would be issued for his arrest.20 Just over a week later, fees related to failure to pay had ballooned the debt to $245,21 and Mr. Thornburg was forced to serve ten days in jail, “without the judge ever having considered whether [his] failure to pay was due to indigence.”22 In another case, Linda Roberts, a disabled woman, was arrested for shoplifting $21 worth of food from a grocery store.23 Her income consisted solely of Supplemental Nutrition Assistance Program (SNAP) benefits and a Social Security disability check.24 Ms. Roberts was ordered to pay $746 in court costs, fines, fees, and restitution, or serve fifteen days in jail, again without any meaningful judicial inquiry into her ability to pay.25 Incarceration for nonpayment was not unusual; one county processed 154 such cases over a five-month stretch.26 While lack of records precludes full understanding of the previous regime’s problems, these examples show that Colorado courts were imprisoning debtors living only on welfare benefits, far below the federal poverty line — results that seem manifestly wrong.27
It was in this context that the Colorado legislature took action, spearheaded by Representative Joseph Salazar and Senate President Pro Tempore Lucía Guzmán.28 “This is the 21st century,” Salazar said. “[T]here is no way in the world we should tolerate this.”29 The bill cleared every legislative hurdle swimmingly, aided by a strategically timed exclusive in The Denver Post.30 Both the House Committee on Appropriations31 and the Senate Committee on Judiciary32 gave favorable recommendations. The bill passed the Colorado House by a vote of 64–033 and the Colorado Senate by a vote of 34–1.34 It was signed by the Governor shortly thereafter.35
The bill made three simple but notable changes to Colorado law. First, it expanded coverage from fines to any “monetary amount” imposed by sentencing,36 a subtle but important fix that captures court costs and fees in addition to fines. Second, it required courts to make a determination that the defendant is not indigent prior to incarceration.37 Third, it clarified procedural and substantive standards. Courts must provide notice and a hearing and make “findings on the record” that the defendant can pay “without undue hardship to the defendant or the defendant’s dependents” and that “the defendant has not made a good faith effort to comply with the order.”38
The new Colorado legislation has been warmly received by the ACLU39 and the press.40 Indeed, it represents a crucial step forward, especially in its mandate for on-the-record hearings. But for those who would see modern-day “debtors’ prisons” dismantled, its protections are likely insufficient to finish the job. For that, state courts and legislatures will ultimately have to clarify the substantive definition of indigence for these purposes. The bill’s “undue hardship” standard remains imprecise, and related law provides little guidance. While it may not fully resolve the issue, H.B. 14-1061 nonetheless sets the ground for the next wave of skirmishes.
To start, forcing reasoning onto the record will likely weed out particularly unsavory results, like those the ACLU highlighted. Transparency, even assuming generous deference from a reviewing court, can indeed be effective in reaching more principled results.41 But transparency works best when strong underlying social norms help police the results42 — and while public outcry might defend another Ms. Roberts, more ambiguous cases may not receive such strident support. An exclusively procedural solution, then, runs the risk of leaving substantive discretion in the hands of the very judges who drew underinclusive lines to begin with.43
So a substantive definition of indigency seems appropriate, whether supplied by statute or developed through appellate review. Supreme Court precedent evidently sets some lower bound on that definition, but it has not provided much clarity on what that bound is. The foundational case on point, Bearden v. Georgia,44 requires the court to determine whether a defendant has made “sufficient bona fide efforts to pay,”45 but does not specify what those efforts are, except for a cryptic reference to the relevance of “all reasonable efforts” to “seek employment or borrow money” to repay the debt.46
To be sure, H.B. 14-1061 says defendants should not be expected to pay if doing so would create “undue hardship” on them or their dependents.47 While not self-interpreting, “undue hardship” is used elsewhere in Colorado law. Those usages suggest that the payment would have to exceed “properly calculated” obligations and “financial inconvenience,”48 and that “hardship” is measured only as against the defendant’s “immediate short-term needs.”49 Such clarifications are hardly granular enough to warrant enthusiasm.
Nor do analogous areas of Colorado law provide much help. In criminal restitution, for example, the collections investigator must “conduct an investigation into the financial ability of the defendant to pay the restitution ordered by the court.”50 But the statute provides no substantive guidance on what “financial ability to pay” actually means. Colorado judicial procedure for the collection of fines, fees, and costs is similarly vague: courts may waive such debts only “after making a finding of financial inability to pay . . . based on a review of a financial affidavit or similar supporting documentation.”51
A more detailed indigency determination obtains for waiving costs in civil matters.52 There, a judicial directive mandates specific procedures that must be followed for a valid determination of indigency.53 One key benchmark for that determination is whether income falls below 125% of the federal poverty line.54 Some elements of this definition seem likely to produce fair results: “income” is defined narrowly so as to avoid counting federal welfare dollars.55
Yet a definition of indigency that relies on the Department of Health and Human Services (HHS) formula may be problematic.56 HHS’s annual “poverty guidelines”57 are based on the Census Bureau’s “poverty thresholds” and reflect the annual change in the Consumer Price Index for All Urban Consumers.58 But the basic calculation, a formula tracing back to the 1960s,59 extrapolates total necessary expenditures from the cost of following certain food plans developed by the Department of Agriculture — plans which assume both a well-stocked kitchen and a competent cook.60 Not only is that method painfully outdated in a world where many individuals struggle to find time to cook at home,61 but also it fails to capture regional differences in cost-of-living expenses62 and the role of adverse events, like medical emergencies.63 Indeed, a number of organizations have proposed alternatives to the HHS measure,64 including the Census Bureau itself.65
Simply importing the bare HHS thresholds from the welfare-benefit context, then, seems both unfair and out-of-touch, as the metric overlooks the hidden costs of poverty. Moreover, the definition of poverty for indigency and welfare purposes need not be the same. But adopting some clear rule or proxy — such as SNAP eligibility — has clear advantages, saving both time and resources.66
Arriving at a workable definition of indigence for these purposes is, of course, a broad and complex task. Colorado’s legislature or its appellate courts will likely have to take another, more detailed look at their substantive definition of indigency. Until they do, the new safeguards may not adequately guarantee the interment of debtors’ prisons in the criminal context. Still, the strength of Colorado’s bill, and the procedural fix it instated, is that it forces courts’ determinations of indigence onto the record. That transparency will undoubtedly help. And, without the bill, it would have been impossible to have the rigorous discussion of the definition of indigence that should — and must — take place.