Interest income earned on IOLTA accounts held by partner financial institutions in 2021 through November exceeds $4.9 million, an increase of 20% compared to the same time period in 2020. All income from IOLTA accounts will be fully accounted in early 2022. Average monthly income received in 2021 is consistent with revenue in 2019, when revenue from IOLTA accounts hit a historical peak of $5.1 million. We anticipate upcoming decreases in monthly revenue in part due to recently approved adjustments to interest rates from several financial institutions.
IOLTA’s reserve fund has a current balance of $4,232,207. The IOLTA Board established the reserve fund to provide for stability in year-to-year funding available for grantmaking when income declines. In December 2021 the IOLTA Board approved a contribution to the reserve of $750,000. Following this contribution, the reserve fund now meets the identified target.
Cy pres and other court awards continue to be an important source of funding for NC IOLTA. In 2005 the NC General Assembly passed a statute stating that the unpaid residuals in class action litigation (unless otherwise ordered by the court) shall be divided and sent equally to the NC State Bar for the provision of civil legal services for indigents and to the Indigent Person’s Attorney Fund for criminal defense for indigents. In 2021, NC IOLTA received $142,098 in cy pres and other court awards.
The NC Equal Access to Justice Commission recently released an updated cy pres manual which provides information for judges and attorneys about cy pres, tips for structuring award agreements, and examples of awards. The manual can be found at nciolta.org/for-lawyers/court-awards-cy-pres.
On December 2 the IOLTA Board approved 2022 IOLTA grant awards totaling $4,254,500. Grantmaking by category and source is as follows:
- $3,516,000 to providers of direct civil legal aid to indigent clients,
- $491,000 to volunteer lawyer programs facilitating pro bono legal services, and
- $247,500 to projects to improve the administration of justice.
Regular 2022 grantmaking increased by 40% over 2021 regular grant levels.
More information on grantmaking including a full list of 2022 awards can be found at nciolta.org/grant-programs/grant-information.
NC IOLTA administers state funding on behalf of the NC State Bar under the Domestic Violence Victim Assistance Act. Funds generated by costs assessed in civil and criminal court actions are distributed to Legal Aid of North Carolina and Pisgah Legal Services to support legal assistance for domestic violence victims. Since the start of the state’s fiscal year in July, NC IOLTA has administered $392,407 in domestic violence state funds. Funds received under the act continue to be significantly less than pre-pandemic levels.
The 2020-21 report on funding administered under the act is available now: nciolta.org/media/730496/domestic-violence-report.pdf.
NC IOLTA’s 2020 Annual Report, Justice is Foundational, provides an overview of IOLTA’s activities and impact. Find the report here: nciolta.org/media/730672/annual-report-2020.pdf.