Rule Legal Assistance Eligibility; Maximum Income Guidelines

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Rule Legal Assistance Eligibility; Maximum Income Guidelines

  1. 1. Federal Register / Vol. 70, No. 99 / Tuesday, May 24, 2005 / Proposed Rules 29695 eligibility in the NFIP. No regulatory 12612, Federalism, dated October 26, PART 67—[AMENDED] flexibility analysis has been prepared. 1987. 1. The authority citation for part 67 Regulatory Classification Executive Order 12778, Civil Justice Reform continues to read as follows: This proposed rule is not a significant Authority: 42 U.S.C. 4001 et seq.; This proposed rule meets the regulatory action under the criteria of applicable standards of Section 2(b)(2) Reorganization Plan No. 3 of 1978, 3 CFR, Section 3(f) of Executive Order 12866 of of Executive Order 12778. 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, September 30, 1993, Regulatory 3 CFR, 1979 Comp., p. 376. Planning and Review, 58 FR 51735. List of Subjects in 44 CFR Part 67 § 67.4 [Amended] Executive Order 12612, Federalism Administrative practice and procedure, flood insurance, reporting 2. The tables published under the This proposed rule involves no and recordkeeping requirements. authority of § 67.4 are proposed to be policies that have federalism Accordingly, 44 CFR part 67 is amended as follows: implications under Executive Order proposed to be amended as follows: # Depth in feet above ground Elevation in State City/town/county Source of flooding Location feet ((NAVD) Existing Modified Iowa ............... West Des Moines (City) Jordan Creek ............... Approximately 3,210 feet downstream of 68th None ........ 924. Polk and Dallas Street. Counties. Approximately 1,950 feet upstream of E.P. True None ........ 970. Parkway. Raccoon River ............. Approximately 75 feet downstream of South 814 .......... 816. First Street. Approximately 1.7 miles upstream of U.S. Inter- 832 .......... 833. state 35. Maps are available for inspection at City Hall, 4200 Mills Civic Parkway, West Des Moines, Iowa. Send comments to The Honorable Eugene Meyer, Mayor, City of West Des Moines, 4200 Mills Civic Parkway, West Des Moines, Iowa 50265. (Catalog of Federal Domestic Assistance No. clarify the focus of the regulation on the Procedural Background 83.100, ‘‘Flood Insurance.’’) financial eligibility of applicants for On June 30, 2001, LSC initiated a Dated: May 18, 2005. LSC-funded legal services. Negotiated Rulemaking and appointed a David I. Maurstad, Working Group comprised of DATES: Comments must be submitted on Acting Director, Mitigation Division, or before June 23, 2005. representatives of LSC (including the Emergency Preparedness and Response Office of Inspector General), the Directorate. ADDRESSES: Comments must be National Legal Aid and Defenders [FR Doc. 05–10299 Filed 5–23–05; 8:45 am] submitted in writing and may be sent by Association, the Center for Law and BILLING CODE 9110–12–P regular mail, or may be transmitted by Social Policy, the American Bar fax or email to: Mattie C. Condray, Association’s Standing Committee on Senior Assistant General Counsel, Office Legal Aid and Indigent Defendants and of Legal Affairs, Legal Services a number of individual LSC recipient LEGAL SERVICES CORPORATION Corporation, 3333 K. St., NW., programs. The Negotiated Rulemaking Washington, DC 20007–3522; (202) 337– Working Group met three times 45 CFR Part 1611 6519 (fax); mcondray@lsc.gov (e-mail). throughout 2002 and developed a Draft Financial Eligibility FOR FURTHER INFORMATION CONTACT: Notice of Proposed Rulemaking (NPRM) Mattie C. Condray, Senior Assistant which was the basis for the NPRM AGENCY: Legal Services Corporation. General Counsel, Office of Legal Affairs, published by LSC on November 22, ACTION: Notice of proposed rulemaking. Legal Services Corporation, 3333 K. St., 2002 proposing significant revisions to SUMMARY: The Legal Services NW., Washington, DC 20007–3522; to Part 1611 (67 FR 70376). LSC (202) 295–1624 (phone); (202) 337–6519 received 15 comments on that NPRM. Corporation (‘‘LSC’’ or ‘‘Corporation’’) is (fax); mcondray@lsc.gov (e-mail). Except as specifically noted in the republishing for additional comment Section-by-Section analysis below, the previously proposed amendments (with SUPPLEMENTARY INFORMATION: Section comments LSC received either certain additional revisions) to its 1007(a) of the Legal Services affirmatively supported or raised no regulations relating to financial Corporation Act requires LSC to objection to the proposals in the eligibility for LSC-funded legal services. establish guidelines, including setting November 2002 NPRM.1 The proposed revisions are intended to maximum income levels, for the Upon receipt of the comments, LSC reorganize the regulation to make it determination of applicants’ financial staff prepared a Draft Final Rule easier to read and follow; simplify and eligibility for LSC-funded legal discussing the comments and making streamline the requirements of the rule assistance. Part 1611 implements this permanent the proposed revisions. to ease administrative burdens faced by provision, setting forth the requirements LSC recipients in implementing the relating to determination and 1 For additional discussion of the Negotiated regulation and to aid LSC in documentation of client financial Rulemaking Working Group, see 67 FR 70376 enforcement of the regulation; and to eligibility. (November 22, 2002). VerDate jul<14>2003 15:14 May 23, 2005 Jkt 205001 PO 00000 Frm 00038 Fmt 4702 Sfmt 4702 E:FRFM24MYP1.SGM 24MYP1
  2. 2. 29696 Federal Register / Vol. 70, No. 99 / Tuesday, May 24, 2005 / Proposed Rules However, on the eve of the January implementing the regulation, facilitate entitlement to service. Rather, financial 31–February 1, 2003 Board of Directors compliance and aid LSC in enforcement eligibility is merely a threshold question meeting at which the Draft Final Rule of the regulation; and clarification of the and the issue of whether any otherwise was scheduled to be considered, LSC focus of the regulation on the financial eligible applicant will be provided with received a request from Representative eligibility of applicants for LSC-funded legal assistance is a matter for the James Sensenbrenner, Chairman of the legal services as an issue separate from recipient to determine with reference to U.S. House of Representatives Judiciary decisions on whether to accept a its priorities and resources. In addition, Committee, to suspend action on the particular client for service. In this part does not address eligibility rulemaking pending the confirmation of particular, LSC is proposing to based on citizenship or alienage status; new LSC Board of Directors members significantly reorganize and simplify the those eligibility requirements are set appointed by President Bush. The then- sections of the rule which set forth the forth in Part 1626 of LSC’s regulations, LSC Operations and Regulations various requirements relating to Restrictions on Legal Assistance to Committee deferred to Chairman establishment of recipient annual Aliens. Sensenbrenner’s request. After the income and asset ceilings, authorized confirmation of the nine newly exceptions and determinations of Section-by-Section Analysis appointed Board members, the eligibility. These changes are intended Section 1611.1—Purpose reconsitituted Operations and to clarify the regulation and include LSC is proposing to revise this section Regulations Committee further deferred substantive changes to make intake to make clear that the standards of this action on the rulemaking pending the simpler and less burdensome and part concern only the financial appointment of a new LSC President. render basic financial eligibility eligibility of persons seeking LSC- After the arrival of the new LSC determinations easier for recipients to President in January 2004, the make. LSC is also proposing to move the funded legal assistance and that a reconstituted Operations and existing provisions on group finding of financial eligibility under Part Regulations Committee resumed representation, with some amendment, 1611 does not create an entitlement to consideration of the Part 1611 to a separate section of the regulation. service. In addition, LSC proposes to rulemaking. Finally, LSC is proposing simplification remove the language in the current At its meetings of May 1, 2004, June and clarification of the retainer regulation referring to giving 5, 2004 and September 11, 2004, the agreement requirement. preferences to ‘‘those least able to obtain Operations and Regulations Committee One other general issue merits legal assistance.’’ Although the original discussed and provided policy direction discussion. Section 509(h) of the FY LSC Act contained language indicating to staff on the two aspects of the 1996 LSC appropriations act, Public that recipients should provide proposed changes to the regulations Law 104–134, provides that, among preferences in service to the poorest about which LSC and the field had other records, eligibility records ‘‘shall among applicants, that language was failed to achieve consensus during the be made available to any auditor or deleted when the Act was reauthorized Working Group meetings—retainer monitor of the recipient * * * except in 1977 and has remained out of the agreements and group representation. for such records subject to the attorney- legislation ever since. Moreover, section The Committee reviewed these client privilege.’’ This provision has 504(a)(9) of the FY 1996 appropriations proposals and the remainder of the been retained in each subsequent act, Public Law 104–134 (incorporated proposed revisions to Part 1611 at its appropriations measure and continues by reference in the current meeting of April 1, 2005. At the meeting to be in force. During the prior stages of appropriations act and implemented by of the full Board of Directors on April this rulemaking, there had been some regulation at 45 CFR part 1620) provides 30, 2005, upon the recommendation of discussion and consideration of having that recipients are to make service the Committee, the Board determined this language expressly incorporated determinations in accordance with that because two years has passed since into Part 1611. LSC continues to believe written priorities, which take into the publication of the November 2002 that, as 509(h) covers significantly more account factors other than the relative NPRM, rather than adopting a final rule than eligibility records, having a full poverty among applicants. Thus, as amending Part 1611, the most prudent discussion of the meaning of 509(h) in there is no statutory basis for a course of action would be to republish the context of 1611, which addresses preference for those least able to afford a revised NPRM for public comment. only financial eligibility issues, is not assistance and because LSC believes Accordingly, except for the retainer appropriate. Accordingly, LSC does not that the regulation should focus on agreement and group eligibility sections, propose to include regulatory language financial eligibility determinations LSC is proposing the same revisions implementing 509(h) with respect to without reference to issues relating to (with only a few, non-substantive records covered by this Part. For a fuller determinations by a recipient to provide differences) as LSC proposed in discussion of this issue, see the services to a particular applicant, such November 2002 and requests public preamble to the November 22, 2002 language should be removed from the comment thereon. NPRM, 67 FR 70376. regulation. LSC also proposes to add language specifying that this Part also Proposed Revisions to Part 1611 Title of Part 1611 sets forth financial standards for groups While specific proposed revisions are LSC proposes to change the title of seeking legal assistance supported by discussed in greater detail in the Part 1611 from ‘‘Eligibility’’ to LSC funds. Finally, LSC proposes to Section-by-Section analysis below, it ‘‘Financial Eligibility.’’ This proposed include a reference to the retainer should be noted that the proposed change is intended, first, to make clear agreement requirement in the purpose revisions reflect several overall goals of that with respect to individuals seeking section to provide a notice at the the Working Group: reorganization of LSC-funded legal assistance, the beginning of the regulation that this the regulation to make it easier to read standards of this part deal only with the subject is included in Part 1611. and follow; simplification and financial eligibility of such persons. LSC streamlining of the requirements of the believes this change will help clarify Section 1611.2—Definitions rule to ease administrative burdens that a finding of financial eligibility LSC proposes to add definitions for faced by LSC recipients in under Part 1611 does not create an several terms and to amend the VerDate jul<14>2003 15:14 May 23, 2005 Jkt 205001 PO 00000 Frm 00039 Fmt 4702 Sfmt 4702 E:FRFM24MYP1.SGM 24MYP1
  3. 3. Federal Register / Vol. 70, No. 99 / Tuesday, May 24, 2005 / Proposed Rules 29697 definitions for each of the existing terms excluded from this definition, as the proposed language accomplishes that currently defined in the regulation. LSC eligibility of groups would be addressed purpose. believes that the new definitions and wholly within proposed section 1611.6. Recipients currently may provide Section 1611.2(e)—Brief Services the amended definitions will help to make the regulation more easily legal assistance without regard to a LSC proposes to add a definition of comprehensible. person’s financial eligibility under Part the term ‘‘brief services’’ as it is used in 1611 when the assistance is supported proposed section 1611.9, Retainer Section 1611.2(a)—Advice and Counsel wholly by non-LSC funds. LSC does not Agreements. LSC notes that brief LSC proposes to add a definition of propose to change this (in fact, LSC services is legal assistance characterized the term ‘‘advice and counsel’’ as that proposes to restate this principle in primarily by being distinguishable from term appears in proposed section proposed section 1611.4(a)) and believes both extended service and advice and 1611.9, Retainer Agreements. Under the that the use of the term applicant as counsel. Under the proposed defintion, proposed definition, ‘‘advice and proposed herein will help to clarify the brief service is the performance of a counsel’’ would be defined as limited application of the rule. discrete task (or tasks) which are not legal assistance that involves the review incident to continuous representation in of information relevant to the client’s Section 1611.2(d)—Assets a case but which involve more than the legal problem(s) and counseling the LSC proposes to add a definition of mere provision of advice and counsel. client on the relevant law or action(s) to the term assets to the regulation. The Examples of brief services would take to address the legal problem(s). LSC proposed definition, ‘‘cash or other include activities such as the drafting of anticipates that advice and counsel resources that are readily convertible to documents or personalized assistance would generally be characterized by a cash, which are currently and actually with the completion of pleadings being one-time or very short term relationship available to the applicant,’’ is intended prepared and filed by pro se litigants, between the attorney and the client. to provide some guidance to recipients and making limited third-party contacts Advice and counsel does not encompass as to what is meant by the term assets, on behalf of a client in a short time drafting of documents or making third- yet provide considerable latitude to period. party contacts on behalf of the client. recipients in developing a description of Thus, for example, advising a client of assets that addresses local concerns and Section 1611.2(f)—Extended Service what notice a landlord is required to conditions. The key concepts intended LSC proposes to add a definition of provide to a tenant before evicting the in this definition are (1) ready the term ‘‘extended service’’ as that term tenant would fall under ‘‘advice and convertibility to cash; and (2) is used in proposed section 1611.9, counsel,’’ but making a phone call to a availability of the resource to the Retainer Agreements. As defined, landlord to prevent the landlord from applicant. extended service would mean legal evicting a tenant would not be Although the term is not defined in assistance characterized by the considered ‘‘advice and counsel.’’ the regulation, current section 1611.6(c) performance of multiple tasks incident states that ‘‘assets considered shall to continuous representation in which Section 1611.2(b)—Applicable Rules of include all liquid and non-liquid assets. the recipient undertakes responsibility Professional Responsibility * * *’’ The intent of this requirement is for protecting or advancing the client’s LSC proposes to add a definition of that recipients are supposed to consider interests beyond advice and counsel or the term ‘‘applicable rules of all assets upon which the applicant brief services. Examples of extended professional responsibility’’ as that term could draw in obtaining private legal service would include representation of appears in proposed sections 1611.8, assistance. While there was no intent to a client in litigation, administrative Change in Financial Eligibility Status change the underlying requirement, in adjudicative proceeding, alternate and 1611.9, Retainer Agreements. This discussing the issues of assets and asset dispute resolution proceeding, or definition is intended to make clear that ceilings in the Working Group it became extended negotiations with a third the references in the regulation refer to apparent that the terms ‘‘liquid’’ and party. the rules of ethics and professional ‘‘non-liquid’’ were obscuring responsibility applicable to attorneys in understanding of the regulation. To Section 1611.2(f)—Governmental the jursidiction where the recipient some, the term ‘‘non-liquid’’ implied Program for Low Income Individuals or either provides legal services or something not readily convertible to Families maintains its records. cash, while to others the term implied LSC proposes to change the term that an asset that was simply something is used in the regulation from Section 1611.2(c)—Applicant other than cash, without regard to the ‘‘governmental program for the poor’’ to Consistent with the intention ease of converting the asset to cash. ‘‘governmental program for low income throughout to keep the focus of the Thus, the Working Group decided that individuals and families.’’ This change regulation on the standards and criteria the terms ‘‘liquid’’ and ‘‘non-liquid’’ is not intended to create any substantive for determining the financial eligibility should be eliminated and that the change in the current definition, but of persons seeking legal assistance regulation should focus instead on the merely reflect preferred nomenclature. supported with LSC funds, LSC ready convertibility of the asset to cash. proposes to use the term ‘‘applicant’’ The other key concept in the Section 1611.2(g)—Governmental throughout the regulation to emphasize definition of asset is the availability of Program for Persons With Disabilities the distinction between applicants, the resource to the applicant. Although LSC is proposing to add a definition clients, and persons seeking or receiving the current regulation notes that the of the term ‘‘governmental program for assistance supported by other than LSC recipient’s asset guidelines ‘‘shall take persons with disabilities.’’ LSC proposes funds. Accordingly, LSC proposes to into account impediments to an to include in the authorized exceptions add a definition of applicant providing individual’s access to assets of the to the annual income ceilings an that an applicant is an individual family unit or household,’’ the Working exception relating to applicants seeking seeking legal assistance supported with Group was of the opinion that this to obtain or maintain govermental LSC funds. Groups, corporations and principle could be more clearly benefits for persons with disabilities. associations would be specifically articulated. LSC believes that the Accordingly, it is appropriate to include VerDate jul<14>2003 15:14 May 23, 2005 Jkt 205001 PO 00000 Frm 00040 Fmt 4702 Sfmt 4702 E:FRFM24MYP1.SGM 24MYP1
  4. 4. 29698 Federal Register / Vol. 70, No. 99 / Tuesday, May 24, 2005 / Proposed Rules a proposed definition for this term. The applicant, LSC does not believe that the from the definition of total cash proposed definition, ‘‘any Federal, State definition of income is the appropriate receipts. It is worth noting that the list or local program that provides benefits place in the regulation to deal with this of items included is not intended to be of any kind to persons whose eligibility issue. exhaustive, while the list of items to be is determined on the basis of mental Taking the phrase ‘‘before taxes’’ out excluded is intended to be exhaustive. and/or physical disability,’’ is intended of the definition of income would Finally, LSC wishes to restate in this to be similar in structure and effectively change the meaning of preamble guidance on the treatment of application to the definition of the term income from gross income to net Indian trust fund monies in making ‘‘governmental program for low income income. The term income has meant income determinations. Several individuals and families.’’ gross income since the original adoption provisions of Federal law regulate of the financial eligibility regulation in whether or not income or interests in Section 1611.2(h)—Income 1976. See 41 FR 51604, at 51606, Indian trusts are taxable or should be LSC proposes to revise the current November 23, 1976. The maximum considered as resources or income for definition of income to refer to the total income guidelines are based on the Federal benefits. See 25 U.S.C. 1407– cash receipts of a ‘‘household,’’ instead Department of Health and Human 1408; 25 U.S.C. 117a–117c. Under the of a ‘‘family unit’’ and to make clear that Services (DHHS) Federal Poverty terms of those laws, LSC has determined recipients have the discretion to define Guidelines amounts. DHHS’ Federal that recipients may disregard up to the term household in any reasonable Poverty Guidelines are, by law, based on $2000 per year of funds received by manner. Currently, the definition of the Census Bureau’s Federal Poverty individual Native Americans that are income refers to ‘‘family unit,’’ while Thresholds, which are calculated using derived from income or interests in the phrase ‘‘household or family unit’’ gross income before taxes. 42 U.S.C. Indian trusts from being considered appears in the section on asset ceilings. 9902(2); Office of Management and income for the purpose of determining It appears that there is no difference Budget Directive No. 14 (May 1978). financial eligibility of Native American intended by the use of different terms in Changing the definition of income applicants for service, and that such these sections and LSC believes that it effectively from gross to net would funds or interests of individual Native is appropriate to simplify the regulation introduce two different uses of the term Americans in trust or restricted lands to use the same single term in each income into the regulations (one use in should not be considered as a resource provision, without creating a the income guidelines published for the purpose of LSC financial substantive change in the meaning of annually by LSC in Appendix A to Part eligibility. See LSC Office of Legal either term. LSC proposes to use 1611 and another use in the text of the Affairs External Opinion 99–17, August ‘‘household’’ instead of ‘‘family unit’’ regulation). This would have significant 27, 1999. because it is a simpler, more repercussions in the application of the As noted in External Opinion 99–17, understandable term. regulation. LSC believes that this action the exclusion applies only to funds and As noted above, LSC does not intend would cause greater confusion. None of other interests held in trust by the the use of the term ‘‘household’’ to have the comments previously received Federal government and investment a different meaning from the current supporting removal of ‘‘before taxes’’ income accrued therefrom. The term ‘‘family unit.’’ Under current from the definition of income address following have been found to qualify for guidance from the LSC Office of Legal this issue. Moreover, LSC believes that the exclusion from income in Affairs, recipients have considerable the practical problem (that taxes, determining eligibility for various latitude in defining the term ‘‘family indeed, are funds unavailable to the government benefits: income from the unit.’’ Specifically, OLA External applicant), is better addressed by sale of timber from land held in trust; Opinion No. EX–2000–1011 states: considering taxes as a separate factor income derived from farming and which can be considered by the ranching operations on reservation land Neither the LSC Act nor the LSC recipient in making financial eligibility held in trust by the Federal government; regulations define ‘‘family unit’’ for client eligibility purposes. The Corporation will determinations. LSC invites comment income derived from rentals, royalties, defer to recipient determinations on this on this issue. This matter is presented and sales proceeds from natural issue, within reason. Recipients may in greater detail in the discussion of resources of land held in trust; sales consider living arrangements, familial proposed section 1611.5, below. proceeds from crops grown on land held relationships, legal responsibility, financial In addition, LSC proposes to move the in trust; and use of land held in trust for responsibility or family unit definitions used information on what is encompassed by grazing purposes. On the other hand, by government benefits agencies, amongst the term ‘‘total cash receipts’’ into the per capita distributions of revenues other factors, in making such decisions. definition of income. LSC believes that from gaming activity on tribal trust LSC intends that this standard would having this information in the definition property are not protected because such also apply to definitions of ‘‘household’’ of income, rather than in a separate funds are not held in trust by the and the proposed definition would definition will make the regulation Federal government. Thus, such make this clear. easier to understand, particularly as the distributions are considered to be Field representatives on the Working term ‘‘total cash receipts’’ is used only income for purposes of determining LSC Group and several comments on the in the definition of income. In financial eligibility. November 2002 NPRM also suggested incorporating the language on ‘‘total deleting the words ‘‘before taxes’’ from cash receipts,’’ LSC proposes to take the Total Cash Receipts the definition of income. Such a change current definition of the term without LSC proposes to delete the definition is desirable, they contend, because any substantive amendment, but of ‘‘total cash reciepts,’’ currently at automatically deducted taxes are not reorganized to make it easier to section 1611.2(h), as a separately available for an applicant’s use and the understand. Specifically, LSC proposes defined term in the regulation. Rather, failure to take current taxes into account to separate the definition into two LSC proposes to reorganize the in determining income has an adverse sentences, one of which sets forth those information contained in the definition impact on the working poor. While it is things which are included in total cash and move it directly into the definition undoubtedly true that automatically receipts and one which sets forth those of ‘‘income.’’ As noted above, the only deducted taxes are not available to an things which are specifically excluded place the term ‘‘total cash reciepts’’ is VerDate jul<14>2003 15:14 May 23, 2005 Jkt 205001 PO 00000 Frm 00041 Fmt 4702 Sfmt 4702 E:FRFM24MYP1.SGM 24MYP1
  5. 5. Federal Register / Vol. 70, No. 99 / Tuesday, May 24, 2005 / Proposed Rules 29699 used is in the defintion of ‘‘income’’ and In establishing income and asset or other assets that may not be attached LSC believes that having a separate ceilings, the recipient would have to for the satisfaction of a debt, etc. definition for ‘‘total cash reciepts’’ is consider the cost of living in the There was discussion within the cumbersome and unnecessary. locality; the number of clients who can Working Group about the appropriate be served by the resources of the scope of this provision. Field Section 1611.3—Financial Eligibility representatives suggested that the list of recipient; the potentially eligible Policies exclusions should be illustrative, and population at various ceilings; and the LSC proposes to create a new section availability of other sources of legal not exhaustive, allowing recipients 1611.3, Financial Eligibility Policies, assistance. With respect to assets of greater discretion in developing asset based on requirements currently found domestic violence victims jointly held ceilings. Four of the comments LSC in sections 1611.5(a), 1611.3(a)–(c) and with their abusers, this requirement received on the November 2002 NPRM 1611.6. The new section 1611.3 would applies when the applicant has made agreed with the suggestion that the list address in one section recipients’ the recipient aware that he or she is a should be illustrative rather than responsibilities for adopting and victim of domestic violence. exhaustive. LSC, however, prefers to implementing financial eligibility In addition, LSC proposes to permit retain the approach in the current policies. Under the proposed new recipients to adopt financial eligibility regulation in which the list of section, the current requirement that policies which provide for authorized excludable assets is set forth in toto. recipients’ governing bodies have to exceptions to the annual income ceiling LSC believes that this approach adopt policies for determining financial pursuant to proposed section 1611.5 emphasizes the policy that most assets eligibility would be retained. LSC and for waiver of the asset ceiling for an are to be considered and maintains a proposes, however, to change the applicant in a particular case under basic level of consistency nationally current requirement for an annual unusual circumstances and when with respect to this issue. However, LSC review of these policies and instead approved by the Executive Director or does agree that the regulation could require recipients’ governing bodies to his/her designee. Finally, LSC proposes afford recipients some additional conduct triennial reviews of policies. to permit recipients to adopt financial flexibility in developing asset ceilings, The Working Group agreed that an eligibility policies which permit consistent with the policy articulated annual review was unnecessary and has financial eligibility to be established by above. The Working Group believes that tended to result in rather pro forma reference to an applicant’s receipt of the proposed language meets those reviews of policies. In contrast, a benefits from a governmental program objectives, particularly in light of the triennial review requirement would be for low-income individuals or families proposed amendment to the asset sufficient to ensure that financial consistent with proposed section ceiling waiver standard discussed eligibility policies remain relevant and 1611.4(b). below. LSC invites comment on whether would encourage a more thorough and These proposed provisions are, with the list should be illustrative or thoughtful review when such review is two exceptions, based directly on exhaustive. LSC also invites comment undertaken. The section would also add current requirements with a few on whether additional specific assets an express requirement that recipients substantive changes. First among the should be included in the list of adopt implementing procedures. While changes, recipients would no longer be excludable assets and, if so, what items this is already implicit in the current required to routinely submit their asset might be appropriate. regulation, LSC believes it would be ceilings to LSC. This requirement LSC is also proposing to change the better for this requirement to be appears to serve little or no purpose, as asset ceiling waiver standard slightly. expressly stated. Such implementing compliance with this requirement has The current regulation permits waiver procedures could be adopted either by been spotty and LSC has taken no action in ‘‘unusual or extremely meritorious a recipient’s governing body or by the to obtain the information from situations;’’ the proposed rule would recipient’s management. recipients which have not automatically permit waiver in ‘‘unusual Proposed section 1611.3 would also submitted it. Moreover, the information circumstances.’’ The Working Group contain certain minimum requirements collected is not being put to any routine determined that the current language is for the content of recipient’s financial use. In addition, LSC has not had a unnecessarily stringent and that it is eligibility policies. Specifically, LSC parallel requirement for the submission unclear what the difference is intended proposes that the recipient’s financial of income ceilings. The Working Group to be between ‘‘unusual’’ and eligibility policy must: determined that this requirement could ‘‘extremely meritorious.’’ It was • Specify that only applicants for be eliminated without any adverse effect suggested in the Working Group that the service determined to be financially on program compliance with or standard should be ‘‘where eligible under the policy may be further Corporation enforcement of the appropriate.’’ LSC, however, felt that the considered for LSC-funded service; regulation. regulation should continue to reflect the • Establish annual income ceilings of Another substantive change is that policy that waivers of the asset ceilings no more than 125% of the current recipients would be permitted to should only be granted sparingly and DHHS Federal Poverty Guidelines provide in their financial eligibility not as a matter of course. The Working amounts; policies for the exclusion of (in addition Group agreed that the revised language • Establish asset ceilings; and to a primary residence, as provided for accomplishes this goal, while providing • Specify that, notwithstanding any in the existing regulation) vehicles, some additional appropriate discretion other provisions of the regulation or the assets used in producing income (such to recipients. In addition, where the recipient’s financial eligibility policies, as a farmer’s tractor or a carpenter’s current rule requires all waiver in assessing the financial eligibility of tools) and other assets excluded from decisions to be made by the Executive an individual known to be a victim of attachment under State or Federal law Director, LSC proposes to permit those domestic violence, the recipient shall from the calculation of assets. In decisions to be made by the Executive consider only the income and assets of identifying other assets excluded from Director or his/her designee. LSC the individual applicant and shall not attachment under State or Federal law, believes it is important that a person in consider any assets jointly held with the LSC has in mind assets that are significant authority be involved in abuser. excluded from bankruptcy proceedings making asset ceiling waiver decisions, VerDate jul<14>2003 15:14 May 23, 2005 Jkt 205001 PO 00000 Frm 00042 Fmt 4702 Sfmt 4702 E:FRFM24MYP1.SGM 24MYP1
  6. 6. 29700 Federal Register / Vol. 70, No. 99 / Tuesday, May 24, 2005 / Proposed Rules but recognizes that, especially as more applicant to be financially eligible if the benefits for low-income individuals and recipients have consolidated and now applicant’s assets are at or below the families, eligibility for which includes serve larger areas, it is important for recipient’s applicable asset ceiling level an asset test. Key to this practice is that recipients to have the discretion to (or the ceiling has been properly the recipient’s governing body has to delegate certain authority to regional or waived) and the applicant’s income is at take some identifiable action to branch office managers or directors to or below the recipient’s applicable recognize the asset test of the increase administrative efficiency. income ceiling, or if one or more of the governmental benefit program being The first totally new element is the authorized exceptions to the ceiling relied upon. This ensures that the proposed language regarding victims of applies. These provisions are based on eligibility standards of the govermental domestic violence. This proposal existing provisions found in sections program have been carefully considered implements LSC’s FY 1998 1611.3, 1611.4 and 1611.6. As revised, and are incorporated into the overall appropriations law. Specifically, section the new provisions do not represent a financial eligibility policies adopted and 506 of that act provides: substantive change, but LSC believes regularly reviewed by the recipient’s In establishing the income or assets of an having the basic statements as to who governing body. As this practice has individual who is a victim of domestic may be found to be financially eligible proved efficient and effective, it was violence, under section 1007(a)(2) of the for assistance in one section makes the determined that a parallel process could Legal Services Corporation Act (42 U.S.C. regulation much clearer. In addition, also be adopted for income screening 2996f(a)(2)), to determine if the individual is where the existing regulation uses a and that these practices should be eligible for legal assistance, a recipient construction that speaks to when a described in such section shall consider only expressly included in the regulations. It recipient may provide legal assistance, is important to note that this provision the assets and income of the individual and shall not include any jointly held assets. the proposed new language emphasizes would only apply to applicants whose the point that the requirements speak sole source of income is derived from Although this law has been in effect only to determinations of financial such benefits. Applicants who also have since 1997, it has never been formally eligibility and not to decisions regarding income derived from other sources incorporated into Part 1611. This whether or not to actually provide legal would be subject to an independent provision of law applies regardless of assistance. inquiry and assessment of financial whether it appears in the regulation. LSC also proposes to incorporate into eligibility. However, incorporating this language this section a significant substantive into the regulation is appropriate, Finally, in the November 2002 NPRM, change to the regulation. Consistent particularly in light of the goal of this LSC proposed to include in this section with proposed section 1611.3 as rulemaking to clarify the requirements a provision requiring recipients to make discussed above, if adopted, the relating to financial eligibility reasonable inquiry into an applicant’s regulation would permit recipients to determinations. financial status in making financial determine an applicant to be financially Finally, the proposal to permit eligibility determinations. Upon eligible because the applicant’s income recipients to adopt financial eligibility is derived solely from a governmental reflection, LSC believes that this policies which permit financial program for low-income individuals or requirement is better included in eligibility to be established by reference families, provided that the recipient’s proposed section 1611.7, Manner of to an applicant’s receipt of benefits from governing body has determined that the Determining Financial Eligibility and a governmental program for low-income income standards of the governmental has moved this proposal to that section. individuals or families consistent with program are at or below 125% of the For a detailed discussion of this issue, proposed section 1611.4(b) is also new. Federal Poverty Guidelines amounts. see the discussion of proposed section This proposal is discussed in greater For many recipients, a significant 1611.7, below. detail below. proportion of applicants rely on Section 1611.5—Authorized Exceptions Section 1611.4—Financial Eligibility for governmental benefits for low-income to the Annual Income Ceiling Legal Assistance individuals and families as their sole source of income. In order to qualify for This proposed section provides for This proposed section would set forth these benefits, such persons have authorized exceptions to the annual the basic requirement that recipients already been screened by the agency income ceiling. The proposed language, may provide legal assistance supported providing the benefits (using an like the current language of sections with LSC funds only to those eligibility determination process that is 1611.4 and 1611.5, on which it is based, individuals whom the recipient has stricter than the one required under LSC is permissive. A recipient would be at determined are financially eligible for regulations) and determined to be liberty to include some, none, or all of such assistance pursuant to their financially eligible for those benefits. In the authorized exceptions discussed policies, consistent with this Part. This Working Group discussions, many below in its financial eligibility policies. section also contains a proposed representatives of the field noted that if Thus, to the extent a recipient would statement that nothing in Part 1611 they could rely on the determinations choose to avail itself of the authority prohibits a recipient from providing made by these agencies without having provided in this proposed section, a legal assistance to an individual without to otherwise make an independent recipient would be permitted to regard to that individual’s income and inquiry into financial eligibility, it determine an applicant to be financially assets if the legal assistance is supported would substantially ease the eligible for assistance, notwithstanding wholly by funds from a source other administrative burden involved in that the applicant’s income is in excess than LSC (regardless of whether LSC making financial eligibility of the recipient’s applicable income funds were used as a match to obtain determinations. ceiling. In making such determinations, such other funds, as is the case with The Working Group also noted that however, the recipient would have to Title III or VOCA grant funds) and the current LSC practice permits recipients detemine that the applicant’s assets assistance is otherwise permissible to determine that an applicant’s assets were at or below the recipient’s under applicable law and regulation. are within the recipient’s asset ceiling applicable asset ceiling (or the ceiling This proposed section would further level without additional review if the would have had to have been waived). provide that a recipient may find an applicant is receiving governmental This requirement is consistent with the VerDate jul<14>2003 15:14 May 23, 2005 Jkt 205001 PO 00000 Frm 00043 Fmt 4702 Sfmt 4702 E:FRFM24MYP1.SGM 24MYP1
  7. 7. Federal Register / Vol. 70, No. 99 / Tuesday, May 24, 2005 / Proposed Rules 29701 current regulation, but would be be deemed financially eligible if the Executive Director to designate a affirmatively stated for greater clarity. $250,000 of the income is devoted to responsible individual to make such Under the proposed section, there nursing home expenses, determinations. LSC believes that this would be two situations in which an notwithstanding that the applicant’s approach provides additional applicant’s income could exceed the remaining income is $50,000— administrative flexibility to recipients, recipient’s income ceiling without an substantially in excess of the income yet is consistent with the underlying absolute upper limit: (1) Where the ceiling. This situation is not intended, policy. applicant is seeking to maintain and, indeed, LSC has no reason to LSC also proposes to permit governmental benefits for low-income believe recipients are serving such exceptions for certain situations in individuals and families; and (2) where persons. However, consistent with the which the applicant’s income is in the executive director (or his/her overall goal of clarifying the regulation, excess of the recipient’s applicable designee) determines, on the basis of LSC believes that a requirement that an income ceiling, but does not exceed documentation received by the applicant must be otherwise financially 200% of the applicable Federal Poverty recipient, that the applicant’s income is eligible considering only that portion of Guidelines amount. At the outset, LSC primarily committed to medical or the applicant’s income which is not notes that this section also proposes to nursing home expenses and, in devoted to medical or nursing home change the current upper income limit considering only that portion of the expenses should be clearly set forth in of 150% of the LSC national income applicant’s income which is not so the regulation. guidelines amount, which is 150% of committed, the applicant would LSC received two comments on the 125% of the Federal Poverty Guidelines otherwise be financially eligible. November 2002 NPRM regarding this amounts, or 187.5% of the Federal The first instance would be a new proposed revision. Both comments Poverty Guidelines amounts. Under the addition to the regulation. Currently, an asked LSC to remove the requirement proposed new regulation, the upper applicant seeking to obtain that the determination that the limit would increase to 200% of the governmental benefits for low income applicant’s income is primarily Federal Poverty Guidelines amounts. persons may be deemed financially committed to medical or nursing home This change is being proposed to further eligible if the applicant’s income does expenses be made by the Executive simplify the language of the regulation not exceed 150% of the LSC national Director or his/her designee. These and to recognize the changing eligibility level. The existing regulation, commenters argued that removing this demographic of the legal services client however, does not specifically address requirement would afford recipients base, which now increasingly includes applicants seeking to maintain such greater administrative flexibility in the working poor. The Working Group benefits. Thus, under the current making financial eligibility discussed the fact that this action would regulation, an applicant whose income determinations. One comment also slightly increase the pool of potential is over the income ceiling but under applicants for service but was of the argued that such a change is justified 150% of the LSC national eligibility opinion that this would not have a because other sections of the rule do not level may be deemed financially eligible negative impact on the quantity or require determinations made by the for assistance in obtaining benefits, but quality of services delivered. Executive Director (or designee). The not for assistance in maintaining them. Turning to the exceptions, LSC existing rule, however, does require that Thus, the applicant seeking assistance proposes to retain the current exception the Executive Director make to maintain benefits would have to be for individuals seeking to obtain determinations regarding whether an turned down, but that same applicant governmental benefits for low-income applicant’s income is primarily could then be found financially eligible individuals and families. Second, LSC committed to medical or nursing home for assistance to re-obtain such benefits proposes to add an exception for once the benefits were lost. expenses. LSC believes it is important to individuals seeking to obtain or Accordingly, LSC proposes to address continue this requirement in this maintain governmental benefits for this problem in the regulation. However, instance because a recipient is making persons with mental and/or physical unlike the situation in obtaining the a determination of financial eligibility disabilities. Many disability benefit benefits, in seeking to maintain benefits for an applicant whose income exceeds programs provide only subsistence LSC considers an upper limit on income the otherwise absolute upper limit of support and those individuals should be unnecessary since in such cases the the income ceiling, that such a treated the same way as those seeking to applicant’s income will necessarily be determination be made by a person in obtain benefits available on the basis of rather limited (for the applicant to have significant authority.2 This is similar to financial need. However, many persons been eligible in the first place for the the LSC view regarding decisions to with disabilities who are eligible for benefits he or she is seeking to waive the asset ceiling. LSC does disability benefits may not be maintain). understand, however, that it is particularly economically The second instance is taken from important for recipients to have the disadvantaged and should not be section 1611.5(b)(1)(B) of the current discretion to delegate certain authority eligible for legal assistance simply by regulation addressing instances in to regional or branch office managers or virtue of eligibility for such disability which the applicant’s income is directors to increase administrative benefits. Therefore, those applicants primarily devoted to medical or nursing efficiency. This is why LSC proposes must have incomes below 200% of the home expenses and does not represent broadening the existing rule to permit applicable poverty level in order to be a substantive change in the current considered financially eligible for LSC- 2 This situation is distinguishable from the other regulation. LSC does propose to specify funded services. exception to the absolute income limit relating to in the regulation, however, that in such applicants seeking to maintain governmental Finally, the proposed regulation cases the recipient is still required to benefits for low income persons. As noted above, maintains the current authorized make a determination of financial in those instances, the applicant’s income will exceptions found in the factors listed in eligibility with regard to the applicant’s already be rather limited, even if exceeding the current section 1611.5. Specifically, the absolute income ceiling. In the medical/nursing remaining income. The existing home expenses situation, this may not be the case recipient would be permitted to regulation could be read to permit an and the applicant’s income may be considerably in determine an applicant whose income is applicant with an income of $300,000 to excess of the ceiling. below 200% of the applicable Federal VerDate jul<14>2003 15:14 May 23, 2005 Jkt 205001 PO 00000 Frm 00044 Fmt 4702 Sfmt 4702 E:FRFM24MYP1.SGM 24MYP1
  8. 8. 29702 Federal Register / Vol. 70, No. 99 / Tuesday, May 24, 2005 / Proposed Rules Poverty Guidelines amount to be LSC Assistant General Counsel, to circumstances’’ affecting the ability to financially eligible for legal assistance Stephen St. Hilaire, Executive Director, afford legal assistance. See 48 FR 54201 supported with LSC funds based on one Camden Regional Legal Services, Inc. at 54203 (November 30, 1983). However, or more enumerated factors that affect Examples of such ‘‘fixed debts and given that other types of expenses the applicant’s ability to afford legal obligations’’ would include mortgage included in the list do not seem to be assistance. As in the current regulation, payments, child support, alimony, and particularly ‘‘special’’ (e.g., mortgage recipients would not be required to business equipment loan payments. LSC payments; child care expenses), LSC no apply these factors in a ‘‘spend down’’ intends that this term should also longer finds this explanation fashion. That is, although recipients include rent in addition to mortgage pursuasive. Rather, LSC believes that would be permitted to do so, they payments. Previous OLA opinions have the exclusion of current taxes, but not would not be required to determine that, addressed mortgage payments but not prior unpaid taxes, from the list of after deducting the allowable expenses, rent and rent has, heretofore, not been factors which recipients’ may consider the applicant’s income is below the considered a fixed debt. LSC now sees under exceptions to the income ceiling applicable income ceiling before no rational distinction between the two has the effect of punishing those determining the applicant to be for the purposes of this regulation and persons who are in compliance with the financially eligible. The regulation therefore proposes to treat these law in favor of persons who are would also be amended to clarify that expenses in a similar manner. delinquent in their legal responsibility the factors apply to the applicant and The term ‘‘fixed debts and to pay taxes. Moreover, as noted above, members of the applicant’s household. obligations,’’ however, is not without applicants for legal services are The factors proposed are identical to the limit. It is not intended to include increasingly the working poor. ones in the current regulation, with the expenses, such as food costs, utilities, Excluding current taxes has a following exceptions: credit card debt, etc. These types of disproportionate effect on applicants • The factor relating to medical debts are usually not fixed as to time who work versus applicants who do not expenses would be restated to make and amount. The Working Group work. Consequently, in the November clear that it refers only to unreimbused considered whether there were 2002 NPRM, LSC proposed including medical expenses, but that medical additional factors which should be current taxes within scope of the term insurance premiums are included; enumerated in this section and several ‘‘fixed debts and obligations’’ (as they • The factor relating to employment members of the Working Group had been prior to 1983). expenses would be reorganized for proposed adding other factors, such as When the Operations and Regulations clarity and would expressly include utilities, to the list. Three of the Committee once again addressed this expenses related to job training or comments LSC received on the issue, field representatives reiterated educational activities in preparation for November 2002 NPRM proposed adding their recommendation that the term employment; utilities to the overall list of factors. income should be defined as income • The factor relating to expenses Although, as the commenters note, after taxes. LSC continues to believe, as associated with age or disability would applicants must pay for some measure noted above, that effectively defining no longer refer to resident members of of utilities, the same can be said for income as net income, while the LSC the family as a reference to the applicant clothing and food, which are also income guidelines (and the underlying or members of the applicant’s certainly basic necessary expenses. DHHS Federal Poverty Guidelines household is proposed to be However, these sorts of costs have never amounts on which the LSC guidelines incorporated elsewhere in this section been covered by the types of expenses are based) are calculated on the basis of of the regulation; which recipients are generally permitted gross income would make the regulation • The factor relating to fixed debts to consider in determining the ability of internally inconsistent. Rather, LSC and obligations would be amended to an applicant to afford legal assistance. believes that considering taxes a factor read only ‘‘fixed debts and obligations;’’ With the exception of housing expenses which can be considered by the • A new factor, ‘‘current taxes’’ (which fall under the heading of fixed recipient in making financial eligibility would be added to the list. debts and obligations, a category which determinations addresses the practical With regard to ‘‘fixed debts and does not generally include utilities problem raised by the commenters. obligations,’’ the current regulation because utility bills are not typically However, the Committee considered provides little guidance as to what is fixed as to time and amount), the other current taxes as fundamentally a meant by this term, except to factors represent expenses for items different kind of expense than the other specifically include unpaid taxes from which may not be particularly expenses falling within the scope of prior years. LSC proposes to simply use extraordinary, but which are for things ‘‘fixed debts or obligations.’’ Instead, the the term ‘‘fixed debts and obligations,’’ other than the most basic necessities. Committee recommended, and the while providing guidance in the Although LSC is not proposing adding Board agreed, that current taxes should preamble as to what is encompassed by any additional factors, LSC specifically be a separate category of authorized the term. LSC believes that this invites comment on this matter. exception to the annual income ceiling. approach will provide recipients with Another issue which was raised in the Accordingly, LSC proposes to add a new flexibility in applying the rule, while Working Group in the context of subsection (iv) to section 1611.5(a)(4). providing more guidance than could consideration of the scope of the term LSC invites comment on the proposed easily be contained in regulatory text. ‘‘fixed debts and obligations’’ was the addition of the authorized exception for Prior guidance from the LSC Office of inclusion of current taxes. Prior to 1983, current taxes and on the appropriate Legal Affairs has stated that, ‘‘in the Part 1611 included current taxes along scope and specific terminology which absence of any regulatory definition or with past due unpaid taxes as a fixed LSC should use to describe and define guidance as to the meaning of ‘‘fixed debt. When the regulation was changed this proposed exception. debts and obligations,’’ the common in 1983, the reference to taxes was meaning of the term applies’’ and that amended to refer only to unpaid prior Section 1611.6—Representation of it encompasses debts fixed as to both year taxes. This change was justified on Groups time and amount. See Letter of the basis that the 1611.5 factors were The eligibility of groups for legal November 1, 1993 from J. Kelly Martin, intended to account only for ‘‘special assistance supported with LSC funds VerDate jul<14>2003 15:14 May 23, 2005 Jkt 205001 PO 00000 Frm 00045 Fmt 4702 Sfmt 4702 E:FRFM24MYP1.SGM 24MYP1
  9. 9. Federal Register / Vol. 70, No. 99 / Tuesday, May 24, 2005 / Proposed Rules 29703 was a subject of extensive discussion there is or can be a wide variety of representation of groups whose primary among both the members of the Working opinion on what the ‘‘primary function’’ activity is the ‘‘furtherance of the Group and at the 2004 and 2005 of any group is and on what is ‘‘in the interests of’’ persons who would be meetings of the current Operations and interests’’ of the eligible client eligible. Regulations Committee. Prior to 1983, community. The LSC representatives The Board agreed that permitting LSC the regulation permitted representation were concerned that the risk and effort recipients to use LSC funds for the of groups that were either primarily related to articulating and enforcing a representation of groups which provide composed of eligible persons, or which necessarily subjective standard would services to low income persons is had as their primary purpose the be inappropriate. Rather, LSC consistent with the LSC mission and furtherance of the interests of persons in representatives were of the opinion that could be an efficient use of LSC the community unable to afford legal already scarce legal services resources resources, provided that the legal assistance. In 1983, the regulation was would be better devoted to providing assistance is related to the services the amended to preclude the use of LSC assistance to eligible individuals or group provides. The Board also agreed funds for the representation of groups groups of eligible individuals. In the that extending the permissible use of unless they were composed primarily of end, the Working Group did not achieve LSC funds for the representation of individuals financially eligible for consensus on this issue and the Draft groups whose primary activity is the service and to add a requirement that NPRM did not propose to permit the ‘‘furtherance of the interests of’’ low any group seeking representation representation of groups other than income persons would not be demonstrate that it lacks the funds or those primarily composed of eligible appropriate because of the necessarily the means to obtain the funds to retain individuals. subjective nature of determining what is private counsel. In its deliberations on the Draft in the ‘‘furtherance of the interests of’’ During the Working Group meetings, NPRM, the Operations and Regulations low income persons. representatives from the field proposed Committee acknowledged the legitimacy Accordingly, the proposed rule would that LSC revise the regulation to once of the concerns of the LSC permit a recipient to provide legal again permit the representation of representatives, but determined that the assistance supported with LSC funds to groups which, although not primarily value of permitting the representation of a group, corporation, association or composed of eligible persons, have as a groups having a primary function of other entity if the recipient has primary function the delivery of providing services to, or furthering the determined that the group, corporation, services to, or furtherance of the interests of, those who would be association or other entity lacks and has interests of, persons in the community financially eligible outweighed any risks no practical means of obtaining private unable to afford legal assistance. attendant upon such representation. In counsel in the matter for which Examples of such a group might be a approving the recommendation of the representation is sought and either: food bank or a rural community Committee, the Board directed that the (1) The group, or for a non- development corporation working to Draft NPRM be amended to propose membership group, the organizing or develop affordable housing in an permitting such representation operating body of the group, is primarily isolated community. Field (including any conforming amendments composed of individuals who would be representatives noted that in such cases, necessary) prior to publication of the there may not be local counsel willing NPRM for comment. The NPRM financially eligible for legal assistance to provide pro bono representation and published in November 2002 reflected under the Act; or that the group might not otherwise be this direction. (2) The group has as a principal able to afford private counsel. Further, When the new Operations and activity the delivery of services to those the field representatives noted that Regulations Committee considered this persons in the community who would restricting recipients to representing issue, field representatives once again be financially eligible for LSC-funded with LSC funds only those groups supported changing the regulation to legal assistance and the legal assistance primarily composed of eligible permit the representation of groups sought relates to such activity. individuals prevents them from having as their primary function the The first instance, relating to the providing legal assistance in the most provision of services to, or furthering eligibility and representation of groups efficient manner possible as other the interests of, those who would be composed primarily of eligible groups may be better able to accomplish financially eligible (providing the group individuals, represents the current results benefitting more members of the could demonstrate its inability to afford practice permitted by current section eligible community than would to retain private counsel), while LSC 1611.5(c). The proposed rule is intended representation of eligible individuals or Management initially once again to have the same interpretation of groups composed primarily of such supported permitting only the ‘‘primarily composed’’ that has individuals. Field representatives also representation of groups primarily developed and been adopted in practice noted that the rule requires that the composed of eligible individuals. over the years since 1983. In the case of group would have to provide However, upon further reflection and membership groups, at least 51% of the information showing that it lacks and consideration of the arguments made by members would have to be individuals has no means of obtaining the funds to the field and the comments made by who would be financially eligible; in the retain private counsel, so that the rule members of the Operations and case of non-membership groups, at least would not permit representation of well Regulation Committee, LSC 51% of members of the governing body funded groups. Management ultimately recommended would have to be individuals who The LSC representatives were that the regulation could be broadened would be financially eligible. The latter concerned that allowing the use of LSC to permit the representation, in addition instance represents a variation on one of funds to support the representation of to groups primarly composed of eligible the situations permitted by the pre-1983 groups not composed primarily of individuals, groups which have as a rule, although the language would be eligible clients would be problematic. In primary activity the delivery of services revised to focus on ‘‘principal activity’’ the examples given, the ‘‘primary to persons who would be eligible. rather than ‘‘primary purpose’’ and the function’’ of the group is easily Management continued to recommend rule would only permit the discernable. It may be, however, that that the regulation not permit the representation of groups which have as VerDate jul<14>2003 15:14 May 23, 2005 Jkt 205001 PO 00000 Frm 00046 Fmt 4702 Sfmt 4702 E:FRFM24MYP1.SGM 24MYP1

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