The lawyer-supported fund that pays for indigent clients' representation has declined by about 75 percent in the past year, threatening the ability of Legal Services of New Jersey to continue operating at its current level, the agency said yesterday.
Legal Services is expecting to receive $3 million from the Interest On Lawyers Trust Accounts program when the next fiscal year begins in July, a drastic drop from the $12.4 million it received from that same fund for the current year, said Legal Services spokesman Tom Makin.
"Legal Services programs face a financial cliff as of June 30, 2009, when all reserves are drained and other one-time strategies are exhausted," said Legal Services president Melville D. Miller Jr.
Legal Services received a $4 million increase in state funding between 2008 and 2009, said Treasury Department spokesman Tom Vincz. The state's new economic stimulus package gave the agency another $9.5 million for the current fiscal year, which ends June 30. That money is designated for foreclosure legal assistance to provide legal services to homeowners and tenants in civil matters related to financial distress, including mortgage foreclosure, bankruptcy, debt collection and eviction.
That same stimulus package allocated $12 million in grant-in-aid funds for training housing counselors and $500,000 for the state judiciary for foreclosure mediation services.
What happens to the foreclosure program on July 1??? Hopefully this article is a public press for more funds. But it sounds like the agency as a whole will be taking a big hit. This funding problem appears to be for "indigent client representation" program. The huge reduction of funds may hurt the agency but there is a chance the foreclosure modification program could stay intact. Hopefully that the worst that happens.
Now, we need some numbers on how the remediation program is working...