Copyright 1999 Federal Document Clearing House, Inc.
Federal Document Clearing House Congressional Testimony
September 29, 1999
SECTION: CAPITOL HILL HEARING TESTIMONY
LENGTH: 10894 words
HEADLINE:
TESTIMONY September 29, 1999 JOHN ERLENBORN VICE CHAIR OF BOARD OF DIRECTORS
HOUSE JUDICIARY COMMERCIAL AND ADMINISTRATIVE LAW LEGAL
SERVICES CORPORATION
BODY:
STATEMENT OF
THE LEGAL SERVICES CORPORATION BEFORE THE HOUSE JUDICIARY
SUBCOMMITTEE ON COMMERCIAL AND ADMINISTRATIVE LAW SEPTEMBER 29, 1999 BY JOHN
ERLENBORN VICE CHAIR OF BOARD OF DIRECTORS AND JOHN MCKAY PRESIDENT INTRODUCTION
Mr. Chairman and Members of the Subcommittee, thank you very much for the
opportunity to testify. The Legal Services Corporation ("LSC"
or "the Corporation") welcomes this opportunity to address the House Judiciary
Subcommittee on Commercial and Administrative Law which has oversight
responsibility for the Legal Services Corporation. The Legal Services
Corporation is a private, non- profit corporation, created by Congress
to seek to ensure equal access to justice for all by supporting the provision of
civil legal assistance to those who otherwise would not be able to afford it.
For Fiscal Year 1999, Congress appropriated $300 million for LSC, $289 million
of which the Corporation is using to fund 257 grantees throughout the nation and
its territories. The Corporation uses less than 3% of its total appropriations
for its own management and administration. On behalf of the Board of Directors
of the Corporation and its Management Team, we are pleased to report on the
record of accomplishment the Corporation has compiled over the past six years.
We take particular pride in the Corporation's implementation and enforcement of
the Congressional restrictions enacted in 1996, as well as our management
initiatives to promote the highest and best use of federal funds in every state
and encourage competition for legal services grants. The LSC Board and staff are
committed to its mission as defined by the LSC Act: to promote equal access to
our system of justice for low-income people throughout the United States. In his
remarks in August, Chairman Gekas stated that this oversight hearing would be
about accountability: a careful review of the facts to assure Congress and the
American people that LSC funds are used to serve the poor and guarantee them
access to the courts. He also urged that accountability for these goals by all
professionals in the civil equal justice community be part of the next era of
LSC. We are here to demonstrate, by our record since 1996 and by our open and
complete cooperation with the fact- finders looking into the case service
reporting issues, that accountability - and credibility - are central to the
present era of LSC. Record of Accomplishments, 1996-99 1. Competition. The role
of LSC is to manage and oversee the federal funds that support the direct
provision of legal services by some 257 grantees across the nation and its
territories. Since 1996, the Corporation has used a system of competition for
grants to promote the economical and effective delivery of legal services, as
required by 1007(a)(3) of the Legal Services Corporation Act.
We encourage local legal services providers and others to compete for available
grants by broadly circulating information about the availability of grant funds
and by providing outreach and technical support to potential applicants. In the
competition process, LSC evaluates applications according to established quality
standards and awards grants to the applicants best able to provide high-quality
legal services in accordance with applicable legal requirements. LSC also uses
the competition process to promote increased volunteer private attorney
involvement and to expand public-private partnerships, through which other
resources can be secured to build upon federal funding. During the grant period,
LSC works with successful applicants to improve areas identified in the
competition process as requiring development. In 1999, our fourth year of
competition, we received grant applications from 169 applicants for 217 service
areas in 41 states and the District of Columbia. There were multiple applicants
in five (5) service areas. These FY 2000 grant decisions will be made this
November. Seventy-three current recipients whose grants were not up for
competition this year were subject to a grant renewal process to ensure their
continued compliance with grant conditions. Competition has resulted in improved
legal assistance to our client community. First, it ensures the most effective
and efficient applicant in each service area is awarded the grant to deliver
legal assistance to low-income persons. While competition between more than one
applicant for a service area is rare, the process has allowed for several
changes in legal services providers in the last four years. Most recently, a new
applicant successfully competed with an LSC grantee of long-standing to take
over the provision of legal assistance in a large, metropolitan area in the
mid-west. Second, the competition process identifies weaknesses and strengths of
programs. When necessary, programs are visited, short funding periods are
initiated and improvement efforts are undertaken. This process has led to
important improvements and, where reform was not forthcoming, to the replacement
of providers. Third, through the use of technology, LSC is developing the
capacity to analyze application data in order to identify significant statistics
regarding the programs; for example, where programs are most successful in
leveraging non-LSC funding. Finally, the state planning process, which is a
component of the competition process and will be explained in more detail below,
asks programs and other legal services providers in each state to work together
to more effectively deliver services. Competition has already led to the growth
of centralized intake systems, to more consumer education and
self-representation projects, and to more effective pro bono efforts. 2. State
Planning. LSC, as a major funder for equal access to civil justice in every
state, has a duty to stimulate the most effective means of delivering legal
services to low-income and vulnerable people. We are committed to effective and
meaningful partnerships with our grantees and the broader civil justice
community. We are also obligated to ensure that our investment promotes the
efficiency and effectiveness of client service and complements the efforts of
other civil legal services providers. Beginning in February 1998, the
Corporation has required all grant recipients to participate in a process to
develop and implement a comprehensive, integrated statewide delivery system, in
every state. The goals of this process are to ensure the following: that
programs= efforts are coordinated with all providers in a state to meet pressing
client needs; that there are enough opportunities for training and information
sharing between programs; that programs are keeping up with and using new
technology; and that programs are working together to increase resources and
develop new initiatives to expand the scope and reach of their services. In
concert with all stakeholders, each LSC-funded program must, therefore, assess
the strengths and weaknesses of the current approach in their state, establish
goals to strengthen and expand services to eligible clients, and determine the
major steps and a timetable necessary to achieve those goals. Our overall
objective in this process is to promote the highest and best use of federal
dollars in every state system. LSC will continue to review program configuration
in all states and promote program collaboration and/or consolidation where it
appears that federal funds could be used more effectively and efficiently by
programs or joint efforts serving broader areas or entire states. In addition,
while configuration is often the most visible component of the state planning
efforts, it is only one of several strategies to available to achieve these
goals. Therefore, LSC will seek to identify, test, and evaluate other new
strategies to enhance the effectiveness and quality of legal services, and to
promote use of promising strategies. 3. Regulations. Development of regulations
is a major function of the Corporation and is vital to the oversight of the
grant system. Since 1996, LSC has revised and issued final rules affecting 24
parts of its regulations. For example, in 1996, the Corporation issued three
rules affecting timekeeping requirements, prohibiting representation in
drug-eviction cases, and establishing a system of competition for its grants -
all before the 1996 legislative reforms became law. Subsequently, the
Corporation approved 14 regulations by July 1996 to place into effect the 1996
legislative reforms passed in April of that year. Since that time, the Board and
LSC Management have worked diligently to see that all the Congressional reforms
are promptly implemented through regulation and that policy guidance in other
areas is kept up to date and is in full conformance with the law. 4. Enforcement
of Congressional Restrictions. We are committed to ensuring that laws passed by
Congress are fully complied with by our grantees. In 1996, Congress imposed new,
and expanded existing, restrictions on the types of activities in which LSC
grantees may engage to refocus the LSC delivery system on serving individual
clients with particular legal needs. Legal services attorneys are not permitted
to initiate or participate in class actions. They may not challenge or engage in
any activity to reform the welfare system. They may not engage in direct or
grassroots lobbying on behalf of their clients, although they are permitted to
use non-LSC funds to respond to written requests of officials for information or
testimony and to participate in public rulemaking processes. For cases and
claims initiated after April 26, 1996, they may not collect court-awarded
attorneys' fees. Litigation on behalf of prisoners and representation of
undocumented and other categories of aliens are also prohibited. Other
requirements addressed redistricting, cases involving eviction from public
housing of individuals charged with or convicted of drug violations,
administrative lobbying, and the direct solicitation of clients. Unlike past
efforts to redirect the work of legal services, these provisions apply to all of
the funds of a recipient, with few specified exceptions. The Corporation has
made every effort to ensure that these restrictions are followed by all of our
grantees and that the mandate of Congress, as enacted in LSC's FY 1996
appropriations legislation, is being carried out. This Administration has not
hesitated to take strong actions when grantees have failed to comply with the
law or LSC regulations. Fiscal sanctions have and will continue to be imposed,
where necessary and appropriate, up to and including termination of the grant in
its entirety. For example, in 1997 LSC investigated the Texas Rural Legal Aid
("TRLA") for its involvement in a lawsuit challenging absentee voting by
non-resident military personnel in a local election. Although TRLA promptly
withdrew from that case, LSC determined that TRLA had violated the legal
restriction against claiming attorneys' fees and, therefore, admonished the
program and recovered the $7,500 in costs related to the filing of the case. In
1998, the Corporation withdrew funding from the Legal Aid Society of Alameda
County based on its determination that the program lacked the management and
leadership capability necessary to ensure compliance with the law and
Corporation policies. The lack of proper oversight at the program had been
documented by the Corporation's Office of Inspector General and in an on-site
review conducted by LSC's compliance specialists. Another legal services
provider was found for the Alameda service area. Most recently, LSC recovered
$17,000 in LSC funds from the Farmworker Legal Services of North Carolina
("FLSNC") based on its investigation finding a violation of the law by the
representation of aliens who were never present in the United States. LSC also
directed that its migrant funding grant be withdrawn from FLSNC and administered
directly by the Legal Services of North Carolina under strict procedures to
improve management, administration, and oversight of the migrant funds. The sum
of these actions are indicative of LSC's commitment to active grant management
to maximize the use of its federal funding and ensure the integrity of the
programs entrusted to it. 5. LSC Response to Lawsuits Challenging Congressional
Restrictions. The Corporation has vigorously and successfully defended its
regulations and the underlying statutory provisions in two lawsuits challenging
their constitutionality, Legal Aid Society of Hawaii v. LSC (U. S. District
Court, District of Hawaii) and Carmen Velazquez et al. v. Legal Services
Corporation (U.S. District Court, Eastern District of New York). A
three-judge panel of the U.S. Circuit Court of Appeals for the Ninth Circuit
ruled on May 19, 1998, in favor of LSC on the appeal in LASH. It unanimously
reaffirmed the ruling of the U.S. District Court in Hawaii that the application
of LSC restrictions to a recipient's non-LSC funds does not violate the
plaintiffs' First Amendment rights of free speech and association. Retired
Justice Byron White wrote the opinion for the panel, which concluded that LSC's
regulations complied with precedents set in the 1991 Rust v. Sullivan case
regarding restrictions on federally-funded programs. The Supreme Court has
denied certiorari in that case. On January 7, 1999, the Second Circuit upheld as
constitutional virtually all of the statutory restrictions on the use of funds
by LSC's grantees that were challenged in Velazquez v. Legal Services
Corporation. In Velazquez, the panel was divided solely with respect to
a proviso to the restriction on litigation involving welfare reform. The
majority found that the proviso to the exception for "suits-for-benefits" that
bars challenges to existing welfare reform laws impermissibly discriminates on
the basis of viewpoint - that is, it permits representation only if it favors
the status quo over change. The dissenting judge on the panel would have found
the entire welfare reform provision - including the "suits-for-benefits" proviso
- to pass constitutional muster under Rust - a view shared by the Corporation
and, it appears, the Court of Appeals for the Ninth Circuit. The Second Circuit
has denied rehearing and the Corporation expects to pursue its partial appeal of
Velazquez to the Supreme Court. 6. Compliance Monitoring. The Corporation's FY
1996 appropriation also mandated a new system for oversight of program
compliance. The principal mechanism for checking grantee compliance with all
statutory and regulatory requirements and restrictions is now the grantee's
annual audit. These audits are conducted by Independent Public Accountants
("IPAs"), under the guidance and oversight of LSC's OIG. LSC Management retains
responsibility for interpreting applicable law and regulations, investigating
complaints, and enforcing compliance. Management worked cooperatively with the
OIG to implement the new system, which is now fully in place. The results to
date demonstrate general, substantial compliance by grantees with the new
Congressional requirements and restrictions. As reported by the OIG in its
Recipient Audit Reports for 1998, the IPAs did not report any cases of
noncompliance with statutory prohibitions or restrictions on the types of
matters for which legal assistance may be provided.(1) The CSR Issue The
Corporation acknowledges that serious questions have been raised concerning the
accuracy and validity of the case service report (CSR) data submitted annually
by our grantees. The Corporation is aware that problems exist in the statistical
reports received and is making every effort to identify and correct those
problems. The problems identified stem, in part, from a lack of clarity in some
of the Corporation's case reporting guidelines and, more generally, from
insufficient attention by grantees to the existing reporting and documentation
requirements. It should be kept in mind that the issue is largely one of grantee
compliance with technical, administrative guidance on how and when to report
certain activities. In no instance has the Corporation, its Inspector General,
or the General Accounting Office, identified any fraud or intentional
misrepresentation by any of the grantees in their compilation and reporting of
this data. Nor have these or any of the financial and compliance audits
conducted under the auspices of the OIG indicated that taxpayers' dollars were
being grossly misspent by the grantees. In its public reporting of activities,
which includes CSR data reported by its grantees, the Corporation did not
intentionally deceive or mislead the Congress in order to secure for itself and
its grantees increased funding, nor did it attempt at any time to hide from the
public or Congress the problems which were emerging in the CSR system and its
efforts to correct these deficiencies. Rather, the Corporation views the issues
concerning the CSR data to be akin to those encountered by many government
entities as they attempt to meet the goals envisioned by the Government
Performance and Results Act ("GPRA"). 1. Self-initiated Review of CSR Data. The
Corporation's review of its CSR data was an outgrowth of its ongoing oversight
responsibilities and became integral to its voluntary strategic planning
process. Although not subject to the Government Performance and Results Act ,
the Corporation shared the aspirations of that law to rationalize the budget and
appropriations processes by tying funding into objective measures of the
agency's performance. In November 1997, the LSC Board adopted its first
Strategic Plan for FY1998-2003. That plan is currently being revised - as are
the initial plans submitted by many governmental entities. As recently reported
by GAO, most federal agencies are far from meeting the goals set by GPRA for
performance data on which the Administration and Congress can rely in setting
budget amounts and appropriations levels. Nonetheless, the Corporation, having
embarked on the path laid out by GPRA, recognized the need to assess the data
currently available on grantee activity for its accuracy and adequacy as a
measure of the Corporation's performance. This task fell initially to the
Inspector General, who planned to perform numerous site visits during 1998 to
assess the CSR system. Two factors shaped the planning process at that time: the
forward looking nature of the objective - that is, how will the system function
in the year 2000 and beyond as a performance measure - and the focus on systemic
problems rather than the accuracy of any particular data submission. Hence, the
plan was to identify the types of errors to which the current case reporting
system may be prone in order to eliminate those errors system-wide. It was not
designed to validate or test the accuracy of the national totals of cases
handled by grantees in 1997. 2. The CSR Problem Assessment. What the Corporation
and its Inspector General found when they began the assessment of the CSR system
was a 20-year-old reporting structure, the guidance for which had not been
updated since 1993. The reporting system rested on the definition of a "case."
However clear and meaningful the definition of a case may have been in the past,
it was evident that the definition had not kept pace with the changes in the
service delivery systems. As the pace of the evolution of service delivery
systems and the configuration of grantees accelerated following the funding
cutbacks and program reforms in 1996, and spurred on by the technological
revolution, the reporting of grantee activity solely on the basis of "cases" was
becoming increasingly inadequate, resulting in inconsistent and inaccurate
reporting. Moreover, routine, on-site reviews of grantee activity reports has
been lacking since 1995. Because the grant activity reports of which the CSRs
were a part were neither a statutory nor regulatory requirement, the IPAs were
not charged with determining grantee reporting compliance. During 1996 and 1997,
the Corporation's enforcement capacities were devoted primarily to compliance
with the 1996 legislative reforms, following up on compliance referrals from the
Office of Inspector General, and investigating complaints. Its staff oversaw the
transition efforts in 1996 to ensure that the LSC funded programs properly and
timely withdrew from some 630 class actions, 428 cases involving prisoners,
2,991 ineligible alien cases, and otherwise conformed their policies and
practices to the law. There were few resources available to systematically
oversee administrative requirements such as CSR data. Nonetheless, in early
1998, the Corporation did investigate a complaint which had been referred by its
Inspector General alleging a grantee was purposefully inflating its CSR data.
While that investigation did find problems with the grantee's reporting of
cases, it did not find any intentional misreporting, fraud or mismanagement, and
the system errors were corrected by the grantee prior to the submission of its
1997 CSR data. As these concerns surfaced, the Corporation decided as an initial
step to reissue the 1993 CSR Handbook in May, 1998, with additional guidance on
particular areas which were considered to be most prone to error. In general,
programs were directed to review their own reporting procedures and practices to
ensure they conformed to the Handbook and to ensure that all branch offices were
aware of and were following these procedures. Programs were reminded not to
report financially or otherwise ineligible clients, referrals of ineligible
cases or cases for which no legal work was performed, and cases wholly funded
with non-LSC funds. Recognizing that the guidance would not affect the 1997 CSR
data which had already been submitted by the grantees, the Corporation sought to
heighten the awareness of grantees to the CSR requirements and focus their
attention on potential problem areas. As previously reported to Congress, a
number of grantees did voluntarily submit corrections to their 1997 CSR data
during 1998. During the course of the year, as more information became available
to the Corporation about the nature and scope of the problems with the CSR data,
LSC undertook substantial revisions to the CSR Handbook, which was issued in
November, 1998. 3. On-site Reviews. The Inspector General began the field work
for the six programs selected for the CSR audits in April, 1998, and completed
the field work by November, 1998. Following government auditing standards, the
OIG established the criteria by which the grantee's CSR system would be audited
and the results reported. The following chart identifies the six programs
reviewed by the OIG, the month in which the field work was completed, the month
in which the final report was issued, and the error rate attributed to closed
cases: Program Field Work Final Report Error Rate for Visited Completed Issued
Closed Cases Legal Services of Northern Virginia May 1998 October 1998 13% Gulf
Coast Legal Foundation (Houston) June 1998 July 1999 22% Legal Action of
Wisconsin, Inc. July 1998 August 1999 6% Legal Aid Society of San Diego October
1998 March 1999 68% Prairie State Legal Services (IL) November 1998 May 1999 6%
Legal Services of Greater Miami, Inc. November 1998 March 1999 76% In the course
of these audits, the Inspector General identified a number of common causes to
errors in reporting the number of closed cases. Most, but not all, programs had
failed to timely close cases, thus counting a case as closed in 1997 when it
should have been closed in a prior year. Another error common to many programs
was the counting as a case applicants for service who were referred to another
provider or who otherwise did not receive legal assistance which met LSC's
definition of a case. Most, but again not all, the programs had counted some
cases more than once - although the reason for the duplication varied. For
example, one program counted the same case as closed at the time it referred the
case to the provider of its private attorney involvement ("PAI") program and
again when the PAI provider closed the case. Another program counted as separate
cases subsequent client contacts even though it involved the same legal issue.
Most programs also had a higher error for their open case count than for their
closed case count. For all programs, the primary contributor to the open case
error rate was the grantee's failure to timely close cases. Finally, while not
included by the Inspector General as a misreported case for CSR purposes, the
lack of adequately documented financial eligibility, particularly with respect
to a client's assets, and the absence of signed citizen attestation forms were
noted in a number of the reports. The audits conducted by the Government
Accounting Office and reported in June, 1999, confirmed the Inspector General's
findings as to the factors causing systemic errors in grantee case reporting.
The GAO visited five large programs: Puerto Rico Legal Services, Inc., Legal
Services for New York City, Legal Aid Foundation of Los Angeles, Legal
Assistance Foundation of Chicago, and the Legal Aid Bureau, Inc. in Baltimore,
Maryland. Overall, the GAO deemed questionable approximately 34% of both open
and closed cases reported by the five grantees. The percentage of questionable
cases for individual programs ranged from 7% to 42%. A problem common to all
programs was the untimely closure of cases, although again the extent of the
problem in any particular program varied from under 4% in one program to over
30% in another. The GAO audits also confirmed that documentation problems, as
noted by the earlier Inspector General reports, were widespread. Overall, the
GAO questioned between 5-9% of the cases reported because of the lack of
adequate financial eligibility documentation and between 7-24% of the cases for
lack of citizenship or alien status documentation. It should be noted that GAO
concluded only that the case files failed to contain the documentation necessary
to confirm the eligibility status of the clients served; it made no
determination as the eligibility or ineligibility of any these clients. 4. LSC's
Corrective Action. As the audit information rolled out during 1998 and well into
1999, the Corporation gained a fuller understanding of the extent of the CSR
data problem and its complexities. Even though quantifiable data was lacking
during most of 1998, the Corporation had sufficient information to begin taking
actions to address the problems. As previously noted, the Corporation reissued
its CSR instructions to all grantees, calling their attention to problem areas
known at that time. Recognizing that more action was needed to improve the CSR
system, LSC has provided additional written guidance to the field, including a
substantial revision to its CSR instructions, conducted training sessions on
that guidance, required all grantees perform a self-inspection of their CSR
data, followed up with grantees where corrective action was found necessary, and
has increased its on-site presence to test grantee compliance. However, at the
time it released the Factbook in June, 1998, summarizing the 1997 CSR data along
with other information gathered from the grantees, LSC had only the preliminary
feedback from the Inspector General on the site visit in Northern Virginia,
information from two complaints investigation, and some anecdotal information
concerning problems in a limited number of other grantees. None of this
information suggested a nationwide problem in case reporting errors or provided
any basis on which to extrapolate the findings to the case data compiled
nationally. Indeed, at no time during 1998, did the Corporation have
sufficiently quantifiable data to consider amending the national case statistics
reported in the Factbook. In particular, during the summer months when the House
Subcommittee and Committee were marking up the Corporation's FY99
appropriations, the Factbook contained the best and most current information
available to the Corporation and the public as to the level of activity as
reported by its grantees. Moreover, it was not evident at the time what effect,
if any, the CSR data had on the deliberations on the appropriations levels for
the Corporation and its grantees. Number of Fiscal House Committee House Floor
Action Year Cases* %Change Year Appropriations* % Change Appropriations* %Change
1992 1.56 1994 $415 $415 1993 1.62 3.5% 1995 278 33% 278 33% 1994 1.69 4.3% 1996
141 49% 250 10% 1995 1.66 1.7% 1997 141 No Change 250 No Change 1996 1.43 14%
1998 141 No Change 250 No Change 1997 1.46 2.5% 1999 141 No Change 250 No Change
* All amounts in millions Although firm information in the way of final reports
was lacking, the Corporation was receiving useful information from the Inspector
General's visits. This information was used to identify areas which needed to be
corrected by improved policy guidance and more effective training at the grantee
level. In November, 1998, the Corporation substantially revised the CSR Handbook
to address the problems which had surfaced over the year and to emphasize to the
grantees the importance of accurate case statistical reporting. The primary
revisions that were made applicable to 1998 CSR data to be reported in March
1999 were the clarifications on the timely closing of cases and management
oversight of case service reports. Grantees were again reminded not to count as
cases activities solely supported by non-LSC funds, clients not eligible for
LSC-funded assistance, and applicants that are referred without other legal
services being provided. In addition, a number of changes were to be made
effective for the 1999 CSR data to be submitted in 2000. In general, all
grantees were expected then to have fully automated their case management
systems, have procedures to screen for duplicate cases, and separately reporting
cases handled by PAI providers from those handled directly by the grantee.
Another significant change was the requirement to report all cases which would
be eligible for LSC services, regardless of funding source. It has been
suggested that this change may cause an artificial increase in the number of
cases reported through the CSR system. The purpose of the change is to achieve
better accuracy and more consistency in the reporting of work facilitated by LSC
funding. Our grantees have successfully leveraged their federal funding by
attracting other private and public sources of funding. Grantees use their mix
of funding in a variety of ways, and the current CSR system does not
consistently collect and identify much of this effort on behalf of eligible
clients. The revised reporting requirement should bring more uniformity to the
collection of data as that relates to the eligible population. By using the
grantees' funding information, we will be better able to factor from this more
complete universe of data the work that can reasonably be attributed to LSC's
funding. The Corporation followed up the issuance of its 1999 CSR Handbook with
a training sessions in December 1998, March and April 1999, and with additional
written guidance issued in February, March and July, 1999. In order to test the
effectiveness of the Corporation's efforts in 1998 to correct deficiencies in
the CSR system, the Inspector General decided to concentrate on 1998 data in six
audits planned for 1999. The Corporation augmented these audits by dedicating
its compliance staff resources in 1999 to perform on-site follow up on CSR audit
referrals by the Inspector General's Office or the GAO and to conduct compliance
reviews at additional locations. To date, the Corporation's compliance staff has
conducted six on-site visits to programs to evaluate their CSR systems and has
plans to visit six other programs by years' end. In addition, they have
completed follow up reviews at four programs and plan on at least one more
follow up review before the end of the year. Most recently, the compliance staff
has been on-site at the Legal Aid Bureau of Maryland to work through procedures
to ensure the access to materials necessary to a review of CSR compliance
without implicating privileged materials. Recognizing that even with the
increase in the Corporation's physical presence at its grantees, it could not
expect to cover all or even a significant percentage of its grantees. Therefore,
in May, 1999, the Corporation directed all of its grantees to conduct a detailed
self-inspection of the grantees' 1998 CSR data. The grantees were to certify to
the Corporation by July 1, 1999, that their 1998 CSR data were substantially
accurate - defined as 95% correct. The self-inspection process served to focus
grantee attention and resources on their CSR systems. The majority of the
grantees were able to certify their submissions of 1998 data according to the
Corporation's requirements. However, 60 grantees are currently unable to certify
as to the accuracy of their 1998 CSR data, including many of the Corporation's
largest programs. Each of these programs was required to identify the primary
factors contributing to their error rates and to advise the Corporation as to
what action they intend to take to correct these problems in the future. The
Corporation is currently following up with each of the programs still
experiencing deficiencies to ensure effective action is being taken to correct
their CSR systems. LSC is also going on-site at both certifying and
non-certifying grantees to test the validity of the self-inspection process.
Based on the certifications submitted, the Corporation has estimated the number
of closed cases in 1998 to be approximately 1.1 million. In estimating the
number of closed cases, the Corporation has adjusted downward all certified data
submitted by its grantees by the maximum 5% error tolerance allowed and,
further, has adjusted downward the data submitted by the non- certifying
grantees by the particular error rates reported by or attributed to these
programs. Thus, based on its current information, the Corporation is confident
that the count of 1.1 million closed cases does not overstate the level of this
activity in 1998. In September, 1999, the GAO critiqued the Corporation's
corrective actions to date and concluded that its actions were not sufficient to
correct the problem. Based on a telephone survey with some 80 grantees, the GAO
concluded that certain policy areas require more clarification, that more
effective communication and training on the new CSR policies are required, and
that the certification process could be improved by more adequate sampling in
the smallest programs and more uniformity in the certification process. The
Corporation generally agrees with these recommendations and is moving to
implement them as expeditiously as possible. The Corporation has recently begun
receiving feedback from the Inspector General based on the site visits in 1999
to the Monroe County Legal Assistance Corporation in New York, the Philadelphia
Legal Assistance Center, the Legal Aid Bureau, Inc. in Baltimore, Maryland, the
Legal Services of Eastern Missouri, Inc., the Legal Services of North Texas, and
the Volunteer Lawyers Project of the Boston Bar Association. These reports
indicate that, with the exception of the Boston program, the CSR error rates for
1998 data continue to be unacceptably high. Untimely closing of cases, counting
as cases applicants who receive no substantive legal assistance, and counting
duplicate cases continue to be an issue. It is apparent from the persistence of
the first two types of error that LSC's guidance may have come too late in the
year to have had the intended effect on reducing or eliminating these problems.
The Handbook was not expected to have had any significant effect on duplicate
cases as the systematic screening for such errors was to go into effect in 1999.
In addition, a new problem area involving the failure to take the applicant's
name during intake has arisen; however, this appears to be isolated to two
programs and has not been encountered elsewhere. On the positive side, the
Corporation is encouraged by the Boston program's clean CSR audit. The
Corporation is also encouraged by a number of programs which underwent audits of
their 1997 CSR data that were able to certify the accuracy of their 1998 CSR
data. In addition, a number of other programs, although they were not able to
certify that their 1998 CSR data met the 95% accuracy standard, reported
promising reductions in their error rates. However, clearly more needs to be
done. 5. The Corporation's Future Plans. While significant progress has been
made, the Corporation agrees with GAO and others that more needs to be done. The
Appropriations Committee has made clear its expectations that the 1999 CSR data
will be reported to Congress by April 30, 2000, and has issued a mandate to the
Inspector General to validate that data. The Corporation is committed to seeing
that this problem is corrected and to carrying out the directives of this
Congress. With regard to the individual programs with continuing high error
rates in their CSR data, the Corporation will pursue the corrective action plans
submitted by these programs to ensure that the actions are promptly taken and
effectively address the problems identified. The Corporation is prepared to take
additional steps as necessary and appropriate with any program that fails to
adequately address their problems. In accord with the advice and recommendations
by the GAO, the Corporation will do its part in assuring the grantees are
provided full and clear guidance on CSR reporting policies and that their case
management systems comply with operational standards to be issued by the
Corporation. The Corporation will seek to find more opportunities and more
innovative methods of ensuring that its guidance is adequately communicated to
the necessary personnel at each of its grantees. The Corporation intends to
continue its efforts in the field to make compliance with CSR procedures a
priority for all of its grantees. However, in view of its limited resources, the
Corporation will ask programs to repeat their self-inspections in 2000 and
certify as to accuracy of the 1999 CSR data being submitted. The Corporation
will incorporate into this self- inspection process the improvements recommended
by the GAO, including adjusting the sample sizes required and providing more
uniform reporting mechanisms for the certifying and non- certifying programs. In
addition, the Corporation will endeavor to validate the self-inspection process
in order to have the requisite confidence in the data submitted. Finally, the
Corporation will adjust the timing of the submission of the 1999 CSR data to
ensure its compliance with Congressional direction to have the activity data
reported to it by April 30, 2000. All of these efforts will be directed at
ensuring the accuracy of the 1999 CSR data. As great as these efforts are, the
Corporation has not lost sight of - and it urges the Congress not to ignore -
its original goal: the development of adequate and meaningful performance
measures for its strategic planning purposes. Throughout this process, the
Corporation has been mindful that however accurate the count of "cases" by its
grantees, that alone will not suffice to measure their performance or that of
the Corporation. We know that grantees provide a range of meaningful services to
clients that is not being captured by the definition of a case. Moreover, the
current reporting system fails to answer the question as to the benefits being
received by the clients and, more importantly, what need exists that is not
being met. As with many other governmental entities, LSC is finding that these
are not easy questions to answer. Nonetheless, this Board and the LSC management
is committed to improving the reporting system to begin addressing needed
performance measures. As an initial step, we are canvassing all our grantees to
determine what additional sources of data currently exist and their experiences
with measuring service outcomes and unmet needs. The Corporation is assessing
the need for pilot programs to test and perfect new data collection mechanisms.
While this will require much time and effort on the part of Corporation staff
and its grantees, the benefits from the strategic planning process are
substantial and we remain committed to achieving its goals. This Committee has
our assurances that the design and collection of objective performance measures
are and will remain a priority of the Corporation. CONCLUSION We welcome the
Committee's interest in seeing that adequate accountability exists for the
funding and functions entrusted to the Corporation. More importantly, we share
the Committee's desire to assure the American people that the Corporation and
its grantees are working to ensure the goals of equal justice for the poor of
this Nation and maintaining their access to the courts throughout the land. The
Corporation and its staff have dedicated themselves to these principles and to
carrying out, to the best of its abilities, the mandates entrusted to it by
Congress. Through this process, Congress has provided LSC with a clear mandate
on its data collection and reports to Congress. As in the past, LSC intends to
fulfill this mandate. 1. "Results of Recipient Audit Reports for the Year Ended
December 31, 1998." Final Report No. AU99-016. July 1999.
LOAD-DATE: October 1, 1999