Legal services programs that receive federal taxpayer dollars from the Legal
Services Corporation have a long history of engaging in politically motivated
litigation that often does little to help the needs of the poor who come to
their offices seeking help. But the following cases demonstrate that these
legal services programs will go even further--by sponsoring race discrimination
‘studies’ that have little or no relation to the everyday legal needs of the
poor who seek their help.
Legal Aid Gets Paid To Drop HUD Complaint
Legal Aid of Western Missouri, a recipient of federal taxpayer dollars based in Kansas City, recently agreed to settle a complaint it had filed with the U.S. Department of Housing and Urban Development (HUD) against Capitol Federal Savings, a local lender, based on a racial discrimination study that Legal Aid had conducted in 1995-96. Legal Aid had set a program where it sent ten trained “testers” posing as mortgage loan applicants to apply for loans at Capitol Federal. Half of the testers were white, and half were black. Based on the results obtained by these ten testers, Legal Aid filed a administrative complaint with HUD alleging that Capitol Federal discriminated against the black testers by offering the white testers better terms and assistance than was offered to the black “loan applicants.” Although Capitol Federal denied having done anything wrong, it agreed to settle the case. Most disturbingly, the settlement involved Capitol Federal making a $50,000 payment to Legal Aid and to local housing organizations. In other words, Legal Aid may have made a profit from filing the complaint, since the costs of funding the testing program were likely paid for by a grant that Legal Aid received from HUD to conduct the test. This may represent a violation of LSC regulations, since legal services programs receiving LSC money are not permitted to engage in fee-generating litigation. More generally, this case illustrates how legal services programs have a tendency to involve themselves in politically motivated activities that do not further the everyday legal needs of the poor.
See Ted Sickinger, “Hard-to-Prove Cases Can Be Put To Test,”
Kansas City Star, February 28, 1999.
Legal Services Issues Rental Housing Discrimination Study
In another example of legal services getting involved in political disputes far removed from its basic mission, Jacksonville Area Legal Aid, a Legal Services Corporation grantee, recently completed a six-month study of rental housing discrimination in the Jacksonville, Florida area. The study was funded by a grant from the U.S. Department of Housing and Urban Development. To carry out the study, Legal Aid sent out black and white actors posing as rental housing seekers. Although the study concluded that blacks encounter discrimination 58 percent of the time when they seek rental housing, officials of the Northeast Florida Builders Association disagreed, questioning the accuracy of the study and claiming that, at most, any discrimination encountered by the bias ‘testers’ represented isolated instances that do not represent the norm in Jacksonville rental housing. Beyond the question of the accuracy of the study, there is a broader question of why a legal services program is engaged in such a program that does not help a single poor person with their legal problems. Even though non-LSC funds were ostensibly used to support the study, staff time used to direct and prepare the study is time that is not being used to do legal work for the poor.
See Jim Schoettler, “Study Finds Blacks Face Housing Bias,”
Florida Times-Union, March 21, 1999.