[Federal Register Volume 60, Number 183 (Thursday, September 21, 1995)]
[Proposed Rules]
[Pages 48956-48957]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-23489]
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LEGAL SERVICES CORPORATION
45 CFR Part 1635
Timekeeping Requirement
AGENCY: Legal Services Corporation.
ACTION: Proposed rule.
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SUMMARY: This proposed rule requires all recipients of Legal Services
Corporation (``LSC'' or ``Corporation'') funds to account for the time
spent on all cases, matters and other activities by their attorneys and
paralegals, whether funded by the Corporation or by other sources.
DATES: Comments must be submitted on or before October 23, 1995.
ADDRESSES: Comments should be submitted to the Office of the General
Counsel, Legal Services Corporation, 750 First Street, NE., 11th Floor,
Washington, DC 20002-4250.
FOR FURTHER INFORMATION CONTACT: Victor M. Fortuno, General Counsel, at
(202) 336-8810.
SUPPLEMENTARY INFORMATION: On June 25, 1995, in order to improve the
accountability of recipients for their Corporation funds, and in
response to concerns expressed during congressional hearings, the LSC
Board of Directors (``Board'') adopted a resolution requiring
Corporation staff to prepare a regulation specifying a time and
recordkeeping system for implementation by LSC recipients. On September
8, 1995, the Board's Operations and Regulations Committee
(``Committee'') held public hearings on proposed 45 CFR part 1635.
After adopting several changes to the proposed rule, the Committee
voted to publish the proposed rule in the Federal Register for notice
and comment.
This proposed rule requires recipients to account for the time
spent on all cases, matters and other activities by their attorneys and
paralegals. These requirements apply whether the case, matter or
activity is funded by the Corporation or by other sources. Such
timekeeping is not now required under 45 C.F.R. part 1630.
Perhaps a quarter of current Corporation recipients already
maintain time records that meet most or all of the conditions of the
proposed rule. They are already able to avail themselves of the
potential benefits of timekeeping to recipients, such as improved
supervisory information, better cost estimation in bidding for other
funds, enhanced control of priority implementation by their local
boards of directors and more informative reports to grantors and the
public.
The Corporation is mindful of the costs which this regulation will
impose
[[Page 48957]]
on its recipients, especially those who currently do not have the
capacity to maintain the time records required by this proposed rule.
Timekeeping is time consuming, and record keeping systems have real
costs. Nevertheless, despite the possibility that implementation of
this proposed rule will reduce a recipient's LSC-funded capacity for
client services by one- or two-percent or more, the Corporation has
concluded that timekeeping by attorneys and paralegals will materially
improve recipient accountability for Corporation funds.
If adopted, this part shall be effective January 1, 1996.
A section-by-section discussion of the proposed rule is provided
below.
Section 1635.1 Purpose
This section sets out the purpose of the proposed rule: to improve
recipient accountability for the use of funds provided by the
Corporation. This section also sets out the manner in which the
proposed rule achieves its stated purpose: by assuring supporting
documentation of allocations of expenditures of Corporation funds, by
enhancing recipients' ability to determine costs, and by increasing the
information available to the Corporation for assuring recipient
compliance.
Section 1635.2 Definitions
This section defines ``case'', ``matter'' and ``activity,'' the
functions of a program for which time records are required to be kept.
The definitions are formulated so as to cover all allocations of
recipients. Some examples of ``matters'' are education of eligible
clients and development of written materials explaining legal rights
and responsibilities. ``Administrative and general'' is a catchall
category within ``activity.'' It is designed to encompass everything
that does not fall within cases or matters or fund-raising activities,
and would include, for example, skills training and professional
activities.
Section 1635.3 Timekeeping Requirement
This section sets out the timekeeping requirement. It is intended
to require all recipients to account for the time spent on all cases,
matters and other activities by their attorneys and paralegals, whether
funded by the Corporation or by other sources. Recipients must account
for one hundred percent of attorney and paralegal time spent in the
course of their employment, even if the time is spent outside normal
business hours. Allocation of costs based on time and other records
continues to be governed by 45 C.F.R. part 1630, which requires a
reasonable basis for allocations of expenses to all funds.
The Corporation does not prescribe either manual or automated
timekeeping systems, nor specific report formats or contents. Each
recipient will need to determine the appropriate matters and activities
for which time will be kept, keeping in mind its particular service
patterns. In order to assist recipients, the Corporation plans to make
available this fall a manual of forms and operating systems already in
use by some recipients.
Section 1635.4 Administrative Provisions
This section advises recipients of the Corporation's access to the
time records required by this part. Since these records will be
available for examination by auditors and representatives of the
Corporation, they should be maintained in a manner consistent with the
attorney-client privilege and all applicable rules of professional
responsibility. As a practical matter, this may mean that client names
should not appear in time records.
List of Subjects in 45 CFR Part 1635
Legal services, Reporting and recordkeeping requirements.
For reasons set forth in the preamble, LSC proposes to amend 45 CFR
chapter XVI by adding part 1635 as follows:
PART 1635--TIMEKEEPING REQUIREMENT
Sec.
1635.1 Purpose.
1635.2 Definitions.
1635.3 Timekeeping Requirement.
1635.4 Administrative Provisions.
Authority: 42 U.S.C. 2996e(b)(1)(A), 2996g(a), 2996g(b),
2996g(e).
Sec. 1635.1 Purpose.
This part is intended to improve recipient accountability for the
use of funds provided by the Corporation by:
(a) assuring that allocations of expenditures of Corporation funds
pursuant to 45 C.F.R. part 1630 are supported by accurate and
contemporaneous records of the cases, matters and activities for which
the funds have been expended;
(b) enhancing the ability of recipients to determine the cost of
specific functions; and
(c) increasing the information available to the Corporation for
assuring recipient compliance with federal law and Corporation rules
and regulations.
Sec. 1635.2 Definitions.
As used in this part--
(a) ``Activity'' means all other actions of or by a recipient,
including fund-raising and administrative and general, which are not
cases or matters.
(b) ``Case'' means the provision of advice to representation of one
or more clients.
(c) ``Matter'' means the provision of other program services that
do not involve advice to or representation of one or more clients.
Sec. 1635.3 Timekeeping Requirement.
(a) All expenditures of funds for recipient actions are, by
definition, for cases, matters or activities. The allocation of all
expenditures must be carried out in accordance with 45 C.F.R. part
1630.
(b) Time spent by attorneys and paralegals must be documented by
time records which record the amount of time spent on each case, matter
or activity. Time records must be created contemporaneously and must
account for time in increments not greater than one-quarter of an hour
which aggregate to all of the efforts of the attorneys and paralegals
for which compensation is paid.
Sec. 1635.4 Administrative Provisions.
Time records required by this section shall be available for
examination by auditors and representatives of the Corporation, and
should be maintained in a manner consistent with the attorney-client
privilege and the rules of professional responsibility applicable in
the local jurisdiction.
Dated: September 18, 1995.
Suzanne B. Glasow,
Senior Counsel for Operations & Regulations.
[FR Doc. 95-23489 Filed 9-20-95; 8:45 am]
BILLING CODE 7050-01-P