According to the Nevada State Bar’s Access to Justice Commission, the need for legal services by disadvantaged Nevadans is continuing to rise dramatically due to the challenging economy. As Nevada Supreme Court Justice Hardesty, co-chair of the Access to Justice Commission recently noted, “Statewide, there is one legal aid attorney for about every 5,000 people in poverty. Only two out of 10 qualifying people in need in Nevada can be helped with current resources.”
Much of the funding for legal aid needs comes from interest earned on accounts that lawyers hold in trust for their clients, known as IOLTA (interest on lawyers trust accounts). Programs funded by IOLTA are responsible for providing help to those in need of civil legal aid, such as victims of domestic violence, children in need of protection by the court system, seniors, victims of fraud and those in need of bankruptcy protection and relief from foreclosure.
In 2008, the Access to Justice Commission asked banks to step up and increase the interest they pay on IOLTA accounts. Bank of Nevada was one of the first to respond, offering a special higher interest rate on its IOLTA accounts. This year, the Nevada Supreme Court further strengthened the resolve to help ensure that lawyers place IOLTA funds with banks that offer higher interest rates, with a rule change that went into effect in January.
The new rule provisions require Nevada lawyers to create or maintain their IOLTA accounts only at financial institutions which, in addition to other minimum qualifications (in amended SCR 217, subsection 1), offer interest rates tied to one of the three indices set forth in subsection 2 or a flat interest rate approved by the Access to Justice Commission. The rate was set at 1.2 percent by the Access to Justice Commission.
With this new amended ruling, Nevada lawyers are able to make a greater difference in their communities by placing their IOLTA accounts with banks that offer the highest interest rates. The higher level of funding that becomes available, the greater the contributions to legal aid for those in need without taxing the public, and at no cost to lawyers.
As an example, the Legal Aid Center of Southern Nevada (LACSN) operates Nevada’s largest pro bono program. Last year, LACSN helped 18,000 families, a significant increase since 2008. The Center is the only program in Clark County that represents foster care children in the courts, but only has funding to represent half of the children. The organization currently has approximately 1,000 open cases with attorneys in Clark County, with a large portion of funding coming from the IOLTA program. IOLTA interest also provides much-needed funding to the five other full-time civil legal aid programs in Nevada: Nevada Legal Services, City of Las Vegas Senior Citizens Law Project, Washoe Legal Services, Volunteer Attorneys for Rural Nevadans, and the Washoe County Senior Law Project.
“The banks that are most active in the legal community and that stepped up to offer high IOLTA interest rates have been a critical component in the success of legal aid services in the past year, said Justice Hardesty. “The support of these IOLTA account programs with higher interest rates will remain vital moving forward,” he continued.
The Access to Justice Commission was created to assess current and future needs for civil legal services for persons of limited means in Nevada, develop statewide policies designed to support and improve the delivery of legal services, and improve self-help services and opportunities for proper person litigants and increase pro bono activities.
Attorneys and law firms seeking more information on how they can contribute to legal aid programs may contact Kristina Marzec at the Access to Justice Commission at 702-317-1404 or kristinam@nvbar.org.
