Bar Targets IOLTA Accounts and Out-of-State Lawyers to Raise Legal Aid Money
Task force's proposalson indigent funding will be considered Saturday by state bar's Board of Governors
The State Bar of Georgia's indigent legal services task force will take another stab Saturday at seeking approval from the Board of Governors for a professional rules change that would require lawyers to establish client trust accounts at banks that agree to offer competitive interest rates.
The proposal is one of five fundraising methods recommended by the task force to plug a $1.8 million hole in the budgets of Georgia Legal Services and the Atlanta Legal Aid Society. If approved, the rules change would go to the state Supreme Court for authorization.
The Civil Legal Services Task Force, a 14-member panel of lawyers, legislators and judges appointed this fall by bar President Charles "Buck" Ruffin, drafted the rules change after the high court indicated it likely would levy an additional $50 fee on Georgia lawyers to raise money for indigent legal aid in civil cases. The task force met Thursday during the bar's midyear meeting in Atlanta to go over its proposals before going in front of the Board of Governors this weekend.
Other fundraising measures recommended by the task force are modifying fees charged to out-of-state lawyers, asking the state Legislature for additional funding when the General Assembly reconvenes for the 2014 session next week, asking law library boards of trustees to designate excess fees to indigent legal services and educating judges that cy-pres funds from class action settlements may be donated to legal aid organizations.
Interest on lawyer trust accounts, also known as IOLTA, goes to the Georgia Bar Foundation for grants to legal aid agencies. The amount collected has dropped in recent years as interest rates, and the economy in general, declined. The new rules proposed by the task force would create a list of eligible banks that agree to pay interest rates or dividends that are no less than what they offer their non-IOLTA customers. The task force estimated the requirement would generate as much as $6 million over several years.
More than 30 other states have similar rate requirements for lawyers' client trust accounts, according to the task force. The rules change also would allow lawyers to apply for waivers from the requirement under certain circumstances, such as conflicts with clients.
"It's not as if we're being overly aggressive or taking extraordinary steps," said task force chairman J. Randolph Evans, a partner at McKenna, Long & Aldridge. "We're actually behind the curve on this."
The bar's governing board tabled its vote on the Civil Legal Services Task Force's proposal in November during its fall meeting at Jekyll Island.
The task force members appeared confident that the measure will pass, citing ill timing rather than ill will in explaining the measure's earlier defeat. By the time the proposal reached the floor at the fall meeting, the Board of Governors already was riled up from an earlier debate about a controversial nomination to the state's Judicial Qualifications Commission. Several board members voiced concerns that they had not received the IOLTA proposal in enough time to adequately review it.
"Since the fall Board of Governors meeting, we went back and looked at the comments from people at the meeting. We put together a slightly revised version of the IOLTA rule and some FAQs, which went out to all the board members by the first of December. I haven't had any comments since we sent that out," said task force vice chairwoman Rita Sheffey, a partner at Hunton & Williams.