Legal Aid funding source a dramatic victim of the recession

The Washington Post on Monday reported on the impact the recession is having on a major funding source for civil legal services providers.  Interest on Lawyers Trust Accounts (IOLTA) programs have been a source of revenue for many legal aid organizations in the United States since the 1980s (see IOLTA.org for more on the history and details of the programs). As the Federal Reserve has cut interest rates in the face of the economic recession, revenue from IOLTA programs has plummeted –  “from $371 million in 2007 to a projected $93 million this year” nationally, the Post reports.

This means legal aid providers have seen their budgets cut substantially, forcing everything from service cuts to layoffs and office closures. However, this is in the face of rising demand for civil legal services. The Maryland Legal Aid Bureau has seen a six percent increase in their case load while dealing with an eleven percent budget cut in 2009.

The Brennan Center also has a great analysis of the situation from last February that you can check out to learn more.

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