[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2644 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 2644

To authorize appropriations for the Legal Services Corporation, and for 
                            other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 15, 1993

  Mr. Bryant introduced the following bill; which was referred to the 
                       Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
To authorize appropriations for the Legal Services Corporation, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Legal Services 
Reauthorization Act of 1993''.
    (b) Table of Contents.--The table of contents is as follows:
Sec. 1. Short title.
Sec. 2. Reference to the Legal Services Corporation Act.
Sec. 3. Authorization of appropriations.
Sec. 4. Protection against theft and fraud.
Sec. 5. Prohibitions on lobbying.
Sec. 6. Enforcement, sanctions, and monitoring.
Sec. 7. Class actions.
Sec. 8. Negotiation requirement.
Sec. 9. Prohibition on use of funds for redistricting.
Sec. 10. Restrictions on use of funds for legal assistance to aliens.
Sec. 11. Governing bodies of recipients.
Sec. 12. Professional responsibilities.
Sec. 13. Solicitation.
Sec. 14. Certain eviction proceedings.
Sec. 15. Procedural safeguards for litigation.
Sec. 16. Competition study.
Sec. 17. Training.
Sec. 18. Limitation on use amendments.
Sec. 19. Recordkeeping and noncorporation funds.
Sec. 20. Evasion.
Sec. 21. Fee-generating case provisions.
Sec. 22. Attorneys' fees provisions.
Sec. 23. Corporation board control over policy.
Sec. 24. Reprogramming provisions.
Sec. 25. 12-month grants.
Sec. 26. Establishment of local priorities.
Sec. 27. Staff attorneys.
Sec. 28. Study on legal assistance to older Americans.

SEC. 2. REFERENCE TO THE LEGAL SERVICES CORPORATION ACT.

    Except as otherwise expressly provided, whenever in this Act an 
amendment or repeal is expressed in terms of an amendment or repeal of 
a section or other provision, the reference shall be considered to be 
made to a section or other provision of the Legal Services Corporation 
Act (42 U.S.C. 2996 and following).

SEC. 3. AUTHORIZATION OF APPROPRIATIONS.

    Section 1010(a) (42 U.S.C. 2996i(a)) is amended by striking the 
first three sentences and inserting the following: ``There are 
authorized to be appropriated for the purpose of carrying out the 
activities of the Corporation such sums as may be necessary for each of 
fiscal years 1993, 1994, 1995, and 1996.''.

SEC. 4. PROTECTION AGAINST THEFT AND FRAUD.

    Section 1005 (42 U.S.C. 2996d) is amended by adding at the end the 
following:
    ``(h) For purposes of sections 286, 287, 641, 1001, and 1002 of 
title 18, United States Code, the Corporation shall be considered to be 
a department or agency of the United States Government.
    ``(i) For purposes of sections 3729 through 3733 of title 31, 
United States Code, the term `United States Government' shall include 
the Corporation, except that actions that are authorized by section 
3730(b) of such title to be brought by persons may not be brought 
against the Corporation, any recipient, other grantee or contractor of 
the Corporation, subgrantee or subcontractor of any such entity, or 
employee thereof.
    ``(j) For purposes of section 1516 of title 18, United States 
Code--
            ``(1) the term `Federal auditor' shall include any auditor 
        employed or retained on a contractual basis by the Corporation,
            ``(2) the term `contract' shall include any grant or 
        contract made by the Corporation, and
            ``(3) the term `person', as used in subsection (a) of such 
        section, shall include any recipient or other grantee or 
        contractor receiving financial assistance under section 
        1006(a)(1) or 1006(a)(3).
    ``(k) Funds provided by the Corporation under section 1006 shall be 
deemed to be Federal appropriations for the purpose of all Federal 
criminal laws when used by a recipient, another grantee or contractor 
of the Corporation, or any subgrantee or subcontractor of any such 
entity.
    ``(l) For purposes of section 666 of title 18, United States Code, 
funds provided by the Corporation shall be deemed to be benefits under 
a Federal program involving a grant or contract.''.

SEC. 5. PROHIBITIONS ON LOBBYING.

    Section 1007(a)(5) (42 U.S.C. 2996f(a)(5)) is amended to read as 
follows:
            ``(5) ensure that no funds made available by the 
        Corporation to any recipient or other grantee or contractor are 
        used to pay for any personal service, advertisement, telegram, 
        telephone communication, letter, printed or written matter, or 
        other device, or to pay for any publicity or propaganda, 
        intended or designed--
                    ``(A) to influence any decision by a Federal, 
                State, or local agency, except when legal assistance is 
                provided by an employee of a recipient or other grantee 
                or contractor of the Corporation to an eligible client 
                on a particular application, claim, case, or other 
                matter, which directly involves the client's legal 
                rights or responsibilities, or
                    ``(B) to influence any Member of Congress or any 
                other Federal, State, or local elected official to 
                favor or oppose any Act, bill, resolution, or similar 
                legislation, or any referendum, initiative, 
                constitutional amendment, or any similar procedure of 
                the Congress, any State legislature, any local council, 
                or any similar governing body,
        except that this paragraph shall not preclude such funds from 
        being used in connection with--
                    ``(i) any communication made in response to any 
                Federal, State, or local agency or elected official,
                    ``(ii) any communication to a Federal, State, or 
                local elected official pertaining to the authorization 
                or appropriation of funds or any other measure 
                affecting the authority, functions, or funding of the 
                recipient, grantee, or contractor, or the Corporation 
                or pertaining to oversight measures directly affecting 
                the recipient, grantee, or contractor, or the 
                Corporation, if the project director or designee of the 
                recipient, grantee, or contractor has expressly 
                determined that the legislative body involved is 
                considering such authorization, appropriation, or other 
                measure, or is conducting oversight of the recipient, 
                grantee, or contractor, or the Corporation, or
                    ``(iii) any communication on behalf of an eligible 
                client in the course of representation of that client 
                before a legislative body, if the project director or 
                designee of the recipient, grantee, or contractor has 
                expressly approved such representation in accordance 
                with policy established by the governing or policy body 
                of the recipient, grantee, or contractor, and if such 
                project director or designee has determined, before 
                approving the undertaking of such representation, 
                that--
                            ``(I) the client seeks representation to 
                        protect the client's existing legal rights or 
                        interests or is in need of relief which can be 
                        provided by the legislative body involved, and
                            ``(II) documentation specifically 
                        authorizing such representation has been 
                        secured from the eligible client by a recipient 
                        or other grantee or contractor,
        but nothing in this paragraph shall be construed to permit an 
        attorney or an employee of a recipient or other grantee or 
        contractor of the Corporation to engage in any publicity or 
        propaganda intended or designed to support or defeat 
        legislation pending before the Congress or State or local 
        legislative bodies or intended or designed to influence any 
        decision by a Federal, State, or local agency or to solicit a 
        client, in violation of professional responsibilities, for the 
        purpose of making possible any activity permitted by this 
        paragraph;''.

SEC. 6. ENFORCEMENT, SANCTIONS, AND MONITORING.

    (a) Enforcement.--Section 1006(b)(1)(A) (42 U.S.C. 2996e(b)(1)(A)) 
is amended to read as follows:
    ``(b)(1)(A)(i) The Corporation shall have the authority to ensure 
the compliance of recipients, other grantees and contractors of the 
Corporation, and their respective employees with the provisions of this 
title. The Corporation may issue rules, regulations, guidelines, and 
instructions to interpret the provisions of this title, but may not 
impose, by regulation or otherwise, restrictions or limitations on 
types of cases or forms of representation of clients unless such 
restrictions or limitations are explicitly authorized by this title or 
other applicable law, and may not impose, by regulation or otherwise, 
restrictions or requirements on such recipients, grantees, or 
contractors that are in addition to or inconsistent with the provisions 
of this title and other applicable law.
    ``(ii) The Corporation shall have the authority to enforce the 
rules, regulations, guidelines, and instructions issued under this 
title, and to terminate, in accordance with the standards described in 
paragraph (5) of this subsection, financial support to a recipient or 
other grantee or contractor of the Corporation. Pursuant to regulations 
adopted by the Corporation under section 1008(e), the Corporation 
shall--
            ``(I) arrange for independent evaluations to determine 
        whether recipients and other grantees and contractors of the 
        Corporation are providing comprehensive, economical, and 
        effective legal assistance of high quality to eligible clients, 
        and
            ``(II) conduct reasonable monitoring and investigations 
        into allegations that a recipient or other grantee or 
        contractor has violated this title, the rules, regulations, 
        guidelines, or instructions issued under this title, or other 
        laws.
    ``(iii) Not later than 30 days after receiving a written request 
alleging that a recipient or other grantee or contractor has violated 
the provisions of this title, or any rule, regulation, guideline, or 
instruction issued under this title, or any other law, the Corporation 
may initiate an investigation of the matter. A recipient or other 
grantee or contractor that is the subject of such investigation shall 
be so notified by the Corporation and, prior to the completion of the 
investigation, shall be provided with a reasonable opportunity to 
respond to the allegations either in writing or in person, as 
determined by the Corporation. Unless required by law, the Corporation 
shall not make the findings of its investigation public until a final 
report is issued or unless such disclosure is made with the consent of 
such recipient, grantee, or contractor. If, at the conclusion of the 
investigation, the Corporation determines that it will take action 
under paragraph (5) of this subsection, it shall notify the recipient, 
grantee, or contractor of its right to request a hearing. A hearing 
must be requested not later than 30 days after receiving the 
notification.''.
    (b) Regulations for Enforcement.--Section 1006(b)(5) (42 U.S.C. 
2996e(b)(5)) is amended to read as follows:
    ``(5)(A) The Board shall issue regulations to provide for the 
enforcement of this title. Such regulations may include, among 
available remedies, provisions for the immediate suspension of 
financial assistance under this title, suspension or termination of an 
employee of the Corporation, or of any employee of a recipient or other 
grantee or contractor by such recipient, grantee, or contractor, the 
reduction or termination of such financial assistance or employment, 
and denial of an application for refunding. Any such employee may be 
terminated only after consideration of other remedial measures and only 
after the employee has been afforded reasonable notice and opportunity 
for a timely, full, and fair hearing. When requested, such hearing 
shall be conducted by an independent hearing examiner. The Corporation 
may suspend, reduce, or terminate financial assistance under this 
title, or deny an application for refunding under this title--
            ``(i) when there has been a substantial failure to comply 
        with the provisions of this title, or rules, regulations, 
        guidelines, or instructions issued under this title, or of 
        other laws, and after notice and an opportunity to correct such 
        failure has been provided to the recipient, grantee, or 
        contractor involved; or
            ``(ii) when independent evaluations demonstrate that a 
        recipient or other grantee or contractor has consistently 
        failed to use its resources to provide economical and effective 
        legal assistance of high quality as measured by generally 
        accepted professional standards, and after notice and an 
        opportunity to correct such failure has been provided to such 
        recipient, grantee, or contractor.
The Corporation may deny an application for refunding of a recipient or 
other grantee or contractor when the Corporation has identified an 
applicant for financial assistance under this title that is better able 
to provide high quality, comprehensive, economical, and effective legal 
assistance for the geographic area served by such recipient, grantee, 
or contractor, consistent with the provisions of subsections (a)(2) and 
(c) of section 1007 of this title.
    ``(B) Financial assistance under this title may not be terminated 
or suspended, an application for refunding under this title may not be 
denied, and the annual level of financial assistance under this title 
may not be reduced by more than 5 percent or $20,000, whichever is 
less, unless the recipient or other grantee or contractor involved has 
been afforded reasonable notice and, at the request of the recipient, 
grantee, or contractor, a timely and fair hearing before an independent 
hearing examiner pursuant to regulations issued by the Corporation. 
Such regulations shall provide for commencement of the hearing before 
an independent hearing examiner at the earliest appropriate date, but 
in no case more than 45 days after a request for such a hearing is 
received. As soon as practical after the hearing, but in no case more 
than 60 days after its conclusion, the independent hearing examiner 
shall make a recommended decision on the matter involved. A copy of the 
recommended decision shall be sent to the Corporation and the 
recipient, grantee, or contractor involved. If neither the Corporation 
nor the recipient, grantee, or contractor involved requests review by 
the president of the Corporation of that recommended decision within 10 
days after the date the recipient, grantee, or contractor receives a 
copy of the decision, that decision shall become final. Within 30 days 
after receipt of a request for a review of a recommended decision, the 
president of the Corporation shall make a final decision with respect 
to that recommended decision. In addition to other remedies provided by 
law, the recipient, grantee, or contractor may appeal the final 
decision to the Board.''.
    (c) Monitoring and Independent Evaluations of Programs.--Section 
1007(d) (42 U.S.C. 2996f(d)) is amended to read as follows:
    ``(d)(1) The Corporation shall monitor recipients and other 
grantees and contractors of the Corporation in order to ensure that the 
provisions of this title, the rules, regulations, guidelines, and 
instructions issued under this title, and other laws are carried out by 
such recipients, grantees, and contractors, and shall provide for 
independent evaluations to determine whether such recipients, grantees, 
and contractors are providing economical and effective legal assistance 
of high quality to eligible clients. The Corporation shall adopt 
standards and procedures to implement the provisions of section 
1006(b)(1)(A) and this subsection as regulations under section 1008(e).
    ``(2) The standards and procedures adopted under paragraph (1) 
shall take into account--
             ``(A) that the responsibility of the Corporation with 
        regard to monitoring and evaluation is to ensure compliance 
        with this title, the rules, regulations, guidelines, and 
        instructions issued under this title, and any other laws and to 
        provide for independent evaluations to assess the extent to 
        which the overall delivery of legal assistance by a recipient 
        or other grantee or contractor is economical, effective, and of 
        high quality and not to manage the day-to-day operations of 
        recipients and other grantees and contractors;
            ``(B) that each recipient or other grantee or contractor 
        has the responsibility to manage its day-to-day operations and 
        to assure that its employees comply with all applicable law and 
        deliver high quality legal assistance in an effective and 
        economical manner;
            ``(C) that the personal privacy of eligible clients could 
        be adversely affected by the public disclosure of records or 
        documents obtained in connection with monitoring under 
        paragraph (1) or an investigation pursuant to section 
        1006(b)(1)(A); and
            ``(D) the rules of ethics and professional responsibility 
        that are applicable in the jurisdiction where a recipient or 
        other grantee or contractor delivers legal assistance.
The Corporation may not require disclosure of records described in 
subparagraph (C) except to the extent such records can be expected to 
contain information directly pertinent and necessary to an audit, or to 
an investigation of a likely pattern of discrimination, lack of 
compliance with the law, or poor performance by a recipient or other 
grantee or contractor which is indicated by other external evidence.
    ``(3) The Corporation shall ensure that the monitoring process is 
fair and conducted in a manner that does not cause more than necessary 
disruption to the provision of legal services provided by the recipient 
or other grantee or contractor being monitored, and provides--
            ``(A) sufficient notice before monitoring is conducted;
            ``(B) flexibility to negotiate with the Corporation when 
        disagreements arise over the timing and conduct of monitoring;
            ``(C) reasonable opportunity to respond and comment on 
        draft reports on monitoring;
            ``(D) protection from disclosure to third parties of the 
        results of monitoring and the contents of any draft reports on 
        monitoring before a final report on the monitoring is issued; 
        and
            ``(E) protection from disclosure to third parties of any 
        documents obtained during monitoring except to the extent 
        necessary to carry out the monitoring, consistent with the laws 
        and the rules of ethics and professional responsibility 
        applicable to the jurisdiction where such documents are 
        maintained, except that the Corporation shall at all times have 
        the authority to make evidence of criminal conduct available to 
        the appropriate legal authority.
The Corporation shall ensure that the monitoring process is reasonably 
related to the purposes which the monitoring is intended to accomplish.
    ``(4) The Corporation, in cooperation with recipients and other 
appropriate groups, shall develop criteria for evaluating the 
capability and performance of recipients and other grantees and 
contractors of the Corporation. Such criteria shall provide for the 
assessment of--
            ``(A) the degree to which any such recipient, grantee, or 
        contractor provides a comprehensive range of legal assistance 
        to eligible clients, including, in the case of support 
        entities, a comprehensive range of appropriate support 
        services;
            ``(B) the past demonstrated record of any such recipient, 
        grantee, or contractor in providing effective, economical, and 
        high quality legal services to poor individuals and in 
        developing additional resources, including pro bono services 
        from the private bar;
            ``(C) the ability of any such recipient, grantee, or 
        contractor to determine and address the needs of eligible 
        clients for particular services, including, in the case of 
        support entities, the range of support services needed in the 
        geographical or subject matter area served;
            ``(D) the adherence by any such recipient, grantee, or 
        contractor to accepted norms of performance to guide the 
        provision of legal assistance to poor individuals; and
            ``(E) the adherence by any such recipient, grantee, or 
        contractor to applicable rules of professional responsibility 
        for attorneys providing legal assistance to poor individuals.
    ``(5) Notwithstanding the preceding provisions of this subsection, 
the Inspector General of the Corporation shall not, in carrying out his 
or her functions, be subject to any restriction that--
            ``(A) is contained in the standards and procedures adopted 
        by the Corporation under this subsection; and
            ``(B) limits access by the Corporation to documents or 
        other information.''.
    (d) Technical Amendments.--
            (1) Section 1006(b) (42 U.S.C. 2996e(b)) is amended by 
        adding at the end the following:
    ``(7) The Corporation shall ensure that--
            ``(A) no employee of the Corporation or of any recipient or 
        other grantee or contractor of the Corporation (except as 
        permitted by law in connection with such employee's own 
        employment situation), while carrying out legal assistance 
        activities supported under this title, engages in, or 
        encourages others to engage in, any public demonstration or 
        picketing, boycott, or strike; and
            ``(B) no such employee, at any time, engages in, or 
        encourages others to engage in--
                    ``(i) any rioting or civil disturbance,
                    ``(ii) any activity which is in violation of an 
                outstanding injunction of any court of competent 
                jurisdiction,
                    ``(iii) any other illegal activity, or
                    ``(iv) any intentional identification of the 
                Corporation or any recipient or other grantee or 
                contractor of the Corporation with any political 
                activity prohibited by section 1007(a)(6).''.
            (2) Section 1006(b)(2) (42 U.S.C. 2996e(b)(2)) is amended 
        by striking ``provisions of section 1011'' and inserting 
        ``regulations issued under paragraph (5) of this subsection''.
            (3) Section 1007(a)(9) (42 U.S.C. 2996f(a)(9)) is amended 
        by striking ``1011'' and inserting ``1006(b)(5)''.
            (4) Section 1011 (42 U.S.C. 2996j) is repealed.

SEC. 7. CLASS ACTIONS.

    Section 1006(d)(5) (42 U.S.C. 2996e(d)(5)) is amended--
             (1) by striking ``No'' and inserting ``(A) Subject to 
        subparagraph (B), no''; and
            (2) by adding at the end the following:
            ``(B) No recipient, other grantee or contractor of the 
        Corporation, or employee of any such recipient, grantee, or 
        contractor may bring a class action suit against the Federal 
        Government or any State or local government unless--
                    ``(i) the project director of the recipient, 
                grantee, or contractor has expressly approved the 
                filing of such an action in accordance with policies 
                established by the governing or policy body of the 
                recipient, grantee, or contractor and the filing of 
                such action has not been expressly disapproved by such 
                governing or policy body;
                    ``(ii) the class relief which is the subject of 
                such an action is sought for the primary benefit of 
                individuals who are eligible for legal assistance under 
                this title; and
                    ``(iii) before filing such an action, the project 
                director of the recipient, grantee, or contractor 
                determines that the government entity is not likely to 
                change the policy or practice in question, that the 
                policy or practice will continue to adversely affect 
                eligible clients, that the recipient, grantee, or 
                contractor has given notice of its intention to seek 
                class relief, and that responsible efforts to resolve 
                without litigation the adverse effects of the policy or 
                practice have not been successful or would be adverse 
                to the interest of the clients.''.

SEC. 8. NEGOTIATION REQUIREMENT.

    Section 1007(a) (42 U.S.C. 2996f(a)) is amended--
            (1) in paragraph (9) by striking ``and'' after the 
        semicolon; and
            (2) by adding at the end the following:
            ``(11) require recipients and other grantees and 
        contractors of the Corporation to adopt policies, consistent 
        with the rules of ethics and professional responsibility that 
        apply in the jurisdiction in which legal assistance is to be 
        provided, which require employees of the recipients, grantees, 
        and contractors to attempt to negotiate settlements and to use 
        alternative dispute resolution mechanisms, where appropriate 
        and available, before filing suit, except that nothing in this 
        paragraph shall be construed to permit the Corporation--
                    ``(A) to require policies which restrict 
                representation of clients to matters where the clients 
                agree to such negotiation or use of alternative dispute 
                resolution mechanisms; or
                    ``(B) to preclude an attorney from filing suit 
                where the attorney's professional responsibility to the 
                client requires that litigation be commenced without 
                notice to or negotiations with the opposing parties.''.

SEC. 9. PROHIBITION ON USE OF FUNDS FOR REDISTRICTING.

    Section 1007(b) (42 U.S.C. 2996f(b)) is amended--
            (1) in paragraph (10) by striking the period and inserting 
        ``; or''; and
            (2) by adding at the end the following:
            ``(11) to--
                    ``(A) advocate or oppose, or contribute or make 
                available any funds, personnel, or equipment for use in 
                advocating or opposing, any plan or proposal, or
                    ``(B) represent any party or participate in any 
                other way in litigation,
        that is intended to or has the effect of altering, revising, or 
        reapportioning a legislative, judicial, or elective district at 
        any level of government, including influencing the timing or 
        manner of the taking of a census.''.

SEC. 10. RESTRICTIONS ON USE OF FUNDS FOR LEGAL ASSISTANCE TO ALIENS.

    Section 1007 (42 U.S.C. 2996f) is amended by adding at the end the 
following:
    ``(i) No funds appropriated to the Legal Services Corporation may 
be used to provide legal assistance for or on behalf of any alien 
unless the alien is present in the United States and is--
            ``(1) an alien lawfully admitted for permanent residence as 
        defined in section 101(a)(20) of the Immigration and 
        Nationality Act (8 U.S.C. 1101(a)(20)), including aliens who 
        acquire the status of lawful permanent resident aliens under 
        the provisions of section 216 or 245A of that Act (8 U.S.C. 
        1186a, 1255a);
            ``(2) an alien who is either married to a United States 
        citizen or is a parent or an unmarried child under 21 years of 
        age of such citizen and who has filed an application to adjust 
        status to lawful permanent resident under the Immigration and 
        Nationality Act, and such application has not been finally 
        adjudicated;
            ``(3)(A) an alien who is lawfully present in the United 
        States pursuant to an admission under section 207 of the 
        Immigration and Nationality Act (8 U.S.C. 1157), who has been 
        granted suspension of deportation under section 244 of the 
        Immigration and Nationality Act, or who has been granted asylum 
        by the Attorney General under such Act, or
            ``(B) an alien who is lawfully present in the United States 
        as a result of being granted conditional entry pursuant to 
        section 203(a)(7) of the Immigration and Nationality Act before 
        April 1, 1980, because of persecution or fear of persecution on 
        account of race, religion, or political opinion or because of 
        being uprooted by catastrophic natural calamity;
            ``(4) an alien who is lawfully present in the United States 
        as a result of the Attorney General's withholding of 
        deportation pursuant to section 243(h) of the Immigration and 
        Nationality Act (8 U.S.C. 1253(h));
            ``(5) an alien whose employment to perform temporary 
        agricultural labor or services is authorized by the Immigration 
        and Naturalization Service;
            ``(6) an alien who has been provided a record of permanent 
        residence under section 249 of the Immigration and Nationality 
        Act;
            ``(7) an alien who is an eligible immigrant (as defined in 
        section 301(b)(1) of the Immigration Act of 1990), was 
        physically present in the United States on May 5, 1988, and is 
        seeking admission as an immediate relative under the 
        Immigration and Nationality Act or under section 203(a)(2) of 
        such Act (including under section 112 of the Immigration Act of 
        1990) or is seeking (or is being provided) benefits under 
        section 301(a) of the Immigration Act of 1990; or
            ``(8) an alien who is eligible for medical assistance for 
        treatment of an emergency medical condition under title XIX of 
        the Social Security Act, if the legal assistance to be provided 
        is needed in order to help obtain such medical assistance.''.

SEC. 11. GOVERNING BODIES OF RECIPIENTS.

    Section 1007(c) (42 U.S.C. 2996f(c)) is amended to read as follows:
    ``(c)(1) In making grants or entering into contracts for legal 
assistance, the Corporation shall ensure that--
            ``(A) any recipient which has as one of its purposes the 
        provision of legal assistance to eligible clients is governed 
        by a body--
                    ``(i) the majority of which is comprised of 
                attorneys who are appointed by the governing bodies of 
                State, county, or local bar associations the 
                memberships of which represent a majority of the 
                attorneys practicing law in the locality in which the 
                recipient is to provide legal assistance or, in the 
                case of programs providing service in more than one 
                State, in the State or locality in which the principal 
                office of the recipient is located;
                    ``(ii) at least 60 percent of which consists of 
                attorneys who are members of the bar of a State in 
                which the legal assistance is to be provided, except 
                that the Corporation--
                            ``(I) shall, upon application, grant 
                        waivers of the requirements of this clause for 
                        a legal services program, supported under 
                        section 222(a)(3) of the Economic Opportunity 
                        Act of 1964, which on the date of the enactment 
                        of this title has a majority of persons who are 
                        not attorneys on its policymaking board, and
                            ``(II) may grant, pursuant to regulations 
                        issued by the Corporation, a waiver of the 
                        requirements of this clause for recipients 
                        which, because of the nature of the population 
                        they serve, are unable to comply with such 
                        requirements; and
                    ``(iii) at least one-third of which consists of 
                persons who are, when selected, eligible clients who 
                may also be representatives of associations or 
                organizations of eligible clients; and
            ``(B) any other recipient, grantee, or contractor of the 
        Corporation is governed by a body that meets the requirements 
        of subparagraph (A) or has established a policy body, whose 
        membership is selected consistent with such requirements, to 
        establish policy with respect to the administration of any 
        grant or contract under this title.
Any attorney serving on a governing body or policy body of a recipient, 
grantee, or contractor described in this paragraph may not, while so 
serving, receive compensation from such recipient, grantee, or 
contractor. Subparagraph (A)(i) shall not be construed to prevent the 
governing body of a bar association from appointing members of the 
governing or policy bodies of more than one recipient or other grantee 
or contractor of the Corporation.
    ``(2) Consistent with the provisions of this title, the rules, 
regulations, guidelines, and instructions issued under this title, and 
any other laws, each recipient or other grantee or contractor of the 
Corporation, pursuant to the direction and control of its governing or 
policy body, and not the Corporation, shall determine all broad 
policies concerning its provision of legal assistance and other 
activities of the recipient, grantee, or contractor, including--
            ``(A) financial eligibility criteria of clients 
        represented, consistent with the guidelines established 
        pursuant to section 1007(a)(2);
             ``(B) the services that the recipient, grantee, or 
        contractor will make available;
            ``(C) the policies that will govern the fiscal, 
        administrative, and representational activities of the 
        recipient, grantee, or contractor, in compliance with the 
        provisions of this title and regulations issued under this 
        title, other applicable law, or requirements imposed by 
        grantors of resources to the recipient, grantee, or contractor;
            ``(D) subject to the prohibitions contained in this title, 
        the priorities of the recipient, grantee, or contractor for the 
        use of all available resources, including the policies 
        regarding the types of cases or matters attorneys, paralegal 
        staff, and other staff may undertake using such resources; and
            ``(E) significant policy decisions concerning the use of 
        staff attorneys and other available and appropriate staff and 
        nonstaff resources, including private attorneys and others, to 
        provide legal assistance to eligible clients and to carry out 
        activities relating to the delivery of legal assistance.
    ``(3) The governing or policy body of a recipient or other grantee 
or contractor of the Corporation shall--
            ``(A) not interfere with the lawyer-client relationship in 
        the representation of specific clients by the recipient, 
        grantee, or contractor;
            ``(B) comply with the legal and ethical requirements on 
        conflicts of interest that apply in the jurisdiction where the 
        recipient, grantee, or contractor is located;
            ``(C) not act on a case-by-case basis in setting 
        priorities, except that the governing or policy body may 
        reconsider priorities at any time for future applications for 
        services in light of changing legal needs of clients or in 
        light of an emergency; and
            ``(D) ensure that activities under this title are carried 
        out in a manner consistent with attorneys' professional 
        responsibilities to a client as established in the rules of 
        ethics and professional responsibility that apply in the 
        jurisdiction where the legal assistance is provided.
    ``(4) The Corporation shall not--
            ``(A) interfere with the governing or policy bodies 
        described in paragraph (1) in their determinations of the broad 
        policy matters described in paragraph (2);
            ``(B) impose requirements or limitations on the types of 
        cases or representation of clients unless those requirements or 
        limitations are explicitly authorized by this title or other 
        applicable law; or
            ``(C) impose requirements or limitations on the governing 
        or policy bodies of recipients and other grantees or 
        contractors of the Corporation that are additional to, or more 
        restrictive than, the provisions of this subsection, including 
        requirements or limitations with respect to--
                    ``(i) the procedures of appointment, the political 
                affiliations, or the length of terms of board members,
                    ``(ii) the size, quorum requirements, and committee 
                operations of such governing or policy bodies;
                    ``(iii) the content of the bylaws of such 
                recipients, grantees, or contractors; or
                    ``(iv) the communications between governing or 
                policy bodies and appointing authorities specified in 
                paragraph (1).''.

SEC. 12. PROFESSIONAL RESPONSIBILITIES.

    (a) Statement of Findings.--Section 1001(6) (42 U.S.C. 2996(6)) is 
amended to read as follows:
            ``(6) attorneys providing legal assistance must have full 
        freedom to protect the best interests of their clients in 
        keeping with the rules of ethics and professional 
        responsibility that apply in the jurisdiction where the legal 
        assistance is provided and the high standards of the legal 
        profession.''.
    (b) Responsibilities of the Corporation.--Section 1006(b)(3) (42 
U.S.C. 2996e(b)(3)) is amended to read as follows:
    ``(3) The Corporation shall not, under any provision of this title, 
interfere with any attorney in carrying out his or her ethical or 
professional responsibilities to a client as established in the rules 
of ethics and professional responsibility that apply in the 
jurisdiction where the legal assistance is provided or abrogate as to 
attorneys in programs assisted under this title the authority of a 
State or other jurisdiction to enforce the standards of professional 
responsibility generally applicable to attorneys in such 
jurisdiction.''.
    (c) Grants and Contracts.--Section 1007(a)(10) (42 U.S.C. 
2996f(a)(10)) is amended to read as follows:
            ``(10) ensure that all attorneys, while engaged in legal 
        assistance activities supported, in whole or in part, by the 
        Corporation, refrain from the persistent incitement of 
        litigation and any other activity prohibited by the rules of 
        ethics or professional responsibility that apply in the 
        jurisdiction where the legal assistance is provided, and ensure 
        that such attorneys refrain from personal representation for a 
        private fee in any cases in which they were involved while 
        engaged in such legal assistance activities; and''.
    (d) Access to Records.--Section 1009(d) (42 U.S.C. 2996h(d)) is 
amended by inserting before the period at the end the following: ``or 
protected from disclosure by the laws or the rules of ethics or 
professional responsibility that apply in the jurisdiction where such 
reports or records are maintained''.

SEC. 13. SOLICITATION.

    Section 1007 (42 U.S.C. 2996f) is amended by adding at the end the 
following:
    ``(j) Any recipient or other grantee or contractor of the 
Corporation, and any employee of any such recipient, grantee, or 
contractor, who has given in-person unsolicited advice to a nonattorney 
that such nonattorney should obtain counsel or take legal action shall 
not accept employment resulting from that advice, or refer that 
nonattorney to another such recipient, grantee, contractor, or 
employee, except that--
            ``(1) a recipient or other grantee or contractor of the 
        Corporation, or an employee of any such recipient, grantee, or 
        contractor may accept employment by a close friend, relative, 
        former client (if the advice given is germane to the previous 
        employment by the client), or person whom the recipient, 
        grantee, contractor, or employee reasonably believes to be a 
        client because the recipient, grantee, contractor, or employee 
        is currently handling an active legal matter or case for that 
        specific person;
            ``(2) a recipient or other grantee or contractor of the 
        Corporation, or an employee of any such recipient, grantee, or 
        contractor may accept employment or refer a nonattorney to 
        another such recipient, grantee, contractor, or employee when 
        the employment or referral (as the case may be) results from 
        the participation of the recipient, grantee, contractor, or 
        employee in activities designed to educate nonattorneys about 
        their legal rights, to recognize legal problems, to make 
        intelligent selection of counsel, or to utilize available legal 
        services if such outreach activities are conducted or sponsored 
        by the recipient, grantee, or contractor, another legal 
        assistance organization, or a church organization; and
            ``(3) without affecting the right of a recipient, other 
        grantee or contractor of the Corporation, or employee of any 
        such recipient, grantee, or contractor to accept employment, 
        any such recipient, grantee, contractor, or employee may speak 
        publicly or write for publication on legal topics if such 
        recipient, grantee, contractor, or employee does not emphasize 
        his, her, or its own professional experience or reputation and 
        does not undertake to give individual advice in such speech or 
        publication.''.

SEC. 14. CERTAIN EVICTION PROCEEDINGS.

    Section 1007 (42 U.S.C. 2996f) is amended by adding at the end the 
following:
    ``(k)(1) No funds made available by or through the Corporation may 
be used for initiating the defense of a person in a proceeding to evict 
that person from a public housing project if the person has been 
convicted of the illegal sale or distribution of a controlled substance 
and if the eviction proceeding is brought by a public housing agency 
because the illegal drug activity of that person threatens the health 
or safety of other tenants residing in the public housing project or 
employees of the public housing agency.
    ``(2) As used in this subsection--
            ``(A) the term `controlled substance' has the meaning given 
        that term in section 102 of the Controlled Substances Act (21 
        U.S.C. 802); and
            ``(B) the terms `public housing project' and `public 
        housing agency' have the meanings given those terms in section 
        3 of the United States Housing Act of 1937 (42 U.S.C. 
        1437a).''.

SEC. 15. PROCEDURAL SAFEGUARDS FOR LITIGATION.

    Section 1007 (42 U.S.C. 2996f) is amended by adding at the end the 
following:
    ``(l) No recipient, other grantee or contractor of the Corporation, 
or employee of such recipient, grantee, or contractor may engage in 
precomplaint settlement negotiations, file a complaint, or otherwise 
pursue litigation against a defendant unless a written retainer 
agreement which enumerates the particular facts on which the claim or 
controversy is initially based has been signed by the plaintiffs 
(including named plaintiffs in a class action). Such retainer agreement 
shall be executed when representation commences or, if not possible at 
that time because of an emergency situation, then as soon thereafter as 
is practicable. Such retainer agreement--
            ``(1) shall be kept on file by the recipient, grantee, or 
        contractor, in a manner that does not disclose information 
        protected by the attorney-client privilege or by the rules of 
        ethics or professional responsibility that apply in the 
        jurisdiction in which the legal assistance is provided, and
            ``(2) shall be made available--
                    ``(A) to any Federal department or agency that is 
                auditing the activities of the Corporation or of any 
                such recipient, grantee, or contractor, and
                    ``(B) to any auditor receiving Federal funds to 
                conduct such auditing, including any auditor or monitor 
                of the Corporation.
Other parties shall have access to such agreement only through the 
applicable rules of discovery after litigation has begun. Claims of 
attorney-client privilege shall not protect information contained in 
such agreement which, after the agreement is signed, is disclosed by 
the plaintiff or the plaintiff's counsel to third parties during 
precomplaint settlement negotiations or litigation. The recipient, 
grantee, or contractor is not required to execute a written retainer 
agreement under this subsection when the only service to be provided is 
brief advice and consultation. Unless authorized by a court of 
competent jurisdiction, no recipient, grantee, or contractor of the 
Corporation or employee of such recipient, grantee, or contractor may 
file a complaint or petition in a court until all plaintiffs known to 
plaintiff's counsel at the time have been specifically identified in 
the complaint or petition.''.

SEC. 16. COMPETITION STUDY.

    Section 1007 (42 U.S.C. 2996f) is amended by adding at the end the 
following:
    ``(m)(1) The Corporation shall study the feasibility of a system of 
competition in the awarding of some or all grants or contracts for 
legal assistance and related activities under section 1006 (a)(1) and 
(a)(3) of this title. The Corporation shall, within 3 years after the 
date of the enactment of the Legal Services Reauthorization Act of 
1993, report to the Congress the results of this study, based on 
independent evaluation. Such study shall be conducted in conjunction 
with an advisory committee which includes project directors, attorneys 
providing legal assistance, the organized bar, and eligible clients, 
who are selected by appropriate representatives of these groups.
    ``(2) The study under paragraph (1) shall examine how a system of 
competition would--
            ``(A) ensure access to, and the continued provision of, 
        high-quality, economical, and effective legal services to 
        resolve problems of clients, consistent with section 1001;
            ``(B) take into account locally determined needs for 
        particular kinds of cases or services;
            ``(C) take into account the ongoing ethical and 
        professional responsibilities of recipients, other grantees or 
        contractors of the Corporation, and their attorneys for 
        existing cases, the potential disruption in client services, 
        and loss of experienced staff, pro bono services, funds from 
        sources other than the Corporation, and other resources if an 
        existing recipient or other grantee or contractor were 
        replaced;
            ``(D) ensure that every recipient or other grantee or 
        contractor seeking a grant or contract through a competitive 
        bidding process will comply with all provisions of this title 
        and the rules, regulations, guidelines, and instructions issued 
        under this title that are applicable to those recipients and 
        other grantees and contractors organized for the purpose of 
        providing legal services to eligible clients; and
            ``(E) ensure that a new recipient or other grantee or 
        contractor selected would provide a sufficient level of 
        quality, economy, and effectiveness to justify the burdens of 
        replacing the current recipient, grantee, or contractor, using 
        the criteria set forth in this paragraph and those developed by 
        the Corporation in accordance with section 1007(d)(4).''.

SEC. 17. TRAINING.

    Section 1007(b)(6) (42 U.S.C. 2996f(b)(6)) is amended to read as 
follows:
            ``(6) to support or conduct training programs for the 
        purpose of advocating particular public policies or encouraging 
        political activities, labor or antilabor activities, boycotts, 
        picketing, strikes, or demonstrations, except that this 
        paragraph shall not be construed to prohibit the training of 
        attorneys or paralegal personnel necessary to prepare them to 
        provide adequate legal assistance to eligible clients, to 
        advise any eligible client as to the nature of the legislative 
        process, or to inform any eligible client of his or her rights 
        under any statute, order, or regulation;''.

SEC. 18. LIMITATION ON USE AMENDMENTS.

    Section 1007(b) (42 U.S.C. 2996f(b)) is amended by striking 
paragraph (9) and redesignating paragraph (10) and paragraph (11) (as 
added by section 9 of this Act) as paragraphs (9) and (10), 
respectively.

SEC. 19. RECORDKEEPING AND NONCORPORATION FUNDS.

    (a) Non-Corporation Funds.--Section 1010(c) (42 U.S.C. 2996i(c)) is 
amended by adding at the end the following: ``Public funds received by 
any recipient or other grantee or contractor of the Corporation, 
including funds from Interest on Lawyer Trust Account (IOLTA) programs, 
shall not be used to engage in publicity or propaganda as restricted by 
section 1007(a)(5).''.
    (b) Timekeeping.--Section 1008(b) (42 U.S.C. 2996g(b)) is amended--
            (1) by inserting ``(1)'' after ``(b)''; and
            (2) by adding at the end the following:
    ``(2) The Corporation, by regulation adopted pursuant to subsection 
(e) of this section, shall require each recipient or other grantee or 
contractor of the Corporation to maintain records of time spent on the 
cases or matters with respect to which that recipient, grantee, or 
contractor is engaged in activities and to maintain a recordkeeping 
system that discloses the source of funds to be charged for each such 
case or matter. The specific time and recordkeeping system to be 
employed shall be determined by the recipient or other grantee or 
contractor in a manner that meets the requirements of a recordkeeping 
system as set forth in the preceding sentence and meets obligations 
that are imposed by other funding sources. Pursuant to regulations 
adopted under this paragraph, each employee of such recipient, grantee, 
or contractor, who is an attorney or paralegal, shall be required to 
keep contemporaneous records of the time spent by case or matter and 
the type of case or matter.''.

SEC. 20. EVASION.

    The Legal Services Corporation Act is amended--
            (1) by redesignating sections 1013 and 1014 as sections 
        1014 and 1015, respectively; and
            (2) by inserting after section 1012 the following new 
        section:

                                ``evasion

    ``Sec. 1013. The use of `alternative corporations' to avoid or 
otherwise evade the provisions of this title or the Legal Services 
Reauthorization Act of 1993 is prohibited. The term `alternative 
corporation' means any corporation, law firm, business association, 
group, entity, or enterprise which, through shared staff or control 
over workload or interlocking boards of directors, has a single 
identity of interest with a recipient or other grantee or contractor of 
the Corporation. Any recipient or other grantee or contractor of the 
Corporation which shares employees with any other corporation, law 
firm, business association, group, entity, or enterprise shall specify 
with particularity the use of any funds by such employees in accordance 
with the timekeeping and recordkeeping requirements established under 
section 1008(b).''.

SEC. 21. FEE-GENERATING CASE PROVISIONS.

    Section 1007(b)(1) (42 U.S.C. 2996f(b)(1)) is amended by striking 
``(which guidelines'' and all that follows through the end of the 
paragraph and inserting the following: ``, except that--
            ``(A) such guidelines shall not preclude the provision of 
        legal assistance in cases in which a client seeks only 
        statutory benefits and appropriate private representation is 
        not available; and
            ``(B) the Corporation may not--
                    ``(i) prevent recipients or other grantees or 
                contractors of the Corporation from seeking, receiving, 
                or retaining attorneys' fees awarded or approved by a 
                court or administrative body or included in a 
                settlement in any matter that may be appropriately 
                undertaken under the guidelines promulgated under this 
                paragraph, or
                    ``(ii) offset attorneys' fees against grant amounts 
                or take into account the amount of any such attorneys' 
                fees in establishing funding levels, fund balances, or 
                distributing funds appropriated under this title;''.

SEC. 22. ATTORNEYS' FEES PROVISIONS.

    Section 1006(f) (42 U.S.C. 2996e(f)) is amended to read as follows:
    ``(f) If any court finds, based on substantial evidence, that a 
recipient or other grantee or contractor of the Corporation commenced 
an action for the purpose of harassment or retaliation or maliciously 
abused legal process, or that the plaintiff's action was frivolous, 
unreasonable, or without foundation, the court may award reasonable 
costs and attorneys' fees incurred by the defendant in defending the 
action. Any such costs and fees shall be paid directly by the 
Corporation. The Corporation may recover the amount of any costs and 
fees paid by the Corporation from the recipient, grantee, or contractor 
against whom the award was made by offsetting that amount against 
future grant awards made by the Corporation to such recipient, grantee, 
or contractor. Unless otherwise agreed by the Corporation and the 
recipient, grantee, or contractor, the Corporation, in any one grant 
year, may not deduct more than 5 percent of a grant for purposes of 
recoupment of such costs and fees.''.

SEC. 23. CORPORATION BOARD CONTROL OVER POLICY.

    Section 1006 (42 U.S.C. 2996e) is amended by adding at the end the 
following:
    ``(g) All rules, regulations, guidelines, instructions, and grant 
conditions under this title, and all policies or changes in policy 
directly affecting recipients or other grantees or contractors of the 
Corporation, shall be adopted by the Board of the Corporation after 
notice and comment. For purposes of this subsection, policies or 
changes in policies include, but are not limited to, increasing or 
decreasing funding to, imposing new terms and conditions on, or making 
changes in the classes of recipients or other grantees or contractors 
which provide and support the delivery of legal assistance. This 
subsection shall not preclude the staff of the Corporation from 
imposing, without notice and comment, specific conditions on a grant to 
an individual recipient or other grantee, or on a contract with a 
recipient or other contractor, that are not applicable to other such 
recipients, grantees, or contractors if the conditions relate 
specifically to a prior determination that the recipient, grantee, or 
contractor has not complied with the provisions of this title or the 
rules, regulations, guidelines, or instructions issued under this 
title.''.

SEC. 24. REPROGRAMMING PROVISIONS.

    Section 1008 (42 U.S.C. 2996h) is amended by adding at the end the 
following:
    ``(f) The Corporation may not promulgate rules, regulations, 
guidelines, or instructions under this title unless the Corporation has 
so notified the Committees on Appropriations and on the Judiciary of 
the House of Representatives and the Committees on Appropriations and 
on Labor and Human Resources of the Senate at least 15 days before 
final publication of the rules, regulations, guidelines, or 
instructions, and has given such committees an opportunity to comment 
on such rules, regulations, guidelines, or instructions.''.

SEC. 25. 12-MONTH GRANTS.

    Section 1010 (42 U.S.C. 2996i) is amended by adding to the end the 
following:
    ``(e) All grants and contracts made pursuant to sections 1006(a) 
(1) and (3) for calendar years 1993, 1994, 1995, and 1996 shall be made 
for a period of at least 12 months, except for any grant to a new 
program commencing operations after the beginning of the applicable 
calendar year.''.

SEC. 26. ESTABLISHMENT OF LOCAL PRIORITIES.

    Section 1007(a) (42 U.S.C. 2996f(a)) is amended--
            (1) in paragraph (2)(C)(i) by striking ``goals established 
        by the Corporation'' and inserting ``the principles of section 
        1001 of this title and any goals established by law''; and
            (2) by adding after paragraph (11) (as added by section 
        8(2) of this Act) the following:
``The procedures adopted pursuant to paragraph (2)(C)(i) shall require 
the governing or policy bodies of recipients and other grantees and 
contractors of the Corporation to review annually the priorities that 
are determined in accordance with such procedures, and periodically 
analyze the legal needs of clients in the area served by each such 
recipient, grantee, or contractor to take into account new or changing 
circumstances of such clients. As part of such analysis, each such 
recipient, grantee, or contractor shall seek comments and information 
from clients, the organized bar, and program staff, as well as other 
parties with relevant information concerning client needs, including 
community groups, private attorneys participating in the private 
attorney involvement plans of the recipient, grantee, or contractor, 
and human services agencies. In the case of support entities, their 
governing or policy bodies shall also periodically analyze the 
advocacy, support, and coordination needs of recipients served by the 
support entity.''.

SEC. 27. STAFF ATTORNEYS.

    Section 1002(7) (42 U.S.C. 2996a(7)) is amended to read as follows:
            ``(7) `staff attorney' means an attorney who--
                    ``(A) is employed by a recipient organized in whole 
                or in part for the provision of legal assistance to 
                eligible clients under this title, and
                    ``(B) receives more than one-half of his or her 
                annual professional salary from the proceeds of a grant 
                or contract from the Corporation to such recipient.''.

SEC. 28. STUDY ON LEGAL ASSISTANCE TO OLDER AMERICANS.

    The Legal Services Corporation shall conduct a study to determine 
the extent and effectiveness of legal assistance provided to older 
Americans by recipients and other grantees and contractors under the 
Legal Services Corporation Act. The Corporation shall submit to the 
Congress, not later than 6 months after the date of the enactment of 
this Act, a report on the study, together with any recommendations that 
the Corporation has on ways to improve the provision of such legal 
assistance to older Americans.

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