Cost-Benefit Analysis Of Juvenile Justice Programs

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Cost-Benefit Analysis of Juvenile Justice ProgramsCost-Benefit Analysis ofJuvenile Justice ProgramsJuvenile Justice Guide Book for Legislators

Cost-Benefit Analysis of Juvenile Justice ProgramsIntroductionTo reach the best decisions for their constituents, lawmakersconstantly assess the advantages and disadvantages of variouscourses of action. Sometimes these choices are simple, andrigorous analysis is not necessary. Often, however, the variouscosts and outcomes of policy decisions are difficult to project.In response to these challenges, a growing number of statesare turning to data-driven cost assessment techniques to informtheir policies. One such device, cost-benefit analysis (CBA), isgaining national attention due to its success providing valuableinformation to government leaders.The Vera Institute of Justice (Vera) identifies the five basic steps of cost-benefit analysis as:123452Determine the effects of the initiative,Determine whose perspectives matter,(e.g. Who will be affected by each policy alternative?)Measure costs in dollars and cents,Measure benefits in dollars and cents, andCompare the costs and benefits.

Juvenile Justice Guide Book for LegislatorsCost-Benefit Analysis DefinedAccording to Vera, cost-benefit analysis is abe noted, however, that CBA determines only asystemic tool for evaluating public policy. Itprogram’s cost-effectiveness, not its overall success.allows lawmakers to weigh multiple options andTo understand the value of each option, CBA datadetermine which will achieve the greatest resultsmust be assessed together with separately conductedfor the lowest cost.program success evaluations. Reliable programBecause cost-benefit analysis turns all outcomes intomonetary values, it allows evaluators to compareassessments, combined with CBA analysis can helpleaders identify the best policy options.programs that have different goals—for example,program A aims to reduce crime, while program Baims to curb substance abuse—in order to find theoption with the greatest net societal benefit. It must3

Cost-Benefit Analysis of Juvenile Justice ProgramsDevelopment ofCost-Benefit AnalysisCost-benefit analysis of public programs is gainingnational attention thanks in large part to the workof Steve Aos and his colleagues at the WashingtonState Institute for Public Policy (WSIPP). WSIPPhas advised the Washington Legislature on researchbased approaches to public policy for the last 15years on issues ranging from public health andeducation to housing and criminal justice. One suchWSIPP cost-benefit analysis addressed Washington’sproblem with crime and overcrowded prisons.program data. The report, released in 2006, foundthat the state could save 2 billion and reduce crimeby using evidence-based alternatives to incarceration.In 2005, Washington was faced with a growingprison population that would necessitate theconstruction of three new prisons by 2030 at acost of 750 million. In response, the Legislatureappropriated funds through its capital budget billfor WSIPP to study evidence-based programs soinvestments could be made to reduce crime andsave Washington money over the long-term.Cost-Benefit Analysis Appliedto Juvenile JusticeWSIPP’s study reviewed and analyzed 571comparison group evaluations of adult corrections,juvenile corrections and prevention programs.In 2005, Washington was facedwith a growing prison populationthat would necessitate theconstruction of three new prisonsby 2030 at a cost of 750 million.Each study included met a strict set of criteria—suchas only using programs currently being used in thefield, not models, and having someone other thanthe program’s developer conduct the assessment—toavoid conflicts of interest. WSIPP established thesestandards before their financial assessment began toensure that they were relying on the best possible4A follow-up study from WSIPP, reported on in2009, found that Washington is having successimplementing the cost saving recommendations.The state invested 48 million in evidence-basedprograms in 2007 and has reduced its forecastedexpenditures in prison construction.In January 2004, WSIPP released a report assessingthe Community Juvenile Accountability Act, a 1997Washington law that focused on reducing the state’sjuvenile crime by implementing evidence-basedprograms in the juvenile court system.In this study, WSIPP found that programs such asfunctional family therapy (FFT is a family-basedintervention program that focuses on improvingprotective factors and reducing risk factors forjuvenile delinquent behavior) and aggressionreplacement training (ART is an interventionprogram that helps youths develop skills to controlanger and use appropriate behavior) reducedrecidivism and saved taxpayer dollars. In the caseof aggression replacement training, 11.66 wassaved for each 1 spent, and the rate of participantscommitting another felony within 18 monthsdropped by 24 percent.In addition to Washington, other states—includingFlorida, Pennsylvania and Wisconsin—have usedcost-benefit analysis to evaluate programs withintheir juvenile justice systems. A few of these states,including Pennsylvania, have borrowed elements ofWashington’s cost-benefit model to apply to theirown state’s data.

Juvenile Justice Guide Book for LegislatorsFloridaIn Florida, legislators were searching for ways toreduce the amount of money spent housing juvenilesin detention facilities. According to Florida’s Officeof Program Policy Analysis and GovernmentAccountability (OPPAGA), 76 percent of juvenilesin state detention centers were in need of mentalhealth, substance abuse or psychiatric treatment,and 42 percent of those in detention were chargedwith misdemeanors or parole violations. OPPAGAfound that these treatments and problems could bemore effectively handled in diversion programs, and,between 2005 and 2008, 2,033 juveniles successfullycompleted such programs. To house these juvenilesin detention centers would have cost 50.8 million.With the redirection program, however, the costwas 14.4 million. By using these programs, Floridagained a cost benefit of 36.4 million.OPPAGA emphasized that, to realize benefitsthrough diversion programs, cost-benefit analysisof evidence-based programs must be rigorous soprojections match the realities. Separate assessmentsof program effectiveness must have been previouslyconducted. In this example, the juveniles whocompleted the diversion program were 46 percentless likely to be convicted of a felony in the futurethan those placed in detention facilities.PennsylvaniaIn 2008, the Prevention Research Center of HumanDevelopment, with funding from Pennsylvania’sCommission on Crime and Delinquency (PCCD),issued a report detailing their study of Pennsylvania’sreturn on investment for seven juvenile programsused throughout the state. The study found thatthese programs saved Pennsylvania 317 millionin reduced criminal justice costs and salaries. Thebenefits per 1 invested ranged from 1 to 25depending upon the program. The “LifeSkillsTraining” program, for example, benefitted 25.72per 1 spent, saving Pennsylvanians 16.160 millionover the course of its operation.The benefits per 1 investedranged from 1 to 25 dependingupon the program.Report authors concluded that, given the significantcost benefits realized by these programs, otheragencies should take a more active role in comparing,assessing and using cost-effectiveness data.WisconsinWhat Works, Wisconsin!, a study requested by theWisconsin Governor’s Juvenile Justice Commissionto examine evidence-based programs with growingdelinquency prevention evidence, provides anotherexample of cost-benefit analysis. What Works,Wisconsin! found that, in 2004, it cost 68,255 tohouse a juvenile offender in a corrections facilityin Wisconsin for 12 months. The study analyzedmany potentially beneficial programs, includingWraparound Milwaukee. This program coordinatestreatment and services for delinquent and nondelinquent youth with mental health disorders,with the goal of keeping youth in the communityand with their families when possible. WraparoundMilwaukee allows families to select from an arrayof services and provides “care coordination” toensure the best use of resources. Although rigorousevidence-based studies have not been conductedfor Wraparound Milwaukee, it reported in 2000that 650 youth were served in the community at5

Cost-Benefit Analysis of Juvenile Justice Programsa monthly cost of about 3,300 per participant;traditional incarceration would have cost 5,000.The findings in What Works, Wisconsin! claim thatthe two biggest barriers to appropriately fundingeffective evidence-based programs are a lack ofinformation available to policymakers and prohibitivestart-up costs. If these obstacles can be overcome, theauthors believe the benefits of using evidence-basedprograms will be substantial.Cost-Effectiveness AnalysisCost-benefit analysis is not the only costThe Redeploy Illinois initiative gives countiesassessment tool used by the states. Cost-financial support to provide comprehensiveeffectiveness analysis also compares theservices to delinquent youth in their homerelative costs and outcomes of two or morecommunities who might otherwise be sentcourses of action, but is different fromto the Illinois Department of Juvenile Justicecost-benefit analysis in that it does not turn(IDJJ). In the first two years of implementation,all results into monetary values. Due to thisthe Redeploy Illinois pilot sites, on average,limitation, cost-effectiveness analyses arereduced their commitments to IDJJ by 44generally only used to compare programspercent. As of January 2010, Redeploywith similar goals.Illinois has nine programs serving juvenilesIllinois’ use of a cost-effective assessmenthelped the state save money and reducecrime rates by implementing evidence-basedprograms. The Redeploy Illinois initiative,spent by Redeploy Illinois pilot sites, IDJJhas had a cost avoidance of 3.55 million onjuvenile incarceration.passed by the Illinois legislature in 2004, isThe success of Redeploy Illinois has promptedpredicated on the belief that non-violentits oversight board to recommend an increasedyouth offenders are less likely to be involvedfinancial investment to expand services to thein future delinquent behavior if they remain inentire state. The board also recommendedtheir home communities to receive treatmentthat a cost-benefit analysis of Redeploy Illinoisinstead of being sent to a detention conducted in addition to the programThe programs also are less expensive thanassessments to help understand its true value.housing a juvenile in a detention center.As of January 2010, some of the programThe annual cost of housing one juvenile inassessments had begun.a detention center was 70,827 in 2005.6in 20 counties. So far, for every 1 million

Juvenile Justice Guide Book for Legislators.the two biggest barriers toConclusionappropriately funding effectiveevidence-based programs are alack of information available topolicymakers and prohibitivestart-up costs.Although cost-benefit analysis mayappear complicated, it is important toremember that the goal is simply toweigh the advantages and disadvantagesof one course of action over another.For legislators interested in learning howThese include identifying programs with the bestresults, enabling states and localities to spendtheir limited resources effectively and allowinglawmakers to make decisions based on a calculated,supportable analysis.cost-benefit analysis can be applied intheir state, there are many developingresources to turn to. With thiseducational assistance, state leaders willbe better able to decide how to valueinformation derived from cost analyses.Moving ForwardThe success of these examples has increased nationalinterest in replicating cost-benefit analysis and similarprogram assessments. To inform practitioners, Verainitiated a project to centralize information on thetopic in the National Knowledge Bank for CostBenefit Analysis in Criminal Justice ( Thewebsite serves as a clearinghouse for resources andresearch and is also a center for active practitioners.It includes podcasts, videos and a cost-benefit toolkitdeveloped specifically to provide general educationand training on criminal justice cost-benefit analysisto various audiences.For references and additional resources, pleasesee the References, Glossary & Resources section.Another project designed to increase the accessibilityof cost-benefit analysis is the Results First Initiative.WSIPP partnered with the Pew Charitable Trustsand the MacArthur Foundation to develop a costbenefit tool that can be applied to data collectedfrom programs in other states. The project willinclude a software designed to help states identifyevidence-based policies that maximize the return oninvestment for taxpayers.7

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Cost-benefit analysis is not the only cost assessment tool used by the states. Cost-effectiveness analysis also compares the relative costs and outcomes of two or more courses of action, but is different from cost-benefit analysis in that it does not turn all results into monetary values. Due to this limitation, cost-effectiveness analyses are

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