On Jan. 28, during its quarterly meeting in Austin, the State Bar Board of Directors passed a resolution supporting Prime Partner banks. The resolution urges lawyer organizations in Texas to move their business to Prime Partner banks because they voluntarily provide millions in additional funding to legal aid programs in Texas.
Click here for a list of Prime Partner banks.
After interest rates crashed to nearly zero percent in 2008, Prime Partner banks voluntarily agreed to offer one percent interest on lawyer trust accounts. The interest on those accounts — known as IOLTA (Interest On Lawyer Trust Accounts) — funds legal aid programs throughout Texas. These legal aid programs assist low-income families through domestic violence, housing, disability, and other legal problems.
Below is the text of the Board’s resolution calling on Texas lawyers to move their business to Prime Partner banks:
RESOLUTION SUPPORTING FUNDING FOR CIVIL LEGAL AID IN TEXAS
APPROVED BY THE BOARD OF THE STATE BAR OF TEXAS
WHEREAS, civil legal services to the poor in the State of Texas are funded in large part by interest on lawyers trust accounts (IOLTA);
WHEREAS, interest income received for IOLTA accounts in the State of Texas has decreased dramatically over the past few years, resulting in a reduction in revenue of $20 million in 2007 to $5.5 million in 2009 alone;
WHEREAS, the Texas Access to Justice Foundation has addressed this critical shortfall in funding for legal services for the poor of Texas, in part, by creating the Texas IOLTA Prime Partners Program for banks in the State of Texas;
WHEREAS, the Prime Partner Program consists of those banks committed to their communities and the State of Texas and willing to pay a minimum of 1% interest or an interest rate equal to 75% of the Federal Funds Target Rate of interest, whichever is higher, on IOLTA accounts;
WHEREAS, more than 90 banks in the State of Texas have become members of the Prime Partners Program to help fund legal services for the poor which is still greatly underfunded in Texas;
WHEREAS, the State of Texas still has a large number of low income residents who are denied access to the justice system because of their inability to afford basic legal services;
WHEREAS, many lawyers in the State of Texas provide many hours of free legal services each year, and the State Bar of Texas encourages all of its members to provide pro bono legal services to the public in a minimum amount of 50 hours each year, yet the need for additional legal representation is great; and
WHEREAS, the Legal Services to the Poor in Civil Matters Standing Committee has passed a resolution urging the State Bar of Texas to encourage and request all Texas banks and eligible financial institutions that it uses for its business become members of the Texas IOLTA Prime Partners Program of the Texas Access to Justice Foundation
NOW, THEREFORE, BE IT RESOLVED that the State Bar of Texas urges the Sections of the State Bar, local bar associations, and TYLA Affiliates to encourage and request all banks and eligible financial institutions doing business with those organizations to become members of the Texas IOLTA Prime Partners Program of the Texas Access to Justice Foundation, and to pay a minimum of 1% or an interest rate equal to 75% of the Federal Funds Target Rate, whichever is higher, on the deposit of qualifying IOLTA funds in support of the provision of civil legal services to the poor in the State of Texas; and
BE IT FURTHER RESOLVED that should any of the banks and eligible financial institutions doing business with the State Bar, Sections, local bar associations, or TYLA Affiliates refuse to become Prime Partners, those organizations should investigate all other banking options and are strongly encouraged to move their business from any such bank and eligible financial institution to other banks and eligible financial institutions that are members of the Texas IOLTA Prime Partners Program and to support the Texas IOLTA Prime Partner Program through all other efforts including education and outreach on the Program and on the paramount need for increased funding for civil legal aid.