Balancing the Scales: State Efforts for Local Legal Aid Funding

The Legal Services Corporation Act of 1974 changed the access to justice landscape by funding the first independent, national nonprofit – the Legal Services Corporation (LSC) – to financially support legal aid organizations that assist with civil legal matters. The Act underscored that “there is a need to provide high quality legal assistance to those who would be otherwise unable to afford adequate legal counsel.”

Unmet civil legal need continues to grow, however, and without necessary funding, legal services organizations and pro bono lawyers cannot adequately provide services to low-income individuals. Both nationally and across the states, government officials, legal services organizations, pro bono attorneys, and others are advocating for increased civil legal aid funding to meet need.

National Civil Legal Aid Funding: The Legal Services Corporation Act of 1974 not only established LSC, but also included dedicated funding. Following a record increase in Congressional funding for LSC of $400 million in Fiscal 1994, that funding has remained relatively flat over the last thirty years, with funding of $560 million in Fiscal Year 2024.

Legal services providers and others in the legal community, including corporate legal department leaders, continue to advocate for increased federal funding to meet need: 74% of low-income households faced at least one civil legal problem (an increase from pre-pandemic numbers) and low-income Americans received no or insufficient legal help for 92% of their civil legal problems, according to the LSC’s 2022 Justice Gap Report.

Local Civil Legal Aid Efforts: With the federal government providing about 19% of legal aid funding, many states are trying to pick up the slack, but not without challenges. The challenges often vary based on the source of funding for civil legal services, whether that is interest-bearing lawyer account funds, court fines and fees, or general legislative funding. Many state legal services organizations are fighting to keep programs funded that previously received one-time or supplemental Covid-19 relief funding. Some communities are succeeding in their budget advocacy, in part by relying on important reports and detailed data on inequities in the legal system.

Below is a roundup of the current civil legal aid funding landscape in several states:

  • Illinois: Following a recent report that found Black Illinoisans are eight times more likely to be unhoused than white residents, Illinois’s Governor announced $250 million in the state’s Fiscal Year 2025 budget – an increase of $50 million over last year – to support implementation of a statewide plan to combat the structural drivers of inequality in homelessness, including $2 million in legal aid assistance for those in eviction court, as well as $35 million in rental assistance and $13 million to be spent on reducing racial disparities in homelessness. The proposed budget also includes funding to address the migrant crisis, including $182 million that would be used for “welcoming center” services, like coordinating housing and legal help and a program to fight homelessness. The funding responds to the 36,000 asylum seekers who have arrived in Chicago under the direction of Texas’s Governor, an issue that continues to capture national attention. The Governor’s budget proposal for the next fiscal year still must be approved by state lawmakers.
  • Maryland: In 2021, Maryland’s General Assembly created the Access to Counsel in Evictions Program, through which eligible tenants in Maryland are provided access to legal representation in eviction and subsidy termination cases. The State’s current budget allocates $14 million per year for Fiscal Year 2024 through 2027 to the Program, and that money largely comes from federal emergency rental assistance funding and another special settlement fund. The Maryland Access to Counsel in Evictions Task Force has noted the instability of these funding streams and that the current funding is insufficient to scale the Program. They have called for recurring funding in the State’s budget “as the gold standard” of ways to fund the Program. In late April, Maryland Governor Wes Moore signed the Renters’ Rights and Housing Stabilization Act of 2024, which raised the filing fee in eviction cases to help generate revenue to meet needed funding for civil legal aid. The legislation ultimately watered down the filing fee from the proposed $93 to $43, as well as protections against passing fees to tenants.
  • New York: New York’s Governor led a sweep of $55 million from the Interest on Lawyer Account (IOLA) Fund in the state’s Fiscal Year 2025 budget intended for legal service providers to instead fund a homeowner protection fund that provides free housing counseling and legal services to New York homeowners at risk of foreclosure. The effort resulted in significant outcry from New York’s legal community, which noted that the homeowner protection program is being funded at the expense of low-income New Yorkers. IOLA funds can be considered ripe for sweeps absent legal protections because they are not composed of taxpayer dollars, but rather cash earned through private interest that is held in attorney escrow accounts that are subject to interest rate fluctuations. Recent proposed legislation seeks to prevent future sweeps by allowing IOLA to fund its grants without having to go through the New York State budget process.
  • Washington, DC: Since 2006, DC has implemented a public funding stream – the Access to Justice Initiative – to support the provision of civil legal services. The Access to Justice Grants program funds critical legal services for low-income residents facing evictions, domestic violence, and other legal challenges. The budget proposed by DC’s Mayor in April included a 67 percent cut to this program, reducing funding from approximately $31.5 million in 2024 to $10.5 million in 2025. DC’s Mayor attempted similar cuts in the preceding budget cycle, which the DC Council restored, and it is similarly anticipated they will restore funds again this year. Even if restored, funding would remain flat and falls short of meeting need.

Takeaways: The pursuit of adequate civil legal aid funding remains a crucial endeavor at both national and state levels. While the Legal Services Corporation Act of 1974 laid the groundwork for federal support, the pressing need for increased funding persists, with unmet civil legal need on the rise. Nationally, Pro Bono Institute has engaged and supported general counsels in advocating for additional funding for civil legal aid. The fight doesn’t end at the national level, however. Across states, efforts to bridge the gap vary, with challenges stemming from diverse funding sources and budget constraints, as well as some notable successes, such as Colorado’s proposed Equal Justice Fund Authority and Illinois’s substantial budget allocations to address societal inequities. Pro bono leaders can continue to join efforts in their local jurisdictions as part of a shared commitment among government officials, legal services organizations, lawyers, and others to ensure access to justice and provide essential support to marginalized communities.