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MCLE Self-Assessment Test

Bar dues will drop by $10, legal services
will get $10 million

By Nancy McCarthy
Staff Writer

A State Bar fee bill that includes a $10 rebate for all California attorneys and a potential $10 million windfall for the state's beleaguered legal services programs was headed for a vote in Sacramento after the Assembly Judiciary Committee approved the amended fee measure last month. The bill, SB 163, includes changes to bar governance as well, but the board of governors directed bar leaders to ask lawmakers to make several modifications. By an 11-6 vote, the full bar board backed SB 163, prior to the amendments that mean an estimated $8.4 million reduction in the agency's general fund over two years.

Executive Director Joe Dunn told the judiciary committee that the board's operations committee voted unanimously to support the amended bill, authored by Sen. Noreen Evans, D-Napa. It goes to the Assembly floor next.

Noreen Evans

Evans touted the increase in funding for legal services as "a very important provision" for programs whose IOLTA funding has been "decimated." Nearly 100 legal services programs in California, underwritten by funds generated by Interest on Lawyer Trust Accounts, have seen their funding dry up as interest rates declined in recent years.

The bar has an estimated cumulative surplus of $12.4 million this year, due to belt-tightening measures that include a hiring freeze, no salary increases, and a halt or reduction to many programs following Gov. Schwarzenegger's veto of the fee bill in 2009.

SB 163, amended with input from legislative leaders in both houses, includes:

  • A $10 reduction in member dues for 2012. This means most active members will pay $400. The reduction is also available to inactive lawyers, who will owe $115.
  • Increasing the amount each lawyer can donate, by a check-off box on the bill, to legal services from $10 to $20 for the next two years.
  • Transferring $2 million in both 2012 and 2013 from the bar's insurance affinity program account (non-mandatory dues money) to IOLTA-funded legal services programs.

Dunn told the Assembly Judiciary Committee that the bar committee was "extremely proud to embrace" the amendments reached with legislative leaders. "This one-time rebate gives back to our members when we find ourselves in the fortunate circumstance of having budgeted wisely and enjoying a short-term surplus," Dunn said.

The bar governance changes, described in a bill analysis as "the most sweeping changes" in decades, were the result of a compromise between majority and minority reports by a governance reform task force. The group's debate boiled down to how many people should serve on the board of governors and how they should get there.

But in spite of Dunn's warning that the legislature "is pretty serious about this compromise," some board members are unhappy that their numbers will shrink under the proposal. "I really stand bewildered as to how it is that the legislature thinks this board has acted inappropriately to promote the administration of justice or to protect the public," said Gretchen Nelson, a governor from Los Angeles at a board meeting prior to legislative action. "I have heard nothing (to indicate) that a 23-member board (negatively) impacts public protection."

SB 163 reduces the board from 23 to 19, with six elected lawyers, five lawyers appointed by the Supreme Court and two more lawyer appointments by the legislature. Attorneys could be elected or appointed to one additional term but terms of the six public members would be unlimited. A six-person governance task force will be made permanent.

Dunn made clear that the lawmakers' proposal meant "we're pretty serious about this compromise. We're open to discussion but we're not open to going back to where we came from."

Nonetheless, Nelson introduced a seven-point memo directing Dunn and lobbyist Jennifer Wada to seek amendments that include leaving the board membership at 23, standardizing three-year terms for all board members, and eliminating the governance task force. Nelson and other board members complained that the six-member panel will create a "mini super-board" with disproportionate influence.

The debate on her proposal showed clear divisions remaining on the board when several backers of the minority report, which called for reducing the board to 11, said further discussions were inappropriate and amounted to revisiting issues already decided.

Former Assemblywoman Gwen Moore, a public member, said rejecting the legislative proposal for 19 board members is unacceptable and "becomes an irritant to the legislature to feel we are digging in our heels or are resistant to change.

"We have to be very careful on how we craft this," Moore added, "so as not to piss them off and do more harm than being helpful."

Board members who were not on the governance task force and had no voice in its deliberations were unswayed. "Some of us here were second-class citizens in this process," said Pat Kelly, a Los Angeles governor. Kelly was particularly worried that an ongoing governance task force would have excessive power within the board of governors and said he had "trouble" with legislators getting to appoint two more lawyers to the board.

Dunn, a former senator who is well-connected in Sacramento, told the judiciary committee last month that although the seven areas are in the amended bill, some of them still are under discussion.