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Chapter 9

Crime Victim Compensation

Abstract: Crime victim compensation provides greatly needed financial assistance for crime victims in the aftermath of victimization. The first compensation program in the United States was created in California in 1965. Today, all 50 states, plus the District of Columbia and the Virgin Islands, have compensation programs. This chapter will discuss compensable costs, eligibility requirements, the size and structure of compensation programs, and the impact of the Victims of Crime Act on state programs.

Learning Objectives: Upon completion of this chapter, students will understand the following concepts:

1. The definition and purpose of crime victim compensation.

2. "Core" offenses that are generally considered compensable crimes.

3. Primary compensation costs covered by all victim compensation programs.

4. Requirements established by compensation programs that determine a victim's eligibility to receive benefits.

5. How victims can receive compensation through application procedures.

• In 1995 state crime victim compensation programs paid $247,605,531 to 119,113 victims of violent crimes, a decrease of $9,203,656 in payments and 7,794 victims from the previous year.
• In 1996, state crime victim compensation programs received $83,843,000 in federal matching funds from the VOCA Crime Victims Fund; this represents 35% of the total amount deposited in the Fund in 1995, $233,907,256.
• 42,939 victims of assault received 47% ($118,169,444) of the total amount of crime victim compensation paid to victims and 26,111 victims of child sexual abuse received 12% ($31,873,317) of the compensation funds paid to victims in 1995.
• Of the expenses for which crime victims received state compensation in 1995, nearly half ($119,878,335) were for medical related expenses, including medical treatment, dental, and sexual assault in 1995. In addition, $49,748,382 was paid to victims for lost wages or loss of support; $46,349,954 was paid to victims for mental health treatment; and $22,776,342 was paid to victims for reimbursement of funeral expenses.
• Compensation programs now operate in all 50 states, the District of Columbia, and the Virgin Islands.
• Maximum benefits available to victims from the state programs generally range between $10,000 and $25,000, though a few states have higher or lower maximums.
• Nationally, the average amount paid to each victim applying for compensation is about $2,000.
• The median annual payout per state is just under $2 million. The range of total payments among states is considerable, with 12 states paying less than $500,000 annually and about the same number paying more than $3 million.
• While there is no federal crime victim compensation program per se, each state treats federal crime victims in the same manner as victims of state and local crimes.

The above information was provided by the National Association of Crime Victim Compensation Boards and reflect information provided by the U.S. Department of Justice, Office for Victims of Crime, 1996.

Compensation for victims of crime is one of the earliest forms of victim assistance. Ancient history traces the idea of victim compensation to the Babylonian civilization before 2380 B.C. In the 1950s, Margery Fry, a member of parliament in England, initiated legislation to establish the first compensation program in modern society.

In this country, the first compensation program was established in California in 1965. By 1980, 28 additional states had created programs. By 1995, all 50 states, plus the District of Columbia and the Virgin Islands, have established compensation programs.

The state compensation programs are represented by the National Association of Crime Victim Compensation Boards (NACVCB), a national organization that provides advocacy, training, technical assistance, and communication among state programs. The NACVCB provides a strong national voice on all matters affecting state compensation programs before Congress and the Office for Victims of Crime. In addition, it provides extensive training to its members on a wide range of issues facing programs today -- from administration and funding matters to coverage of emerging areas of victimization.

Crime victim compensation is one of the pillars of victim assistance. For thousands of crime victims each year, it serves as the primary means of financial aid in the aftermath of victimization. While restitution laws requiring reparations to crime victims date back to the 1800s, there is one important distinction between these two sources of financial relief for crime victims: crime victim compensation does not require the apprehension and conviction of the offender to provide financial relief to the victim.

Victim compensation is defined as:

"Money paid through a public fund to allow victims to receive out-of-pocket expenses incurred as a result of a violent crime perpetrated against them." (National Victim Center, 1992)

This chapter will provide an overview of the types of crimes, the compensable losses, and the eligibility requirements for victims in order to qualify for compensation. Each state program has been created under individual state laws; thus, the programs vary somewhat from state to state. Throughout this chapter, attempts will be made to summarize characteristics common among most state programs.

The information in this chapter has been excerpted largely from various publications produced by the NACVCB including: Crime Victim Compensation: A Fact Sheet and Crime Victim Compensation: An Overview.

The NACVCB provides this information with the following caveat:

"While there are many characteristics of state programs that are common to all states, it is important to emphasize that each compensation program offers additional and unique benefits and has other requirements. You need to check with the compensation program in your state to gain a full understanding of the eligibility requirements and the benefits for victims, as well as information on how crime victims can apply for compensation."

Total Benefits Paid by Compensation Programs Nationwide

• According to the NACVCB, approximately $250 million is paid annually to more than 125,000 victims nationwide.
• California operates the nation's largest program, paying nearly one third of all compensation benefits nationwide (approximately $75-80 million annually).
• Only Texas, which pays out approximately $20-30 million to victims each year, comes close in benefit payout.

Nationwide, the amount of compensation payments is the following:

• The median annual payout per state is just under $2 million (half the states pay a total less than that, and half pay more).
• The range is considerable, with 12 states paying less than $500,000 annually and about the same number paying more than $3 million.
  

Size of Compensation Programs

The size of state compensation programs is relatively small for state agencies:

• 10 states operate with three or fewer people
• 34 states employ fewer than 15 people
• Seven states operate with more than 20 employees
• California is the largest with over 250 employees

Location of Compensation Programs

Compensation programs, with the exception of Arizona and Colorado, are administered in central state offices. According to the NACVCB, the largest number of state programs are affiliated with criminal-justice related executive branch agencies (one-third), within Offices of Attorneys General (one-fifth), and independent state agencies (one-fifth). Workers' compensation bureaus house five programs, and other programs are affiliated with corrections departments, social services agencies, and finance and management departments. Four states operate their programs within court systems.

While governed by state law, Colorado and Arizona operate compensation programs at the local level through prosecutors' offices. Each of 22 judicial districts in Colorado has a compensation board, and each of Arizona's 15 counties operates a program.

Compensable Crimes

While the extent and types of crimes that are eligible for state compensation benefits differ slightly from state to state, most programs include a basic "core" of offenses. According to research conducted by an NIJ-sponsored study entitled Compensating Crime Victims: A Summary of Policies and Practices (Parent, Auerbach, and Carlson, 1992), about three fourths of the state statutes define compensable crimes in the following language:

Criminally injurious conduct that occurs, or is attempted in a state, and poses a substantial threat of personal injury or death, and is punishable by a fine, imprisonment, or death.

In general, victims of personal violence, sexual assault or abuse qualify for compensation, while victims of most property crimes do not qualify. A further explanation of these distinctions is presented below.

Collateral Resources

It is important to emphasize that compensation programs are considered "payers of last resort," meaning that the victim must exhaust all other sources of insurance or public benefits that could pay for medical care, funeral benefits, counseling, etc. Historically, this principle has been incorporated into each state's program because compensation was thought to supplement existing resources of the victim, not to serve as an automatic "payment" in response to victimization.

Compensation programs are "subrogated" to the victim for any expenses the victim recovers from the offender or a third party. NACVCB explains:

"If the victim recovers any money from the offender or any other party liable for the victim's expenses, the compensation program must be paid back for that portion of the expenses for which the program has paid. Generally, if the victim's losses are greater than the amount paid for by the compensation program, the program will expect repayment only after those other losses are fully reimbursed. In other words, if the victim's total losses are $100,000, and the compensation program awards $10,000, the amounts recovered otherwise by the victim by other recoveries can go to pay for the remaining $90,000 in losses before the compensation program needs to be repaid."

Coverage of Domestic Violence and Drunk Driving Victims

For many years, domestic violence and drunk driving victims were excluded from receiving compensation in most states. The domestic violence exclusion emanated because of concerns that compensation awards to battered women would benefit the battering spouse by not holding him financially accountable for his crime. There also was the chance that the offender could benefit from a compensation award if the offender and victim continued to live together. Victims of drunk driving crashes were excluded because drunk driving was not considered a violent crime and because of fears of overtaxing the financial resources of state compensation programs.

Amendments to the Victims of Crime Act, which provides about 20% of the funding for state programs, required that states cover domestic violence and drunk driving as compensable crimes by 1991.

Compensation Benefits

According to the NACVCB, all compensation programs cover the same major types of expenses, although their specific limits may vary. The primary compensable costs covered by all states are as follows:

• Medical expenses
• Mental health counseling
• Lost wages for victims unable to work because of crime-related injury
• Lost support for defendants of homicide victims
• Funeral expenses

The majority of compensation payments statewide are paid to victims for the above expenses. For example:

• Medical fees comprise well over half of the amount of all compensation awards nationwide.
• Lost wage and support payments comprise the next largest payment category for most states.
• Awards for counseling are growing rapidly -- in a few states, 20% to 40% of their awards are now paid for counseling.

In addition, a number of other expenses are paid for by some, but not all, programs, including:

• Moving or relocation expenses, often limited only to instances where the victim is in imminent physical danger, or if medically necessary (such as severe emotional trauma from sexual assault).
• Transportation to medical providers, usually limited to occasions when the provider is located in a place distant from the victim's residence, or when other special circumstances exist.
• Replacement services for work the victim is unable to perform because of crime-related injury (child care, housekeeping), usually limited to payment to non-family members.
• Essential personal property lost or damaged during the crime (all states will cover medically necessary equipment, such as eyeglasses or hearing aids, but only a few can cover anything else).
• Crime-scene cleanup, or the cost of securing a home or restoring it to its pre-crime condition.
• Rehabilitation, which may include physical therapy and/or job therapy; ramps, wheelchairs, and modification of homes or vehicles for paralyzed victims; and driving lessons.

Eligibility Requirements

In order to qualify for crime victim compensation, certain eligibility requirements must be met by the individual filing the claim. Again, eligibility requirements vary from state-to-state. However, every state requires that victims follow certain critical criminal justice-related provisions or application filing procedures in order to qualify.

According to NACVCB, all programs require that the victim must:

• Report the crime promptly to law enforcement (72 hours is the general standard, although a few programs have shorter or longer periods, and nearly all have "good cause" exceptions applied liberally to children and incapacitated victims, and others with special circumstances).
• Cooperate with police and prosecutors in the investigation and prosecution of the case. The apprehension and/or conviction of a perpetrator is not a prerequisite to receiving compensation.
• Submit a timely application to the compensation program (generally one year from the date of the crime, although a few states have shorter or longer time frames, and most can waive these requirements for exceptional circumstances) and provide other information as requested by the program.
• Be innocent of criminal activity or significant misconduct that caused or contributed to the victim's injury or death.
• In addition, since collateral sources need to be utilized first (before compensation can be paid), eligibility depends on whether the expenses for which reimbursement is sought have not been or cannot be paid from some other collateral source (medical insurance, other public assistance programs, etc.). If the collateral source is just a potential source of payment, like offender restitution, the compensation program generally will pay anyway and expect to be repaid if the victim ever receives the collateral resource.

Secondary Victims

An important aspect of compensation is the eligibility of a victim's dependents or other secondary victims. Generally eligibility for these victims depends on the eligibility of the "direct" victim -- the one who suffered the injury or death. If a homicide victim was engaged in criminal activity, for example, the family generally would not be eligible for any benefits.

Emergency Awards

Many, but not all compensation programs have established emergency award provisions allowing the program to make an emergency award to a victim within a few days or weeks. However, there is a trend away from granting emergency awards due to the difficulty of verifying the claims under such expedited situations. Most programs now limit emergency awards to cases of extreme hardship, and because of the delays in processing other claims when staff must attend to emergency requests. Emergency awards are also limited to relatively small amounts.

Jurisdiction and Filing Claims

Victims must apply for compensation in the state where the crime occurs. Until the passage of the Victims of Crime Act (VOCA) in 1984, state programs had set up a complicated nationwide system of reciprocity agreements between states for covering out-of-state victims that became crime victims while visiting their state. In order to qualify for federal VOCA payments, states have been required for the last decade to cover residents and nonresident, including victims of federal crimes. Of course, victims have to meet the eligibility requirements of the state statutes.

The NACVCB states:

• Victims of crime are eligible for compensation in the state where the crime takes place, and should make an application to that state program.
• All states, with the exception of Nevada, will accept applications from nonresidents who are injured within their borders (a very few states restrict eligibility to U.S. citizens).
• If the crime occurs in Nevada to a nonresident, the victim should apply in his or her state of residency. All of the states will honor such applications as if the crime had taken place within their own borders.
• A few states extend coverage to their residents who are injured in other states with compensation programs, as well as other countries, but awards are usually conditioned upon the victim first applying in that other state or country (a number of countries, including Canada, Great Britain, Germany, France, Sweden, and Australia, have compensation programs).

Maximums and Limits

Every state program has established a limit on the maximum benefits available to victims. Nationwide the following maximum benefits apply:

• Currently, maximum awards range between $10,000 and $25,000, although a few states have higher or lower maximums.
• Nationally, the average amount paid to each victim applying for compensation is about $2,000.
• In addition, many states have lower limits on specific compensable expenses, like funerals and mental health counseling.
• Each state can provide information on the specific benefits that are available to victims within its jurisdiction.

The Application Process

Victims typically learn about crime victim compensation programs from local victim assistance providers, police, prosecutors, and public awareness activities (posters, billboards, and/or public service announcements) conducted by the state program. For many crime victims, missing the application filing deadline is one of the most painful "second injuries" in the aftermath of victimization. State programs generally have very strict policies on application deadlines, and do not accept late applications -- usually one year after the crime. However, exceptions are made in almost all states for crimes involving child sexual abuse cases -- extending the filing deadline for "just cause."

While compensation programs have instituted many policies and programs for "getting information out statewide" about their programs, this is an area that needs greater improvement on the part of compensation programs. However, with many programs facing limited resources to make payouts, it presents a "double edged sword" when public awareness campaigns increase demands on existing programs.

According to NACVCB:

• The victim is responsible for completing the application form and providing all requested documentation. The victim must return the form to the compensation program or some designated intermediary.
• Most programs process claims through a staff centralized in one office in the state capital, but a few states have branch or regional offices, and a few (other than Colorado and Arizona) make use of locally-based individuals in other entities or agencies to perform preliminary work on applications (document gathering and verification) prior to final decision making in the central office.

Decision-making authority varies from state to state:

• About half the states use part-time boards or commissions to determine eligibility and awards.
• About half authorize full-time administrative staff (usually program directors) to make determinations.
• In court-based programs, judges or court-appointed officials decide claims.

Funding of Compensation Programs

State compensation programs receive funding from a variety of sources. However, there are two primary sources on the state level that fund programs:

• Funding from fees or charges that offenders pay.
• Funding from general-revenue appropriations from legislatures.

According to NACVCB, more than four-fifths of the states are in the first category, gaining most of their income from offenders. In fact, in a large majority of states, no tax dollars are involved at all in either the administration of the program or in the awards given to victims.

An additional funding issue facing compensation programs today is recovering restitution from convicted offenders in order to help offset the cost of providing compensation benefits to their victims. This is described as "fund recovery" measures -- holding offenders and others liable for injury to victims, and making them pay for the consequences of their crimes. Some state programs are making special efforts to seek restitution from offenders and are working with prosecutors and judges to ensure restitution is ordered and collected, as well as monitoring restitution payments. However, fund recovery remains a small source of total program income thus far, with only a few programs beginning to recover more than 10% of their awards.

Recent Trends in Compensation

In some states, claims doubled, tripled, and even quadrupled in the period from 1985-1992. The greater visibility of the programs, the growth in other victim services, and new laws mandating that rights, services and information be provided to victims have resulted in more and more victims applying for help.

• While compensation programs have strived to meet this rising demand, stresses on program resources and administration are inevitable, particularly as many state government budgets have declined, and specific sources of revenue for compensation programs have failed to keep pace.
• For many programs, there continues to be concern about whether there will be enough money to pay claims, and enough staff to process them, in the near future.
• Compensation programs everywhere are working hard to process claims promptly and, at the same time, are seeking necessary legislative changes to boost revenue and control costs.
• The healthy growth in claims is an extremely positive sign; it shows that more victims are receiving the financial help they need. Programs will continue to work to ensure that the resources are there when they are needed by victims, by exploring new funding options and increases, and maintaining controls over costs to the extent reasonable and necessary.

Victims of Crime Act

With the enactment of the Victims of Crime Act of 1984, (amended), state compensation programs can receive federal VOCA funds that equal 40% of the previous year's compensation award amounts paid by the state funds.

• Federal funds provide about 20% of the monies available to states for making awards to victims.

The funding formula for compensation programs works in the following way:

For every 100 state dollars spent, the program will receive 40 federal dollars through a grant process that will make the funds available a little over a year after the end of the fiscal year upon which the calculation is based. This theoretically results in a 72%/28% state-to-federal mix of money (out of every $140 dollars available, $100 will be state, and $40 will be federal), but since most programs are paying more in awards each year, the federal funds will be proportionately less of the total by the time they are available. States also must bear the entire burden of their administrative budgets, since none of the VOCA funds can be used for administration. (NACVCB)

To qualify for federal funding, states must meet the following VOCA requirements:

• Programs must cover medical expenses, mental health counseling, and lost wages, as well as funeral expenses and lost support for families of homicide victims.
• They must also consider drunk driving and domestic violence as compensable crimes.
• They must not categorically exclude domestic violence victims on the basis of their being related to or living with the offender. (Programs may deny claims when an award to the victim would "unjustly enrich" the offender.)
• Programs also must comply with statistical reporting requirements.
• All states currently meet the standards, except Nevada, which does not cover nonresident criminally injured within its borders.

The VOCA grant program is administered by the Office for Victims of Crime within the U.S. Justice Department, which also provides valuable technical assistance to state compensation programs.

Federal Victims

With the passage of VOCA, as stated previously, victims of crimes that occur under federal jurisdiction, such as on Indian reservations, military installations, national parks, or other federal lands, are eligible for compensation in the state in which the crime occurred.

NACVCB states:

Since there is no federal crime victim compensation program, each state treats federal crime victims as fully eligible for all the benefits available for victims of state and local crimes. Compensation programs depend on the help of federal victim/witness coordinators in informing federal victims of their opportunity to apply for benefits.

Self Examination Chapter 9

Crime Victim Compensation

1) Generally, what is the range of maximum benefits available to victims from compensation programs?

2) Which states do not have victim compensation programs?

3) What are the five primary compensable costs covered by all states?

4) What is "unjust enrichment?"

5) What are the two principal state sources and one federal source of funding for victim compensation programs?

National Association of Crime Victim Compensation Boards Publication

What is Crime Victim Compensation?

Crime victim compensation programs can pay for the otherwise-unreimbursed expenses victims of violent crime incur as a direct result of their personal injuries. These programs, which operate through state and local governments, pay for medical expenses, mental health counseling, lost wages, and funeral expenses, and for loss of support for a victim's dependents.

Property loss (damaged or stolen property) is usually not covered, with the exception of eyeglasses, hearing aids and other medical devices. Compensation is awarded only when other sources of payment, such as medical or auto insurance, other public benefits, or restitution, are not readily available to the victim. Maximum benefits generally range between $10,000 and $25,000, although a few states have higher or lower maximums. (Nationally, the average amount paid to each victim applying for compensation is about $2,000.) About $250 million is being paid to more than 125,000 victims nationwide each year.

Why is it so Important?

While no amount of money can erase the trauma and grief suffered by crime victims, financial assistance can be crucial in helping many people through the recovery process. For some victims, these funds can help preserve the stability and dignity of their lives.

How Many States have Crime Victim Compensation?

How Many Countries?

All 50 states, the District of Columbia, and the Virgin Islands have active victim compensation programs. (There is no federal compensation program, but federal funds supplement the states' funds, and victims of federal crimes are fully eligible in the states where the crimes occur.) Each state conducts its program according to its own law, but most of the programs are similar in scope and operation. A number of other countries operate compensation programs, including Britain, Germany, Japan, Canada, Australia, and New Zealand.

What are the Eligibility Requirements for Victims and their Families?

In general, the victim must be innocent of criminal activity and "contributory misconduct," report the crime promptly to the police, cooperate with the criminal justice system, and submit a timely application. A conviction of the offender is not required. Victims are eligible regardless of whether the crime is under federal, state or military jurisdiction. The victim is eligible in the state where the crime took place, regardless of whether the victim is a resident of that state.

How Does the Application Process Work?

Typically, a victim may receive a compensation application from a prosecutor's office or police department, or by contacting the compensation program itself. The help of victim advocates in providing applications and assistance in filing is vital to the process, since most compensation programs operate with very small staffs. Once completed, the application is submitted to the compensation program in the state where the crime occurred. The program staff verifies the information, obtains police reports to confirm the circumstances of the crime, and notifies the victim concerning the victim's eligibility and what expenses can be paid. The victim may appeal the decision.

Where Does the Money Come from to Pay the Claims?

In two-thirds of the states, no tax dollars are involved. All the money for compensation to victims comes from fines, penalties, court costs, or other assessments against convicted criminals. For example, a state might require each convicted felon to pay $25 into the compensation fund, or might assess a $3 surcharge on all moving traffic violations. About a third of states use general appropriations and criminal fees. In addition, the federal Crime Victims Fund - financed entirely from federal criminal fines and fees - provides supplemental funds to each state.

What about Victims Injured in Crimes in Foreign Countries?

Some states will cover their own residents when injured outside the United States, but many cannot, since their laws limit their coverage only to crimes occurring within their own borders. While a number of foreign countries operate compensation programs, benefits may be limited and difficult to access.

Where can I get More Information?

Contact the program in your state or call the National Association of Crime Victim Compensation Boards at (703) 370-2996.

References

National Association of Crime Victim Compensation Boards. Crime victim compensation: A fact sheet. Washington, DC: Author.

National Association of Crime Victims Compensation Boards. Crime victim compensation: An overview. Washington, DC: Author.

National Victim Center (1992). State compensation laws. INFOLINK, 1 (52).

National Victim Center (1994). Focus on the future: A prosecutor's guide to victim assistance. Washington, DC: U.S. Department of Justice, Office for Victims of Crime.

Parent, Auerbach, & Carlson (1992). Compensating crime victims: A summary of policies and practices. Washington, DC: U.S. Department of Justice, Office for Justice Programs, National Institute of Justice.

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