The Maryland Legal Services Corporation (MLSC), which funds civil legal services to low-income persons throughout the state, announced that grant levels will be reduced for fiscal year 2013 beginning July 1, 2012.
At its annual Grant Informational Meeting held last month, MLSC Executive Director Susan Erlichman informed current grantees as well as other interested applicants that MLSC is facing a significant funding short fall and is unable to maintain grants at current levels.
Ms. Erlichman cited the continuing low interest rates and lower than expected court filing fees, from which MLSC receives most of its revenue for grant-making, as the primary reasons for the funding reduction. “The Federal Reserve dropped its target interest rate to near zero in December 2008, where it remains today, and court filing fees have fallen short of projections by more than $1 million due to fewer court filings and more fee waivers,” explained Erlichman. The increase in court filing fee surcharges was enacted in 2010 by the Maryland General Assembly to help with the loss in IOLTA revenue and contains a sunset provision for 2013.
Given the dramatic increase in need for services since the onset of the Great Recession, MLSC reports that is has spent heavily from emergency reserve funds to avoid cuts at a time when help with foreclosures, evictions, food stamps, unemployment, and other critical needs has surged.
In an effort to maintain as much stability as possible in Maryland’s civil legal aid delivery system, MLSC will continue using emergency reserves to mitigate the reduction. Grantees reapplying for grants were directed to submit proposals for FY 2013 reflecting a five percent decrease, with the caveat that cuts might be greater and additional reductions will likely be necessary the following year as well. “We will have to redouble our efforts to not only preserve but increase resources to help meet the crushing demand for legal assistance,” states MLSC Chairman F. Vernon Boozer. “We’ll be working tirelessly with Maryland’s dedicated coalition of access to justice leaders and supporters to make sure that our state’s legal services safety net is maintained.”
MLSC was established by the Maryland General Assembly in 1982 to receive and distribute funds to nonprofit organizations that provide civil legal assistance to low-income persons. From its inception, MLSC has made grants totaling over $164 million to help provide services in nearly two million legal matters for Maryland’s families in areas of family, housing, consumer, employment, health care and other civil legal matters.