1. Cost-Benefit Analysis for Justice Policy: A Step-By-Step Guide January 18, 2011 Mike Wilson, Oregon Criminal Justice Commission Lora Krsulich, Vera Institute of Justice

2. Cost-Benefit Analysis for Justice Policy: A Step-By-Step Guide January 18, 2011 Michael Wilson, Oregon Criminal Justice Commission Lora Krsulich,Vera Institute of Justice

3. Today’s Agenda

4. Housekeeping items Questions Use the chat feature to send us questions throughout the webinar Use the raise hand feature to ask a question during a the question and answer period. Check the chat feature for instructions about how to un-mute your phone line. Webinar support and troubleshooting Call: (800) 843-9166 Email: help@readytalk.com Handout This webinar is being recorded

6. CBA Toolkit

7. Snapshots of CBA Literature

8. Podcasts, Videocasts, and Webinars

9. Roundtable Discussions

11. Part 1 Preview You will learn how to: Discuss prison economics and the return on investment from incarceration. Deconstruct costs into their component parts: estimates, probabilities and sentencing distributions. Interpret an effect size and demonstrate how effects sizes are used to produce CBA findings

12. Introduction to Cost-Benefit Analysis in Justice Policy

13. What is cost-benefit analysis? An approach to policymaking A systematic tool for evaluating public policy A way to weigh options A method for finding out what will achieve the greatest results at the lowest cost

14. Why use cost-benefit analysis? Strengths: Inform policy Efficient use of resources Common measurement Weaknesses: Accuracy Deciding what costs/benefits to include

15. Cost-benefit applications Ballot initiative Program designed to reduce drug use What benefits do you include? Which costs are measured? County, state, local, all?

16. Prison Economics

17. Prison Economics What is the impact of incarceration on crime? The Oregon Criminal Justice Commission found that a 10% increase in the incarceration rate leads to a 2.6% reduction in crime. Others, including the Washington State Institute of Public Policy (WSIPP), have found similar results. How many crimes are avoided by incarceration? What is the cost-benefit ratio of incarceration?

18. Pie Chart Slide Source: Oregon Criminal Justice Commission

19. Cost-Benefit Analysis of Incarceration Cost-Benefit Analysis of Incarceration Oregon Washington Year All Violent Property Drug 1994 $2.78 $9.57 $2.36 $0.37 1995 $2.42 $8.20 $2.40 $0.37 1996 $1.98 $7.06 $2.23 $0.34 1997 $1.81 $6.58 $2.22 $0.36 1998 $1.60 $5.85 $1.94 $0.36 1999 $1.31 $5.37 $1.74 $0.32 2000 $1.10 $5.24 $1.61 $0.31 2001 $1.11 $4.87 $1.46 $0.28 2002 $0.95 $4.46 $1.20 $0.26 2003 $1.01 $4.82 $1.26 $0.29 2004 $1.01 $4.33 $1.18 $0.32 2005 $0.93 $4.35 $1.10 $0.35 2006 $0.96 N/A N/A N/A 2007 $0.91 N/A N/A N/A Source: Oregon Criminal Justice Commission and WSIPP

20. Costs of CrimeCrime Estimates

21. Table 1: Oregon Cost Estimates Costs by crime type Costs by resource use Taxpayer and victim costs

22. Costs by Crime Type Murder/manslaughter Sex offense Robbery Assault Property Drug Other Misdemeanor

23. Costs by Resource Use Arrest, Conviction, and State Adult Costs Marginal vs. average cost Sources of cost data Cross sectional regression analysis Local budget data Local arrest data and traffic stop data For state adult costs, must keep track of inflation and put dollars in a common year

24. Taxpayer Costs Police Courts Juvenile detention state Juvenile detention county Juvenile probation Juvenile parole Juvenile county supervision Adult probation Adult jail (county) Adult prison Adult post prison supervision

25. Victimization Costs How can we estimate costs to victims? Victimization estimates: National Institute of Justice, Victim Costs and Consequences: A New Look (1996) K. E. McCollister, M. T. French, & H. Fang (2010). The Cost of Crime to Society: New Crime-Specific Estimates for Policy and Program Evaluation. Drug and Alcohol Dependence, 108(1), 98-109. Tangible and intangible losses Loss estimates

26. Questions?

27. Costs of CrimeProbabilities

28. Figure 1: Probability of Arrest, Conviction and Incarceration

29. Table 2: Estimated Probability of Arrest and Conviction Probability offense reported Probability offense leads to arrest Probability offense leads to conviction Probability arrest leads to conviction

30. Probability of an Offense Being Reported Source: National Victimization Survey (2007) Person crimes: 46% reported Property crimes: 37% reported Oregon Example Need to make adjustments to reflect felony crimes in Oregon Theft value over $750 Sex Crimes against children

31. Probability of a Reported Offense Leading to an Arrest Source: Uniform Crime Reports Offense and arrest data Oregon Example: Arrest Rate

32. Probability of an Offense Leading to an Arrest Oregon Example For number of actual offenses, divide number reported by national rate of report. For probability of arrest, divide number of arrests by number of actual offenses.

33. Probability of an Arrest Leading to a Conviction How many arrests end in conviction Oregon Example This was difficult to do because OR does not have a map of UCR data to state law codes Worked with a few large police departments to map UCR to Oregon Revised Statutes

34. Questions?

35. Costs of Crime:Sentencing Distributions

36. Sentencing Distributions Need to know the sentencing distribution to calculate DOC costs What percentage of convicted offenders get prison, probation and local control? What are the average lengths of the sentences? What are the present value costs of incarceration?

37. Table 3: Sentencing Distribution Probability conviction leads to prison Probability conviction leads to jail Probability conviction leads to probation Average length of sentence

38. Questions?

39. Estimating Effects

40. What is an effect size? Quantifies the effectiveness of a particular policy or program Estimates how much a program reduces crime Provides a foundation for cost-benefit analysis

41. Where do effect sizes come from? Evaluations of own-state programs Are there estimates for a given program in your state? Meta-analysis Meta-analysis summarizes research to estimate an effect size If no effect size available, you can calculate what effect size would be needed to pay for the program

42. Advantages of Evaluating Own State Programs Effect size from the literature will likely not match your state Different time periods Different demographics Effectiveness changes over time

43. Advantages of Meta-Analysis Program may not exist in your state Expensive and difficult to evaluate all programs

44. Applying an Effect Size CBA monetizes effect sizes: Program costs Averted taxpayer costs (arrest, conviction, state adult costs) Averted victim costs (out of pocket and emotional) Offender, family, community benefits

45. Example of Cost-Benefit Findings

46. Big picture take-aways Incarceration reduces crime. There are diminishing returns to incarceration. Crime costs are influenced by type of crime and how resources are used to arrest, convict, and sentence offenders. Using effect sizes, CBA can provide a framework to compare across policy choices.

47. Questions?Contact Information:Mike WilsonSAC Director/EconomistOregon Criminal Justice CommissionMichael.K.Wilson@state.or.us(503) 378-4850

48. Wrap-Up

49. Part 1 Review Discussed prison economics and return on investment from incarceration Deconstructed costs into their component parts: estimates, probabilities and sentencing distributions. Interpreted an effect size and demonstrated how effects sizes are used to produce CBA findings

50. Part 2 Preview You will learn how to: Calculate the cost of an offense using real numbers from Oregon Build a cost-benefit model Use cost-benefit analysis in decision-making

52. Follow us on Twitter at http://www.twitter.com/CBKBankThe next webinar in this series will take place on Tuesday, January 25 at 2 p.m. EST.

53. This project is supported by Grant No. 2009-MU-BX K029 awarded by the Bureau of Justice Assistance. The Bureau of Justice Assistance is a component of the Office of Justice Programs, which also includes the Bureau of Justice Statistics, the National Institute of Justice, the Office of Juvenile Justice and Delinquency Prevention, and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking. Points of view or opinions in this document are those of the author and do not represent the official position or policies of the United States Department of Justice.

54. Contact Information Lora Krsulich lkrsulich@vera.org (212) 376-5201 cbkb@cbkb.org http://www.cbkb.org

55. Thank you!