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Study finds legal aid yields seven-fold return on investment

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Study finds legal aid yields seven-fold return on investment

With funding for civil legal aid in Florida at its lowest point in 10 years, a new study shows that every dollar spent on civil legal services for the state’s low-income residents yields more than $7 in economic impacts.

Legal aid funding graph Commissioned by The Florida Bar Foundation, the study found that 33 Florida nonprofit civil legal aid organizations produced $600 million in economic impact with $83 million in total funding from sources including the Foundation, the Legal Services Corporation, local governments, donors, and others in 2015. Florida Bar President Bill Schifino praised the role Bar members play in providing pro bono services, but said more can be done.

The study was released February 2 at press conferences in Miami and St. Petersburg and was presented February 3 at the Supreme Court’s Commission on Access to Civil Justice.

“Equal justice under law is not only a basic underpinning of our democracy; it’s also good economic policy,” said Florida Bar Foundation President Matthew G. Brenner. “This study adds to a large body of empirical data — from Florida as well as other states — that clearly demonstrates that society at large benefits when the rights of the poorest and most vulnerable among us are protected.”

One of the largest economic impacts of civil legal aid results from assistance in obtaining the federal benefits, child support, wages, and unemployment compensation to which Florida residents are entitled, income that is in turn spent within Florida. The federal benefits obtained for legal aid clients include:

• $120.6 million in Social Security benefits;

• $70.7 million in Medicaid and Medicare reimbursements; and

• $2.7 million in veterans’ benefits.

With civil legal aid helping capture $264.3 million in such income and reimbursements for Floridians, Florida businesses are estimated to have experienced $274.8 million in increased income in 2015. Investment in civil legal aid also is estimated to have generated 2,243 new jobs.

Not only does civil legal aid put dollars directly into the economy, it also saves money for the government, businesses, nonprofits, clients, and others in a variety of ways. The study found that:

• $2.9 million in costs for emergency shelter were avoided for low-income families who, with the assistance of legal aid advocates, were able to avoid eviction or gain time to seek alternative housing;

• $50.6 million in foreclosure costs were avoided by low-income homeowners, lenders, neighbors, and local governments;

• $6.9 million in costs associated with domestic violence were avoided.

The study points out that civil legal aid also helps ease the burden on Florida’s court system by helping people who are self-represented navigate the system and helping the public understand legal processes. Civil legal aid organizations also support and leverage the pro bono work of private attorneys.

Working with legal aid agencies and on their own, Schifino said last year Florida attorneys collectively provided 1.7 million hours of pro bono service and contributed another $5.3 million to legal aid organizations.

“Many Florida lawyers do their pro bono work with the support of legal aid organizations that provide expertise and resources to enable them to work in areas of the law that may be outside their typical scope of practice. Legal aid organizations also play a big role in handling the screening and assignment of cases to volunteer attorneys,” Schifino said. “Although these [pro bono] figures are impressive, they are sadly still not enough to meet the growing needs. Florida’s poverty rate has risen from 11.1 percent in 2005 to 16.2 percent in 2015. A million Florida children are living in poverty — almost one in four. Various studies and reports have shown that even in the best of times about 80 percent of low-income litigants either go it alone or simply give up when faced with a legal challenge.”

“Civil legal aid helps ensure fairness in our justice system,” said Chief Justice Jorge Labarga. “But its benefits extend well beyond that. A large number of our citizens fall in the legal services gap. They just cannot afford a lawyer at today’s prices. This study shows that when they have a good way to resolve their civil legal problems, they can remain important assets to their families, on their jobs, and in their communities.”

Results of the study suggest that every additional $100,000 in funding enables legal aid organizations to generate $719,000 in economic benefits. The analysis was conducted by The Resource for Great Programs, a research firm with more than 20 years’ experience conducting similar economic impact studies.

“That’s why it’s so important to get the word out that — as Matt said — civil legal aid does more than help individual clients and their families. It makes our communities — and our state — stronger and more prosperous and boosts our economy,” Schifino said. “A seven-to-one return on investment is hard to come by in any scenario. I know I’d take that kind of ROI on my investments any day. And that’s what civil legal aid gives us. We now have the data to show it.. . . It’s the right thing to do, and it’s the smart thing to do.”

The economic return-per-dollar findings are similar to those from legal aid economic impact studies conducted in other states, including Texas ($7.42), Iowa ($6.71), Tennessee ($11.20), and Virginia ($5.27), and by other researchers. A previous study performed by Florida TaxWatch in 2010 using 2008 data found an economic impact of $4.78 for every dollar spent on civil legal aid in Florida.

ABA President-elect Hilarie Bass, co-president of Greenberg Traurig, said funding is needed not only to provide direct services to low-income clients, but also to implement technology that will make the legal system more accessible to all.

“Through innovation, we can maximize the tools that technology affords us to make legal information more readily available to all persons otherwise unable to afford an attorney,” Bass said. “We can provide pro se litigants with greater access to the information and forms they need to navigate a complex judicial system, and recognize that there are multiple new forms of assistance for the millions of Americans who seek legal assistance, but who have been turned away for years for lack of funding.”

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