MLSC, MSBA releases “Honor Roll” of top banks

The Maryland State Bar Assoc. and Maryland Legal Services Corp. recognize “Honor Roll” financial institutions that pay premium interest rates on Interest on Lawyers Trust Accounts, which help fund civil legal services for low-income Marylanders.

• American Bank – Montgomery & Prince George’s counties & Washington, DC

• Baltimore County Savings Bank – Baltimore City, Baltimore, Harford & Howard counties

• BankAnnapolis – Anne Arundel and Queen Anne’s counties

• Carrollton Bank – Baltimore City, Anne Arundel, Baltimore & Harford counties

• Congressional Bank – Montgomery County, Washington, DC & N. Virginia

• First Shore Federal – Wicomico & Worcester counties

• Hamilton Federal Bank – Anne Arundel and Baltimore c0unties

• HSBC Bank USA, N.A. – Montgomery County

• MainStreet Bank – N. Virginia

• Midstate Federal Savings & Loan – Baltimore County

• Premier Bank, Inc. – Montgomery County & Washington, DC

• Sandy Spring Bank – Anne Arundel, Frederick, Howard, Montgomery & Prince George’s counties

• Severn Savings Bank – Anne Arundel County

• Standard Bank – Allegany County

• TD Bank – Anne Arundel, Baltimore, Harford & Prince George’s counties

For a complete list of all financial institutions approved to accept IOLTA deposits, visit www.mlsc.org.

Amid other budget cuts, Pennsylvania governor maintains previous year’s civil legal aid funding

From the Pittsburgh Post-Gazette: “While Gov. Tom Corbett has proposed cutting Pennsylvania’s budget by 3 percent in order to close a $4.16 billion deficit, he has not proposed a big cut for legal services for the poor. But his budget proposed $47.2 million less in funding than the courts requested. . . .The court system is expecting to face some funding drop-offs next fiscal year because federal funds are slated to fall from $2.14 million this fiscal year to $1.42 million next year. In a budget where other state agencies and programs are facing deep cuts, Mr. Corbett’s proposals for legal services for the poor look relatively robust. He proposes to keep $5.05 million in legal services, funded through a Social Services Block Grant (SSBG) that involves federal funds targeted to urban or rural areas in economic distress, at the same level. He also proposes that funding for the Department of Public Welfare to contract with the Pennsylvania Legal Aid Network (PLAN) to provide low-income people legal assistance be held at $3.01 million, down from $3.04 million in this fiscal year.

“‘In welfare, my budget retains the core services to care for our needy,’ Mr. Corbett said in his budget address. ‘At the same time, it puts the brakes on a runaway train of spending. My administration is committed to caring for the eligible poor. This budget reflects that commitment.’ Alfred J. Azen, the executive director of the state IOLTA (Interest on Lawyers Trust Accounts) Board, which provides funding to legal services, said holding the state general funding for PLAN and the SSBG funding flat ‘demonstrates that he values the civil legal services for the poor.’ . . .

“Other funding shortfalls are appearing on the horizon for legal services. A temporary filing fee surcharge — which consists of $10.25 per filing to fund judicial operations, $1 per filing to fund civil legal services and $2.25 per filing to support district attorney salaries — is slated to expire Jan. 7, 2012, and also could affect funding for legal services, Mr. Azen said. Because the surcharge is supposed to sunset midway through the 2011-2012 fiscal year, only about $1.3 million would be generated for legal services, he said. Legal services in Pennsylvania may be affected because there are calls to roll back federal funding for legal services to 2008 levels.”

Legal aid groups across the U.S. brace for another strained year with shrinking IOLTA revenue and funding shortfalls

The National Law Journal reports:  “State and local funding cuts vary across the country, but sharp declines in IOLTA money during the past three years have hit every state, said Betty Balli Torres, director of the National Association of IOLTA Programs, an organization of state administrators. . . . ‘Basically, what we’ve seen nationally is a 75% decrease in public interest funding through IOLTA,’ Torres said. ‘We’re talking about a huge drop in a matter of three years. It’s playing out that way state by state by state.’ IOLTA generated $380 million nationally for legal aid groups in 2008, but that fell to $124 million in 2010, Torres said. Interest rates were at 5.25% in September 2007 and have since fallen to 0.25% or even lower, she said.

“‘First and foremost, interest rates are in a bad position. I can’t think of a time when IOLTA revenue and interest rates were this low,’ said Lora Livingston, a district judge in Texas and the chairwoman of the American Bar Association’s Commission on IOLTA. ‘Until interest rates go up, there’s not a whole lot we can do right now.’

“And no one is predicting a quick rise in those rates. Interest rates are not expected to rise until the first quarter of 2012, meaning they will likely stay low throughout 2011. . . . Federal money is another key component for legal aid organizations, and one of the few bright spots in the financial picture. The Legal Services Corp. funnels federal money to 136 legal aid programs across the country and has seen its appropriation increase in recent years. It received $390 million from the federal government in 2009 and $420 million in 2010. However, that increase has not been enough to offset cuts in IOLTA money and state and local support, said John Constance, the corporation’s director of government relations and public affairs.”

For more: Karen Sloan, “Perfect storm hits legal aid,” National Law Journal, January 3, 2011

Volunteer your time

From today’s On the Record blog from the Daily Record: “Ben Rosenberg of Rosenberg Martin Greenberg had a pretty strong reaction to contributor Joe Surkiewicz’s column in this week’s Maryland Lawyer section,” wrote reporter Caryn Tamber. “Surkiewicz, the director of communications at Maryland Legal Aid, wrote about the tremendous need for more volunteer lawyers.

“Rosenberg, co-chair of the Legal Aid’s Equal Justice Council, which works to fund Legal Aid, called me Monday afternoon to enthusiastically second Surkiewicz’s message.

“’As a result of a number of factors, all of which have sort of come together in sort of like a perfect storm, the demand for legal services to the underrepresented and people who can’t afford legal representation has exploded, while at the same time what we had thought of as a stable funding source has imploded, and that’s the IOLTA funding,’ Rosenberg said.”

Strong show of support for legal services at House hearing

Legal services advocates came out in force for yesterday’s hearing in front of the House Judiciary Hearing for HB 106, a bill proposing to raise court filing surcharge fees to fill the funding gap created by severe shortfalls in IOLTA revenues (a major funding source for Maryland Legal Aid and other legal services programs around the state).

“The judiciary supports this bill,” Court of Appeals Chief Judge Robert M. Bell told the committee. “Right now we’re not meeting the demands of poor litigants who can’t afford a lawyer. Only about 25 percent of them have access to a lawyer, in spite of increased efforts to get lawyers to support access to justice through pro bono and contributions. Lawyers have been doing their part. We’re here to urge you to provide stable resources to legal services.”

District Court Chief Judge Ben Clyburn, vice chair of the Access to Justice Commission (created by Bell), told the committee that the  commission “strongly” supports the bill to fill the funding gap.

Legal Aid executive director Wilhelm Joseph said that Maryland has 1.5 million residents who fall below the official poverty line. “Many are the new poor who are ashamed, confused and embarrassed—and totally unprepared—to deal with civil legal issues,” Joseph said. “We are a charitable organization—in this country, civil access to justice is dispersed by charity—so we must solicit and beg for funding to serve our constituents in every jurisdiction that you represent. We’re asking that you help the Maryland Legal Services Corporation to help us help your constituents.”

Andrew Jay Graham, a principal in the Baltimore law firm Kramon & Graham and a leader of the Equal Justice Council (Legal Aid’s private bar fundraising arm), told the committee that poor people need lawyers, but are unable to pay for them. “So they get their problems resolved other ways that aren’t good for society,” he said. “In 2009, Maryland lawyers contributed more money to Legal Aid than in any  previous year. Legal Aid is a tremendous law firm and everyone on its staff is extremely dedicated and underpaid, handling between 50,000 and 60,000 cases a year. We urge you to pass this bill.”

Maryland State Bar Association president-elect Tom Murphy told the committee that the 24,000-lawyer organization supports the bill. “The time and donations to legal services  made by our members are tremendous,” he said. “But legal services needs a stable funding source. This bill is the only rational answer to the problem.”

Also testifying in favor of the bill at the hearing was Legal Aid supervising attorney Harbour Partesotti, who gave a front-line perspective of what civil legal services means to elderly clients helped by the Long Term Care Assistance Project (she told the committee about a sick,  elderly client who was threatened with eviction from her nursing home until Legal Aid intervened). Also testifying were MLSC executive director Susan Erlichman, Baltimore Circuit Court Judge (and MLSC board member) Pam White, Howard County Circuit Court Judge Diane Leasure, and Access to Justice Commission executive director Pam Ortiz.

A strong showing of legal services staffers attended the hearing, included those from Legal Aid, the Women’s Law Center, Community Legal Services of Prince George’s County, the Maryland Volunteer Lawyers’ Service, the Homeless Persons Representation Project, the House of Ruth and Mid-Shore Pro Bono.

Next week, the Senate Judicial Proceedings Committee will hold a hearing on the companion bill, SB 248, at 1 p.m. on Thursday.