Statement of Administration Policy: H.R. 2039 - Legal Services Reauthorization Act of 1992

(House Floor)
(Frank (D) MA)

The Administration is pleased that Congress is considering the reauthorization of the Legal Services Corporation (ISC). Reauthorization is long overdue. The Administration, however, opposes enactment of H.R. 2039. If H.R. 2039 were presented to the President in its current form, his senior advisers would recommend a veto. The most critical issues relating to H.R. 2039 are discussed below.

—   The bill's restrictions on redistricting-related activities only prohibit such activity with respect to a congressional or State legislative district. The Administration supports such restrictions, but believes that all redistricting-related activities at all levels of government must be prohibited. Any new reauthorization legislation that does not prohibit LSC recipients from engaging in any redistricting activities involving legislative, judicial, or other elective districts at all levels of government is unacceptable.

—   The bill's restrictions on abortion-related activities are wholly inadequate. The bill fails to incorporate into the authorization statute the restriction that has been in the annual appropriations bill which prohibits the Corporation or any LSC recipient from using LSC funds to participate in any litigation with respect to abortion. Thus, this raises the specter of annual battles in the appropriation process over an issue that should be addressed in the authorization process. Any new reauthorization legislation that does not incorporate current statutory restrictions on LSC recipients on litigation and lobbying activities pertaining to abortion is unacceptable. The Administration supports the amendment to be offered by Representative Gekas, which would ban LSC recipients from engaging in any abortion related activities with any funds, including Interest On Lawyer Trust Accounts (IOLTA) funds.

—   The bill does not provide for the establishment of competition in the awarding of grants. Instead, H.R. 2039 calls for a feasibility study on the use of competition. This proposal falls short of what is clearly needed. LSC grantees operate on a presumptive refunding basis. Unless LSC meets the heavy burden of demonstrating that the recipient violated the law, the grantee automatically receives a new grant each year. This system does not promote excellence among grantees because the incentive is absent to deliver legal services that meet the needs of clients.

The President has long been a strong promoter of pro- competitive, market-oriented solutions for delivering the best products and services to consumers. The delivery of legal services should be no different, and such services should be subject to the power of the marketplace. The beneficiary of these marketplace incentives will be the eligible clients who need services, not necessarily individual legal services lawyers or grantees. Any new reauthorization legislation must establish a genuine system of competition for all grants.

—   Accountability is another issue of critical importance. At the present time, there is a concern that Federal dollars are cross-subsidizing federally proscribed activities. Therefore, the Administration supports the amendment to be offered by Representative McCollum, which prohibits LSC recipients from using non-federal funds on federally proscribed activities. The Administration supports the timekeeping provision in H.R. 2039, which provides for appropriate timekeeping measures of accountability, but believes additional provisions addressing accountability issues need to be added.

The Administration also supports the amendment to be offered by Representative Stenholm, prohibiting the awarding of attorney's fees to LSC grantees because the rationale for awarding attorney's fees is absent under these circumstances. LSC clients do not need assistance paying for attorney's fees because such services are provided for free.

—   The bill's restrictions on lobbying activities are wholly inadequate. These provisions would allow legal services attorneys to pursue social causes at the expense of the basic needs of eligible clients. Pursuance of such wide- ranging lobbying activities departs from the LSC's historic purpose of delivering traditional legal services to poor people. Although there may be very limited circumstances in which legislative representations may be legitimate on behalf of an individual client with a specific problem, H.R. 2039 allows activities far beyond these circumstances.

—   The bill's restrictions on monitoring prevent LSC from ensuring that recipients are using Federal funds in accordance with relevant regulations and statutes. The bill must provide the Corporation with adequate tools to monitor recipients and conduct thorough and complete investigations when necessary.

The Legal Services Corporation is a constitutional anomaly whose structure results in serious control and accountability problems. By statute, the Corporation is not an agency or instrumentality of the Federal government, yet it has many of the characteristics of a government agency. The Administration objects to the Corporation's hybrid nature, and believes LSC should be made clearly either a governmental entity accountable to the Executive Branch or a private organization.

The provisions mentioned above are some of the primary areas of interest and concern to the Administration. There are other provisions of the bill that are also problematic. The Administration stands ready to work with Congress to fashion an acceptable LSC reauthorization act.

If these issues are not satisfactorily addressed, the President's senior advisers would recommend a veto.