Living Off Fines and Fees: Municipal Reliance on an Unexplored Revenue Source

Abstract

This study examines the vast degree of variation that exists in municipal reliance on fines and fees as a revenue source in the U.S. Using data covering nearly 11,000 municipalities, this study shows that reliance on fines and fees is strongly related to a municipality’s budgetary wealth, the stability of its resources, and the size of the municipality’s black population. It also shows that the strongest explanatory variables are a municipality’s police and judicial expenditure shares, a relationship found to be robust to arrest rates at the county level. The study’s findings strongly indicate that fines and fees revenue is actively produced through police officers generating citations and arrests for low-level offenses.