Massive cuts proposed for legal service providers

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Wisconsin’s poor could soon have far less options for civil legal service providers due to proposed cuts in the state budget.

Part of Gov. Scott Walker’s 2011-13 budget reallocates money collected by the Wisconsin Trust Account Foundation and distributed to organizations such as the Legal Aid Society of Milwaukee and Legal Action of Wisconsin to other aspects of the criminal justice system.

The current budget provides approximately $5 million for civil legal services for the poor, generated by a $4 surcharge to the justice information fee. The proposed cut would eliminate 75 percent of the grant money annually issued to legal service providers, said DeEtte Tomlinson, executive director of WisTAF.

“The impact will be pretty devastating,” she said. “We’ve already made grant provisions for the 2011-12 state appropriation based on that provision being included in the next state budget.”

Tomlinson said WisTAF banked on $2.5 million in state money for the 2011 fiscal year and another $2.5 million in 2012. Absent that money, she said WisTAF grants would total only about $1 million annually through interest generated on attorney trust accounts and the $50 annual assessment on Wisconsin lawyers.

Legal Action of Wisconsin would suffer the biggest hit, losing almost $1.3 million in grant money for each of the next two years.

“That would zero out,” said Legal Action executive director John Ebbott. “It’s just a horrible thing.”

Loss of the state money would result in 46 positions being eliminated, which Ebbott said equates to 42 percent of the Legal Action’s staff.

“This is the worst cut we’ve had in history,” he said.

Ten other legal service providers including Wisconsin Judicare Inc., Legal Aid Society of Milwaukee and Disability Rights Wisconsin would lose out on substantial grant money through WisTAF, as well.

Walker’s proposal would shift money allotted to civil legal service providers to support pay increases for assistant district attorneys and also for additional court reporters in the state.

Tomlinson acknowledged there is little that can be done to compensate for the substantial loss in state aid, although in the short-term she said WisTAF plans to tap into its financial reserve to ease the pain for grantees.

But that total is only $1.4 million, which Tomlinson said would have to be stretched out as long as possible while other sources of money are explored.

The primary option for increasing grant money will be through the Interest on Lawyers Trust Accounts program, she said.

Starting last year, IOLTA accounts began earning interest at a higher rate due to a Supreme Court rule change, which translated to $600,000 in revenue in 2010, compared to $350,000 in 2009.

Depressed interest rates during the recession have reduced IOLTA revenue, however, which used to top $1 million a year.

Tomlinson expected the rule change, combined with economic recovery, will raise IOLTA returns to pre-recession levels within the next two years.

One option not being considered is a fee hike associated with the Public Interest Legal Service Fund Program, Tomlinson said.

“At this point WisTAF has no plans of going back to ask for an increase in the $50 assessment,” she said.

After an initial $1 million appropriation in the 2007-09 budget, Gov. Jim Doyle pushed for a more self-sustaining option to increase funding for indigent legal services and the current budget included the revenue from the justice information fee.

The surcharge is typically assessed with a court fee for filing court proceedings, such as civil or small claims actions.

Loss of state money would also hinder the ongoing efforts of the Supreme Court-authorized Access to Justice Commission.

Formed last year and financed by the State Bar of Wisconsin, the commission is charged with researching and developing ways to increase legal representation for poor people.

The genesis for the commission was a 2007 State Bar study that revealed more than 500,000 state residents do not have access to adequate legal representation.

While the cuts would not immediately jeopardize the future of the commission, attorney member Michael Gonring said they would expedite the search for increased long-term private and public financing for civil legal services for the poor.

“Certainly it creates a challenge if the budget cuts go through because the commission obviously wants to increase funding by one way or another,” he said. “We were working on ways to get additional funding even before this, but this would ramp up the work that has to be done.”

The Supreme Court is scheduled to review the progress of the commission in 2013.

Jack Zemlicka can be reached at [email protected].