Bipartisan Fix to Save Private Sector Funding for Civil Legal Services and Legal Education Clears Senate

Washington, D.C. – With the clock on the 111th Congress running out, the U.S. Senate unanimously passed a bill Wednesday to save a program that funds access to civil legal services for hundreds of thousands of low-income Americans at no cost to the government. The effort to save the program was led by a bipartisan group including Senators Jeff Merkley (D-OR), Bob Corker (R-TN), Tim Johnson (D-SD), Mike Enzi (R-WY), Johnny Isakson (R-GA), and numerous other senators.

The Interest on Loan Trust Accounts (IOLTA) program assists victims of domestic violence, victims of wrongful foreclosure, and children and teenagers seeking legal assistance in difficult family situations, along with many other civil justice programs for low-income Americans.  The program also funds law-related education including high school mock trial competitions, summer training for teachers, and programs on the U.S. Constitution and Bill of Rights.  Each of the 50 states maintains – and 42 of them require – lawyers to place client funds that cannot earn interest for an individual client into these IOLTA accounts.

“Each year and in each of our 50 states, hundreds of thousands of low-income Americans benefit from access to essential legal services and legal education programs supported by the IOLTA partnership between law firms and banks,” Merkley said.  “I applaud my colleagues for seeing the value in this partnership and preserving the IOLTA program for years to come.”
The fix prevents the program from potential collapse on December 31, 2010 owing to a change in the way FDIC insures transaction accounts.

The House of Representatives passed the IOLTA fix as H.R. 6398 by voice vote on November 30, 2010.