The Legal Services Corporation (LSC), formed in 1974 with bipartisan Congressional support and the endorsement of the Nixon Administration, was created to ensure that all Americans have access to a lawyer and the justice system for civil legal issues regardless of their ability to pay. The LSC provides funding to independent local legal services programs through a competitive grant process.

The Corporation currently funds 137 local programs (with approximately 900 offices) serving every county, state and Congressional District in the United States and its territories. These local programs provide direct services to approximately one million constituents who struggle to get by on incomes below or near the poverty line as established by the Department of Health and Human Services. LSC clients include the working poor, veterans, family farmers and people with disabilities. Family law matters (including domestic violence and child custody) and housing issues are the largest categories of cases handled by LSC-funded programs.

Many beneficiaries of LSC funding were formerly middle-class, who became poor because of the breakup of their family, unemployment, illness, age, or disaster. A 2005 study showed that 74 percent of legal aid clients have been women, most of them mothers with children. Many victims of the September 11 terrorist attacks have received assistance from LSC-funded programs, including family members of victims in need of help with social security survivor benefits, landlord/tenant issues, child custody and guardianship issues, emergency public assistance and many other matters. In 2005, LSC-funded programs in the Gulf Coast were overwhelmed, as already under funded programs try to help existing clients and newly eligible clients who lost their jobs and/or their homes. Today, significant numbers of low-income families find themselves in need of legal aid to prevent homelessness resulting from foreclosures on sub-prime mortgages. In addition to affecting low-income home owners, the foreclosures are also forcing low-income renters from their homes.

The Legal Services Corporation (LSC) has been operating since 1980 without a renewed authorization by virtue of its annual appropriation. The ABA continues to speak out strongly on behalf of the LSC by utilizing an ongoing grassroots legislative advocacy campaign involving ABA, state, local and specialty bar leaders.

Today, while LSC enjoys bipartisan support, securing adequate funding remains a challenge due to the escalating budget deficit. At the same time, the number of people living in poverty in the United States has increased by 5.74%. More than 50 million Americans are eligible for federally funded legal assistance -- an all-time high. Every year, tens of thousands of eligible persons with major legal problems are turned away because of the local programs' lack of resources.(See Justice Gap Below)

(For more information, see FY 2009 Appropriations Background)

In mid-March, the new 111th Congress provided $390 million for the Legal Services Corporation for FY 2009, a $40 million increase over FY 2008. While the Fiscal Year begins October 1, the outgoing 110th Congress deferred funding decisions to the incoming Congress.

The FY 2010 appropriations process began in late March when the LSC board submitted its own budget proposal to Congress. The LSC is one of the few government-funded entities allowed to submit its own budget proposal directly to Congress. On March 20, 2009, the bipartisan LSC Board of Directors urged Congress to provide a significant funding increase for LSC to $485.1 million, $95.1 million more than the amount provided for FY 09.

ABA President H. Thomas Wells, Jr. wrote the Office of Management and Budget regarding the Administration’s expected request for LSC of $435 million. President Wells also urged the Administration to delete at least two of the 1995 funding restrictions that have been included in all subsequent appropriations bills.

On April 01, 2009, the House Appropriations Subcommittee on Commerce, Justice and Science held a public hearing on LSC's funding. Congressman Alan Mollohan (D-WV) chairs the subcommittee. LSC Board Vice-Chair Lillian BeVier Strickland and President Helaine Barnett testified on behalf of the Corporation.

The Senate Appropriations Subcommittee on Commerce, Justice, Science and Related Agencies (CJS), led by Chairwoman Barbara Mikulski (D-MD) and Ranking Member Richard Shelby (R-AL), did not schedule any hearings related to LSC funding.

ABA Day in Washington, April 21-23, 2009, once again organized bar leaders to educate their Members of Congress about the need for increased funding for LSC. More than 300 ABA and state/local bar leaders participated in this year’s program which focused on access to legal services issues, including as always, funding for LSC. As part of ABA Day, the ABA released a newly completed Harris public opinion poll which demonstrated strong national support for providing free legal services to qualified low-income families.

The Obama Administration, submitted its detailed budget proposal in early May, and requested that Congress fund LSC at $435 million and lift three of the restrictions on LSC-funded attorneys: (1) non-LSC fund use; (2) allowing the receipt of statutorily authorized attorneys’ fees; and (3) the filing of class actions.

ABA President Tommy Wells wrote the House and Senate Appropriations Subcommittees in support of increasing LSC’s budget to at least the $435 million requested by the President. The ABA also asked Congress to lift the three restrictions included in the Administration’s budget request. President Wells’s letter included two important attachments which further demonstrated non-partisan, national support for providing more adequate funding for LSC: a letter signed by all 50 state bar association presidents (plus D.C., Puerto Rico and the U.S. Virgin Islands) and the presidents of the four major bars of color; and the annual letter circulated by Senator Edward Kennedy (D-MA) supporting increased funding for LSC. This year’s letter was signed by 53 Senators, with additional Senators expressing support through personal letters to the Subcommittee.

In June 2009, the House of Representatives approved the Commerce, Justice Science appropriations bill (H.R. 2847) which included a $50 million increase for LSC bringing LSC’s funding to $440 million, $5 million more than the amount requested by the President. The House agreed to lift the restriction on attorneys’ fees but kept in place the remaining restrictions. During floor consideration, Rep. Jeb Hensarling (R-TX) offered an amendment to eliminate the LSC because of alleged mismanagement and to reduce the federal budget. The amendment was soundly defeated 105-323.

Also in June, the Senate Appropriations Committee reported out its version of H.R. 2847 but provided only a $10 million increase, to $400 million. In addition, the Senate Committee removed the restriction on the use of non-LSC funds but kept the remaining restrictions in place.

On December 9, 2009, the House and Senate both passed the Conference Report on H.R. 3288, the FY 2010 Consolidated Appropriations Act, which includes many programs of importance to the ABA and organized bar. P.L. 111- 117 provides funding for the following ABA Access to Legal Services priority programs:

Despite focused efforts by the ABA and many groups to lift the restriction on non-LSC funds and class action restriction, the bill retains those restrictions.

In March, Senator Tom Harkin (D-IA) introduced S. 718, legislation to reauthorize LSC. The ABA was actively engaged in drafting the bill and endorsed the legislation. To date, 20 Senators have cosponsored the bill. In mid-October, Rep. Bobby Scott (D-VA) introduced H.R. 3764. Immediate Past ABA President Tommy Wells testified on October 27 before the House Judiciary Committee and urged the 111th Congress to enact bipartisan reauthorization legislation.

Board of Directors/Management

The LSC is governed by an 11-person bipartisan Board of Directors, nominated by the President and confirmed by the Senate. The full Senate Committee on Health, Education, Labor and Pensions (Help) is responsible for confirming nominees to this Board. The ABA pursuant to longstanding procedures conducts an evaluation of the nominees' qualifications and commitment to the program and submits its views to the Senate.

The Board of Directors in December 2009 named LSC’s long-time General Counsel Victor Fortuno Interim President. He replaced Helaine Barnett, formerly the Attorney-in-Charge of civil legal services for the Legal Aid Society of New York City, who served as LSC's President from  January 2004 to December 2009. In February 2008, the Board announced the appointment of Jeffrey E. Schanz as the Corporation's new Inspector General, effective March 3, 2008. Schanz previously served for 17 years with the United States Department of Justice (DOJ) as Director of the Office of Policy and Planning, Audit Division, Office of the Inspector General.

On August 6, 2009, the President announced he would nominate five individuals to serve on the LSC Board replacing the Democratic members whose terms had expired. Their nominations were transmitted to the Senate the same day. The ABA reviewed their qualifications and submitted a report to the HELP Committee. The Senate HELP Committee in October approved the five Democratic nominees for consideration by the full Senate, including past ABA President Robert J. Grey, Jr. The nominations are awaiting action by the full Senate. The sixth Democratic Board member, Laurie Mikva, was confirmed in June.

In December 2009, the President nominated three Republicans to serve on the Board. The ABA carefully reviewed their qualifications and, on January 25, 2010 the ABA submitted its report to the Senate HELP Committee.

The Legal Services Corporation on October 17, 2005 released the results of its year-long study "Documenting the Justice Gap in America."

The study documents that one in every two individuals who qualify for and actually seek assistance from LSC-funded programs are turned away because of a lack of resources. This 50 percent denial of service figure does not include the number of individuals who are eligible but do not seek assistance for whatever reason.

The study also verifies that at least 80 percent of the legal needs of the poor are not addressed. This figure highlights the much broader, unmet legal need that includes services provided by legal aid and private lawyers, whether pro bono or private attorneys charging full or reduced fees. This result was based on a review of the recent state studies, which support the often-quoted ABA study completed in 1994. Since the ABA completed its study in the early 90s, the unmet need has remained the same and even increased. Although private and state funding has increased, federal funding has declined, and the number of individuals eligible for assistance has increased as poverty has increased. These reports have been verified by more recently by multiple State-sponsored "legal needs" studies.

• The need for legal services for poor Americans has never been greater; over 80% of the civil legal needs of the poor are not being met.
• LSC is a fundamentally conservative program, one that facilitates the peaceful resolution of disputes and reinforces respect for the rule of law. More than 90 percent of the cases are resolved without litigation.
• LSC was "reformed" by Congress in 1996. The Corporation is vigorously enforcing the restrictions passed by Congress and is working aggressively to ensure all programs that receive federal funds comply with all existing laws.

The ABA supports a strong, federally funded, community controlled program to provide legal aid for the poor. The ABA favors substantial private bar involvement in the delivery of legal services and actively encourages pro bono participation by individual attorneys, law firms, and corporate general counsels.

January 25, 2010