Oregon Prisons Were Ordered to Protect Veteran Benefits. They Tried to Find a Loophole Instead.

When the Oregon Legislature set up a mechanism last year to collect debts from inmates in state prisons, it made an exception. It barred the state's Department of Corrections from taking money from veterans' disability benefits.

But prison officials built in a work-around that would force former service members behind bars to pay court fines before they could buy food, clothing or sundries from the commissary.

Critics say the Oregon Department of Corrections is unfairly and perhaps illegally trying to take money from imprisoned veterans.

"This is the most outrageous treatment I've seen of veterans in 10 years," says Jesse Barton, a Salem lawyer and longtime advocate for incarcerated veterans in Oregon. "I guess the DOC has concluded they can take money from the most vulnerable veterans without consequences."

Complaints about the accounts went ignored by the DOC and Oregon Department of Justice for months. But Gov. Kate Brown, in the midst of a tight race for re-election, has reversed her prisons chief and Justice Department—and last week ordered them to change the policy.

Oregon officials have a motivation to collect as much money from prisoners as they can. The largest source of debt to the state of Oregon are the unpaid court-ordered fees and restitution levied against people convicted of crimes.

Oregon's 14,876 inmates owe, on average, $120 in court-ordered fees and restitution, often to pay back attorney's fees, court costs and damages resulting from their crimes. In 2017, the money owed by convicted criminals made up nearly half of the uncollected debt in the state. The second-largest debt is unpaid taxes.

To fix the problem, lawmakers passed a bill in 2017 that allows the Department of Corrections to take 10 to 15 percent of the money deposited in inmate spending accounts to pay their debts. (Senate Bill 844 passed with bipartisan support.)

But some money was off-limits. The law set up a number of so-called "protected monies" that corrections could not touch, including disability benefits for veterans, Native American tribal payments, and railroad retirement benefits.

The DOC created a mechanism to skirt the restrictions and access the money anyway—by extracting debt payments when the money changed accounts. The DOC says there is more than $90,000 currently in such protected accounts.

Lawyers, including the directors of the Veterans Defense Resource Center in Eugene, have argued that moving the money from account to account is a shell game designed to garnish off-limits funds.

But the DOC and its attorneys at the DOJ rejected the argument in a letter from senior assistant attorney general Matthew Lysne.

"Your concerns that the DOC is violating [the law] are misplaced," Lysne wrote. The DOJ argued that because inmates can leave the money in the protected accounts, they consent to paying it toward their court-ordered debts when they transfer it to spend in the commissary.

In July, veterans advocate Barton contacted the inspector general for the DOC, Craig Prins, who told him that because "this legislative bill predates me," he could not look into the matter.

But Barton found a powerful ally: Gov. Brown.

After Barton called her office and shared his objections, she ordered her staff to look into the procedure.

"Gov. Brown was made aware of the issue and immediately requested staff to review the practice," says spokeswoman Nikki Fisher.

Now, the DOC has changed its tune.

It had begun taking 5 percent from inmate accounts in July to put into a "transitional savings account" that inmates would be able to access when they were released from custody. But it had not yet started collecting the 10 percent earmarked to pay down restitution debts—and it now appears it will not use protected funds for this purpose.

"After receiving a clear directive from Gov. Brown about her desire to ensure protected funds remain protected, we will rewrite our rules and policies," says Jennifer Black, a DOC spokeswoman.

For the families of veterans in Oregon prisons, the money grab was an insult and a violation.

An incarcerated veteran's mother, who asked to remain anonymous for fear of retribution, says her son tried to buy shoes with his disability payments. But when he transferred the money to his general spending account, the DOC took 5 percent.

"The DOC procedure takes away money these vets have earned," she says. "It violates a right these vets have earned."