Proposal Would Cut $75 Million from Legal Services

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February 9, 2011; Source: PRNewswire | A congressional proposal, announced Wednesday by the House Appropriations Committee would shave $75 million from the budget for the Legal Services Corporation (LSC). The reduction would be a cut of 14 percent from last year’s appropriation and is a 17 percent reduction from the White House’s 2011 budget.

LSC distributes 95 percent of this federal money to fund 136 programs that annually provide legal aid to millions of low-income people across the country. The cut would likely result in the laying off of 300 legal services attorneys at a time when the legal needs of poor people are extremely intense. These programs help people resist foreclosure proceedings, they help veterans and disabled people complete applications or appeal denied applications for public benefits, and they help the elderly with consumer fraud, among many other things. These programs are critical components of any community’s safety net.

This cut comes at a time when there have already been serious reductions in other monies upon which these programs also depend – specifically in the Interest on Lawyers’ Trust Fund Accounts (IOLTA). That funding is derived in large part from the funds set up for escrow in real estate transactions – when housing is slow the funds wither. Nonprofits need to make themselves heard on this appropriation or our sector will lose absolutely critical capacity.—Ruth McCambridge