The DC Bar Foundation has announced awards totaling $1.1 million to support direct civil legal services for the poor and underserved in Washington, DC, although the foundation had to dip into its reserves to meet its funding goal.
The foundation said funds available for grants were down drastically this year, largely due to a drop in interest rates, which cut into revenues from IOLTA accounts (Interest on Lawyers’ Trust Accounts).
These accounts were created as a way to earn interest on small settlements from attorneys’ clients that are pooled together in a trust. Because it is unethical for attorneys to derive financial benefit from funds that belong to their clients, the interest earned from IOLTA accounts is distributed to legal aid services.
According to the American Bar Association, IOLTA grants are among the most significant sources of funding for programs that provide civil legal services to the poor. But IOLTA revenues were down by 60 percent this year, the DC Bar Foundation said.
"The economic downturn has created an enormously challenging environment for nonprofit civil legal services organizations, precisely at a time when the need for their services is increasing," said Stephen J. Pollak, president of the DC Bar Foundation.
The $1.1 million in grants this June represent just 50 percent of the June 2008 grants. And although IOLTA returns for the coming year are expected to be even lower, the DC Bar Foundation said it is intent on awarding grants in June 2010 totaling at least $1.1 million.
This year, the foundation’s grants funded 25 organizations that make legal representation available to the homeless, disabled and the elderly, as well as to children, victims of domestic violence and other less fortunate individuals.
The foundation said it also supports its grantees throughout the year with a range of technical assistance and programming. 
