Texas lawmakers must act this session to ensure access to legal services for the neediest in our communities.
Low interest rates have had a tremendous negative impact on a major funding source for the Texas legal aid system.
The budgets of some 40 legal aid organizations in the state, including the Texas Rio Grande Legal Aid in San Antonio, are dependent on the Interest on Lawyer’s Trust Accounts (IOLTA) as a major funding source. These are accounts lawyers are required to create to hold their client money separate from law firm funds. Individually they don’t add up to much, but the 20,000 bank accounts in 550 banks hold $1.1 billion and together the interest has the potential of generating mega bucks.
In 2007, that interest revenue was $20 million. Due to the huge decrease in interest rates, revenue is expected to drop to $1.5 million this year.
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