Money communities spend on litigation is money 'Down the Drain'
Early this summer, my wife and I bought our two daughters their own baby doll strollers. Of course, the girls decided hauling each other in the strollers was much more fun than merely transporting dolls. So now, just a couple of months later, the strollers have to be trashed. The money spent on these strollers was essentially wasted.
It is one thing for private citizens to throw money down the drain on things like $10 doll strollers that won't last, but it is quite another thing for local government bodies to waste money, especially at a time when budgets are being squeezed and slashed.
Unfortunately, a new study finds that the Metro-East's status as a haven for lawsuits has led to municipal governments here being sued frequently, costing area taxpayers millions of dollars each year – millions that could have gone to hiring more teachers or police officers or avoiding layoffs of city and county workers.
In the study, titled "Down the Drain: How Abusive Lawsuits in the Metro-East Drain Municipal Budgets, Force Service Cuts and Suppress Job Growth," Illinois Lawsuit Abuse Watch (I-LAW), found that in 2010 alone, the Madison and St. Clair County governments spent a combined $3.1 million dollars defending themselves against lawsuits.
The Metro-East's longtime national reputation as the "Lawsuit Abuse Capital of the Midwest" not only drains jobs from the area but also drains money for teachers, police officers, new parks and road repairs, to name just a few of the budget cuts that result from municipalities being targeted with lawsuits.
Specifically, the $3.1 million spent on litigation-related costs in Madison and St. Clair Counties in 2010 could have been used to add 50 new Sheriffs' Deputies, hire 83 new teachers or buy124 new police vehicles.
But Metro-East county governments are not the only targets of lawsuits. The City of Alton, in Madison County, spent a total of $1.9 million on settlements, judgments and outside counsel from 2005-2010, while the City of Belleville, in neighboring St. Clair County, spent more than $792,000 from 2005-2010 on litigation expenses. Metro-East residents thus take two hits – once when their county is sued and another time when their city is sued.
All too often, a municipality will decide that it's cheaper to settle a lawsuit than to fight it, but this leads potential plaintiffs to view that municipality as an easy mark, and the result is even more lawsuits filed.
The City of Chicago has successfully reduced the number of lawsuits filed against the city as well as the amount of money spent by the city on litigation costs by publicly announcing a new policy of aggressively fighting, and not settling, most lawsuits filed against city government. Metro-East municipalities should follow this proven approach and fight back so that they are no longer viewed by potential plaintiffs as personal ATM machines.
The cost of litigation will never be zero, but city and county officials should take steps to reduce these costs as much as possible, because taxpayer money spent defending against lawsuits is money down the drain.
Lawsuit reform is not a magic bullet to solve every financial problem facing local governments, but it should be at least part of the conversation. Many local judges, as well as county and city elected officials, will be on the ballot in 2012 and local voters will have the opportunity to find out what these candidates will do to stop taxpayer money from being wasted on litigation. It is an opportunity taxpayers should not let pass by.
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