[Senate Hearing 110-655]
[From the U.S. Government Publishing Office]
S. Hrg. 110-655
CLOSING THE JUSTICE GAP: PROVIDING CIVIL LEGAL ASSISTANCE TO LOW-INCOME
AMERICANS
=======================================================================
HEARING
before the
COMMITTEE ON THE JUDICIARY
UNITED STATES SENATE
ONE HUNDRED TENTH CONGRESS
SECOND SESSION
__________
MAY 22, 2008
__________
Serial No. J-110-95
__________
Printed for the use of the Committee on the Judiciary
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45-653 PDF WASHINGTON DC: 2008
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COMMITTEE ON THE JUDICIARY
PATRICK J. LEAHY, Vermont, Chairman
EDWARD M. KENNEDY, Massachusetts ARLEN SPECTER, Pennsylvania
JOSEPH R. BIDEN, Jr., Delaware ORRIN G. HATCH, Utah
HERB KOHL, Wisconsin CHARLES E. GRASSLEY, Iowa
DIANNE FEINSTEIN, California JON KYL, Arizona
RUSSELL D. FEINGOLD, Wisconsin JEFF SESSIONS, Alabama
CHARLES E. SCHUMER, New York LINDSEY O. GRAHAM, South Carolina
RICHARD J. DURBIN, Illinois JOHN CORNYN, Texas
BENJAMIN L. CARDIN, Maryland SAM BROWNBACK, Kansas
SHELDON WHITEHOUSE, Rhode Island TOM COBURN, Oklahoma
Bruce A. Cohen, Chief Counsel and Staff Director
Stephanie A. Middleton, Republican Staff Director
Nicholas A. Rossi, Republican Chief Counsel
C O N T E N T S
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STATEMENTS OF COMMITTEE MEMBERS
Page
Cardin, Benjamin L., a U.S. Senator from the State of Maryland... 1
prepared statement........................................... 143
Feingold, Hon. Russell D., a U.S. Senator from the State of
Wisconsin, prepared statement.................................. 154
Grassley, Hon. Charles E., a U.S. Senator from the State of Iowa,
prepared statement............................................. 175
Leahy, Hon. Patrick J., a U.S. Senator from the State of Vermont,
prepared statement............................................. 197
WITNESSES
Barnett, Helaine M., President, Legal Services Corporation,
Washington, D.C.; accompanied by Jonann C. Chiles, Member,
Board of Directors, Legal Services Corporation, Little Rock,
Arkansas....................................................... 4
Boehm, Kenneth F., Chairman, National Legal and Policy Center,
Falls Church, Virginia......................................... 21
Diller, Rebekah, Deputy Director, Justice Program, Brennan Center
for Justice, New York University Law School, New York, New York 27
Franzel, Jeanette M., Director, Financial Management and
Assurance, U.S. Government Accountability Office, Washington,
D.C............................................................ 24
Joseph, Wilhelm H., Jr., Executive Director, Maryland Legal Aid
Bureau, Inc., Baltimore, Maryland.............................. 19
Livingston, Lora J., Judge, 261st District Court (Texas), Austin,
Texas, and Member, Standing Committee on Legal Aid and Indigent
Defendants, American Bar Association........................... 15
Wallace, Jo-Ann, President and Chief Executive Officer, National
Legal Aid and Defender Association, Washington, D.C............ 17
QUESTIONS AND ANSWERS
Responses of Helaine M. Barnett to questions submitted by
Senators Sessions and Grassley................................. 35
Responses of Jonann C. Chiles to questions submitted by Senator
Sessions....................................................... 103
Responses of Jeanette M. Franzel to questions submitted by
Senator Sessions............................................... 106
SUBMISSIONS FOR THE RECORD
American Bar Association, Thomas M. Susman, Washington, D.C.,
letter and attachments......................................... 108
Associated Press:
August 15, 2006, article..................................... 116
January 18, 2008, article.................................... 120
Barnett, Helaine M., President, Legal Services Corporation,
Washington, D.C.; accompanied by Jonann C. Chiles, Member,
Board of Directors, Legal Services Corporation, Little Rock,
Arkansas, statement............................................ 123
Boehm, Kenneth F., Chairman, National Legal and Policy Center,
Falls Church, Virginia, statement.............................. 134
Boozer, F. Vernon, Chair, Maryland Legal Services Corporation,
Baltimore, Maryland, statement................................. 139
Diller, Rebekah, Deputy Director, Justice Program, Brennan Center
for Justice, New York University Law School, New York, New
York, statement................................................ 146
Franzel, Jeanette M., Director, Financial Management and
Assurance, U.S. Government Accountability Office, Washington,
D.C., statement................................................ 156
Goldsmith, Sharon E., Esq., Executive Director, Pro Bono Resource
Center of Maryland, Baltimore, Maryland, statement............. 169
Joseph, Wilhelm H., Jr., Executive Director, Maryland Legal Aid
Bureau, Inc., Baltimore, Maryland, statement and attachments... 177
Kepplinger, Gary L., General Counsel, General Accountability
Office, Washington, D.C., statement............................ 189
Livingston, Lora J., Judge, 261st District Court (Texas), Austin,
Texas, and Member, Standing Committee on Legal Aid and Indigent
Defendants, American Bar Association, Washington, D.C.,
statement...................................................... 199
National Conference of Bar Presidents, Chicago, Illinois, letter. 212
National Organization of Legal Services Workers, Local 2320,
International Union, United Automobile, Aerospace &
Agricultural Workers of America (UAW), Detroit, Michigan,
statement...................................................... 215
U.S. Senators in support of an increase in Legal Services
Corporation funding, Washington, D.C., joint letter............ 225
Wallace, Jo-Ann, President and Chief Executive Officer, National
Legal Aid and Defender Association, Washington, D.C............ 230
West, Kirt, former Inspector General, Legal Services Corporation,
Washington, D.C., statement.................................... 245
CLOSING THE JUSTICE GAP: PROVIDING CIVIL LEGAL ASSISTANCE TO LOW-INCOME
AMERICANS
----------
THURSDAY, MAY 22, 2008
U.S. Senate,
Committee on the Judiciary,
Washington, D.C.
The Committee met, Pursuant to notice, at 2:15 p.m., in
room SD-226, Dirksen Senate Office Building, Hon. Ben Cardin,
presiding.
Present: Senator Cardin.
OPENING STATEMENT OF HON. BEN CARDIN, A U.S. SENATOR FROM THE
STATE OF MARYLAND
Senator Cardin. The Committee will come to order.
First, let me thank Senator Leahy for allowing me to chair
today's hearing on ``Closing the Justice Gap: Providing Civil
Legal Assistance to Low-Income Americans.''
Let me first apologize for being a few minutes late. The
Senate is voting on the farm bill, the veto override, and that
is going to be the last vote of the week. So I appreciate your
patience in the starting of this hearing.
I also from the beginning want to thank particularly
Senator Kennedy. We all, of course, hold Senator Kennedy in our
prayers. The discovery this week about his illness has been a
blow to all of us here on both sides of the aisle, and there
has been a tremendous outpouring of support. We know that he
will continue to fight, but we miss him.
In planning this hearing, I talked to Senator Kennedy, who
gave me a lot of good advice as to what we should be doing. He
is an ardent supporter of bridging the justice gap in America
and wants to do everything he can to provide additional help to
those today that do not have adequate access to our legal
system, and I thank Senator Kennedy for that. He, of course,
chairs the Committee that has primary jurisdiction over the
Legal Services Corporation, and obviously his leadership in
this area is indispensable. I also want to acknowledge the work
that is being done on the Appropriations Committee that has
been involved in many of these issues.
As I pointed out, the purpose of today's hearing is to
establish a record in the Judiciary Committee on a matter that
is very important to the work of our Committee, and that is,
how well are we meeting the needs of those people who are
otherwise unable to get adequate legal representation in
dealing with access to our justice system? And I would hope
that today's hearing would focus on that so that we would have
a good chance to make an assessment of where we are and where
we need to go.
The LSC Board completed a report that documented the
justice gap in America. That report is titled, ``The Current
Unmet Civil Legal Needs of Low-Income Americans.'' It was a
reflection of what they discovered in 2005, and what that
report pointed out--and I must tell you, I was a little bit
surprised because I did not think the circumstances were as
positive as that report pointed out, which was not very
positive--is that one out of every two eligible individuals who
seek legal assistance are denied services because of budgetary
reasons. That means that we have a large gap in meeting our
responsibilities.
That report was done in 2005. It pointed out pretty clearly
that that is those who seek help, and a large number of
individuals do not even bother to try to get help to deal with
their legal needs. So the gap is much larger than 50- percent
failure in meeting needs.
And then when one understands that the eligibility--the
number of people who are eligible for legal services has
increased since 2005, we have had major disasters since that
time that add to the need for people having access to our legal
system, including, of course, Katrina. We are suffering through
a difficult economic time. The number of foreclosures are at an
all-time high. That adds again to the circumstances of need,
taking us well beyond where we were in 2005. And since 2005,
the resources made available for civil legal needs have
certainly not been keeping up with those additional challenges.
As has been pointed out in the reports that have been made
available to our Committee, there have been several States that
have done an assessment as to where we are in meeting the needs
of low-income families, and those reports show that the gap
could be as high as 80 percent--in other words, one out of five
people who need help who are eligible for services are getting
those services. I think that is a shocking number, and we need
to do something about it.
We have a responsibility, and I must tell you, I have gone
through this a great deal with the different interest groups,
and it is clear to me that the legal profession has a
responsibility. The legal profession is charged with the access
to justice, and the legal community must do more.
It is clear to me that State and local governments must do
more. They have direct responsibility for the welfare of their
citizens, have certain standards that must be met, and State
and local governments must do more.
But it is clear to me that the Federal Government must do a
lot more in order to meet these needs. We have a
responsibility, as the senior partner in administering the
institutions of Government, to make sure that the legal system
is available to all of our citizens. That responsibility, in my
view, has not been met.
In 1981, the Legal Services Corporation statute was passed,
and that statute authorized $321 million of Federal funds to
meet the needs of civil legal services for the poor.
Presumptuously, that would be what we thought the needs were in
1981. The staff has prepared a chart that I will ask them just
to show which will tell us where we have been since 1981. In
fiscal year 2007, the amount went to $348 million. But as you
can see the blue lines on that chart, the amount of funds that
the Federal Government has provided has not kept up with the
inflation, and the red line is the inflationary number.
If we just adjusted the amount of moneys that were provided
in 1981 to provide the same level of service adjusted for
inflation using 1981 dollars, we should be at $678 million to
the Legal Services Corporation. So we need to do much better at
the national level than we are doing today.
My own experiences on how we should deal with this are
really learned from what happened in Maryland during the 1980s.
During the 1980s, I was asked to chair a commission to study
where we were in Maryland and what we could do to try to
improve the situation. All the stakeholders sat on the
commission, and we studied the circumstances in Maryland and
found that there was a shocking gap between needs and services,
where only one out of four were really being met with their
needs.
So we set out to do something about it, and we asked all of
the players to do more. We had many recommendations which have
been enacted into law. One of those was to have our two law
schools that are located in Maryland start clinical programs
and have experiences available for every law student to
understand their responsibility for poverty law.
I remember talking to Governor Schaefer at the time, and
Governor Schaefer agreed to put a substantial amount of money
in the State budget in order to implement that recommendation.
He did that based upon the commitment that the bar would do
more and lawyers would do more and the private sector would do
more in order to close the gap. And today we have robust
clinical programs in both of our law schools, which are
providing direct services to the vulnerable population as well
as training the lawyers of the future to be more sensitive to
their responsibilities.
We attempted to have lawyers do more, and we succeeded. The
Maryland pro bono program is much more robust than it was in
the 1980s. I see Herb Garten, who is in the audience, a member
of the Board. It is a pleasure to have Herb here. He was
instrumental at the Bar Association in Maryland in stepping up
and carrying out their responsibilities. We asked the private
sector to do more. We asked lawyers through their IOLTA program
to do more. And we made a major difference.
So I think we can do a much better job both through the
direct services that are provided through the Federal
Government through grants as well as by the major stakeholders
assuming a greater responsibility, including the lawyers.
So today's hearing, the purpose of which is to establish a
record, a record for this Congress, I hope, to use to develop a
game plan to address the gap that exists today, develop a
strategy to close that gap so that our justice system that we
showcase around the world is truly available to all of our
citizens.
[The prepared statement of Senator Cardin appears as a
submission for the record.]
With that, I will turn to our first panel of witnesses. As
is the custom of the Judiciary Committee, I am going to ask the
two panelists if they would stand in order to take the oath.
Please raise your right hands. Do you affirm that the testimony
you are about to give before the Committee will be the truth,
the whole truth, and nothing but the truth, so help you God?
Ms. Barnett. I do.
Ms. Chiles. I do.
Senator Cardin. Thank you, and let the record show
affirmative response.
Our first of two witnesses, is Helaine Barnett, who is the
President of Legal Services Corporation, comes out of an
experience in legal aid work which we are very proud of, and
she is accompanied by Jonann Chiles, who is a member of the
Board of Directors and recently appointed from Little Rock,
Arkansas.
We will start with President Barnett.
STATEMENT OF HELAINE M. BARNETT, PRESIDENT, LEGAL SERVICES
CORPORATION, WASHINGTON, D.C.; ACCOMPANIED BY JONANN C. CHILES,
MEMBER, BOARD OF DIRECTORS, LEGAL SERVICES CORPORATION, LITTLE
ROCK, ARKANSAS
Ms. Barnett. Thank you and good afternoon, Senator Cardin.
First of all, Senator Cardin, we want to thank you for
holding this hearing today and for giving us an opportunity to
talk about LSC's ground-breaking report on the justice gap in
America and the work that LSC-funded programs are doing to
serve the civil legal needs of the poor. Your long-standing
public support and hard work for civil legal aid in Maryland,
your chairmanship of the Maryland Legal Services Corporation,
and your association and friendship with Herb Garten, whom you
recognized today, are well known. Now we are able to thank you
for your national leadership on this important issue.
I am honored to be the first career legal aid attorney to
hold the position of President of the corporation in its 34-
year history. I know first-hand what our work means to the
lives of our clients and have a deep personal commitment to
providing high-quality civil legal services to eligible low-
income Americans.
Fifty million Americans are eligible to receive civil legal
aid from LSC-funded programs, including more than 13 million
children. The stark reality today is that the need for civil
legal aid to protect basic human needs is much greater than the
resources available.
As you noted, in September of 2004, the Legal Services
Corporation Board of Directors asked LSC staff to document the
extent to which civil legal needs of low-income Americans were
not being met. LSC conducted a year-long study culminating in
the 2005 report ``Documenting the Justice Gap in America: The
Current Unmet Civil Legal Needs of Low-Income Americans.''
The study established that for every client who received
service, one eligible applicant was turned away for lack of
adequate program resources. All those committed to a civil
society know that turning away half of the people who seek
legal assistance is not acceptable. Equal justice under law is
a bedrock principle and these numbers do not reflect equal
justice.
LSC's ``unable to serve'' study documented only those who
actually sought assistance from an LSC-funded program, but as
you know, Chairman Cardin, the need is much greater. Many
eligible people do not contact the program either because they
are unaware they have a legal problem, they do not know that
the program can help them, or they do not know that they are
eligible for free civil legal assistance.
And while our study is now more than 2-1/2 years old, there
have been nine additional statewide legal needs studies and
reports published since our study, and they have all confirmed
that the justice gap findings are a reality and, if anything,
are understated.
Furthermore, the number of people sliding into poverty who
need legal assistance is doubtlessly increasing as a result of
the subprime mortgage foreclosure crisis, the recent rash of
natural disasters across the country, and the general economic
downturn and rising costs of such essentials as energy, gas,
and food.
Whether someone has lost their home to foreclosure or
flooding, or whether their monthly income can no longer provide
for life's necessities, more and more Americans will soon be
turning to legal services programs for help in getting back on
their feet.
So what is the strategy to close the justice gap in
America? The Corporation is developing long-term strategies
involving strengthening local, State, and national
partnerships. Our grantees work hard every day to ensure
efficient use of the funding that is available, and they will
continue to do so.
Technology is a vitally important tool to help expand
access to justice and provide self-help options for those that
we are unable to directly serve. Technology improvements allow
LSC grantees to deliver more assistance and is part of the
strategy.
Private attorney involvement is another important element
of the strategy. The LSC Board has taken a leadership role and
is using LSC's national voice to encourage a culture of
expanded private attorney involvement as an effective tool for
providing legal services to more persons in need. Last year,
private attorneys handled more than 97,000 cases for LSC-funded
programs, and we are working in partnership with the ABA on
ways to expand private attorney involvement.
While these are important elements of the strategy,
technology and private attorneys alone cannot close the justice
gap.
Our Justice Gap Report concluded that just to serve those
who actually sought help and were eligible to receive it, LSC's
funding from the Federal Government would have to more than
double, as would State, local, and private funding. Recognizing
the political and fiscal realities at the time, the Board
elected to request from Congress that the Federal increase be
spread over 5 years.
Nationwide, LSC encourages its grantees to leverage their
Federal dollars, working with their partners in State equal
justice communities, and this has resulted in significant
increases of State, local, and private funds between 2005 and
2007.
However, while State, local, and IOLTA funds have expanded,
State budget deficits and the drop in interest rates are
placing some of those increases at serious risk.
Mr. Chairman, as we have discussed, LSC is improving both
our governance and our oversight. As you know, the Government
Accountability Office issued two reports, one in September 2007
on the Corporation's governance and accountability, and another
in January 2008 on our grants management and oversight. We
appreciated both of these reviews of our policies and practices
and cooperated fully with GAO throughout the audits. Further,
we accepted all of the recommendations and have made it a top
priority to address the recommendations of both reports and
have implemented or gone beyond nearly all the recommendations.
We welcome the opportunity it has presented to help us do our
job even better. In my written statement, I have provided a
full accounting of our progress to date.
In conclusion, the Justice Gap Report is as compelling
today as it was when it was released in September of 2005.
While the statistics are daunting, numbers alone do not tell
the whole story of the impact that the lack of resources for
providing high-quality legal assistance has on the lives of
low-income individuals and families.
For those millions of low-income Americans who are trying
to keep a roof over their heads, who are trying to escape an
abusive or life-threatening relationship, who are trying to
keep their families together and safe, civil legal assistance
is not just an abstract concept but a service that helps save
lives and provides safety, security, and a path to self-
sufficiency. It all flows from our founding principle of equal
access to justice established in the Preamble to our
Constitution and reiterated in our Pledge of Allegiance.
As U.S. Supreme Court Justice Lewis Powell said, ```Equal
Justice under Law' is not merely a caption on the facade of the
Supreme Court building. It is perhaps the most inspiring ideal
of our society...it is fundamental that justice should be the
same, in substance and availability, without regard to economic
status.''
That is the mission that LSC and our grantees across the
country try every single day to fulfill.
Thank you.
[The prepared statement of Ms. Barnett appears as a
submission for the record.]
Senator Cardin. Thank you very much for your testimony.
Ms. Chiles, do you want to make a statement or do you just
want to respond to questions?
Ms. Chiles. Senator, I will be happy to respond to
questions. I do not have a prepared statement. However, I would
like to echo Ms. Barnett's thanks to you for convening this
hearing.
Senator Cardin. Take as much time as you want on that.
[Laughter.]
Ms. Chiles. We appreciate your recognition of the justice
gap and your dedication to working to closing the justice gap.
I am here to assure you on behalf of the Board that we are
dedicated to closing the gap through the efficient and
effective use of the resources that are available to us.
Senator Cardin. Thank you very much, and I am going to have
a couple questions for you.
Let me first start with the 2005 report. It indicated that
one out of every two eligible individuals who seek services are
unable to receive those services, and I want to put a face on
it. Can you tell us what happens to those individuals? Do you
have any idea where they go or what type of cases we are
talking about, what type of people we are talking about that
are turned down for services?
Ms. Barnett. The individuals who sought assistance sought
in the areas of our program's priorities. When our programs are
unable to assist them, perhaps there can be a referral to a bar
association or pro bono panel; perhaps they go pro se to the
courts on their own. But in large measure, we all know that
when we are not able to assist them, they have nowhere else to
go.
Senator Cardin. There is not a huge safety net out there
beyond your grantees. What type of cases are we talking about?
Ms. Barnett. We are talking about the core matters that our
grantees represent nationwide, whether they are family law
cases, keeping families intact; whether they are keeping safe
and habitable housing; whether they are preventing foreclosure;
whether they are assisting with needed medical care; whether
they are providing benefits to disabled persons.
Senator Cardin. Senator Kennedy, as I have indicated, is
taking a lead effort on these issues, including trying to get
the appropriations level at a higher amount, along with Senator
Harkin. If you were to receive extra funding--and staff has
made--I was asking for a copy of the letter. The letter was
dated May 21st and actually is signed by a good number of
members--by a majority of the Members of the Senate asking for
additional funds.
Where are your priorities? Where would these additional
funds be used if you got additional funding beyond the current
level?
Ms. Barnett. Well, as you, I am sure, are aware, we have
asked for $471 million for fiscal year 2009, and 95 percent of
that would go to the local programs based on the statutory
formula of the poor person population in their geographic area.
The additional money would go for technology initiatives
since we believe that is an important strategy with regard to
help closing the justice gap. We also have asked for additional
money to continue our loan repayment assistance program, which
we think is critically important to attract young lawyers to
legal aid programs and to retain high-quality staff. In
addition, we have less than 4 percent going to grants
management and administrative oversight. We feel we do need
additional oversight staff, particularly to implement those
changes and recommendations we have adopted from the GAO
report.
Senator Cardin. Could you just tell us how much of your
budget goes for administrative purposes?
Ms. Barnett. Less than 4 percent.
Senator Cardin. But that also includes the oversight that
you are required to do with the grantees?
Ms. Barnett. It is. In fact, ``administration'' is a term
that we hope we can change. It really has to do with grants
oversight and management. And, yes, that goes--less than 4
percent, and that does cover the staff that we need to provide
both the oversight for compliance and program quality to ensure
it.
Senator Cardin. Well, just to make an observation, that is
certainly a relatively small percentage of the funds, and I
applaud you on that. Clearly, as the GAO report pointed out,
but as this Committee has said, we want to make sure that there
is proper supervision to make sure the funds go for their
intended purpose. So you need to have an adequate staff in
order to do that, so it is difficult with the amount of funds
that have been made available.
Let me just read you one of the demographic information
that has been made available to us, that for low-income persons
there is one attorney for every 6,800 in civil legal needs. In
the general population, it is one out of every 525. So just
looking at the number of lawyers that are prepared to handle
the civil legal needs of low-income families versus the number
of lawyers available to the general public, there is a huge
difference, 13 times more attorneys for the general public than
for low-income families.
Do we really have equal justice with that type of a
disparity on those attorneys that are handling these matters?
Ms. Barnett. Well, we don't believe we do have equal access
to justice right now with the current level of funding. That is
part of the reason we are asking for additional funding where
the great bulk of it goes to the program, to hire staff, to
deal with their salary needs, to get more staff. We do believe
that private attorney involvement can be expanded and enhanced.
We do believe that through technology we can make available
more pro se initiatives. We do believe that we encourage our
programs to leverage their Federal dollars and work in State
access-to-justice communities to increase both the local,
State, and private funding as well.
So, without at least a doubling of the Federal commitment
and a doubling of the local, State, and private sources, there
will not be enough attorneys to represent those who desperately
need it.
Senator Cardin. So that brings me to your request. Your
request you said was four hundred and?
Ms. Barnett. Seventy-one.
Senator Cardin. Four hundred and seventy-one million. Does
that represent a minimum access dollar amount, or is that the
pragmatic number that you would hope could be made available?
Ms. Barnett. When we made our report to the board of
directors, they said, recognizing political reality and fiscal
constraints, that it would be prudent to ask for the doubling
of the Federal commitment over 5 years. So the original idea
was to ask for a 20- percent increase each year. Of course, we
have not gotten 20 percent, and we recognize it is going to be
a much longer process than 5 years.
But the $471 million request is based on 20 percent of the
Senate's allocation in their bill last year for basic field, so
it has a rationale behind it.
Senator Cardin. So to double the budget in 5 years was
the--
Ms. Barnett. Was the original concept, and obviously we
well recognize it is going to take quite a bit longer than that
to accomplish.
Senator Cardin. Ms. Chiles, let me, if I might, ask you to
comment on the GAO report as to how well it was received by the
board, what the board has done in response to it, whether you
accept their recommendations that should be made, and whether
you are taking steps to implement those changes.
Ms. Chiles. Yes, the board has accepted the GAO report,
embraced the GAO report, and worked diligently over the course
of the past 6 or 7 months to address the concerns raised in the
GAO report. I can, if you would like, go through briefly each
of the recommendations that the GAO made to the board and to
management, and I can tell you what has been done to date.
Senator Cardin. If you could do that briefly, that would be
helpful.
Ms. Chiles. Feel free to interrupt me if I am not brief.
In August of 2007, the GAO issued a report entitled ``LSC
Governance and Accountability Practices Need to be Modernized
and Strengthened.'' There were four recommendations made to
management. There were eight recommendations made to the board.
The first recommendation--
Senator Cardin. I think we have the recommendations in our
file, so if you could just perhaps tell us how you have
responded to it, it might be more helpful to us.
Ms. Chiles. OK, very well. We have enacted a Code of
Conduct, which applies to the board, officers and employees. We
have instituted training on that Code of Conduct.
LSC has instituted a Continuity of Operations Plan. That
plan will be tested in July.
The LSC examined whether the Government Accounting
Standards Board should be adopted as a financial standard for
LSC, determined that that was appropriate, and have continued
to operate under those standards.
Fourth, the GAO recommended that LSC management conduct and
document a risk assessment program and implement--well, I
should say conduct and document a risk assessment and
thereafter implement an appropriate program to deal with risk
assessment. And to date, management has researched risk
management programs and best practices, identified the risk
environment for the Corporation, and begun an office-by-office
risk assessment.
When this assessment is finished, an appropriate policy
will be enacted and followed at the Corporation. The
institution of a risk assessment and management program will do
much to address the concerns that have been raised by the GAO
in both the first report and the second report.
The GAO made eight recommendations to the board in the
first report. They recommended that we establish an Audit
Committee or an Audit Committee function. That has been done,
and I believe that that is going to be a very useful tool
within the Legal Services Corporation for addressing, again,
the risk issues identified by the GAO. I think it is also going
to be a very helpful tool for communication between the Board,
management, and the Inspector General's office.
Also in response to the GAO report, the board has adopted
charters for three of its subcommittees. The board is currently
looking at creating a charter for its Operations and
Regulations Committee and its Governance and Performance Review
Committee. We are working to take--we are working to determine
what the appropriate allocation of responsibilities is between
those two committees, and that is why we don't have those two
charters finished yet. We do expect to have those in place in
August, our next meeting.
The GAO recommended that the board develop and implement a
procedure to evaluate key management processes, including
processes for risk assessment, mitigation of risk, internal
controls, and financial reporting. And this recommendation is
going to be taken care of largely, I believe, by the creation
and operation of the Audit Committee.
We have established a shorter timeframe for issuing LSC-
audited financial statements, and still pending is the
establishment of an orientation program for new members,
training for new members, the creation of a Compensation
Committee function, and the evaluation of the performance of
the board, each board committee, and each board member. And,
again, the reason those last three to four recommendations have
not been accomplished yet is because the board is still
discussing the proper allocation of those responsibilities
within the board, with Operations and Regulations or
Performance Review.
Senator Cardin. Can you give us just a timeline as to
when--I take it you are going to act on those recommendations,
you intend to do that?
Ms. Chiles. Yes, sir. We intend to act as quickly as
possible. In fact, we intended to act on those recommendations
in our August meeting. Questions arose about the right way to
go about dealing with these last recommendations; hence, the
addition of these items to our next agenda, our next board
meeting agenda.
Senator Cardin. Do you anticipate at the next board you
will be able to act on those issues?
Ms. Chiles. Yes, sir. Yes, sir.
Senator Cardin. Thank you.
Ms. Chiles. And I would be happy to report back to you
about what we do.
Senator Cardin. If you would, we would appreciate that.
Keep us informed on that. It would be helpful to us.
Ms. Chiles. That covers the first GAO report.
The second GAO report was issued in December 2007. It was
entitled ``LSC Improved Internal Controls Are Needed in Grants
Management and Oversight.'' Four recommendations were made to
management, one recommendation was made to the board.
The first recommendation to management is that it followup
on each instance of improper use of Federal moneys. That has
been done and is still being done by the office--well, by Legal
Services management working together with the Inspector
General's office. And when we receive--when the board receives
a report on the examination of those grantees who are
identified specifically in the GAO report, we plan to conduct a
case study using those instances to determine how those
situations could have been addressed and can be addressed in
the future should they arise.
The second request, the second full request from GAO to LSC
is that the management develop and implement policies and
procedures for information sharing amongst the Office of
Inspector General, the Office of Program Performance, and the
Office of Compliance and Enforcement, and that they coordinate
their visits to grantees. That is being done. As we speak
today, that is being done, and it will continue to be done. It
is being done in practice, and it has been taken care of
through the drafting of updated policies and procedures within
the Corporation.
The third of four recommendations to management was that
LSC management develop and implement an approach for selecting
grantees for internal controls and compliance reviews based on
risk-based criteria; and also that that approach use
information results from oversight and audit activities
consistently. Again, this gets back to the issue of
coordination and communication within LSC and with the
Inspector General's office. And I can represent to you as a
member of the ad hoc committee which was formed by the board to
address some of these issues--well, to address in particular
the issues of communication and coordination that we have made
great strides in the past 6 to 7 months in the areas of
communication and coordination. And the Legal Services
Corporation is stronger because of it.
The last recommendation to the Corporation from the GAO is
that LSC develop and implement procedures to improve the
effectiveness of the current LSC fiscal compliance reviews by
revising its guidelines, and those guidelines have been
updated. And if you have questions about specific changes to
the guidelines, management would, I am sure, be more than happy
to give you that information.
The last recommendation, which was addressed to the board,
was that the board develop and implement policies that
delineate organizational roles and responsibilities for grantee
oversight and monitoring, including grantee internal controls
and compliance. And that has been done and is continuing to be
done. That was accomplished primarily through the creation of
an ad hoc committee on the board, a three-member committee made
up of Mr. Garten, Sarah Singleton from New Mexico, and myself.
Sarah was the designated liaison to management. The ad hoc
committee had several briefings from the OIG and from OPP and
OCE. We have had one public meeting. We gave a report to the
entire board at our last board meeting in April.
In response to that report, the board, the entire board of
the Legal Services Corporation, adopted a very clear and
detailed statement of the roles and responsibilities of each of
the oversight entities at the Legal Services Corporation. And I
am pleased to report that that document was the result of very
hard work on the part of LSC management, the Office of--excuse
me, OPP, OCE, and the Office of Inspector General. We have a
new Inspector General, Jeffrey Schanz, who is a pleasure to
work with.
Senator Cardin. Well, thank you for that pretty thorough
reply.
Ms. Barnett. Mr. Chairman, would it be possible for me just
to elaborate on one or two of the management recommendations
and the action that was taken?
Senator Cardin. Sure.
Ms. Barnett. With regard to the followup of the nine
instances that GAO identified during their program visits, I
did refer eight of them to the Office of the Inspector General,
and the Office of Inspector General has completed the field
work at all eight of them and has reported to us that for the
eight sites reviewed and based on the OIG's preliminary
analysis, management of the grantees have adequately addressed
the GAO recommendations and are implementing additional
controls to prevent those issues from reoccurring.
I also sent an advisory in March to all LSC-funded programs
reminding them of the need for accurate documentation and the
regulations regarding unallowable costs, specifically stressing
the prohibition on the use of LSC funds for alcohol and
lobbying, the need for written policies governing salary
advances, and a reminder of the regulation governing derivative
income.
We kept one of the programs that was identified by GAO
because we had already begun an Office of Compliance and
Enforcement review. And I can report to you that LSC is taking
action to terminate the current grant and replace it with
month-to-month funding, with strict special conditions that
require monthly action and reporting to LSC. And should the
program not be able to meet those special conditions, LSC will
terminate the month-to-month funding and seek a different
provider through new competition.
And, finally, I would just point out that with regard to
our revised fiscal component, we now, as part of our expanded
Office of Compliance and Enforcement onsite fiscal reviews, are
specifically looking for specific documentation, contract
service arrangements, employee interest-free loans or salary
advances, lobbying fees, late fees or penalties due to lack of
good financial management, derivative income, and alcohol
purchases. So we have improved, based on the GAO
recommendations and what they have reported to us, our fiscal
review. And we have finally gone beyond the recommendations and
addressed the timeliness of our reports. All reports for 2007
have been provided to all grantees in either draft or final
form. We have set in our new manuals new timelines. Within 60
days after a program visit, they will get a draft report, for
the most part, and 90 days thereafter.
So we have even gone beyond, I believe, the recommendations
to improve our oversight.
Senator Cardin. Well, thank you. I appreciate that. And if
you will keep us informed as to the further actions taken, we
would appreciate it.
I want to return to the capacity within the legal system.
When I chaired the Maryland Legal Services Corporation, one of
the most glaring problems we identified was the gap on salaries
for those that are in Legal Services versus private practice
and other fields of public interest law. And I really do admire
those lawyers who go into public interest law at any level,
whether it is in the criminal justice system or whether it is
in the civil side.
We had legislation before this Committee last year that
dealt with loan forgiveness, and I know that we looked at the
disparities within public interest then, and it was the legal
aid lawyers who were at the bottom. Although the salary levels
for public defenders and prosecutors should be higher, they
were higher than those that are in the legal aid bureaus.
When I was at the Maryland Legal Services Corporation, 1
year we made that our priority. We decided we were not going to
expand any new opportunities until we could adjust the salary
levels of those attorneys that were providing the services in
order to try to keep experienced lawyers helping meet these
needs.
I am interested as to whether you have looked at that issue
with the different grantees as to whether there is a commitment
to try to deal with the salary disparity for those that are in
the civil legal field in public interest law.
Ms. Barnett. The Legal Services Corporation, Mr. Chairman,
has a 3-year pilot program for a loan repayment assistance
program, and we have a total of 82 participants in 24 programs
initially getting $5,000 a year for 3 years, and this past year
we got a $500,000 appropriation, and we are raising it to
$5,600 for 3 years.
Our evaluation of the first year of the program definitely
demonstrated what I think is no surprise to anyone in this
room, that loan repayment assistance programs definitely helped
young people go to legal service programs and remain there, as
well as permitting the programs to help recruit and retain
high-quality staff.
You have so rightly pointed out that legal aid attorneys
are the lowest paid of any public sector attorneys, with an
average starting salary of $37,000, graduating with an average
debt load of more than $80,000.
When I mentioned that 95 percent of the increased
appropriation would go to the LSC programs, it is our
assumption that some programs would use some of that money for
salary adjustments as well as other infrastructure needs.
Senator Cardin. I am certain that happens. One of my
suggestions might be that there actually be a strategy, if
there is again a commitment--if Congress were to make a
commitment to double the funds going to LSC, it seems to me
that one of the priorities should also be certain
understandings as to how that money is going to get to improve
the career opportunities for legal aid attorneys. I think that
would be a beneficial part of a tangible accomplishment. It is
not just providing a wider variety of services, which we need
to do, or taking in more numbers. It is also retaining quality
attorneys to meet these needs.
Ms. Barnett. We are having in June a conference of all our
executive directors, and salary is one of the workshop issues
in our recruitment and retention session that we will be
focusing on. We will have all 137 LSC-funded programs
represented, and this will be a good forum to have that
discussion.
Senator Cardin. I have one last question, which is--the
critics of LSC often point out that you have a model that in
litigation both sides should have attorneys. Now, I happen to
think that makes common sense to have lawyers on both sides of
an issue. But my question is: Have you been able to demonstrate
that when you have proper legal representation in matters that
could be in litigation, there is a stronger possibility that
these cases or probability that these cases can be resolved
absent a lengthy trial; whereas, when you don't have adequate
representation, sometimes you have unnecessary litigation?
Ms. Barnett. Our statistics nationwide show that only about
10 percent of the cases handled by all LSC-funded programs
actually go to trial; that, in fact, a lot of what we do is
preventative, a lot of what we do is being able to settle and
negotiate a correct resolution for our clients without the
necessity of a lengthy trial. And Jonann Chiles and I were
discussing this in the taxi coming over here. Perhaps you will
share the story of the Tennessee client.
Ms. Chiles. I thought this was a good example of how our
grantees educate their clients to become effective advocates
for themselves. We were told about an incident from Tennessee
where a client went into a grantee's office to set up a meeting
with a lawyer for the purpose of talking about how to deal with
an eviction notice from her landlord. The women went home--she
made her appointment. She went home carrying a flyer in her
hand from the grantee, and in that flyer was a list of her
rights and duties as a tenant and the obligations of a landlord
under Tennessee law.
When the woman got home, her landlord was there with the
police waiting to evict her. She held up her pamphlet and told
the landlord, ``Well, you haven't met A, B, C, and D, and until
you do those things, my lawyer says that you can't evict me.''
Well, the landlord looked at the pamphlet, and the police
officer looked at the pamphlet, and everyone agreed that she
had not had her due process and she could not be evicted yet.
I thought that was a good example of a client being
educated and empowered to represent themselves effectively.
Senator Cardin. Well, thank you for sharing that with us.
Again, I thank both of you for being here, and I thank you for
your testimony.
Ms. Barnett. Thank you so much.
Ms. Chiles. Thank you.
Senator Cardin. The second panel, let me introduce the
second panel. Then I will ask you all to remain standing to
take the oath.
The second panel will consist of the Honorable Lora
Livingston, a judge from the 261st District Court in Texas, and
a member of the Standing Committee on Legal Aid and Indigent
Defendants, American Bar Association; Jo-Ann Wallace, the
President and CEO of the National Legal Aid and Defender
Association, from Washington, D.C.; Wilhelm Joseph, the
Executive Director of the Maryland's Legal Aid Bureau,
Baltimore, Maryland, the person who we are very proud to have
here, who I have had the honor to work with on legal service
issues over the years and who does an outstanding job for the
people of our State; Kenneth Boehm, Chairman of National Legal
and Policy Center from Falls Church, Virginia; Jeanette
Franzel, the Director of the Financial Management and Assurance
Team, U.S. Government Accountability Office--that is GAO--
Washington, D.C.; and Rebekah Diller, Deputy Director of
Justice Program, Brennan Center for Justice, New York
University Law School in New York.
Would you all please raise your hands? Do you affirm that
the testimony you are about to give before the Committee will
be the truth, the whole truth, and nothing but the truth, so
help you God?
Judge Livingston. I do.
Ms. Wallace. I do.
Mr. Joseph. I do.
Mr. Boehm. I do.
Ms. Franzel. I do.
Ms. Diller. I do.
Senator Cardin. Thank you. The record will reflect that
there was an affirmative reply to the oath, and we will start
with the Honorable Lora Livingston.
STATEMENT OF LORA J. LIVINGSTON, JUDGE, 261ST DISTRICT COURT
(TEXAS), AUSTIN, TEXAS, AND MEMBER, STANDING COMMITTEE ON LEGAL
AID AND INDIGENT DEFENDANTS, AMERICAN BAR ASSOCIATION
Judge Livingston. Thank you very much, Senator Cardin, for
letting me visit with you this afternoon about this very
important issue. I will just briefly for the record continue
with my introduction.
My name is Lora Livingston. I am a State court judge. I
live in Austin, Texas. I am a general jurisdiction trial court
judge there, but I am submitting this testimony at the request
of the President of the American Bar Association, William
Neukom of Seattle, Washington--he could not be here today--to
voice the association's views with respect to closing the
justice gap that you so eloquently talked about earlier at the
beginning of this hearing. It is the association's goal to
ensure justice for all and to ensure, most importantly, access
to justice for all Americans, not just those who can afford a
lawyer. The ABA strongly believes that this objective can be
and must be largely achieved by strengthening the Legal
Services Corporation because it is the entity in our system of
justice that really is the linchpin to ensuring access to the
legal system for all Americans.
The ABA is the world's largest voluntary professional
organization with more than 413,000 members. It is the national
representative of the legal profession, and it serves the
public and the profession by promoting justice, professional
excellence, and respect for the law. We are an association that
is firmly rooted in the rule of law and believe in its
precepts.
I started my career as a legal aid lawyer. I was what we
call a ``Reggie.'' I was part of the Reginald Heber Smith
Community Lawyer Fellowship program, and my assignment was in
Austin, Texas. That is how I got to Texas from California,
where I am from.
I spent about 6 years in the legal aid office in Austin,
Texas, doing basic poverty law work, and I then went into
private practice and then later became a judge.
I am here on behalf of President Neukom and the ABA and
also on behalf of the Standing Committee on Legal Aid and
Indigent Defendants. We call that committee within the ABA
``SCLAID'' for short. SCLAID is chaired by former Texas Supreme
Court Justice Deborah Hankinson. She could not be here today
and so asked me to provide this testimony on her behalf.
We have five judges on SCLAID, and I think that that should
demonstrate to you and signal just how important SCLAID is
within the ABA and the importance of this work, ensuring access
to justice for all, because it includes so many members of the
judiciary on the committee.
The ABA has a long history of involvement in access-to-
justice initiatives. Ms. Barnett talked about Supreme Court
Justice Lewis Powell and his work serving the ABA when he was
President and calling back in 1964 for a major expansion of the
Nation's legal services work for the poor, and that ultimately
led to the creation of the LSC program.
The ABA strongly opposed past efforts to eliminate the
efforts to reduce access to legal services for the poor and
since then has been very involved in securing bipartisan
support for not only LSC but for access-to-justice initiatives
in general. You referred earlier to the Senate letter, dated
yesterday, that is signed by, I believe, 55 Senators, and we
are still working on getting more signatures on that letter.
But in addition to that letter, you should also--
Senator Cardin. Let us know when you have 60, please.
Judge Livingston. Great. Even better. See, your information
is more up-to-date than--
Senator Cardin. No, no. I said let us know when you get to
60.
Judge Livingston. Oh, let you know. OK. All right.
Senator Cardin. That is a key number around here.
[Laughter.]
Judge Livingston. That is the number we are shooting for.
That is our goal, and we will definitely let you know when we
achieve that milestone.
In addition to that important letter, though, I should also
tell you that there is a letter signed by all 50 State bar
presidents, the State bar presidents of the District of
Columbia Bar, as well as the bars in the Virgin Islands and
Puerto Rico. This is an important issue to every State bar
association in this country and some of its territories. I
cannot underscore more significantly than that the widespread
both partisan, bipartisan, and nonpartisan support for legal
services to the poor in America.
LSC, I want to tell you, is the essential linchpin in our
comprehensive system of delivery of legal services to the poor
in this country. It is the most significant entity that we have
in the administration of justice in this country, and it is the
one, probably perhaps most important part of the overall system
of justice. It is the one that funds most of the work that is
done out in the field, and certainly there are partners--you
have talked about IOLTA programs. There are certainly
partnerships on the State and local level. There are grant
funds that are nongovernmental funds that support legal
services throughout the country, but LSC funds really are the
linchpin to this comprehensive system of justice in our
country, and that is why strengthening its work and providing
additional funding for the work that it does is so important.
The Preamble to the U.S. Constitution states among the
first enumerated functions of government that we are to
establish justice. It is first. It is part of our fabric in
this country, and we have to, it seems to me, at all levels of
Government, certainly within the judiciary, certainly as the
Senate, support it as best we can.
You have heard some stories, and you talked earlier about
putting a face on legal services. I have got lots of stories,
but I know that we are short on time, and I will not tell you
all of them. But I want to tell you about one from Texas just
briefly, if I might, and that involves--you know about the
Katrina disaster and so forth, but since 2005, LSC programs
have closed more than 10,000 hurricane- related cases through
the end of 2007. That is phenomenal work in light of a major
disaster, and it just begins to tip the iceberg of the very
hard work that field programs have been conducting not just in
response to a disaster, but that is the kind of hard work you
get from every field program in this country. Without that
work, people will go hungry, people will be evicted, people
will not get the benefits that they need that they are entitled
to, that the Government provides for them and guarantees to
each one of them. And that is why LSC needs the support, as
much of it as you can give them, as much of it as we can give
them on the State level, as much as we can do locally, as much
as we can do in each individual community where poor people
reside. And it is our responsibility as a government to do so.
It is our responsibility as a legal profession to do. And we
look forward to the partnership with the Senate in making that
a reality.
Thank you very much for your time this afternoon.
[The prepared statement of Judge Livingston appears as a
submission for the record.]
Senator Cardin. Thank you for your testimony.
Jo-Ann Wallace?
STATEMENT OF JO-ANN WALLACE, PRESIDENT AND CHIEF EXECUTIVE
OFFICER, NATIONAL LEGAL AID AND DEFENDER ASSOCIATION,
WASHINGTON, D.C.
Ms. Wallace. Good afternoon, Senator, members of the staff.
Good afternoon and thank you for the opportunity to speak to
you today about the justice gap in America.
NLADA, the National Legal Aid and Defender Association, is
a national organization committed to equal access through the
delivery of excellence and civil and defender legal services.
Our members are civil and defender advocates who provide legal
assistance to people who otherwise could not cannot afford
attorneys, corporations, and others who care about equal
justice.
As has been stated, the Constitution recognizes that the
establishment of justice is essential to the very creation of
our Government. In passing the Legal Services Corporation Act,
Congress recognized that there cannot be justice in America if
a person's ability to access it depends on how much he can
afford.
The delivery system that was instituted more than three
decades ago established the Legal Services Corporation as the
linchpin of a national system. That model, which remains true
today, is fundamentally sound. But as you have now heard
repeatedly, by any measure it is woefully underfunded. Federal
funding for LSC in effect has been reduced by over 53 percent
from its 1980 level. State-based studies put the unmet need
anywhere, as you noted, from 70 to 90 percent. At a minimum,
one out of two people who need legal assistance must be turned
away by LSC providers.
While the dollars to support legal services have steadily
decreased, the legal need, as you have heard, is increasing.
Veterans returning, the mortgage lending crisis, the storms,
the skyrocketing cost of life essentials are but some of the
factors that are driving the need for services upward. In
short, we are in a growth industry when it comes to demand and
a recession when it comes to resources.
But while running the numbers is alarming, the picture is
even more sobering when we remember that every one of the two
that gets turned away represents a person with a face and a
name and a right to expect justice in our democracy.
``Collette'' was one of the lucky ones. When Hurricane
Katrina struck New Orleans in August 2005, Collette lost her
house and moved with her son, ``James,'' to stay with friends
in Missouri. When that arrangement fell apart and Collette
became homeless, the State took James and placed him in
Missouri's foster care program.
Determined to regain custody of her son, Collette moved to
New Orleans, the only place she could call home. She
successfully applied for a HUD grant, but the money, the grant
money, was delayed for months. All the while Collette was
traveling back and forth to St. Louis to attend custody
hearings and to spend a few hours with her son, James. At each
hearing Collette was asked, ``What progress have you made to
rebuild your home?''
So Collette began rebuilding her home herself, paying for
materials gradually with wages that she earned from part-time
jobs. When staff from Legal Services of Eastern Missouri
learned of Collette's plight, they put her in contact with a
State-based organization whose volunteers helped Collette to
renovate and refurnish her home. They connected her with mental
health services for trauma survivors. And, finally, they
convinced the court that James belonged with his mother.
Elsie Williams is another one of the lucky ones. Ms.
Williams is a 70-year-old retired factor worker who lived on
the $530 a month that she got from Social Security. So when the
sofa bed that she had could not support her anymore, she did
not have the money to replace it, and she could not afford the
prosthetics that she needed as a cancer survivor. So for the
first time in her life, Ms. Williams took out a loan.
Ms. Williams could not read the fine print of the contract
that she signed. She did not know that she had agreed to sign
over her monthly checks to the loan company or to let them
charge her a 95-percent interest rate on that loan and to tack
on numerous other legal and illegal charges. And so she did not
understand why, when she went to the bank in the next few
months, her Social Security money was not there.
But Ms. Williams found a young woman who had been willing
to give up a job making more than $100,000 a year as a real
estate attorney. She wanted to follow her dream to help people
as an attorney with an Atlanta legal aid program. With the
attorney's assistance, Ms. Williams got her Social Security
checks back.
As these stories illustrate, the efforts of legal aid
lawyers support better life outcomes for millions of people,
and as the last example also illustrates, those efforts often
come with significant personal sacrifice. I cannot tell you the
exact starting salary of that young attorney in Atlanta. What I
can tell you is that she took a substantial pay cut to go work
for legal aid.
As a means of stretching scarce dollars to meet the ever
growing demand for assistance, LSC programs have historically
paid salaries that are the lowest of any sector of attorneys.
Legal aid programs across the board this is true of. According
to a 2006 report, the median salary for entry-level civil legal
aid attorneys is a little more than $36,000. The lawyers making
that entry-level salary usually face law school debt of between
$80,000 and $120,000. The convergence of these factors has
extracted a significant price over time due to costs of
turnover and difficulty filling vacant position.
NLADA is most appreciative of recent Federal legislation
that attempts to address this problem, but that additional
investment in the attorney work force must also be supported
with increased Federal support for LSC if you want to ensure
the availability of the next generation of lawyers dedicated to
serving the public interest and also if you want to maximize
the availability of funding for direct services.
The final point I would like to make also goes to the issue
of cost-effectiveness. Equal access to justice cannot be
administered efficiently when Legal Services are not able to
use the same tools and strategies that other lawyers use to
serve their clients. Congress should remove those restrictions
on legal aid attorneys that are inconsistent with the purposes
of the LSC Act, starting with the restrictions upon the LSC
programs, what they can do with State, local, and private funds
available to them.
In closing, I would like to thank the Committee again for
shedding light on this important issue. We would urge Congress
to recommit to equal access for justice by embarking on a
course to expand funding and eliminate the restrictions that
hamper the effectiveness of the public- private partnerships
that are necessary to eliminate the justice gap.
Thank you.
[The prepared statement of Ms. Wallace appears as a
submission for the record.]
Senator Cardin. Thank you for your testimony.
Mr. Wilhelm Joseph?
STATEMENT OF WILHELM H. JOSEPH, JR., EXECUTIVE DIRECTOR,
MARYLAND LEGAL AID BUREAU, INC., BALTIMORE, MARYLAND
Mr. Joseph. Good afternoon, Senator Cardin and staff
gathered here, and thank you, Senator, for hosting the hearing,
and thank you for your outstanding record of leadership on this
issue in Maryland and now on the national level. And please
allow me to convey, through you, my best wishes for the
recovery and good will of Senator Kennedy. It is a particular
honor for me to have been given this opportunity to appear
before you.
I am humbled to be presenting before this august body, to
address you on a subject that is very personal for me. In 1965,
I was a young man with a solid high school education and a
burning desire to pursue a higher education. At that time I was
living in Port of Spain, Trinidad, the place of my birth. I was
a member of a very poor but proud family with a strong work
ethic and without the funds to support furthering my education.
Today I am here as a testament to the generosity and support of
many individuals and institutions in this great country who
extended a helping hand to me. For this I am deeply grateful.
Starting with a track scholarship and other assistance later, I
have earned an undergraduate degree from a historically black
university, a law degree from a reputable university law
school, and a graduate degree from one of this country's
leading institutions. For this and many other blessings I am
very grateful.
Currently, I am most fortunate to be a member of a
partnership in Maryland, the Legal Aid Bureau, whose mission is
to provide the best civil legal assistance possible to low-
income persons. That partnership comprises the judiciary at all
levels--the private bar, individuals and firms; the Maryland
State Bar Association; governing bodies at the State, county,
and city level; various funding sources including our IOLTA
program, represented here today by Herb Garten and Susan
Erlichman; the Maryland Legal Services Corporation;
foundations; and, of course, the federally funded Legal
Services Corporation.
In Maryland, this partnership approach to addressing the
civil needs of the State's low-income is encompassed in three
letters of the alphabet: S for sensible, E for enlightened, and
C for compassionate. Our work is motivated by a shared
intolerance for injustice and a willingness to help others pick
themselves up by their own bootstraps. In Maryland, we face the
same challenges that have been already outlined here today and
that have been clearly set forth in my written submission. That
is the challenge of addressing overwhelming needs with too few
resources. This is a national crisis. In my opinion, it
requires a national response.
In Maryland, we do leverage our LSC resources. We receive
about $3.9 million from LSC. When I arrived in Maryland in
1996, our total funding was $9 million, and the funding then
from LSC was around the same three-point-something million.
Today, in Maryland, our budget will be $22 million, a testament
to that partnership I referred to earlier.
Maryland Legal Aid Bureau represents the helping hand that
catches thousands of vulnerable, unfortunate people before they
fall off the precipice and through the trapdoors of
circumstances that otherwise would cause them to fall into the
quicksand of poverty and crisis, and go deeper and deeper.
Our clients are people who have recently suffered setbacks,
such as loss of a job, unexpected illness, disability. They are
vulnerable children, victims of abuse and neglect, elderly
citizens, victims of domestic and family fractures, and low-
wage workers.
Allow me to offer one illustration. Let's take a look at a
fairly common legal aid family, and I ask the staff, get a pen
and a piece of paper. I want to take you through a very short
exercise.
Consider a family of three--two young children with one
parent with a job that pays just above minimum wage, say $7 per
hour. At that rate of pay, gross wages on 40 hours a week, 32
weeks a year, would bring them $14,560--way below the LSC
eligibility guideline for a family of three, which is at
$22,000. After the compulsory deductions for Social Security,
et cetera, that wage earner's take-home pay is closer to
$13,000.
Now, here is where the rubber hits the road. A quick look
at a sample budget for that family will reveal the following:
Rent, approximately $800 a month; food, $400 a month; child
care, $400 a month; transportation, maybe $400, maybe a whole
lot more with the gas prices; utilities, $150 per month;
clothing, household repairs, et cetera, $150 per month. A very
modest budget. Without health care being mentioned, those total
expenses come to $2,300 per month, annually $27,600. Even with
available subsidies for housing, food stamps, and utilities,
this family will be in a crisis. Meeting $27,000 in expenses on
a $13,000 budget is impossible. These people will try to
survive by periodically failing to pay this particular bill or
another--rent, utilities, et cetera.
These choices have consequences that bring them to the door
of legal services for help. These circumstances also create an
environment that is more conducive to domestic violence, abuse,
and even criminal behavior, in order to make ends meet. In
Maryland alone, there are over 500,000 such persons trying to
subsist below this level of poverty. In 2007, with the
coalition and partnerships, the Legal Aid Bureau helped some
53,000 of them. Combined with the efforts of other providers
including over million pro bono hours rendered by private
attorneys, we helped only a total of 101,000 persons with their
civil legal needs statewide.
Senator Cardin, we need a fundamental change at the
national level with regard to this question, this crisis of
justice in America. This crisis on a daily basis contributes to
suffering, despair, hopelessness, and robs our community of the
full potential of all the members who now subsist at
intolerable and embarrassing levels. We need a substantial
increase in financial resources to meet new regularly, steadily
increasing costs of doing business, recruiting, training,
retaining qualified staff, paying for rents, utilities,
supplies, communication, equipment, furniture, et cetera. Help
us to help others pick themselves up by the bootstraps. Help us
to help those without boots.
Thank you.
[The prepared statement of Mr. Joseph appears as a
submission for the record.]
Senator Cardin. Thank you very much for your testimony and
for your service.
Mr. Kenneth Boehm?
STATEMENT OF KENNETH F. BOEHM, CHAIRMAN, NATIONAL LEGAL AND
POLICY CENTER, FALLS CHURCH, VIRGINIA
Mr. Boehm. Thank you. Good afternoon, Senator Cardin. My
name is Ken Boehm, and I serve am the Chairman of the National
Legal and Policy Center. From 1991 to 1994 I was Assistant to
the President and Counsel to the Board of the Legal Services
and prior to that headed the Department of Policy Development
at Legal Services Corporation. It is an honor to appear before
you today to share some of my views, which will be distinctly
different than many of the other views you are hearing, but for
that reason I especially want to present them.
For today's topic, I would like to focus on two
observations.
First, we really are interested in closing the justice gap,
and that is what we have to focus on, and closing that gap
should involve a much broader approach than simply increasing
the appropriation to a troubled Federal program by five-fold.
As has been pointed out, page 19 of ``Documenting the Justice
Gap in America,'' the 2005 legal needs study done by LSC, they
recommended an increase to $1.6 billion, which is a fivefold
increase.
My second observation, which I will also get into a little
bit, is that the Legal Services Corporation model has been
plagued with many problems from the beginning, and if we are
truly interested in solving this problem and not doing these
incremental Band-aid approaches, we should think far beyond
just giving extra money to the Legal Services Corporation.
As I am sure you know, the Legal Services Corporation has
not been authorized since 1980. That is when its first
reauthorization expired. That is 28 years through Republican
and Democrat Congresses, Republicans and Democrats in the White
house, without reauthorization. That is almost unique for
Federal programs to go that long without any kind of consensus
for reauthorization, and there is a reason for that.
Turning to ``Documenting the Justice Gap in America,'' the
study, there are some limitations to it. It was done by LSC and
the programs, and the conclusion was give us five times our
budget and that will be a good start toward solving the
problems. That is not unusual in Washington for programs that
want more money to simply ask for more money and give a study
that is tailor-made to show that would solve the problem. But I
think we have to think far beyond that. We have to look at
alternatives that, in fact, may be more cost-effective,
alternatives that are already being done by market and other
forces, alternatives to deliver justice not just to poor people
but middle-class people who can't afford the growing costs of
being involved in a civil lawsuit.
It has been said here numerous times that LSC is the
linchpin of providing legal assistance to the poor. It
shouldn't be overlooked, the fact that for every 1 hour of
service by a Legal Services Corporation-funded lawyer, there
are 5 hours of pro bono, five private attorneys in private
practice doing their responsibility, as they are supposed to be
if they are in private practice. And so there are many other
ways, of course, that legal services are given to the poor.
Outside of contingency fee funds in cases of personal
injury, we have a growing trend--that has actually happened
over the last 20 years--for an increase in the jurisdictional
dollar amount of cases in small claims court. As I said, it has
already been happening, these cases. I am sure as anyone here
who has spent any time in small claims court can say, they are
fact-based. There is no lawyer generally needed.
We also have seen a vastly greater increase in mediation,
including mediation without lawyers, even though the American
Bar Association feels that you should have lawyers in these
mediation types of cases. And this is very, very helpful.
People who study mediation say you get a faster result, it is
more cost-effective. And sometimes the parties actually have a
meeting of the minds--that is what mediation is all about--and
you actually have a much better result on all fronts than if
costly litigation is needed.
Another area that needs to be looked at is increased use of
ombudsmen. As somebody who has followed Legal Services'
policies for the last 15 years, this is happening at the State
level, at the local level, through the Older Americans Act.
There is Federal funding for volunteer ombudsmen for long-term
care. Many, many different examples. In European countries,
developing countries, Japan, Australia, Canada, ombudsmen are
widely used to develop justice. We should ask ourselves--we
know we are the most over-lawyered country in the world with
something approaching a million lawyers out there. How does the
rest of developing world solve their legal problems if they do
not have as many lawyers per capita as we do? Well, the way
they solve them is they make many of these less serious legal
problems, problems that can be solved in some way other than
litigation and expensive lawyers, and we should look at those
models.
The key question is: Is our goal increased access to
justice? Or is it just increased federally funded lawyers and
lawsuits? The alternatives generally are faster. They are more
cost-effective. And all too often the burden really falls--the
burden of some of this litigation falls on other people who
cannot afford it. I will give you a very brief example.
A 70-year-old Ohio vegetable farmer named Russell Garber
was sued by LSC-funded lawyers under a Federal law did not
apply to small family farmers. As a matter of principle, he
hired a lawyer to defend him. He couldn't afford a lawyer. He
had to borrow and go into hock at age 70 to do it. The case was
dismissed by a Federal judge in a strongly worded decision very
critical of the Legal Services lawyers for bringing a case that
did not apply in his instance. Instead of accepting their
defeat, the lawyers from the Texas Rural Legal Assistance
instead appealed to a three-judge panel. The three-judge panel
affirmed the dismissal, and Mr. Garber won. His legal bill:
$107,000.
Now, I talked to Mr. Garber this morning just to see how he
was doing 4 years after that. He was up at 5. He was doing his
chores. He is not retiring. He has a $107,000 legal debt.
My question is: Is that justice? We are supposed to be
promoting justice, not just funding for a Federal program.
There are better approaches. They are outside what was in
this study. They are outside generally what the bar looks like,
because a lot of them don't involve funding with lawyers. They
involve other ways of justice, as I listed.
The LSC model is deeply flawed. Not just have we had two
fairly critical GAO reports just in the last year, there were
two other back-to-back critical GAO reports in 1999 when GAO
said they had widespread and significant problems with their
case reporting. They were reporting to Congress. LSC disputed
that and said, Oh, we have solved it, we have taken care of
it--much as you have heard they have solved these GAO problems.
GAO then did a second study in 1999 and found that they had not
solved the problem, and their case numbers finally went way
down because they were counting in one case, one program,
10,000 phone calls by non-lawyers as ``legal cases.''
Well, that is not fair to the taxpayer. It is not fair to
poor people. And it is just not the way our Government should
run.
If you look at just the last 2 years--and we have
documented hundreds of abuses over the years. But if you look
at just the last 2 years, you have the back-to-back GAO
investigations; you have a strained relationship with the LSC
IG, and Congress. There have been three full-time LSC IGs prior
to the current one. All three left after severe feuds with the
LSC Board. The last one, Kirt West, was about to be fired
before three Members of Congress--two Senators and a
Congressman--wrote a letter to the LSC Board saying, ``Don't
fire the IG while he is investigating you.'' That is a very,
very--I do not know of any other Federal program that has had
three consecutive IGs go out of business. They have had
negative publicity based on use of limos, overpriced hotels.
This was the Associated Press and CBS Evening News. These were
not conservative critics. And, in fact, program lawyers, the
ones that we have heard who operate on very, very low salaries
and are really giving their all to the program, were appalled
to see that Legal Services had limos for their board members
and were paying for first-class air travel and all sorts of
other thrills that really do not belong in a Federal anti-
poverty program.
My only thought is as you look at ways to meet the legal
needs of the poor, think beyond just let's pour more money on
this program. Think to are there some structural changes that
could be done that help all people, not just the poor--the
middle class who can't afford lawyers, the Russell Garbers of
the world who can't afford lawyers--help all people get access
to justice.
When the Framers said access to justice, they were not
referring to Legal Services Corporation. That did not come
until the 1970s. They wanted access to justice. I think what
the Framers had in mind and what the saying on the Supreme
Court facade means is we need to have a society with laws and
institutions that allow people access to justice. And if that
does not necessarily suit the needs of the American Bar or the
Legal Services Corporation, well, I think we really should be
after justice and not that.
And as I say, if I could make one recommendation, it would
be this: that there be a real study, perhaps an independent
study, by leading thinkers, and there are some good books that
have been published. Just recently, there is one out by a
Stanford law professor that looks to these alternatives out
there, and let's see if that isn't a more cost-effective way to
deliver access to justice.
Thank you very much.
[The prepared statement of Mr. Boehm appears as a
submission for the record.]
Senator Cardin. Thank you very much for your testimony.
Ms. Jeanette Franzel?
STATEMENT OF JEANETTE FRANZEL, DIRECTOR, FINANCIAL MANAGEMENT
AND ASSURANCE, GOVERNMENT ACCOUNTABILITY OFFICE, WASHINGTON,
D.C.
Ms. Franzel. Good afternoon, Senator Cardin. I would like
to ask that my written statement be submitted for the record.
Senator Cardin. Without objection, all the written
statements will be included in the record.
Ms. Franzel. Thank you. I am very pleased to be here to
discuss our recent GAO reviews that have been mentioned
throughout this hearing on Legal Services Corporation's
governance, accountability, and grants management practices.
The Legal Services Corporation, or LSC, has the important
mission of making Federal funding available to provide legal
assistance in civil matters to low-income people throughout the
United States. Today I will discuss LSC's organizational
framework and funding and highlight the key findings from our
August 2007 report on LSC's governance and accountability and
our December 2007 report on LSC's grants management and
oversight.
The sum of these two reports represent a comprehensive,
top-to-bottom review of the LSC structures and processes that
are needed to increase assurance that LSC programs are carried
out effectively and that funds are used in accordance with
intended purposes.
First, regarding LSC's framework and funding, LSC is a very
unique organization. It was established by a Federal charter in
1974 as a federally funded, private, nonprofit corporation.
Despite its status as a private corporation, the vast majority
of LSC's funding is from Federal appropriations. LSC uses its
funding to provide grants to legal service providers, or
grantees, who serve the low- income members of the community
who need services. LSC received about $350 million in
appropriations for fiscal year 2008 and has 137 different
grantees.
LSC distributes its funding to grantees based on the number
of low-income persons living within a service area, so grantees
are the entities actually spending the funds and providing
legal services to clients. LSC management is responsible for
ensuring that these grant funds are used for their intended
purposes. Thus, LSC is responsible for its own activities and
internal controls and for providing oversight and monitoring of
grantees and their internal controls, their use of grant funds,
and compliance with laws and regulations throughout their
operations.
LSC's Board of Directors plays a significant role in LSC's
governance and is responsible for providing leadership and
direction to LSC's management and overseeing LSC's operations.
Since 1988, LSC has been under the oversight of an Office of
Inspector General which has statutory authority to carry out
audits and investigations of LSC programs, and LSC now has a
new IG, as we have heard.
In the areas of governance and accountability, we found
that LSC's practices had not kept up with evolving reforms that
have impacted other types of organizations. I do want to
emphasize that LSC's board members did show active involvement
in LSC oversight through their regular board meeting attendance
and participation. Also, in our discussions with individual
board members, we found them to be highly committed to their
responsibilities and very receptive to the suggestions that we
were making and the improvements that need to be made in
governance.
We made recommendations in the following areas to help
strengthen LSC governance: establishing basic charters and
responsibilities for the board and its key committees and
putting those in writing; employing orientation, training, and
performance assessment processes for the board and for its
members; adding functions normally handled by boards of
directors, such as audit committees, ethics committees, and
compensation committees, to help oversee those areas impacting
LSC's accountability and codes of ethics; and finally, very
importantly, periodically evaluating key LSC management
processes, such as risk assessment and mitigation, internal
control, grantee oversight, and financial reporting.
We also found that LSC management practices had not kept up
with recent developments for other types of organizations. LSC
management itself had not implemented a systematic or formal
risk assessment process and had not established comprehensive
policies or procedures regarding conflicts of interest and
ethics. In addition, LSC had not established a continuity of
operations program.
In the area of grants management and oversight, which is
really the heart of where LSC funding is applied in LSC
operations, we found weaknesses that left grant funds
vulnerable to misuse. Specifically, we found that the scope of
LSC's monitoring of grantees' fiscal compliance was limited. In
addition, LSC did not use a structured or systematic approach
for assessing risk across its 137 different grantees in order
to guide the timing and scope of grantee visits and oversight
activities.
We also found that oversight feedback to grantees was often
slow. As of September 2007, LSC had not yet issued reports to
10 of the 53 grantees that it had visited during 2006. Without
such communication, grantee managers do not have information
that they need about deficiencies and corrective actions that
are needed to help protect their activities in their own
program.
We also found poor fiscal practices and improper
expenditures at 9 out of the 14 grantees that we visited, and I
would like to stress that these were very limited reviews that
we did. During our limited reviews, we identified issues that
LSC could have identified with more effective oversight. We
found systemic issues involving payments that were made without
sufficient supporting documentation, and in those cases, it was
impossible for us to determine whether the expenditures were
accurate, allowable, or appropriate.
We also found improper expenditures and potentially
improper expenditures at grantees using grant funds, including
travel expenses, loans to employees, alcohol purchases,
lobbying fees, questionable contractor payments, and improper
use of LSC funds resulting from a real estate transaction.
As a result of our review, we made a total of nine
recommendations to LSC's board and eight recommendations to LSC
management. Both LSC's board and management expressed a
commitment to taking corrective action to implement our
recommendations. LSC's most recent progress report indicates
that it is starting to take action on many of our
recommendations and is planning action on the rest. LSC plans
to provide us with a final update by September 1, 2008, and we
look forward to receiving that report and reviewing LSC's
progress.
I want to emphasize, however, that some of these corrective
actions will take time to fully and properly implement, and
many of these actions will need to be continually evaluated
through an LSC ongoing risk assessment and monitoring process,
which we are recommending also be put in place.
In conclusion, LSC serves a key mission, which is being
highlighted during the current period of economic hardship for
many workers and their families who need legal services they
could not otherwise afford. Effective governance, internal
controls grantee oversight, and diligent and proper performance
by grantees are all critical to LSC's mission, the effective
use of its appropriated funding, and its ability to serve the
legal needs of low-income people. Maintaining sound internal
controls and governance will be key to maintaining trust and
credibility of LSC's mission and operations going forward.
That concludes my statement, and I would be happy to answer
any questions that you have.
[The prepared statement of Ms. Franzel appears as a
submission for the record.]
Senator Cardin. Thank you very much.
Ms. Rebekah Diller?
STATEMENT OF REBEKAH DILLER, DEPUTY DIRECTOR, JUSTICE PROGRAM,
BRENNAN CENTER FOR JUSTICE, NEW YORK UNIVERSITY LAW SCHOOL, NEW
YORK, NEW YORK
Ms. Diller. Thank you, Senator Cardin. On behalf of the
Brennan Center for Justice, I would like to thank you for
holding this hearing today and permitting me to testify. The
Brennan Center for Justice is a nonpartisan think tank and
advocacy organization, and for the last 10 years, we have been
deeply involved through litigation, research, and advocacy in
promoting equal access to the courts.
I am going to depart from my written testimony a bit and
just speak about some of the issues that have come up during
this panel.
First, I would just like to say that I agree with Mr. Boehm
that certainly we can look at other models for closing the
justice gap and for improving access to courts in this country.
I think expanding small claims court jurisdiction and things
like that are very useful. But I think we have to be very
honest that that is just not going to close the justice gap.
When you look at the types of cases that legal services
programs handle, primarily housing court cases, family court
cases, those are cases where the other side has a lawyer, and
in order for there to be any type of fairness in the
proceeding, the legal services client needs to have a lawyer as
well. So we can talk about these other matters that may
complement efforts here to close the justice gap, but they are
simply not going to fix the fact that when you have one side
represented, if the other side is not represented, you have a
very unfair proceeding.
One study that I cite in my testimony found that when a
side is represented by a lawyer, they are five times more
likely to prevail in litigation than when they are
unrepresented, so that gives you a sense of the real difference
that a lawyer makes.
The other thing I will just address is the fact that the
justice gap study, while it was produced by the Legal Services
Corporation, is consistent with every other study and in some
ways understates the problem that every other study has found
about the legal needs of low-income people going unmet. So it
is not just LSC studies. It is the study of every access-to-
justice commission that looks at the issue.
The Brennan Center itself I can tell you did a study on a
local level where we looked at New York City housing court and
we looked at how many tenants were represented, and we found
that 76 percent were unrepresented, and that is in contrast to
the landlord side of the proceedings where most observers
estimate that about 90 percent have a lawyer. So the fact that
low-income people go unrepresented is pretty irrefutable.
The other thing I will just note is that when you look at
how the U.S. compares to other developed countries, it is very
interesting, because while I am not really able to speak to the
number of lawyers or lawsuits, what I can tell you is that we
fall way behind in terms of funding for civil legal aid.
England spends about 11 times as much per capita on legal
services as we do; Germany and France spend about as 2 times as
much. So while there may be fewer lawsuits or lawyers,
certainly when low-income people have legal needs there, they
are much more likely to be represented.
The other thing I will just say is that to the extent that
there is an assumption that, you know, somehow there is a self-
interested effort here by lawyers to generate more business for
lawyers, I think the salary quotes that we have heard from
several witnesses really underscore the fact that no one is
going into the legal services business for the money. So if we
were really here for an effort to generate business for lawyers
and provide funding for more and more lawyers just for that
sake itself, we would not be talking about legal services.
People go into legal services because they want to do good
work, and they often do so at great financial sacrifice.
The other thing I will address here today is one step that
the Congress could take which would not cost a penny, but I
think would go pretty far toward helping improve the justice
gap problem that we have talked about, and that is to eliminate
the restriction on State, local, and private funds that is
attached to the LSC appropriation every year. We have talked a
lot about the involvement of State and local governments as
partners, of IOLTA programs as partners, of private donors as
partners. But what the Federal Government has done is it has
said to local nonprofit organizations, if you take one penny of
our money, we are going to restrict how all your other funds
are spent.
This is way out of line with how every other Federal
grantee is treated. The normal course is to certainly restrict
how Federal funds are spent, but not to tell grantees and
others, like State governments, how they can spend their funds.
What is happening as a result of this restriction is that
the Federal Government is actually deterring partners from
getting involved in the civil legal aid delivery system,
deterring private funders from giving to legal aid programs
because their funds will be restricted. It is deterring State
governments and State actors from contributing to LSC-funded
grantees. And it is also creating waste in the system. I will
give you an example from Oregon.
Oregon State justice planners did not want their State
funds to be restricted by the Federal Government, so they set
up two systems of legal aid delivery that run parallel to each
other. That means two sets of rent payments ever month, two
sets of computer networks, copy machines. All the overhead that
one office has now has to be borne by two offices. And the
programs there calculated that if they did not have to operate
separately due to the restriction on State, local, and private
funds, they would save about $300,000 a year. That same
$300,000 a year could go toward opening a new office in an
underserved rural area of the State and serving more clients in
their bread and butter legal services needs.
We have seen the impact of this restriction in particular
in the subprime crisis and in efforts to defend homeowners
against predatory lenders. One of the things it does is it
tells legal services attorneys that they can't seek attorneys'
fee awards even when such awards have been authorized by
consumer fraud statutes. And this means that their bargaining
power is reduced when litigating in these cases. Wrongdoers do
not have to pay fees that have been authorized by statute. And
they are also depriving programs of potentially another source
of revenue that could go to serve yet more homeowners in need
of help.
I will stop there and take any questions.
[The prepared statement of Ms. Diller appears as a
submission for the record.]
Senator Cardin. Thank you for your testimony, and I thank
all six of you for your testimony. It certainly helped complete
our record here. Both Ms. Diller and Ms. Wallace spoke about
the restrictions in the LSC law, which I am glad you both
mentioned. It just seems to me that there are easier ways for
priorities to be determined than putting legal restrictions in
the statute itself.
You went through, Ms. Diller, a list of the restrictions
and mentioned them. Did you mention them in priority order? Do
you believe that outside funding is the most problematic
restriction that LSC has? Or just there is no rhyme or reason
to the list?
Ms. Diller. Well, I would say the restriction on other
funds is the most problematic because of the way that it ties
up the money that comes from other sources, the way it distorts
the planning that local communities can do about how they
construct civil legal aid delivery systems. It deters other
funds from coming into the system. So I do think that is the
most problematic, and I would just point out that to the extent
Congress has concerns about how its money is spent, it can
certainly regulate that. But this is really outside the norm
with the way that any other nonprofit grantee type of
organizations are treated.
Senator Cardin. Ms. Wallace, you mentioned that same
restriction. I do not believe you mentioned other restrictions.
Is that the area that you think is the most important for
Congress to take a look at?
Ms. Wallace. We agree that the restrictions generally
present problems, but certainly agree that that particular
restriction is one of the most problematic, and it is one of
the ones that should be prioritized for a number of reasons. If
we really are going to close the justice gap, we need to make
the partnerships that are going to be required to do that as
effective as possible. And that restriction really does hamper
our ability to do that and hampers programs' abilities to do
that. Not only that, but as was pointed out, we think that it
is a pretty easy fix. So that is a good place to start.
Senator Cardin. Mr. Boehm, you talked a little bit,
particularly in your statement, about the advantages of pro
bono. Do you favor a requirement that all lawyers participate
in pro bono?
Mr. Boehm. I would think there would be constitutional, if
not ethical, problems with requiring it. It is a duty of the
profession, and the profession--I think you have to look at a
profession as a regulated monopoly, and people who are able to
practice law privately have a responsibility. It comes with the
very notion of a profession. And I think this should be every
kind of suasion short of absolute requirement to the degree
they should be publicly shamed if they do not, if they are in
private practice and offering that. And I think also, by the
way, lawyers who work for the Federal and State governments,
lawyers who now have problems doing that sort of thing, should
be allowed to do it. And I think there ought to be a waiver for
certain types of legal services when attorneys who are in
different States from which they were admitted to the bar would
like to do some volunteer work. Right now, you have to be
admitted to the bar, which can be a problem in some cases.
Senator Cardin. You raise some very legitimate points, but
if we could work out the issues that you have referred to,
would you favor a legal, enforceable obligation for attorneys
to participate in pro bono, with the caveats that you have
already mentioned, and others?
Mr. Boehm. Yes, the main one is that if you force somebody
to do that, it almost gets to--I have seen this debated. This
has been debated by leading people on both sides. The
Federalist Society had a series of debates. Mr. Alex Forger,
who is the former LSC president, took the position it should be
legally enforceable.
I think there are a lot of steps you can take right up to
that line that go very, very close to requiring it, and a
number of States have done it. I will give you some very quick
examples. There is increased reporting requirements. In some
States you have to go into great detail. Certain firms have
made it firm policy. There is any number of things you can do,
and there are some proposals, there are policy proposals out
there for certain types of tax credits in a very limited way to
further increase pro bono.
There is no shortage of lawyers per se. There is a shortage
of pro bono.
Senator Cardin. Judge Livingston, why hasn't the bar
association taken a more affirmative view on the requirements
for pro bono?
Judge Livingston. I think they have, in fact. I think that
there are a number--
Senator Cardin. To make it mandatory. They have not taken
steps to try to make it mandatory.
Judge Livingston. They have not taken steps to make it
mandatory for some of the reasons that Mr. Boehm has pointed
out and more practical ones, perhaps, about lawyers not
feeling--feeling an obligation, certainly, to the profession
and to the community to participate in pro bono, but I don't
know that involuntary servitude is really the way to go. At
least, that has been the argument framed by some in this
debate. I disagree with that. I think that we could certainly
do--
Senator Cardin. When I got out of law school--
Judge Livingston.--more than we are doing.
Senator Cardin. When I got out of law school and walked
past a courtroom, a judge grabbed me and said I would handle
this case. I guess I could have told the judge no if I never
wanted to go before his court again. But I handled the case. Is
that--
Judge Livingston. Let me suggest--
Senator Cardin.--involuntary servitude?
Judge Livingston. I don't think it is. I mean, I am in
favor of mandatory pro bono personally. But I will tell you
that as a representative of the profession, it is not a popular
notion.
I will also tell you, though, that the profession has
certainly stepped up. I bet when you went to law school that
law firms, big law firms that are paying these top- dollar
salaries that are elusive to legal aid lawyers, those law firms
traditionally have not allowed billable hour credit for pro
bono work. Now that is a reality. So that is one very simple
way that law firms have been responsive and have been out front
encouraging the associates in their firms to participate in pro
bono.
There are a number of initiatives in every State and local
bar association that I am familiar with that not only
encourages pro bono, but actively recruits pro bono lawyers,
they participate in the pro bono organized activities of the
bar. They have--we just left Minneapolis at the Equal Justice
Conference, which used to be called the ``pro bono
conference,'' where there were a number of strategies discussed
about ways that you can increase the interest among lawyers in
doing pro bono, in actually helping them in carrying out their
pro bono responsibilities as members of the profession. And
there are just untold and millions and millions of examples of
the profession stepping up to the plate to take this
responsibility, not just in doing it but in reporting it and
encouraging young lawyers in their firms to do so as well. It
is an effort that we take seriously.
Senator Cardin. The results are inconsistent among the
States.
Judge Livingston. I am sorry?
Senator Cardin. It is inconsistent among the States.
Judge Livingston. It is definitely inconsistent. It is
inconsistent in communities within a State.
Senator Cardin. That is true also. There have been more
aggressive steps taken in some State over other States. I am
not aware, though--maybe I am wrong about this--that the
American Bar Association has taken a firm position that there
is an obligation for attorneys to handle pro bono, that there
should be reporting requirements in every State, that there
should be specific programs in law schools to sensitize lawyers
to enter pro bono programs. There is a whole list of things
that they have done. I am not aware that the ABA has actually
come out and said that every State should adopt these or try to
make this a standard practice within the canons of ethics of
attorneys.
Judge Livingston. Well, the canons of ethics that our
association recommends do include taking the responsibility
seriously and certainly encourages it. The Center for Pro Bono
is one example of that. There is information in my written
remarks about a website reference that you can go to to find
out about all the initiatives going on at the Center for Pro
Bono.
So there are a number of efforts, and I would say--I never
want to disagree with a Senator, but I would certainly want to
say that the association is on record absolutely encouraging
States, encouraging State bar associations, encouraging local
bar associations, and encouraging every single lawyer that is a
member of the profession, certainly a member of the
association, to engage in pro bono activities and to report
that.
Senator Cardin. Well, there is a big difference between
encouraging and taking it to the line, and I would suggest
beyond the line that Mr. Boehm is suggesting, in which you have
the information in front of you about every attorney in your
State as to what they are doing. And that is what we do in
Maryland. Every lawyer must report their pro bono activities.
If you want to practice law in Maryland, you have got to do
that.
Judge Livingston. Fabulous.
Senator Cardin. Well, why doesn't the bar association work
to require that in every State?
Judge Livingston. Well, I think that--
Senator Cardin. My point is this. My point is this. The
request is being made for the Federal Government through the
taxpayer support to provide a greater level of activity to meet
this gap. I support that. But the bar association also must
take this to the next level. This is a partnership.
Judge Livingston. I agree.
Senator Cardin. I will not forget the lesson I learned from
Governor Schaefer when I went to him and asked him for more
State money. The first question he asked me: ``What are the
lawyers doing?'' I think that is a legitimate question.
Judge Livingston. I agree.
Senator Cardin. And I happen to agree with the point that
pro bono is a very, very valuable part of filling this gap.
Judge Livingston. I totally agree.
Senator Cardin. We need to do a lot more.
Judge Livingston. I totally agree. I don't disagree with
anything you said about how lawyers have to step up. What I am
telling you, Senator, is that lawyers have stepped up. That
does not mean we can't step up further. It does not mean we
can't take a more active role. It does not mean we can't be
more aggressive. The American Bar Association is totally 100
percent committed to all of the efforts that you have outlined,
all of the suggestions that have been made here today, and this
is not the only forum that we have heard them, certainly. And
we will certainly look at all of those. We have been looking at
them. That is what the Center for Pro Bono does. That is what
the Pro Bono Committee does. That is a very important committee
of the association. We recognize at annual awards ceremonies
the work of pro bono lawyers throughout the country in local
bars, in State bars, that are doing just enormous--giving an
enormous effort of their time and energy and staff time and
money toward this effort. And so lawyers do take this
responsibility seriously, the association takes this
responsibility seriously.
And while I agree that certainly more could be done, I want
you to understand and appreciate the fact that the association
is doing quite a bit to promote pro bono and to encourage pro
bono among all of the members of the profession.
To the extent that we can do more, we will take that
challenge and continue to work on it with your recommendations
in mind.
Senator Cardin. Thank you. I appreciate that response. I
really do.
Our commission came out with a recommendation for mandatory
pro bono, and I thought it was an ethical commission, Mr.
Boehm. I did not think we were trying anything that was
unconstitutional or unethical.
Ms. Franzel, is there anything more that you would like to
see from the Legal Services Board in regards to how they are
reacting--I know you want to see the final products, but is
there anything that is of concern to you as to how they are
currently responding to your request? I know that you have not
completed the information, but are they on track to responding
to the suggestions that you have made?
Ms. Franzel. Yes. I am very encouraged by the response. I
do want to caution that many of the really difficult
initiatives are in the planning stages or the initial stages,
and so it will be really important to take a look at things
like risk assessments and grantee oversight--those are the big-
ticket items--and take a look at them over the next year or so.
Some of the other structural issues can be taken care of
very quickly, such as restructuring the board and its
responsibilities, and I am very pleased to see that those are
already in process. And, of course, we will want to see how all
of this is implemented.
Senator Cardin. Thank you.
Mr. Joseph, on the salary levels, I haven't check the legal
service--the Legal Aid Bureau as to their salaries recently.
Are you having trouble in retaining attorneys? Is there a major
gap in Maryland on the payment to legal aid attorneys versus
other areas of public interest law? I know we are not competing
with the large law firms, but in other areas of public interest
law.
Mr. Joseph. All of the above. Generally in Maryland we are
very aggressive about that. In 1996, our starting salary for
lawyers was $25,000 a year, and it had been frozen for 7
straight years. A lawyer who worked there for 7 years--and we
had many--had not gotten a single penny increase. This year, we
are starting lawyers at $45,200. But even that puts us between
$9,000 and $10,000 behind the State attorney--I know because my
daughter works there--behind the Attorney General, behind
public defenders. And what happens is that we are aggressive
about recruiting the most committed and the most competent. And
as soon as they show their wares in the public, they get
recruited and folks try to snatch them, and they go.
So it is a difficulty. We do things to try to compensate
for that. We have a nice liberal vacation schedule. We try to
give leave for child care, different innovative ways to compete
in the marketplace.
I think Mr. Boehm doesn't really understand what it is to
run a legal aid program. It is a business. We have 300
employees, 140 lawyers, 13 physical locations around Maryland.
We can't rely on $3.9 million from the Legal Services
Corporation, so we have hundreds of individual contributors. We
have to have a program observing that. We have lawyers who form
a separate Equal Justice Council, lawyers from all the big law
firms and small law firms. All they do is raise money for legal
aid. We have pro bono hours being donated. Yet we touch a
little piece of the need out there.
I think I demonstrated that when you live on a budget of
poverty, every single day, every year, you will have the need
for advice, for counsel, and sometimes representation. Mr.
Boehm waved his hand at numbers, about somebody who got a small
piece of information on the phone. Let me tell you, sometimes a
piece of information that lasts 1 minute can give you the peace
of mind that makes a difference in your life. Rich clients know
it, too. They call their lawyers to get one piece of advice,
and poor folks do it, too.
I support all the GAO ideas of efficiency and improvement.
I support all the ideas of alternatives. We have mediation, we
have everything. We still don't meet it. This is a serious
crisis. The magnitude in numbers of people living in poverty is
overwhelming. The frequency of the need for legal services is
overwhelming. The complexity of the issues. I don't want a
patent lawyer handling a complex housing issue. I don't want an
entertainment lawyer trying to navigate complex Medicaid rules.
No. It is going to be a very difficult time matching skills and
need in a time-specific situation.
Senator Cardin. Thank you for that response. By the way, I
want you to engage the private community in the funding of
legal aid. I want the law firms involved in the funding of
legal aid. I think that is a healthy situation. And I think it
is a lot easier to get the law firms and the private sector
involved when the Government is a partner and the Government is
a meaningful partner. And when you see the erosion of the
Government support, it, I think, makes it more difficult to get
the other partners to contribute and to provide the pro bono
services that are necessary in order to meet the access-to-
justice issues. So I want to see all the players, and that is
why I do believe the bar must figure out new ways to energize
lawyers to help fill this gap, because lawyers do have a
special responsibility here. I do believe it is an ethical
issue for attorneys to be involved in pro bono activities, and
the failure to do so to me is an ethical violation of the oath
of an attorney.
Let me again thank you all for your help on this panel. I
can assure you there is tremendous interest on this Committee.
I have talked to most of the members of the Committee, and they
are very much interested in getting involved as we try to
develop strategies to meet this gap. There is not a uniform
position here. There are different views. But I think there is
a genuine desire to close this gap. And we certainly will be
working very closely with the Health and Education Committee
and with the House Committees to try to develop a strategy.
Clearly, this needs more legislative attention, and I am
hopeful that as Congress goes through the remainder of this
year and next year, we will look toward ways that we can
elevate the effectiveness of the Federal participation in these
programs, obviously through additional resources, but we think
there may be other ways that we can be helpful.
The record will remain open for 1 week for additional
materials. I ask the witnesses to respond to members' questions
in a timely manner if they are submitted by the members of this
Committee, and without objection, statements from Senators
Leahy and Feingold will be included in the record.
The Committee will stand adjourned. Thank you.
[Whereupon, at 4:15 p.m., the Committee was adjourned.]
[Questions and answers and submissions for the record
follow.]
[Additional material is being retained in the Committee
files.]
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