Treaty with Russia on Measures for Further Reduction and Limitation of Strategic Offensive Arms--Resumed

Floor Speech

Mr. MERKLEY. Madam President, I ask unanimous consent to speak as in morning business for up to 10 minutes.

The PRESIDING OFFICER (Ms. Cantwell). Without objection, it is so ordered.

INTEREST ON LEGAL TRUST ACCOUNTS

Mr. MERKLEY. Madam President, I rise this evening to talk about a program that is of great importance to our citizens across America who are struggling to access legal services. There is a program that is called the Interest on Lawyer Trust Accounts or IOLTA. This is a very interesting arrangement that I was not familiar with until I came to the Senate.

Essentially, IOLTA is interest on lawyer trust accounts, and it works like this. When lawyers need to put money into a trust account, they are putting it in that account on behalf of a client or on behalf of an estate. It is not allowed under the law for the client to earn interest. However, there is an arrangement that has been made over the years in which banks agree to pay interest on those accounts, since they are accessing those deposits--those funds--but the interest gets donated to legal services for poor Americans across the United States of America. So it is a win-win. The client isn't allowed to get the interest, but the banks pay the interest to benefit low-income Americans across our Nation.

That is the structure of the IOLTA accounts. All 50 States have these programs. Forty-two States require lawyers to deposit client funds that do not earn net interest for the client into these IOLTA accounts so they will earn interest to pay for civil legal services for the poor.

During the financial crisis, the FDIC created a program to guarantee that the business and trust checking accounts that do not pay interest are insured--they are guaranteed--and IOLTA was included in this because they do not pay interest to the client. The Dodd-Frank reform bill we had, which extended these arrangements for 2 years for accounts that do not pay interest to the clients, forgot to include the IOLTA accounts that do not pay interest to the clients but do pay interest that goes to fund civil legal services for poor Americans in all 50 States.

So we are seeking to fix this glitch. I wish to note that hundreds of thousands of Americans who don't otherwise have access to legal services are in a position to benefit when they need such services across our Nation.

In Oregon, we have the Oregon Law Foundation, the nonprofit, nonpartisan organization that administers legal aid for the poor. They benefited to the tune of over $1 million in revenue in 2009. When interest was a little better, they had more revenue in 2008--$2.2 million. That was a decrease from 2007 of $3.6 million. So as interest rates have declined, the amount of funds that have gone to fund legal services for the poor have declined, but still, a few million dollars is better than none in terms of providing assistance.

In a case such as this--the Oregon Law Foundation--IOLTA funding makes up 95 percent of their total revenue. So if the guarantee is not extended for 2 more years, we have a real problem, and it goes like this. A lawyer has a fiduciary responsibility to a client to put the funds into an account that protects the client. They would not be able to put the funds into an IOLTA account if it is not guaranteed, if they have the option of putting it into a noninterest-bearing fund that is guaranteed and, thus, the bank's willingness to pay interest. So the funding that goes for legal services across our Nation will disappear.

I rise to talk about this because the deadline for this is December 31. We have a bill to fix this before the Senate. But for those who are familiar, in the Senate, any Senator has the ability to put a hold on legislation, and we have a situation where a Senator has put a hold on this. I think, in general, this hasn't gotten much attention, the fact that this assistance that goes to low-income Americans across this country will be deeply damaged, even if 99 Senators support this, because we don't have 100 Senators. So I am rising to basically make an appeal to my colleagues to take a look at the legal programs in your States that are funded by this.

There are legal education programs that are funded. I hope my colleagues will recognize that what we have is a lose-lose situation if we don't change this law, and that lose-lose is legal education and legal services. The banks will actually make more money because they will not have to pay interest. So you have a lose-lose and a win--a loss for the poor, a loss for the students wanting legal education, and a win for banks receiving greater profits.

In this situation, the banks have been absolutely stellar citizens of our communities. In Oregon, we have a host of banks that not only pay interest on these lawyer trust funds, but they have agreed to maintain a floor of 1 percent interest. I would like to mention these banks recognized by the Oregon Law Foundation as leadership banks. I believe this list is as of the end of the year 2009. By mentioning these banks, I am basically saying thank you to these banks for being involved in this program. They include: the Albina Community Bank, the Bank of Eastern Oregon, the Bank of the Cascades, the Bank of the West, Capital Pacific Bank, Century Bank, Columbia River Bank, Key Bank, Northwest Bank, Peoples Bank of Commerce, the Pioneer Trust Bank, Premier West Bank, Siuslaw Bank, South Valley Bank and Trust, the Bank of Oswego, the Commerce Bank of Oregon, Umpqua Bank--a bank that originated in southern Oregon, in timber country, Douglas County, where I come from--U.S. Bank, Washington Trust Bank, and Wells Fargo.

So all these banks have been willing to pay interest on these lawyer trust accounts, knowing they are doing good work in the community by assisting legal programs.

I mentioned one of those programs in Oregon. Let me mention a couple more. The Juvenile Rights Project provides legal services to children and families who do not otherwise have the means to retain counsel through individual representation in juvenile court and school proceedings and through classwide advocacy in the courts, the legislature, and public agencies. It has the only help line offering legal advice for children and teenagers in Oregon. So that is the Juvenile Rights Project.

Disability Rights Oregon. The Oregon Advocacy Center provides statewide legal services to Oregonians with disabilities who are victims of abuse or neglect or have problems obtaining health care, special education, housing, employment, public benefits, and access to public and private services. Oregonians with disabilities look to OAC--that is the Oregon Advocacy Center or Disability Rights Oregon--to protect and advocate for their rights in courts, with public agencies and with the State legislature.

The Classroom Law Project promotes understanding of the law and legal process for 15,000 elementary and secondary school students in the State of Oregon by incorporating the lessons and principles of democracy into school curriculum. Their programs include the High School Mock Trial Competition. That is an extraordinary competition. It is wonderful to see how a high school student can blossom when preparing to argue before his or her peers the facts of a case and the legal principles of a case. It is an enormous education.

The Classroom Law Project also includes the Summer Institute training for teachers. This program enables those teachers to better address the issues of law and legal process in their classrooms.

Also included is the We the People program on the Constitution and Bill of Rights. A lot of us often carry the Constitution. We understand it is the foundation for our government of, by, and for the people, and we want our children to get an education in the Constitution. This is funded in this fashion.

We also have help for citizens who are trying to get into a home mortgage modification, such as HAMP--the Housing Affordable Modification Program--and also families who are working through issues of domestic violence.

So here is the situation. Families addressing domestic violence issues, families addressing wrongful home foreclosures, children--juveniles--seeking legal assistance, the disabled seeking resolution of issues regarding access to health care, special education, housing or employment are being helped. The Classroom Law Project is helping educate our children about the Constitution, about the Bill of Rights, funding mock trial competitions, and funding the Summer Institute training for teachers. These are the types of tremendous programs that are funded through the interest on lawyer trust accounts. That line of funding, due to a technical overrsight, ends on December 31.

So I am rising to ask my colleagues, if you are the Senator who is holding this up, I encourage you to get the facts from your State because all 50 States participate, and then let this funding, provided through a wonderful arrangement between the banks and our lawyers and these trust accounts, go forward. Who knows how many thousands, the multiple of thousands who will be assisted in challenging situations if we fix this before we adjourn.

I yield the floor.

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