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A Push for Greater Transparency in Government Settlements

Gavel laying on table of money
By Joseph Fawbush, Esq. on September 20, 2019 9:18 AM

Government entities are typically reluctant to reveal the amount they pay out in legal settlements. It is, perhaps, an understandable tendency. Taxpayers are not typically pleased when their government must pay out hundreds of thousands, or even millions, to compensate someone for negligence or an intentional tort committed by a government employee.

That may be starting to change. At least one state, New Mexico, has begun to release the dollar amount it pays out in settlements every year. By law, New Mexico must keep settlements confidential for 180 days. After that, however, Governor Michelle Lujan Grisham’s Administration is making all settlements public. Previously, they were often only available by request.

Any Chance of the Federal Government Releasing Settlement Information?

The push is not limited to state governments. Early in 2019, Rep. Gary Palmer introduced a bill in the U.S. House of Representatives that would create a public searchable database that includes all federal government agency settlements. The Settlement Agreement Information Database Act (SAID) passed the House unanimously on February 13 but did not receive a vote in the Senate. Currently, settlement information is available largely only through press releases.

Federally, the Treasury Department keeps a Judgment Fund to pay out court judgments, justice department settlements and administrative claims awards. You can search for payments and read the Judgment Fund’s annual report to Congress, both of which are publicly available. However, if an agency has the funds to pay and legally can, the Judgment Fund cannot pay it on the agency’s behalf. That means the 3,188 claims the Judgment Fund paid out from October 2017 to September 2018 does not accurately represent how much the government paid in settlements.

Still a Ways to Go

While there may be a push for transparency, New Mexico’s release of settlement information is a policy decision, not a law. The previous administration wanted to increase the state’s confidentiality period, not make settlements more public. Further, the failure for the SAID to receive a vote in the U.S. Senate means it is unlikely to become a law anytime soon, despite the House’s unanimous passage.

For the near term, at least, taxpayers and attorneys looking to know what government agencies have paid out in settlements must find alternatives to an easily searchable public database.

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