Board Meeting Transcripts 2002

 

COMMITTEE MEMBERS PRESENT: 
Ernestine P. Watlington, Chair 
Douglas S. Eakeley 
F. William McCalpin 
Maria Luisa Mercado

BOARD MEMBERS PRESENT: 
Edna Fairbanks-Williams 
LaVeeda Morgan Battle 
John N. Erlenborn

STAFF AND PUBLIC PRESENT: 
Victor M. Fortuno, Vice President for Legal Affairs, General Counsel & Corporate Secretary 
Mauricio Vivero, Vice President for Government Relations & Public Affairs 
Randi Youells, Vice President for Programs 
Leonard Koczur, Acting Inspector General 
Laurie Tarantowicz, Assistant Inspector General for Legal Review 
Michael A. Genz, Director, Office of Program Performance 
Leslie Q. Russell, Director, Office of Information Technology 
David L. Richardson, Acting Vice President for Administration, Treasurer, and Comptroller 
Robert D. Gross, Senior Program Counsel, Office of Program Performance 
David de la Tour, Program Counsel, Office of Compliance & Enforcement 
Danilo Cardona, Director, Office of Compliance & Enforcement 
Kim Harron, Program Counsel, Office of Compliance & Enforcement 
Joe Green, Program Counsel, Office of Compliance & Enforcement 
Bertrand Thomas, Program Counsel, Office of Compliance & Enforcement 
John Eidleman, Program Counsel, Office of Program Performance 
Anh Tu, Program Counsel, Office of Program Performance 
Patricia Hanrahan, Special Assistant to the Vice President for Programs 
Cynthia Schneider, Program Counsel, Office of Program Performance 
Reginald Haley, Program Counsel, Office of Program Performance 
Barbara Donnelly, Program Counsel, Office of Program Performance 
Catherine Sulzer, Deputy Director, Government Relations & Public Affairs 
Don Saunders, Director for Civil Legal Services, National Legal Aid and Defenders Association 
Athea Hayward, Program Counsel, Office of Program Performance 
Linda Perle, Senior Staff Attorney, Center for Law and Social Policy 
Julie Clark, Vice President for Government Relations, National Legal Aid and Defenders Association 
Stacy Mayuga, Deputy Director for Communications, National Legal Aid and Defenders Association

 

		C O N T E N T S
			Page
1.		Approval of agenda	5
2.		Approval of the minutes of the Committee's meeting of September 7, 2001	5
3.		A panel presentation by Anh Tu (Program Counsel, Office of Program Performance), Michelle DeBord (Executive Director, Mid-Pennsylvania Legal Services), Larry Harley (Executive Director, Southwest Virginia Legal Aid Society), Martin Wegbreit (Managing Attorney, Southwest Virginia Legal Aid Society), Alma Jones (Executive Director, Legal Services of North Louisiana), and Ramon Arias (Executive Director, Bay Area Legal Aid) on the problems experienced by programs and executive directors once the technical aspects of "merger" are completed and the real work of developing and sustaining a high-quality legal services program begins	6
4.		A report by Michael Genz and Robert Gross on the progress of the Programs Office's performance in terms of the goals outlined in the "Strategic Directions"	89
5.		A report by Reginald Haley and Barbara Donnelly on the action agenda that LSC will pursue in 2002 as an outgrowth of the Hershey Client Conference	128
6.		A report by Patricia Hanrahan on the action agenda that LSC will pursue in 2002 as an outgrowth of our 2001 conversations on diversity and leadership	143
8.		Consider and Act on other Business	145
		Adjournment	152

MOTIONS: 4, 151

P R O C E E D I N G S

CHAIR WATLINGTON: Thanks, everybody, for coming. We have a good crowd here.

Since we have a quorum, I need approval of the agenda.

M O T I O N

MS. MERCADO: So move, Madame Chair.

MR. McCALPIN: Second.

CHAIR WATLINGTON: It's been moved and seconded. All in favor, signify by saying aye.

(A chorus of ayes.)

CHAIR WATLINGTON: It's approved.

Also, we need approval of the minutes of the committee meeting of September 7, 2001.

 

M O T I O N

MS. MERCADO: So move.

MR. McCALPIN: Second.

CHAIR WATLINGTON: It's been moved and seconded for the approval of the minutes. All in favor say aye.

(A chorus of ayes.)

CHAIR WATLINGTON: Noes, same?

(No response.)

CHAIR WATLINGTON: The minutes are approved.

We're having a panel presentation, and we have Anh Tu here to introduce them and to start it for us here. So I'll turn it over to her.

MS. TU: Thank you. Good morning, Madame Chair, members of the board and committee, President Erlenborn. For the record, my name is Anh Tu. I'm program counsel in the Office of Program Performance at LSC.

I'm here today to provide staff assistance to the panel and five representatives from the field to talk to you about the experience of managing and the right thing -- a merged program. A merged program is the result of a merger of two or more LSC programs.

Let me first introduce the panelists to you. Next to me is Alma Jones. She is the interim director of Legal Services of North Louisiana, which became a consolidated program effective just on January 1st of this year.

Next to Alma is Marty Wegbreit. He is the managing attorney of a branch office of the Southwest Virginia Legal Aid Society. Marty is joined by his executive director, Larry Harley. This is Larry.

And next to Larry is Michelle DeBord. She is the director of Mid-Penn Legal Services, which came into existence as a merged entity on January 1, 2001.

We are missing one panelist, Ramon Arias. He's probably still on west coast time. But he should be here, you know, before his turn to speak comes.

Before I invite Ms. Jones to begin the presentation, I would like just to provide, you know, the Committee with the context of this presentation. Since state planning is a major initiative of this board of directors, is part of your strategic plan, in the past couple of years you have received a number of reports and updates from your own staff, from representatives of the field, from stakeholders, about the challenges and the promises of state planning.

In that -- you have received or you have been briefed about the nuts and bolts of mergers. You have received laments from the field programs about the pains associated with mergers. Your former president, you know, Mr. John McKay, referred to merger as a blunt instrument in state planning, which is used, or we believe and we think it has been used, judiciously, thoughtfully, and sometimes with considerable anguish on the part of your staff. Because we know it causes a lot -- it has caused a lot of pains in our -- in the operation of our grantees.

You know, a merger takes place -- a merger often, although it doesn't always, follows LSC decision to reconfigure service areas in a given state. The reconfigured decisions, up until recently, when the board adopted the standards, have been made as a result of LSC consultation and sometimes in agreement with state planners. It is a blunt instrument used when believe that structural changes is required to improve the delivery system in that state.

Mergers takes place when LSC put -- consolidated two or more services areas. So in that slide, you can see that there a lot of changes that will have to be implemented. So these are the people who will talk to you about those changes, the problems associated with that, and we hope that by now they have had enough experience that they can talk to you about the promise of what a merged program can do in terms of fulfilling the dual goal that you have set out for state planning, which is expanding access to service and enhancing the quality of the service.

Before you today are five people who have played a leadership role, not only in a merger involving two or often three or more independent -- prior independent LSC programs, but then they have also -- these are the people who have also gone on to be executive director of the merged entity.

In inviting the panelists, Vice President Randi Youells asked them to share with you their experience, not so much what have led to merger, but since the merger has been completed. They will tell you about, as Michelle said this morning, the agonies and the ecstasies of managing a merged entity.

We asked that -- Randi encouraged the panelists to discuss also with you what help they could have used from you, from LSC board of directors, LSC staff, financial and otherwise, and help from the rest of the national Legal Services community that would have helped them manage their program and speed up the pace of integration.

They will also share with you their insights of what they know now that they wished they had known going into the merger process and running a merged entity.

Given the time constraints, we have asked representatives to limit their presentations to 15 minutes each from each staff. Marty and Larry will share those 15 minutes.

You undoubtedly will have questions, and I would ask you to hold it until the end. We have about 20 minutes for question and answer.

So I'm now turning over to Alma Jones. Alma is -- just an expanded indication -- Alma is now the director of Legal Services of North Louisiana. She was the director of one of the programs of Northwest Louisiana Legal Services.

It is the result -- the merger has not been consummated yet. The program -- North Louisiana has received LSC for the expanded service area effective the beginning of this month, but the merger will soon be completed. She is, as she said, the baby of this group because she really is the work in progress.

And Alma has graduated from law school in 1976, and has spent practically her entire legal career in Legal Services, first as a staff attorney, then managing attorney, and now she is the executive -- interim executive director of a program that has responsibility for 19 parishes in Louisiana. It has an LSC budget of roughly two million.

So Alma, please.

MS. JONES: Good morning. I'm going to try to talk to you a little bit about some of the experiences that we've had in the merger process. I view this as an opportunity for us to try to help other people who are going through this process and try to make it better. But I do welcome any questions you have at the questioning process.

Three programs in north Louisiana were required to merge by January 1, 2001. Essentially, we learned that that was probably an inevitable thing in December of 2000. I had been with my program at that time since July of 2000, so I was relatively new to the process. But I did believe, firmly believe, that if we cooperated together, we could bring this about.

The three programs were -- in the merger process that I participated in were Northwest Louisiana Legal Services, with the base operation in Shreveport; Kisatchie Legal Services, with the base operation in Natchitoches, Louisiana; and North Louisiana Legal Assistance Corporation, with the base operation in Monroe, Louisiana.

In that call for merger meetings that started in January 2001, there was some opposition fro at least one of the directors because we had not had our service area declared at that time. It was not declared until March.

But two out of three of the directors did feel that it was important that we go ahead and start the process because we needed to know the differences and similarities between the programs in order to be able to bring them together as one. That was the goal.

And so with that in mind, we started monthly meetings in January of 2001. There were varying opinions about whether or not we should staff participate in those merger meetings, but again, the majority of the directors felt that staff should participate. They were going to be directly affected by this process, and they needed to have some input in what was going on. So we did have some staff participation in these meetings as well.

We agreed to rotate those meetings around the system so that if they were in Shreveport one month, they would be in Natchitoches the next month and then Monroe the next month, in fairness to everybody that was concerned.

Initially, what we looked at doing was also getting from our existing boards what we called a merger committee that was designed to give us feedback on the merger process as we perceived it. And so each of our boards had merger committees that we looked to to report our merger activities from those merger meetings that we had each month.

One thing that I found that was very helpful to me during the merger process because I was so new to this whole thing was the seminar that took place that was sponsored by the ABA in San Diego. They provided a binder on mergers that gave us a lot of documents related to the merger process that helped to guide me in the process of merger. And I thought that that was very helpful, and I think that that's something that anybody going through the process needs to participate in.

As the three project directors continued to meet, it became apparent that there were some issues we couldn't resolved because when you're going through a merger process and you don't know who is going to head up the new entity, and you know that you probably have three people who are participating who are somewhat in competition with each other, sometimes that prevents you being able to make decisions that are good for the whole.

And so I started thinking to myself during that process, what would help us get farther a long with this? So one of the things that I did, knowing that I was the new person on the block, was I made some concessions to the other two project directors that I'm not in competition with you because I'm the new kid on the block.

What I'm going to do here is try to focus on trying to do the best I can to bring this merger together without disrupting client services. And that was my position during the course of -- I even said that to the committees that came to us from our various boards, that I was not in competition with these people. My goal was to try to do the best I could to not disrupt client services during this process.

And so I continued with that theme, and I was very adamant in my position on that. But it brought a position of neutrality towards the process that allowed us probably to move faster than we probably would have moved.

In that regard, I read an article in a newsletter from one of the Legal Services programs -- it may have been North Carolina; I can't recall exactly which program it was because it was a while back -- but they talked about having an interim board.

Because you're dealing with people who can't necessarily make final decisions that may slash some of what they are accustomed to doing, and you get to a point where you reach a stalemate and somebody has to unjam that stalemate. And I thought an interim board might be the mechanism for doing that after reading that article.

So I suggested that to the other project directors at the next merger meeting that we had. Ironically, they all went along with that idea and that concept. And so we at that juncture were looking at proposing to our boards that -- at the next regular meeting we agreed we would propose to them that they appoint members to an interim board, consider doing that to make merger decisions on behalf of their full board.

And one of the other things that helped was when I attended the Southeast Project Directors Meeting in Memphis, the Louisiana delegation met with Bob Gross and Pat Hanrahan and we actually posed those questions to them about an interim board.

And they seemed very receptive to that idea. And the only thing that we were having problems with was the composition because we were dealing with whether or not the program that was the smallest should have as many people on its -- in board representation.

But I came out of that meeting, after talking to Pat and Bob, that probably to get around the hurdle of who should have the most and who should have the least, let's just make it equal for everybody. We're all trying to decide what's best for these three programs, and maybe if we just make it equivalents at that time.

And ultimately, we came up with a proposal for a 15-member interim board that would consist of three attorneys and two client representatives. And our old boards went along with that and gave them the authority to make merger decisions.

I saw that as a tremendous vehicle to be able to overcome competing directors trying to get their way on everything when it couldn't be that way. It had to be a spirit of compromise. So the interim board was there to unjam us when we were jammed up, and there were times when we were jammed up on decisions because we wanted what we want, and we would not back down. So that was one thing that I think helped to move the merger process forward, was by doing this.

Okay. So we got the -- after we had the interim board in place, then in June 2001, our first interim board held its first meeting. An important issue was resolved at that meeting because we had been having discussions about who would file the application for the grant at the deadline in July. Who would do that?

And it went back and forth as to who would actually file the application if we were going to do it as a joint effort. And we could not decide who was going to do it. My program was willing to make concessions because we were looking at the issue of whether or not we would lose grants that we were accustomed to getting, and the VAWA grant was keyed into that whole process.

And what we wanted to do was to not do anything that would take away from the funding sources that we were accustomed to having. We had one program that was initially applying for a VAWA grant. Our program had never applied for VAWA money. The Kisatchie program had been consistently getting VAWA money for a while.

So the issue was whether or not we would do anything that would disrupt that particular grant application process for an existing program that was already getting it, and then we had the program in Monroe that was trying to get it.

And it took the interim board to unjam that particular issue, and they did. They made a decision that Kisatchie Legal Services would be the surviving entity, would file the grant application because it did have existing VAWA money already that we did not want to have jeopardized.

Now, it was easy for me to make that decision because I was not competing for VAWA money. So a different factual scenario could lead to a different situation. But we weren't competing because we were not getting VAWA money, and we knew that VAWA money was critical to the operation of the Kisatchie program. So we supported Kisatchie in that position. And as a result, the interim board took a vote and they voted that Kisatchie would be the one that would file the application.

Now, we had decided early on in some of our joint meetings that we would name our new program Legal Services of North Louisiana, so while Kisatchie would be the surviving entity, our plan was to change the name of Kisatchie to Legal Services of North Louisiana, which would encompass the whole 26-parish area, new service area.

So once we got past that, and that was a big hurdle, who would file the grant application, then we moved into a situation that really surprised me. That same board that I had been working with from a committee standpoint, which consisted of -- the interim board consisted of all of the board chairs from each of the three programs.

That same board, on that same day in June, went into private session and kicked all of us out of the meeting and decided that they wanted me to be the interim executive director of the new entity.

Now, that particular day that that happened, it caught me totally by surprised because I had told them all along that I was not competing with the other two directors, and I thought that we would get further with merger if I did not compete. And they asked me if I would do this.

Well, one of the things I had to consider when I was hired by Northwest was, my commitment to them was I would do everything I could to make my program the best it could possibly be. And I felt that if I didn't say yes, that I would actually be violating that particular commitment I made to them. So I reluctantly said yes.

And they set a cap on that when they passed that resolution that I would serve as interim director -- and I told them -- because I had told them before because we couldn't get it unjammed who would be the executive director of the program, I said, it would probably be good to put an interim director in because we have a transitional period going.

Once we merge, we're going to have to make all this stuff come together as one. It's going to be a lot of work involved in that. And you can still leave the competition open for a permanent director, but the transitional things that we need to do at the beginning of the merger still have to be done no matter what.

So why don't we just clear the air of that? That's always a barrier to getting where you need to go in these meetings. Everybody wants to be the chief and nobody wants to be the followers, and so on like that. And you cannot get anywhere if you don't get beyond that particular issue.

So in June, that issue was resolved. And it took a lot of heat off, and they -- off of the whole process of meeting because that issue was resolved through the year 2002, December 31, 2002.

So as a result of that, we were able to move into other areas that needed to be addressed. And some of those other areas was, I had noticed when we were doing this that we had reviewed a memorandum of understanding both from the San Diego materials and also one that had been provided to us by the people who were attempting to merge in the southeast area of Louisiana.

We looked at that, and I told them that I think that it would be a good idea -- it would take a lot of the pressure off of us -- if we would enter into intensive negotiations to set some parameters for this merger by way of a memorandum of understanding.

And in that memorandum of understanding, we do some back and forth compromising to try to come up with things that would reasonably protect us and our programs and our staff, but move the merger forward.

And so we decided on some central issues that we would discuss, and we went back and forth -- in fact, after the June 1st meeting of the board, the board met again in August, and at that time I told them we were going to start intensive meetings.

The second meeting that we had, however, we elected officers for the interim board. We had no officers at the June meeting. At the August meeting, we did actually elect officers and committees and so on like that for the interim board.

And at that meeting, I told them we would start intensive merger meetings that would go every week. And we did that, starting in September. Every week we had a merger meeting because we were trying to meet a December 31st deadline of pulling this merger together.

So the project directors would meet, and some of the members of the staff would meet, every week. And we would rotate those meetings around the system, Monroe, Natchitoches, and Shreveport.

And in those collaborative meetings, a lot came out. We had shared information about personal property. We had shared information about real estate holdings that we had. We had shared information about staffing.

We had shared information about -- we had shared information about what we needed to do as far as our salary scales and so on like that were concerned. And we found that there was a big disparity between those salary scales.

So what we knew that we needed was, we needed intervention of a corporate attorney. We needed intervention of a labor attorney to assist us with some of these things. One of the things that we found is that we may be Legal Services attorneys, but we don't have expertise in these areas.

One of the ironies of that, though, that we found was, until we came together as one, we could not necessarily use the same corporate attorney. There was one waiting in the wings to do pro bono work for Northwest, but I was reluctant to pull that attorney into the process because if we had to use him for everybody because we could not come up with another one and nobody else had one at that time, I did not want to create a conflict of interest. So it was late into the process that we were able to do that.

One of the other things I want to point out, because I believe my time is about up, is that late into the process, we learned that the Monroe program was not going to participate in the merger. And so as a result of that, the word that we got was that the Monroe program would be defunded.

So we're having to start a new operation in the Monroe area. We're having to start from scratch with both staffing and getting a facility there. And that has created its own set of problems for us in having to deal with.

MR. EAKELEY: Ms. Jones, before your time runs out altogether and Anh passes the microphone, I know we're admonished not to ask questions. But I think it would be great if each of you could address briefly, if not at greater length, how the merger has either -- how the merger has affected the programs' ability to provide greater access, higher quality legal services -- what impact the merger has had positively or negatively on the programs' ability to serve their clients.

MS. JONES: Well, one thing we found when we were going through the merger process, we started early on saying that we would get the same case management program. Because we all had different case management programs. You can't really tie all that stuff in for merger process if you don't have the same case management program in place to be able to monitor your cases.

So we all had to -- we all had agreed early on to do that. But with the falling away of the Monroe program from the merger process, and with us not having access to any of their personal property, including their computers, we have to start all over from scratch there.

So we don't have a mechanism to be able to tie them in to do conflict checks. We also don't -- we didn't get our technology grant that we applied for, and we do need assistance in that regard to be able to get all the technology that we need to tie the 26 parishes in together, including videoconferencing because it's such a wide area to cover until you cannot cover it unless you do it with some of the technology.

And so, you know, besides the technical assistance that we need from legal people, we also need the technology to be able to tie the new entity in as well.

And we have at this juncture a disruption of services in the Monroe area, which I'm very concerned about and which we're addressing as much as we possibly can. But one of the things we're trying to do now is just get a facility over there to be able to deliver the services.

And because we are having to restaff over there, we hired about six or seven of the staff from the old program, but we have to completely pretty much restaff over there. There's a disruption of services to clients as a result of that right now.

So in terms of improving it, the process of improving client services probably is going to come after we stabilize things, in answer to your question. We can't really focus in on that until we get the delivery of services to the Monroe area stabilized. Once we get that stabilized, then we can actually focus in on that particular area.

MS. TU: Thank you, Alma. To your knowledge, Chairman Eakeley, for reminding that. I think you'll hear more on those points from the other programs who have operated as a merged entity for a couple of years.

I just have one clarification I would like to make. They very helpful seminar that Alma referred to actually was one sponsored by LSC. Bob Gross and Cindy Schneider were the ones who put that together. It took place at the ABA Equal Justice Conference, but that's --

Anyway, thank you, Alma.

MR. GROSS: There's a slight amendment that NLADA and LSC were also partners.

MS. JONES: I give all of you tremendous credit. It was a good seminar.

MS. TU: The next panelists, a pair of them, are from Southwest Virginia. Next to me is Larry Harley. He's the executive director of Southwest Virginia Legal Aid Society. This is a merged entity that began to operate on January 1, 2001. It is a result of a consolidation of three prior separate service areas.

I will ask Larry to introduce Marty, who's a managing attorney in his program.

MR. HARLEY: Yes. Sitting with me is Marty Wegbreit. Marty has spent his entire legal career working for Legal Services in South Carolina, in Virginia with Client-centered Legal Services, and now with our program, Southwest Virginia Legal Aid. Marty is a valued colleague and friend, and I'm happy to have him join us today.

MR. WEGBREIT: Thank you. As Larry said, my name is Martin Wegbreit. I've been a Legal Aid lawyer for 23 years, two years in South Carolina, 20 years with Client-Centered Legal Services of Southwest Virginia, and the past eleven months with Southwest Virginia Legal Aid Society.

My story is about a consolidation of LSC service areas which went horribly wrong and then turned wonderfully right. Two years ago, LSC set a goal of four to six LSC-funded programs in Virginia. State planners consolidated the services areas of three LSC funded programs south and west of Roanoke.

Legal Aid Society of the New River Valley in Christiansburg served five counties. Southwest Virginia Legal Aid Society in Marion served eight counties. My former program, Client-Centered Legal Services in Castlewood, served seven coalfield counties. Each program received about 43 percent funding from LSC, and most of the rest from Legal Services Corporation of Virginia.

The intent was for the three programs to merge. They did not. A funding competition arose between Southwest and a combined application from Client-Centered and New River.

In November 2000, Southwest was awarded the LSC funding. Within three weeks, the director and board of the New River program agreed to merge with Southwest. This office now is our Christiansburg field office.

The same was not Client-Centered's fate. Southwest was committed to hiring all Client-Centered staff and keeping open the Castlewood office of Client-Centered. However, the director and board of Client-Centered rejected cooperation and merger with Southwest.

The locks on the Client-Centered building were changed, and all staff but two were denied keys. The program stopped doing bankruptcies, and then stopped doing divorces. Finally, with a 43 percent loss of funding, in February 2001, four of twelve staff were laid off, two intake paralegals and two legal assistants.

These four, employed at Client-Centered for 16 to 18 years, were laid off on one day's notice. The remaining eight staff were cut from five to four days a week, with 20 percent salary reductions. In response to the layoffs, five more staff resigned. The remaining intake paralegal, the remaining legal assistant, and three attorneys, including my wife and me.

Five of the eleven attorney board members at Client-Centered also resigned. Legal Services Corporation of Virginia terminated Client-Centered's remaining funding in June 2001.

Eight of the nine former Client-Centered staff now work for Southwest in our Castlewood field office. We moved to a small, temporary, rented office, and moved again to a larger one. We spent about $50,000 equipping our new office with used office furniture, a new computer system, and a new phone system.

LSC is litigating to recover the Client-Centered building purchased 20 years ago with 100 percent LSC carryover funds. The two-day federal court jury trial over the building is set for April 2002. Meanwhile, Southwest is spending $24,000 a year in rent. Regrettably, these added expenses have diminished somewhat the resources available for client services.

However, these adversities only set the stage to prove just how much can be overcome by teamwork, cooperation, and a sustained effort. After opening the Castlewood field office in March 2001, last year we received more than 2200 requests for legal aid, opened more than 500 cases for representation in court or agency proceedings, and provided legal advice to the other eligible applicants for service.

Adding to our experienced staff of three attorneys, two intake paralegals, and three legal assistants, we hired a new attorney, a recent graduate of the Appalachian School of Law, and two new intake paralegals, both of whom are law graduates taking the next Virginia bar exam. All three new staff are from far southwest Virginia.

I would add here, yes, the new staff did know the three murdered victims, and one of the two wounded victims, and the shooter. It hit our office pretty hard. They were devastated.

Southwest now is governed by a 21-member board of directors, ten of whom are from the coalfields, five of whom are from the New River Valley, and six from Southwest's old smaller service area. This past summer, Southwest conducted a program-wide needs assessment.

We gathered 435 surveys, met with 19 community leaders, and conducted 12 focus groups over our new expanded service area, which is larger than Massachusetts or New Jersey. The result was a set of program priorities combining the best policies of three different groups who separately provided legal aid in southwest Virginia.

We are pleased that the changes preserve and expand the legal aid available to low-income people in the coalfields and throughout all of southwest Virginia.

In 2002, Southwest has become the second legal aid program in Virginia, and one of the first in the nation, to access its client database online through the Internet. This password-protected system will allow our three offices, in Christiansburg, Marion, and Castlewood, to function as a single, unified 12-attorney law office, sharing information and resources. This was made possible by an LSC technology grant.

Soon, the Castlewood field office will become the regional centralized intake office for the entire 17-county, four-city region. We are an active participant with five other LSC-funded programs in Virginia to develop a statewide website to foster the widest possible communication and cooperation, again made possibility by an LSC grant.

We have forged partnerships and are working on projects with a wide variety of groups -- domestic violence programs, community action agencies, and area agencies on aging, to name a few.

I truly appreciate the opportunity to tell you my story of what probably has been the most difficult consolidation of LSC service areas in the nation. I hope LSC understands the passion which people can feel for their legal aid program, and the extremes to which they may go to maintain it.

I know LSC understands the hard work, hassles, and hardships involved in consolidating service areas. I believe LSC understands the need to consider these costs in weighing the benefits of state planning ventures. In turn, I understand the benefits of state planning when assessing its costs.

I understand that in unity there is strength, a strength which enhances our continuing mission to the coalfields and all of southwest Virginia to provide high-quality, free, civil legal aid to low income people.

Thank you, and I turn the microphone over to the director of Southwest Virginia Legal Aid Society, Larry Harley.

MR. HARLEY: Thank you, Marty. And thank you, Madame Chairman, for letting us come and meet with you today. It's a privilege to meet with you, our partners in this struggle for equal justice.

Merger and reconfiguration, from my perspective, is sort of like a married couple that encounters some crisis in their marriage, and from that reexamines their commitment to one another and makes a decision that whether they wanted the crisis to occur or not, the marriage is going to be stronger because of it.

Our opportunity for reconfiguration, which Marty is fond of referring to as a merger of two and three-quarter programs, has indeed offered us the promise of a better future, with some problems that have come along with it. My wife says I do the Oreo number, good, bad, and then good, so let me focus on the promise that I believe will come from our reconfiguration.

First, the quantity and quality of access to services in our region will surely improve. As is the case with a combination of any three programs, each had strengths and weaknesses, and some of our weaknesses involved access to services.

We are in the process now of creating a centralized regional intake and hotline system. Even though Client-Centered Legal Services had had a hotline since the early '80s, and the old Southwest had had a hotline since '84, we are expanding that across the entire region, and clients will see expanded access to services, although this has not happened yet.

We have just gone through a reexamination of our service delivery system, and spent six months going through a new priority-setting process. And part of that process enabled us to create new partnerships with other agencies within our region.

And this is something, our new priorities, that were just implemented in November. And we did a better priority-setting process than any of the three separate programs had ever done before, and this was made possible because of our new configuration.

I mentioned that we have new partners that we have formed alliances with because of this reconfiguration, and we have reexamined old partnerships because of the reconfiguration. And this holds new promises for collaborative delivery of services in the future, and we're in the process of working on this now.

We are reexamining and changing all of our administrative systems. Our case management system has been totally revamped this year. We spent more than a thousand hours doing this because we had three systems that had to be combined into one.

Our personnel systems are all being reexamined. We are in the process of starting down that pathway of salary equalization. I'm in that position where nobody's going to be happy, but we are in that process. It will take years to equalize salaries. We will probably lose some staff along the way because of the dissatisfaction of how that will end up being done.

Our operations systems are all being changed. They haven't been changed yet, but they will be.

In sort, whatever the opposite is of least common denominator, and I refer to the opposite of that as best practices, will be instituted. We will take the best practices of each of the two and three-quarters programs and see that those best practices are emulated in the other offices within the program.

All of this won't come without some cost, and we have already encountered problems. There has been client disruption and -- client services disruption. Part of that disruption is caused by the fact that in a rural area where you've combined small programs, the people devoting the thousands of hours to the reorganization are, to a large measure, our advocates. And that's the only way it could be.

So that has caused some disruption. We also have experienced disruption because of confusion in our client community. We are not the only legal aid within our region, and weekly we experience our clients calling the other service provider in our region, that service provider's clients calling us, not realizing they've called the wrong office.

Virginia is soon to implement one toll-free statewide telephone number for client access, and that is going to further compound the client confusion because we can't give up the toll-free numbers we already have. It's a long-distance telephone call for most of our clients to call any of our offices. So there's some confusion that will only be sorted out over time.

Benefits to clients, I think, are going to come slowly. We've spent the past year dealing with just the nuts and bolts of how services are going to get provided without a lot of focus on the quality of those services. Of course, we're turning our eye toward that this year, but wouldn't we like to think that that had been the first thing we had had time to focus on, but unfortunately, it wasn't.

Timing has been a big problem for us. When we were awarded our grant and were notified of that in November of 2000, we also got our grant conditions that included a timetable that gave us the calendar by which time we were supposed to have done various things.

And we learned quickly, and I think the corporation and LSC staff learned quickly, that we couldn't do things as quickly as we had hoped. And I must say that John Eidleman, the LSC staff person that helped shepherd us through this process, was as understanding and as patient as I could have hoped an LSC staff person would have been. And I thank John for that patience.

But we had thought we could implement centralized regional intake within six months, perhaps. We now realize we're looking at a year and a half or two years to do that. And there were other things that similarly were delayed.

We also have experienced a decline in our board participation, and I think it's because of the great distance that board people need to travel to fully participate, particularly client board members that have families.

Even though we pay for the travel and we pay for the child care, it's not easy to ask somebody to be gone as long as it takes to participate. And our board does not want to do its meetings by conference call because they're a newly constituted board and want to forge their own new relationships. So this is a problem that, quite frankly, I had not anticipated at all.

There have been three lawsuits that arose from the reconfiguration in our region. One of those lawsuits is still pending. And that lawsuit will not be resolved by the time we're expected to go through competition again, and I expect there will be competition again, and I expect there will be more lawsuits that arise from competition.

And I can't ask LSC to solve the problems that that raises, but I think we all need to have the possibility of litigation as something that we're thinking about, not as something that might happen once every blue moon, but as something we might come to see as a regular occurrence as part of this process.

And finally, I think that we're experiencing the problem of tired stakeholder relationships. We've been involved with planning since 1995. I know the corporation has, too. Somehow, we are expected to help generate excitement and energy with our private bar partners, the courts within the state, the other agencies that we work with.

I believe they're a little bit tired of legal aid planning. And that creates problems as we're supposed to partner with these stakeholders.

I guess to summarize, I wish that I had known a year ago that it would take a lot more time to do things than it takes. I wish I had had a better understanding of how to create and share a new vision. The MIE training that Michelle DeBord and I attended back in October, managing suddenly larger programs, was the date by which I mark my three months of sanity that I've experienced since then.

And finally, in terms of assistance from the corporation, the technology is more expensive than we expected. And in rural areas, we don't have many alternatives, and the technology resources for us, at least in Virginia, we're finding are more expensive than the technology available to people in metropolitan areas.

And finally, we didn't know anything about due diligence. And I wish that I had availed myself of the training that the Corporation provided, and I didn't make it to that.

But help with understanding the ins and outs of that and those technicalities would be of benefit to us. And if there's any way you all can see fit to let us be on a five-year grant cycle so that we're not competing while we're still implementing what we just promised you we would do, it would be a big help.

We appreciate our partnership with the Corporation, with the LSC staff, and again, it's a privilege to get to come share these things with you.

MS. FAIRBANKS-WILLIAMS: Question: When you're doing your state toll-free number, are you sending cases to other people, or are you doing your own cases? Are you sending some to the other programs or to Office on Aging or anything?

MR. HARLEY: The telephone number will just route calls to the appropriate legal aid office, and then the appropriate regional legal aid office will then do referrals to other agencies as appropriate.

MS. BATTLE: One other quick question, and I know you set the stage for us to wait on questions. But I think fundamental to the vision that we first articulated for state planning was a recognition of the limited amount of federal funds available to be able to provide the kinds of resources necessary to meet the civil legal needs of low income citizens across the nation.

In your view, do you believe that this process ultimately will assist in developing state-based resources, alternative resources to federal funding, for the programs that are in place after the merger has been completed?

MR. HARLEY: No. I don't believe that. I should say that because of reconfiguration, we were in the position to hire for the first time a resource developer, and I believe that we will generate new money because of that.

But I don't believe that in Virginia, at least, and I wouldn't presume to speak for another state -- I don't believe we in the legal services community have the power to create the base of enthusiasm from all the other potential stakeholders that we would need to see enthusiasm from to create the new resources.

MS. BATTLE: Thank you.

MS. TU: Thank you, Larry and Marty.

The next panelist is Michelle DeBord. She is located in Harrisburg, Pennsylvania. The program began as a consolidated entity on January 1, 2001. It is the result of a merger of three programs, three separate LSC programs, plus some.

And Michelle now has responsibility to provide legal aid services -- she and her staff have responsibility to provide legal aid services for about over 130,000 poor people in 18 counties, mostly around in Mid-Penn. So Michelle?

MS. DEBORD: Thank you, Anh. And thank you for asking us to come today and talk about mergers and acquisitions.

Legal Services has always provided me with a sense of purpose to my life. And this period of time, going through these mergers and acquisitions, has been no exception. However, I think that sometimes my major purpose has become, as some of my colleagues say in Pennsylvania, "We're just glad we're not Michelle, that poor slob, what she's got to deal with."

I can say that the experience of merging 3.5 legal services programs, bringing them all together, has been one of the greatest character-building exercises of my life. It's been very, very fractious in Pennsylvania, and it's been a long process. I would echo what Larry said about the exhaustion that people feel about the state planning process. And some of the fallout from that I would like to deal with in my comments.

Publicly, to comment on client services, I would also indicate that I agree with the prior two panelists that we have not had an opportunity to get to those issues as yet. However, what is becoming very clear to me is that we cannot continue to do the same things that we have been doing.

What we have at Mid-Penn with three and a half programs together, quadrupled in size or whatever, it is an entirely different animal. And we are going to have to find more creative ways to advocate for our clients, and more creative ways of dealing with clients and how to deliver client services. That is very, very clear to all of us, I think.

I think our major disruption came, however, in the administrative management fiscal systems. I was surprised at the sheer volume of work generated by trying to merge three and a half programs. So many things had to be redone over again for the new entity that had been done over the years for the three or four programs individually.

Also, I did not foresee that I would lose so many of my partners in the administrative and management teams that had been operating in those programs. Much of the leadership of those programs left, including board leadership.

I lost some very key board members, and I lost quite a few managers throughout the entire service area. And the leadership demands that that placed upon me have been extreme. So that is something I wish I would have known.

One of the things that we did very early on was because we were having departures of top administrative and management staff in some of the programs, we took advantage of those to consolidate those administrative functions to try to begin to cut down some of those positions.

That, in retrospect, was a mistake. We should have kept more of an administrative and management and fiscal team together to go forward and build the new entity, and then looked at downsizing that. The accountants will tell you that 25 percent or under of a program's revenue is a good figure for management, administration, and fundraising. Legal services programs have always operated far below that 25 percent.

The accountants will also tell you that it's not unusual to see an organization that goes through change to need as much as 50 percent of their revenues to manage that change, to manage those kinds of things. We didn't do that.

We didn't do anything near that. And I think there was a lot of disruption that could have been avoided had we had a better fiscal, management, and administrative team in one place to take us forward.

I will say that in terms of LSC's help in the area of having to redo things for the new program, we had a CSR visit not too long ago. David de la Tour and Cammela Vaskin and the team came out. It was very helpful.

I would have hoped -- I would suggest that you do those a little earlier in the merger processes, that you get to the programs right when they're starting to look at putting in new systems and dealing with a host of very practical, nitty-gritty problems right at the beginning. I think that would have been helpful.

I had also no idea that the lack of money would cause such programs. We have always dealt with a lack of money in Legal Services. That's nothing new for us. But it caused so many problems that could have been solved if there had been just a little bit more cash around.

A lot of the merger gurus will tell you that it's very -- it's foolish to go through a merger at a time when there are declining resources or lack of money, and that's exactly what we had to. So it was a very, very difficult process. We did use the downsized administrative staff just to really keep the program afloat.

Starting to deal with issues of salary compatibility and trying to equalize salary systems and so forth -- just a monumental task, and very little help coming from those who possibly could have been in a position to help. I'm not sure that that's an LSC issue as much as it is a state issue. But I think the state planners may have dropped the ball on that one. They probably should have been a little bit more involved in helping us work through some of these wage parity issues and some of these benefit issues that we were all struggling with.

Another surprise to me was that some of the old enemies of Legal Services came out of the woodwork and got up on their hind legs and started preaching again about, "Well, they're going through a merger so obviously Legal Aid doesn't work." So that we have had to deal with -- the question again about, what does your program do? What is the mission of Legal Services? And justifying that again to some of those old voices.

I also wish that we had in Pennsylvania and at Mid-Penn dealt more comprehensively with the unrestricted work issue earlier on in the process. We do have an unrestricted program in Pennsylvania Community Justice Project that is in our service area.

However, in my opinion, it is not a comprehensive solution to our particular needs at Mid-Penn. We have an extremely diverse client population. We have an increasing Hispanic population that is very, very, very underserved. And we need to go back and look at that issue now, and we're doing that at Mid-Penn. But I think that it would have been better had we done something more comprehensive earlier on.

One of the things that I also found, too, our Legal Services program has about 50 or 60 funding sources, different streams of funding that come into the program, large, small. A lot of them are local.

Over the years, in the smaller programs that make up Mid-Penn, funder loyalty at some point got cemented to a person as opposed to the entity, the organization, to Legal Services.

And a lot of the funders developed loyalties to particular people on staff in their local office, or particular leadership in one of the older programs. And that has been a program, trying to go forward and building new loyalty to a new organization. And it's caused some issues.

One of the things that we are doing with that is we're starting advisory committees on a local level that will try to bring back some of that local connection, and hopefully in a better way than it was before. We're looking for broad-based committees, not just from the legal community but people that can help us with resource development, with communications issues, and so forth.

I did bring with me today the structure for those advisory committees that our board did approve, so if anybody would like a copy of that, I did bring those a long.

One of the things that we dealt with that was a bit of a surprise, too, to me was just the total bad karma of the word "merger," both in the community at large and in our client community.

In particular, there's a sense that mergers mean people lose their jobs. Services get cut. Our local office gets closed. I mean, a lot of it came, I think, from the banking mergers and so forth, where people lost local offices and so forth. And that connotation -- I think if we could have found another word for what we were doing, we would have been better off.

But that was a problem, I think, that there was a lot of that to deal with. In fact, last might I was at the Cumberland County Bar Association meeting, annual meeting for the year, and Bob Rains, who's the director -- or the dean, excuse me -- of the Dickensen School of Law was there.

And as you know, probably, Dickensen School of Law was merged with Pennsylvania State University a little while back. And that has -- he stood up and said, "I'm Bob Rains of the formerly independent Dickensen School of Law." And, of course, everybody got a good laugh at that. But that's the way that mergers, I think, are perceived in the community at law, and we have some problems with that.

MR. EAKELEY: Reconfiguration doesn't work?

MS. DEBORD: No, it works.

Strategies to address those issues: We are slowly building a very tight administrative team. But right now, of all my administrators and managers, I think the most experience level I have with Legal Services is about four years. So I've got a whole new crew that I'm dealing with, from fiscal to development and everything.

So we're building a better administrative team. We're going to build a better board. We do have a smaller board, and I would say that some of the problems about getting the board together, that's a real issue. We're hoping these advisory committees will help in that regard a little bit.

But I see my primary job as resource building for this new program, and I feel that we have got to do -- we have got to bring more resources into Legal Services. That's just the long and the short of it.

We have 50, 60 funding sources. They are grants. They are small grants, for the most part. We are living and dying by the grants. When the grants are there, it's great; when they're over, it's not great at all.

So we are building a development department. We have been able to hire someone who specializes in communications, which I think the Corporation and NLADA have both realized is very, very critical for building a funding base for our programs. We have to get the word out about who we are and what we do in a way that we reach the general public, and that's something that we are working on and have been successful in recruiting a good communications specialist for our staff.

We do have technology, a technology department now, which none of the other programs had. We have two people in it, and they have done wonderful things with our computer systems. We're along way from one regional phone number and one huge network, but we're getting there. And I would again indicate that the cost is the biggest factor in stopping us from going forward.

So in terms of LSC, what LSC could have done differently or what they could do differently, I think John Eidleman is wonderful. I'm glad he got promoted to Virginia after what he went through in Pennsylvania. And the team that came out for the CSR visit, they were just great. A very comprehensive review.

I think the leadership was there from LSC on on this issue or mergers, and certainly John McKay put that message out there and pounded it at every opportunity. And eventually people started to listen. I wish in Pennsylvania we had listened a little sooner and gotten more of a jump on it, but I would say that the vision was there. He struck me as knowing where he wanted to go and what he wanted to do.

What I think was lacking was a little bit of fleshing out that vision for us, maybe telling us more what we could expect, maybe helping us to articulate where we wanted to go with these new entities that we were building and why we wanted to go there, how it was going to really translate for our clients. I think that would have been helpful.

The state planners, I think, did a good job, too. But again, I think a lot of -- you know, there's a dropping of the ball on some key issues. And there was a tendency at the state planning level, well, this is a really tough problem so we're going to leave it to the regions, or, this is difficult and we can't really address it. It's going to go to the programs and they can deal with it. So it was -- we knew where we had to go, but a little bit more help from the beginning on how to get there, I think, would have been very, very useful to us.

MR. McCALPIN: Excuse me for violating for the injunction to hold questions. You mentioned the strains of loyalty with funders.

MS. DEBORD: Yes.

MR. McCALPIN: My question is, how about the strains, if any, with private bar involvement?

MS. DEBORD: Some. Not as much as with the funders. But I think it's very helpful that I've spent a lot of time with the bar associations trying to firm up those contacts. But those have been strained as well.

I mean, a lot of the bar associations are very bought into their local program and have been for years and years and years. And even though it's clear to me from touring our 18 counties that we're essentially doing the same -- pretty much the same work, sometimes when you talk to folks at the bar association level or sometimes even when you talk to staff, you'd think you were dealing with people that -- you know, half of them manufactured cars and the other half sewed handkerchiefs or something.

But it's that kind of perception. It's more a perception than a reality.

MR. EAKELEY: Michelle, you were -- the phrase "the agonies and ecstasies of merger" was attributed to you. Would you care to give us a flavor for the ecstasies?

MS. DEBORD: One of the things that we've done lately is we have put together a huge grant proposal for completely integrating our technology system to go to an Internet-based system, as they are talking about in Virginia. That has been a lot of fun to work on.

With having someone on staff who's a superb grant writer and a wonderful technician and knows all this -- you know, can put it all together, I never had that in a small program. I never experienced that. That's been fantastic.

Being able to put together law groups at the statewide level for substantive law work, that has really been a lot of fun. We're not doing too good with those in Pennsylvania yet, but putting together advocates that I knew, respected, and admired from afar in other programs, and bringing them together, and watching them interact as a group, has just been very exciting for me.

So those kinds of things happen, not frequently enough yet, but, you know --

MR. EAKELEY: But I take it they have the potential for --

MS. DEBORD: They have the potential.

MR. EAKELEY: -- enhancing access and improving quality?

MS. DEBORD: Absolutely.

MS. MERCADO: Madam Chair, I just had a question. I think that, you know, all the presenters that have been coming up, obviously one of the key factors that -- just in regular mergers, whether it's banking or oil corporations or it doesn't matter, and in this case, legal services and people, that it's very evident, not only from the accountant's point of view but I think in the practicalities, that more funding is requested to do that.

And I'm curious in your particular communities, in your particular states, what assistance, if anything, from either the private bar or, you know, your local congressional or senatorial people about saying, well, you know, maybe Legal Services needs an influx of resources and money to assist in carrying out the mandate of congress to merge and consolidate and ultimately provide greater access to clients, in having that up-front money to do those kinds of things, whether there has been any kind of cooperative effort or any kind of assistance offered to the local programs to do that, to the state planners to do that.

I mean, have you seen any of that at all occur in your particular states?

MS. DEBORD: No.

MS. TU: Thank you, Michelle.

The next and last panelist probably needs to indication from me because he has addressed and come before this committee and the board before in various capacities, as a leader not only of his own program, Bay Area Legal Aid, but is a leader up until the end of last year of NLADA. And currently he's also playing a leadership role for the whole Legal Services community in his membership on the ABA's Commission on Loan Repayment and Forgiveness.

Ramon Arias is the director of Bay Area Legal Aid, which is, I am -- I may be violating my own rule about talking too much here, but it is -- I worked in California and with this particular consolidation.

And I could not help but just recall just the intense feelings and reaction that generated, that was generated, in the field programs when LSC announced a mandate for -- to consolidate the six separate service areas in the Bay Area, in the San Francisco Bay Area.

At that time, Ramon was the director of one of the San Francisco Neighborhood Legal Assistance, and he also on an interim basis, at LSC's request, took upon the Alameda County because the independent Legal Aid Society of Alameda had run into a severe problem, compliance problem, with LSC and we had to stop funding to that entity.

But be it as it may, the consolidation of the six separate service areas in the San Francisco Bay area was the first I would consider that LSC sent out to the field to announce our intention to use that blunt instrument when necessary.

I hope that Ramon will now tell you about how he has turned it into a velvet instrument to improve the access for clients and quality that he and his staff are providing. Thank you.

MR. ARIAS: Thank you, Anh, for that kind indication. And when Mr. Eakeley mentioned the ecstasy of merger, I was afraid you might be proposing drug testing for your panelists.

(Laughter.)

The last two years have been the most challenging of my work life. As I appear before the committee of the board having the most to do with making it so, please understand that I honestly don't know where to begin, nor am I entirely clear on what to say. And this must be connected somehow to not knowing what to think.

We were asked to comment on the problems that arise once merger is completed and the real work of developing and sustaining a high quality legal services program begins. I'm sure this was unintentional, but the topic heading suggests that the development of high quality programs began with our current efforts to improve delivery through state planning.

The struggle to create high quality programs began long before state planning, and will continue long after our best efforts are forgotten. There is no beginning or end to achieving excellence.

Thus, when the dust settles, the distinction between the problems and challenges caused by mergers and those caused by our own desire to constantly improve is sometimes hard to draw, and maybe makes no difference in the end.

Of course, the same can be said of our achievements. As radical as it is, merger is nothing but a tool, an intervention hopefully designed to improve services to clients. As we all know, it is not an end in itself.

In 1999, the Corporation declared that seven grants serving the Bay area would be consolidated by January 2000. Eventually, three programs merged to form Bay Area Legal Aid, and applied and received the LSC grant.

Two programs that previously were LSC recipients decided not to merge and become non-LSC-funded programs, and one, as Anh Tu explained, the Legal Aid Society of Alameda County, was denied funding in 1998.

Before sharing a few observations, allow me to set the stage because the Bay area is unique in some ways. The civil justice community, that is, the delivery system in the Bay area, if we can call it a system at all, needs to change.

Even after the merger, we have over 30 legal services programs in seven counties. Half of the 30 are located in San Francisco. The other half are based mostly in Alameda and Santa Clara Counties. The remaining four counties are grossly underserved.

It doesn't end there. The distribution of resources is also irrational. In San Francisco, the legal services community, LSC and non-LSC programs together, spend approximately $80 per poor person annually. In Contra Costa County, we spend $22 per poor person, one-fourth as much as we spend in the city. Clearly, if you are poor in the Bay area, access to justice depends on where you live.

Bay Area Legal Aid is one step toward forming a more rational delivery system. Our vision is to provide the same high quality and scope of legal assistance throughout the Bay area, regardless of a client's location, language, or disability.

What have we accomplished toward achieving this goal? I wonder. Every success seems to bring new and sometimes bigger challenges. Let me share four examples.

For ten years, our office in Contra Costa County had only three attorneys. Within a year, Bay Legal doubled the number of attorneys to six, and for the first time, the office began to provide legal assistance to survivors of domestic violence, a success. Yet the family law court that had previously had no expectations of the office now expects Bay Legal to expand services where services never existed.

Before the merger, the San Francisco program, the only one with a successful development program, raised over $300,000 a year. Together, the other programs raised about $15,000 a year. In 2000, its inaugural year, Bay Legal raised 450,000. Last year, we raised 550,000, a tremendous success given the downturn in the economy and the aftermath of September 11th. Unfortunately, it isn't enough. The cost of transforming once underdeveloped programs is terribly expensive.

Recognizing that the provision of high quality legal assistance requires the recruitment and retention of quality staff, Bay Legal recently adopted one of the most progressive compensation packages in California. We increased beginning attorney salaries from 33,000 to 40,000. We are one of only three California programs with a loan repayment program, and one of three with a retirement plan, a remarkable achievement.

But it came at a high price. We eliminated four staff positions, including a PAI coordinator, and face a projected deficit of close to $1 million by the end of 2003. Is this caused by the merger? I don't know. But it's certainly caused by our desire to improve services to clients.

Before the merger, the six LSC programs in the Bay area did not share human or financial resources, nor did we meaningfully collaborate. Now Bay Legal's six offices are linked by telephone, computers, and a shared vision of quality services.

Although we have a long way to go, we operate very much like one law office. Young attorneys in Oakland can simply pick up the phone, dial an extension, and reach an attorney in San Jose or Richmond with more than 20 years of experience.

The quality of services to clients is enhanced immeasurably, another success. Yet we lack the resources to go much further.

The challenges are endless. From the day we became one program, we have dreamed of having a centralized intake system to allow clients access to our services by calling one number regardless of where they live. A live person would answer the phone, not voicemail, and if the client didn't speak English, someone speaking his or her language would immediately take the call.

The client would get help, or an effective referral, as quickly as possible. If we referred the client to a Bay Area Legal Aid office, the information given over the phone would be at the local office when the client arrives.

Sounds simple, doesn't it? We continue to plan, after two years, to lay the ground work. And by the time we finish our planning, we probably won't have the funds to implement it.

Just this Monday -- three days ago, was it, four days ago -- our board chair and I visited bar leaders in Napa County, the seventh county in our service area, and the only one in which we do not have an office.

We met to explore how we might be able to work together to serve Napa County. Much to our astonishment, we learned on Monday that the Legal Aid of the North Bay, the previous LSC recipient for Napa County that did not merge, announced that because they no longer receive funds to serve Napa County, they will close the Napa office unless the local community raises $150,000 by July.

Surprise. We were asked to keep the office open. We want to. It ought to be done. But we don't have the money. The LSC grant for both Marin and Napa Counties is approximately $150,000, not even enough to run the Bay Legal office in Marin County.

What are we to do? Unlike the counties with programs that merged, Bay Legal has had to open new offices in counties that did not, with no funds available other than the LSC grant.

I could go on with other examples. Suffice it to say, as you've heard from the other panelists, it's a tremendous challenge to carry this off.

I would like to share three lessons, and I'm not so much sure that they're lessons to share with the committee as they are lessons to share with programs that are about to go through merger or recently have done so. And I'll limit it to three.

The first is to echo what Michelle just said, and that is the need for adequate administrative and management staff. As I've gone around the country, through my activities with NLADA and the ABA, I often hear from uninformed, well-meaning people that mergers will somehow result in savings because you can merge administrations, and you only need one executive director instead of three, and that you only need one controller instead of three, et cetera, et cetera.

I say uninformed, well-meaning people because that simply isn't the case. The opportunity to merge includes the opportunity to hire new needed administrative staff that never existed before. When we merged in the Bay area, only one program had development staff. Only one program had full-time accounting staff. None of the programs had a full-time manager of information systems.

And so my point is, again to echo what Michelle said, I think programs need to be encouraged and boards of directors need to be educated that merger doesn't result in the lessened need for management, but results in an increase in the need for management.

The second point is governance. I often hear, and we of course encountered this in the Bay area, that programs going through mergers often look at governance as some kind of an exercise in representative government. It isn't.

The point of a board, just as the point in leadership and the point in staff and everything else a legal services program has to do, has to be calculated to build the most effective and efficient program possible.

And that doesn't always mean equal representation among merged programs. It means picking the best board. There again, I think well-meaning and not so much misinformed but uninformed people have a different view.

The third point, and the last point on these lessons, is that, you know, we've mentioned about loyalties, the loyalty of funders, perhaps the loyalty of bar associations to particular programs. One of the things that we learned the day that the Legal Aid Society of Alameda County was defunded, and that we took their name off the front door and put the name of San Francisco Neighborhood Legal Assistance Foundation -- this was before the creation of Bay Area Legal Aid -- I quickly learned that I could have put on that door the Legal Aid of Pennsylvania or the Legal Aid of Virginia.

Clients wouldn't have cared. What clients care about is whether they're going to get help or not, and the quality of the help that they're going to get. I think that that's a lesson learned or a lesson that should be shared with legal services leaders who sometimes get caught up in institutional loyalty themselves.

I want to end my remarks by mentioning three things. When we had our conference call in preparation for this panel, Anh shared with us that we might take a few minutes to talk about what kind of help the Legal Services Corporation might be able to offer.

And I shared with Anh and the other participants that I've grown a bit too cynical about the topic, and the reason is because I know the Corporation doesn't have much discretion in the money that you spend. And I know, from my own experience, that where you do have discretion, you've made every effort you can to try and help programs.

But because you don't have much discretion and you don't have much money, I wasn't going to spend time on it. But this morning I reflected upon my cynicism and decided to be a little more optimistic.

Three things, and they've already been mentioned. One is money. You know, you always hear about money doesn't solve all the problems. But it doesn't hurt. You know, of the three things I'm going to mention, money is the most important. We need money. I'm sure that comes as news to you.

The second is technical assistance. And I think that when it comes to technical assistance, I really encourage the committee, to the extent that it has jurisdiction over the matter, to really examine the manner in which technical assistance is currently provided.

I really would encourage you to evaluate whether the current system of providing technical assistance is the most effective. bcontracting some of that work to organizations like MIE or NLADA?

What about not subcontracting at all with entities? What about subcontracting, or whatever other association there might be, with legal services leaders that have gone through this? What about sending them to New York?

And what about providing funds so that whoever leaves Arizona to go to provide technical assistance is able to hire a replacement for a period of time? What about innovative strategies toward providing technical assistance? I would suggest that you take a look at that.

The final thing is time. Time and money, I think, go together. But you heard from a number of panelists here that they discovered, and they wish they would have known, that this kind of work takes more time than any of us anticipated. And that is so true.

Even through, you know, when I looked at the topic that we were to talk about, that is, when the technical aspects of merger is complete, I never felt -- whatever those technical aspects are, I've never felt that they are complete. Governance. Leadership. Vision building. All of those things that created Bay Area Legal Aid are still going on.

In conclusion, this morning I was reminded or I remembered this song that Bob Dylan used to sing in his weird, unique, raspy voice, "Oh, and I was so much older then. I'm younger than that now." And by the way, if you know what that means, please let me know.

(Laughter.)

But I think that what he was trying to say is that when one is younger, you believe that you know the answers. You have the answers. And when you become a bit older, you gain the wisdom to know that you don't have the answers, and in that way you are less informed and you are younger.

And that's what causes my lack of clarity or not knowing exactly what to say to you. But I will say this. One of my pastimes, believe it or not, is gambling. And the San Francisco '49ers let me down last week, by the way. Of course, I only do it for entertainment purposes.

We have to be careful in our quest to achieve quick results to not gamble. Obviously, we need to take calculated risks, but not to gamble. And what the Corporation has done in many instances, from my point of view, is to gamble.

And what you've done essentially is you've gambled on the people who've talked to you today. You've gambled that leadership in the community would rise and meet the challenge. And in most instances, I believe that the gamble has paid off. And I only hope that where the gamble might not have paid off, that something is done to help.

Anyway, thank you.

MS. TU: Thank you, Ramon. I guess that we probably have less time now, maybe about ten minutes, for questions from members of the committee. And so it's open. You can address it generally, and whoever wants to answer can come forward, or you can ask specific questions of specific panelists. So the floor is open.

MS. MERCADO: It's actually not so much -- Madame Chair? -- it's actually not so much a question, I suppose, more than a statement. It's evident from all the programs, with the different experiences they had, the different client populations and stakeholders in your states, that still the underlying problem is the issue of resources and monies, and doing the mergers and consolidations that you in effect, in the long run, will have a more effective and efficient legal services program.

And it seems to me, just as a board, part of the board who are looking, Mr. President and whoever our successors are going to be, because I'm sure this will be a record, is that these are vignettes probably of all the mergers and acquisitions around the country that have occurred from Legal Services as a mandate from Congress, you know.

And it's like having EEOC to enforce a law, but they didn't give you the funding to enforce it. And consequently, in sort of the same way, mergers and consolidations.

We're asked to do this, but the requirement and the funding that is there, but perhaps as a board, one of the things that we can look at with our vice president for financial affairs on our budget mark that will be coming up for the coming -- I know it's a little late for the folks that have been through there, and maybe not; maybe some of them are still working through it -- is that we ought to get that data and that information about what the actual cost is to do those mergers and consolidations.

And some of them are by no means completed. Some of them are beginning. Some of them haven't even started. But to put in -- and I'm sure that -- because we have the ABA and the NLADA that also submit the recommended budget requests for, you know, the FY 2003, to look at that as a serious number and factor, that if we're going to do the mandate of Congress to merge and consolidate, that that also means that they have to put their money where their mouth is, that we have to have the funding to appropriately do what they want us to do to carry out, to work with all the state planners in their states, and work with those partnerships well.

And that we ought to get, through our technical personnel, our -- the data that we're getting both with assistance from the IG and from our offices and from the programs around the country, what does that number look like? What does that dollar amount look like?

Obviously, we're not going to get the whole amount that we want. But we ought to get something that addresses that particular need in our budget mark for the coming year.

And I know we won't be here, as a lame duck, but it's certainly something that our partners and our legal services, you know, grantees and our staff that stays on and our president that will hopefully stay on, to do that, to build that into our budgetary request for the coming process, the coming year.

CHAIR WATLINGTON: I just wanted to make a comment, too, to Michelle. I'm glad she stated something that I had stated earlier before, even though the board -- when we had that opportunity to go through that plan and those processes, we didn't take advantage. We should have taken advantage of it earlier.

And remember, I said that to the people after the planning: You didn't do what you had supposed to do. So now you got to do it all over. So it's nice hearing you confirming what I had said years ago.

Is there any other question?

MS. BATTLE: I just have a question about following up, I guess, in part on what Ramon said, knowing, of course, we have limited funding. But we do establish policies, and I think that our vision was -- to some degree, in being carried out, it had different effects in different places.

What do you see for us next as the next best step to take in your area in terms of what kinds of policy decisions that Legal Services has to make? And I'm also concerned about the areas that have been defunded, like Monroe, where you're starting from scratch to build a program, and the amount of time that it takes to do that, and what kinds of things we need to be thinking about in order to assist in making that process a success.

MS. JONES: Well, first of all, we weren't aware of the -- that the Monroe program was going to drop out of the merger process until late in the process, like late November was when this happened.

And so when the board appointed -- the interim board appointed me as an interim director, I had set certain target dates that we would get things accomplished towards the merger process.

Well, when the Monroe program fell out of that scenario, that created a whole new timetable for me because I didn't know during the course of that process that I would actually be setting up a new program to operate out of there. So we couldn't really plan a budget because we don't know what the expenses are to get an office, to get it staffed, and that kind of thing.

So what we've set is a target date of trying to get an office space rented by February 1. And if we can do that, then we can begin the process of fully staffing that office so that we -- we really need to get some of those things nailed down before we can look at anticipated costs for that operation and be able to get the overall operation.

But with that coming late in the process, late October, early November, we have to nail down the expenses. And, of course, we don't get any of the personal property of the own program, so we have to start our own from scratch with computers and office furniture, the whole bit.

So that we're looking at trying to nail the expenses of that down before we can reasonably anticipate what the overall operation will need. And some of our funding, by the way, is up in the air because of that office not being stabilized.

CHAIR WATLINGTON: And too, which we really -- as a board member, and I'm sure the other board members -- I'm not talking for them -- but this has been quite informative for us to really see where that the mergers and those things have been.

So I'd like to --

MS. BATTLE: I did want to hear, if I could -- I'm sorry, Ernestine -- I did want to hear from the other -- I asked a question about what the next step ought to be, given where you are, and I wanted to, if I could, hear --

MS. YOUELLS: Could I correct the record, though, just for a moment, and then we'll go to that? Monroe County, the legal services program was not defunded. At the tail end of the year, Monroe County pulled out of the merger. LSC did not defund that program. We are still funding services through this new entity.

But I just wanted -- since this is a permanent record, I did want to correct that.

MS. BATTLE: Okay. Next step. If I could get my next step answered from the other presenters.

MS. DEBORD: Well, I would say the development of mileposts, benchmarks, where you would like to see the programs, these new programs, where do you want us to be in five years. If you can give us some guideposts, that, I think, would be very helpful to us in, you know, fleshing out the vision within our programs.

MS. BATTLE: Okay.

MR. ARIAS: I guess my suggestion is partly based on my ignorance because I don't know at this point whether the Corporation has any discretion to allocate funds beyond the normal grant process.

But if the Corporation does have that discretion, I would suggest contemplating policies that would allow the Corporation to provide specialized, one-time grants -- for example, our challenge to open a new office in Napa County where we've never had an office because that program didn't merge with us; we have an obligation to provide services to clients in that county, but only $50,000 in LSC funds to do so -- and put the onus on the applicant to both show that it is a compelling need, and secondly, to show that we would have the capacity to keep that office open once that grant would end.

MS. BATTLE: Anything from Virginia?

MR. HARLEY: Virginia is a state with quite a bit of state funding. We have three separate streams of state funds that go to our legal aid programs. All of them are declining. So if our federal funding remains level, our state funding is going down, and it's going down dramatically.

I would ask that, in terms of creating new initiatives of policy, that you just give us time to implement what you've already asked us to implement. I've called on planners in Virginia to this year turn away from focus on structure and turn our eye toward what we are about, which is high quality legal services in the areas of law that impact clients the most.

We don't have the money to dramatically increase services. It doesn't look like we're going to get that money. Again, our resources are going down. We need time to focus on high quality services.

MR. WEGBREIT: And to follow up on what Larry said, we realize it's hard, maybe impossible, to give us additional resources. But you can give us time. I've been in legal aid 23 years, and during that time I've seen an ever-increasing number of regulations and things with which we must comply. That takes time away from client service delivery.

Two of the '96 restrictions, the timekeeping and the case disclosure information, were mandated by Congress. To my knowledge, that's seldom if ever used. And if there could be some policy decision down the road to maybe reverse the trend of ever-increasing regulations and reduce that regulatory burden, which is very popular for small businesses like us, that would be a real gift of time.

MS. MERCADO: I just have sort of a quick question on -- in talking about time, obviously the board set aside a different task force to deal with setting up some standards for reconfiguration and state planning.

And by no means are those set in stone. You know, it's a process in the works and definitely part of how we can best deliver legal services to our clients is by setting in processes and systems that work well in that way.

And I don't know whether or not you've looked at any of that to say, if you're talking about time, in looking at the actual standards that are actually in the -- you know, I assume all of you got a copy of the agenda and I'm sure you've got a copy of the standards that your program have -- what areas would we need to look at as far as doing -- making the process that isn't onerous and that allows you to provide your delivery of legal services to clients, and at the same time do the work that is required to do your merger or consolidation -- if the time periods that we have set -- because you must understand that the task force is working -- was working in a new arena. We had no data to see -- to have hindsight five years ago or two years ago, but it's a brand new process.

So if the deadlines that we have set for things to be completed, to be done, are not realistic, then what would be?

MR. ARIAS: I'm not sure, you know, what would be. I think it depends on the facts and the particular situation.

In our situation, Bay Area Legal Aid, when we were first formed, I actually requested and received from the Corporation the permission, if you will, to sub-grant -- in the first year of our existence to sub-grant to the counties that did not merge, to sub-grant the LSC funds to the non-merging programs for a period of one year to allow us more time to build our infrastructure.

As you've heard from other folks, we quickly learned that one year wasn't enough. However, at the time, the Corporation was sensitive to the fact that many programs around the country were proposing sub-grant agreements to circumvent, in many instances, the need to merge. In other words, they were using it for not good intentions.

And so we had to, after one year, end those sub-grants and start serving those counties. That's an instance where we could have used more time in a particular situation. If there is a process to actually request more time for particular things to be done, I think that that would be very helpful.

MR. EAKELEY: Speaking of time, we're probably out of it.

CHAIR WATLINGTON: Yes. We are trying to get the --

MR. EAKELEY: But I did want to thank Anh and the panelists. I thought this was really very informative and therefore insightful, and I think, hopefully. in the limited time left to us, we might be able to put it to good use.

CHAIR WATLINGTON: Well, Doug, the -- and you think we maybe need ten minutes' or five minutes' break here before we go on to the other part of the program? Do the people want that? Okay.

(A brief recess was taken.)

CHAIR WATLINGTON: I see the two gentlemen are already there. We'd like to have a report from Michael Genz and Bob Gross on the progress of the office, and the goals outline and the strategic plan direction.

MR. GENZ: Thank you, Madame Chair. Bob and I are here this afternoon now, I guess, to speak on our progress in the last year in strategic directions.

Following the panel that came first, we do so with a renewed sense of humility and awe and respect, humility as to how much needs to be done out there still, how much work there is, and awe and respect at the folks in the programs that are actually doing the work.

We also want to say that the strategic directions process that the board has instituted has been extremely helpful to us in our work, and focuses us on what's important, high quality service to all clients. It gives us a powerful message to deliver, and it focuses our work.

It's a living document. We think of it all the time. I had a meeting with John Eidleman and Anh Tu about our planning work yesterday afternoon, and they said the very first thing we need to talk about is strategic directions, notwithstanding the fact that we already have it structured. But everything thinks of it all the time. I can assure you that your president and your vice president for operations brings it up all the time. It's always there.

First, a word on the way that we in programs integrate our work. Most of the material in the document that you have organized by the three strategies: by state planning, by technology, and by program oversight. And in fact, staff are organized that way.

But be assured that we're clear that there aren't three sort of separate planets out there that operate independently; that all of us, in real life it's one thing, and that we need to very much coordinate our efforts among the three of us.

So how we do that is an endeavor that we consider all the time. Each state has someone from state planning assigned to it, has someone from programs assigned to it, and someone from technology. And those three meet and coordinate to make sure that we're doing things that work together. January and February, we'll be doing those meetings.

One example of how they come together can be seen in the statewide websites. Obviously, the technology folks are responsible for making sure that the grantee has a website up and that it's working and functioning.

But once it's up, it's a state planning function. This is an effort that is meant by its nature, the state websites, to bring together all of the legal services providers in the area, and the courts, and the bar, to be working together to create this instrument, this tool, to provide services for clients.

It's also, of course, a programmatic function because what's being delivered is community legal education and pro se information and referral information. So we all have to be on the same page on this.

We need to acknowledge up front that what we're doing is a work in progress. We're making what we think is significant progress with respect to our logic model: Here are the goals and here are the steps that we need to take to get to it, and that we're following those steps.

We're in earlier stages when it comes to developing measures to assure us that we're accomplishing those goals. We've decided, wisely, I think, to go slowly in developing those, to go carefully in developing those.

Weak measurements are worse than no measurement at all because weak measurements pretend to measure something that they don't measure and give you bad information. The second reason to go slow, I think, has been emphasized by the panel before. There's an extraordinary burden that programs have from what we're asking them to give us.

Anything in terms of measurement is going to ask them more. So we have to be careful to figure out measurements that will be the least possible intrusive on what their work is.

What we're going to cover today, the document speaks for itself. We're not going to go through it part by part, each part by each part. I'm going to start out talking about the program oversight part and then the technology part, and then I'll pass it over to Bob for the state planning discussion. In this order, we're starting with the smallest unit, the program, and working out.

We want to emphasize that while in the particular document we're going backwards, this does not suggest that we're going backwards in the work that we're doing. We're going forwards. Thank you for laughing.

The first topic, use of program oversight, probably the three major efforts in 2001 are the ones that I want to talk about, are establishing quality review visits for programs; improving the grants, grants management application process; and are expanding our support and technical assistance efforts. These projects are discussed in detail on pages 11 through 14 through the format that that document has the commitments that we put out in our original strategic directions document.

So the first one, establishing quality review visits. As you know, the idea for these came out of the strategic planning process and came from the leadership of the board, several members individually and the board itself, who had the realization that the competition process, with its paper review of applications where there isn't competition, does not give a true, thorough, layered vision of what's going on out there, and that we need to do that to be able to best serve and best do our function.

We also recognize in the process, we're not just going to assess quality and what have you. We're going for lots of different purposes.

Visiting is helpful to provide technical assistance when it's desired. In the case of mergers, it's often helpful to go and find out how things are doing and see if there's something we can do to help. It's also helpful for our staff to see excellent work to spread those models as we see them.

In 2001, we invented the process. We developed the protocols and how to do it. Under John Eidleman's coordination, we visited 12 programs. And in those programs, we chose different purposes -- programs that we just didn't know much about, we hadn't been to for a long while, places where there were mergers, places where wonderful things were going on, places where there may be some needs where we could be of help.

This year, while our planning isn't complete, we're going to do the same. We're going to do those visits. And in addition, we're going to try to do some smaller -- some more smaller visits to expand the scope of what we're able to do.

MR. EAKELEY: Just pause there, if you would. I think -- I thought the document was really just excellent and very informative. But it doesn't -- the purpose of the document was not to say what you're going to do this year, but I'd like you to expand on what the plans are for this year and how much of the -- this is a trick question -- how much of the $3 million in the consolidated operating budget for this fiscal year is devoted to the use of program oversight, and how are you going to use the resources to do the kinds of things that are, I gather, still partially in the planning and partially in the operating process.

MR. GENZ: Wow. Can I get back to you on that?

MR. EAKELEY: Our finance committee meets tomorrow. I've challenged David also to -- what I'm looking at is the allocation of resources within the budget.

We really haven't gotten to the point where we should have been years ago of creating a strategic plan rather than a document called Strategic Directions, updating that, tying annual performance plans of the president and the inspector general into that strategic plan, and then reviewing how the budget allocates resources within the priorities set by the strategic plan and the performance plan to meet the priorities of the board, and then do a performance review at the end.

This is something that a lame duck outgoing board chair is probably entitled to say, and sort of in hindsight, I'd have preferred doing it over.

But in terms of the three strategies of state planning, use of technology, and program oversight, I don't really -- the technical is separately broken out, but I don't have a good sense of how much of the OPP budget is allocated or intended to go to the program -- the quality-enhancing aspects of program oversight that are described here, and how much is going into state planning.

MS. YOUELLS: I'm going to answer that in a very short way. We just learned day before yesterday that we were being taken up to $3.1 million, so we are going to have to go back and we are going to have to decide how we are going to spend that increase that we've been given as part of the budget reconciliation.

We're very grateful to President Erlenborn for doing that. So we don't have an answer for that -- on that to you today, Doug. But we can get that for you.

MR. EAKELEY: Good.

MS. YOUELLS: In terms of how many staff are allocated and then how many dollars exist in consultants for the different line items, off the top of my head, I know right now we have about $200,000, pre-two days ago, budgeted for hiring consultants and technical assistance in state planning, approximately 40,000, Reggie, budgeted for competition consultants. So that was pre-two days ago when I learned we were going up a non-insignificant amount. So --

MR. EAKELEY: I mean, would we, for example, do more site visits if we had some extra money?

MS. YOUELLS: Yes.

MR. EAKELEY: To what extent are we -- to what extent, if any, are site visits by OCE coordinated with potential site visits or take the place of site visits by OPP? What kind of work integration is there, if any, between the two?

MS. YOUELLS: This document, as you know, what we came prepared today to do is to report to you on how we did last year.

MR. EAKELEY: It's a reflection of the quality of the document and how informative it is that I'm jumping ahead.

MS. YOUELLS: So what I'm going to say, Doug, is we would love to give you that, if you would like. We actually talk about those kinds of items every single day.

We talk about how many visits we're going to do in terms of quality visits, how many are associated with competition, how many people we're going to have on the road for state planning, and that's how we come up with the budget dollars that Reggie gives to the president and to David.

We would be glad to do that for you, if you would like it. And we could do that fairly fast. By tomorrow? We can try.

MR. EAKELEY: Well, I don't -- I mean --

MS. MERCADO: We're looking as a finance -- David has -- as a former finance chair, I can tell you that he has that already allocated because when he does the budget every year, all of you, vice presidents and divisions and sections, allocate the staff that you're going to use for what particular areas and categories of consulting or what have you will be in there. So I know that he has that already.

MR. EAKELEY: Well, to a certain extent. But what I'm hearing is this is -- there's some new funds and there's still a lot of discussion going on about where the funds overall should be allocated and what emphasis.

MS. YOUELLS: And although David does put that in those line items, in a place to park them, we have a lot of fluidity within those to make changes as the days and months go on and to make mid-year budget corrections. And that's now what we have done yet.

We certainly -- you are certainly right, he has money parked in certain line items. But we have not had any opportunity to review which line items he has actually moved additional money to and what that will mean in terms of our prospective work.

MR. EAKELEY: This is not a criticism of OPP. It's a self-criticism because here I am on my last penultimate day in office possibly saying, why are we spending 5 million on compliance and enforcement? With no disrespect to compliance and enforcement. And I know that's not in your budget, Danilo; it's OIG plus OCE.

But if you look 3 million for OPP and 5 million plus for OCC and OIG, and then you start to say, well, where are the priorities within the OPP budget? Where are we going and how much of that is state planning, and we still lack the resources to support the state planning initiative, it just leaves questions that the next board will obviously have to answer.

I'm sorry, Mike. That was --

MR. ERLENBORN: Mr. Chairman, I think the inquiry is good. And I think if it cannot be delivered, the answer delivered to you tomorrow --

MR. EAKELEY: I don't expect it to be. I just -- these are really, I think, issues that are -- issues that the board needs to engage in also. But I think that we need to go back several years and finish a process we started but didn't complete, which is what I mentioned before, strategic planning, performance plans, performance reviews, tied into the development of a budget with the input of the board.

But that's, as I said, for the record book.

MR. ERLENBORN: Well, I think your goal is one that should be addressed, and when we get the additional information plus the transcripts of this meeting, including the witnesses we had before as well as what we're hearing now, I'll see that the new members, the new board members, if they're ever appointed by the President, will get copies of those transcripts so that maybe that will give them an idea of what they can start working on.

MR. EAKELEY: I'm going to ask the same of Danilo and David at the next, but where are you talking about spending your resources this year in the planning, in this part of the OPP budget, the program oversight? That's where I interrupted you. Remember? You were turning the page.

MR. GENZ: The percentage distribution of --

MR. EAKELEY: No, no. Just what kinds of activities are you planning to undertake under the category of use of program oversight to improve access and quality?

MR. GENZ: Okay. Well, the visits is one important category, where we're going to expand. We did just 12 last time. We want to go to lots of other places. Maybe we'll go to 12 intensively and some in a less intensive fashion, as many as we can get to. We may do it some other way. We're working on the planning at this point.

We're going to look seriously again at our grant management process. We did so last year. Last year we made significant improvements to the RFP. We eliminated a lot of overlap and confusion. We clarified many topics in the thing. And we added information based on LSC's priorities, such as diversity, so that we would get appropriate information we need.

What we need to do, what we're going to do, next year is do that all over again and look very basically at, can we make it simpler? Can we make it more useful? And we're in the process of doing that.

With respect to other money distribution in this area, of course, is our work expanding our support and technical assistance activities. And the most important of those is a new project that we began this year and will -- I'm sorry, that we began last year and that will really take hold in the next year, and that's our innovation and model practices efforts.

We have for years been asked by folks from the field from time to time, you know, what are good models of this, from sort of basic things to more complex things. Who does really well with strategic planning, and how can we do that?

And we tried to answer those questions on an ad hoc basis. But in July, we made the decision that we were going to make this a serious effort of ours, that we were going to do a best practices or an innovative and model practices section so that we would have that material ahead of time.

We have the person that we introduced to you. Monica Holman is doing that work. And soon you will see fruits of that labor.

MR. EAKELEY: Here's another unfair question. How much of the $1,900,000 in information technology and information management within our M&A line will we be allocating this year to efforts like that to improve access and quality?

MR. GENZ: Information technology?

MR. EAKELEY: Well, we have --

MR. GENZ: I think the answer is all of it.

MR. EAKELEY: -- 1.9 -- well, I think -- I assume some of it is internal to the corporation and the management and administration. But it would be useful at the finance committee meeting tomorrow to get a better sense of where that money goes, John. I think --

MR. GENZ: Oh, I'm sorry. OIT, right. Of course there's a major component of --

MR. EAKELEY: Yes. And are there policy choices within that budget line for allocating more to the program support effort? That's the question behind the question.

CHAIR WATLINGTON: Doug, I just want to add to that. I know I'm jumping ahead a little, but since Reggie -- part of this strategic planning is also how that -- that client conference, how is that going to fit into there, you know, where that is as far as planning and the implementation of that, that we want to make sure that we leave for the board there.

I mean, I just want to make sure that that is not forgotten. I mean, I see it in there, but not as clear.

MR. GENZ: Oh, it's on your agenda today, Madame Chair. And it will be addressed. And the answer is that we've done a -- that we had a wonderful start and we have lots of plans for how we're going to proceed on that, and you'll hear about that from Reggie, Reggie Haley, later.

MR. EAKELEY: You were on technical assistance when I last interrupted you. And you were talking about best practices and communicating best practices to programs, something that the board has been very interested in, which got me off on information technology and systems.

MR. GENZ: Right. And if Mr. President will forgive me, I'm not going to answer your question about money allocation. I presume that you'll let me pass, and we'll get that answer to you, or that's in a sense a larger policy question.

MR. EAKELEY: Well, we'll need the answer before the board is asked to approve the budget tomorrow.

MR. GENZ: Yes, sir.

MR. EAKELEY: Just mischievous.

MR. GENZ: My time is up. Bob?

(Laughter.)

Yes. Okay. Back to Monica and her work. In a sense, we're all working for Monica in the staff because we have committed ourselves to finding and pointing out and directing information to her.

That includes not only programs folks and technologies folks and state planning people, but also OCE has been enlisted and has willingly and enthusiastically said, yes, we're out there. We know things. We're going to feed it back. And we're going to get that out so that it's as useful as possible to everybody.

MR. EAKELEY: I see Bob has abandoned you.

MR. GROSS: Getting one my props.

MR. GENZ: Very quickly, the last topic I'm going to do before we go to state planning is the use of technology. This Monday, last Monday, Glen Rodden was invited to speak in front of the Virginia Supreme Court's Commission on Pro Se Delivery, and specifically to talk about the California I-CAN problem.

To me, this is worthy of note at the top of our discussion about technology. We've only been working on technology for three years. We've only been working on state planning for four years. And it's a truly remarkable example of the Supreme Court turning to legal services programs and saying, we want to do this. How can we do it? Help us.

It also shows the potential of all of this. As courts take up this task -- this task is ours; we're going to do it, they say, access -- then that's work we don't have to do. That's more resources to the -- more understanding, and it's a clear example of partnership in the best state planning mode.

There are many more of these wonderful examples happening. What I want to hit in just moments is this Strategic Directions tells us to be -- to look at replicability and coordination. And so I'm going to talk briefly about the statewide websites and about our nationwide grants that are doing those things.

Statewide websites: In the 2000 year cycle, we had two templates developed. We took those two templates and we turned them in in 2001 to 28 states. Obviously, there's an economy of scale there. They didn't have to start from scratch.

The fact that they're built on similar platforms means that any improvement you have, you can put in. It means you can coordinate between them. You can put information between them. And it's easier to provide technical assistance when you only had the two. This is replicability and coordination. We're only beginning to build them, but we can see the potential.

For the client community, we have CLE. We have strategic planning -- I mean, I'm sorry, we have pro se material; I have strategic planning on the brain -- and we have reflect information.

Those websites also help our pro bono efforts. There's a place for pro bono attorneys to find out about cases, to get help, to get forms, to get information, and to get person-to-person help. Same thing with legal services attorneys.

MR. EAKELEY: Mike, permit me again. We have again in the budget four million seven in carryover restricted funds for technology initiatives in addition to the appropriation this year for technology initiatives.

And obviously, to the extent to which -- this is addressing one of the points Ramon raised -- to the extent to which the Corporation had discretionary resources to fund the management and administrative costs of reconfiguration, that would be a wonderful carrot to add to or it would substitute for a stick those cases where it could, but we don't.

We have appropriation for technology. We do use those grants at times for support of reconfiguration, along with technical assistance. But obviously, it's not a complete match, and we have a -- we sponsor competitive grants because we're looking for replicability and best practices.

But I couldn't -- just clearly, you need the technology to integrate programs. Hearing Alma Jones' story about Northern Louisiana this morning just brought that home very dramatically.

And I was wondering about the interplay between the technology initiatives, the state planning process, and the overall but limited technical assistance we can afford or do afford to those programs that are in the process of reconfiguring, going into the process.

I mean, do we try and mentally allocate -- do we say, are there resources available to provide the technological support or technical assistance, or do we say -- well, I'll just stop there. How does that -- how do these different factors work into the equation on reconfiguration?

MR. GENZ: Many of our technology grants are aimed to address this need, and many places, including Virginia, get a significant amount of money for this coordination because of the -- because of that. It's also true in Louisiana.

I'm not sure I'm addressing fully --

MR. EAKELEY: No. I think it just -- Northern Louisiana applied, did not get, and is in need of. But I don't want to speak to the merits of that grant application versus others, but rather just the process.

Is there a priority given to programs in reconfiguration when they apply for a technology grant, or is there a screen that says, we're just going to consider the objective merits of a particular application without the context of what's happening to the programs?

MR. GENZ: As with all of our work, we're careful to incorporate all the information from all of our parts. So we definitely do that. We consult with Bob. We consult with the state planning team on those decisions.

MR. EAKELEY: I mean, to a certain extent, supporting a replicable program in another state may make it available at less cost in a state undergoing reconfiguration the next year, I suppose.

But is there a -- I don't know. What's the calculus that's employed for making judgment calls on this?

MR. GENZ: We have a new round of grants coming up, and we are very conscious of the need from this round of mergers to address this. There's a category called integration that can be --

MS. YOUELLS: A couple of ways to answer your question, Mr. Eakeley, is first, the grants are competitive. And they are competitive within certain categories. So we have integration grants. We have grants for innovation. We have grants in different categories.

And they're capped, unfortunately. We don't have the amount of dollars. We have many more applicants for those dollars than we have dollars available.

But within those categories, we put out RFPs and we ask our grantees to apply, and the overlying theme, the overarching theme is integration, coordinated, comprehensive delivery system.

So when the grants come in, they're reviewed by outside review panels who actually rank them according to the category that the grant is applying for, and they take a look. One of the things that -- after the advisor panels rate the grants and then they come to Mike and the technology people, one of the first questions that we always ask is, how does this mesh with the development of a state justice community?

And then we start to create our priorities in terms of the highest ranked grants in each of the categories in which the applicants applied for dollars. I make preliminary recommendations, with the assistance of Mike and Glen and Joyce. The president makes the final decision.

But last year I think we had six times as many dollars requested than we had available. But it is something we look at. And reconfiguration, the integration of a new service area, is one of our highest priorities.

MR. EAKELEY: Hoe do you make the judgment as to how much funding to put into each of the categories of technology grant funds?

MR. GENZ: That's something we make each year, and we've not done that yet this year.

MR. EAKELEY: I mean, for example, last year how much went into funding integration technology versus innovation technology programs?

MR. GENZ: Doug, I'm not absolutely sure. And I'll get that to you --

MR. EAKELEY: Just a for example. But again, there's obviously a judgment implicit in allocating funding to those different categories that's a judgment call.

MR. GENZ: Absolutely.

MR. EAKELEY: And how is that judgment made? I mean, what calculus do you use in developing that judgment call?

MR. GENZ: Each year we look at what we think the potential and the needs are in that area. And as I've said, in the integration area, I think we may have a different feeling this year from what we had last year in terms of what we know the needs are.

MS. YOUELLS: The judgment calls are made annually. As we enter into the next grant process, which will be fairly soon, the recommendations are made by the technology folks to me and then I made recommendations to the president.

MR. EAKELEY: But do they make -- for example, are they the ones that say, we think you ought to be putting this much of our technology grant funding into innovative applications and this much into integration?

MS. YOUELLS: The technology team makes a recommendation as to the entire appropriation for the technology initiative grants how much should be allocated in each of those categories.

For example, this year, although we're not in this year, we're already getting a lot of information from different people in the field who think that we should put more dollars into the development of I-CAN type projects, projects to integrate with the courts and make sure that self-represented litigants are having the best quality of legal advice that they can.

So that's something -- we factor those into our thinking. But you're right, in the end it's a judgment call, and it's a judgment call that's made at the highest level by the president when we actually put out the RFP.

MR. EAKELEY: I mean, these are just -- I apologize for backing into this so late in the game. But obviously, these are important policy considerations that -- and we're not questioning them. But implicit in the allocation of limited resources are judgment calls and policy choices that are fraught with controversy or whatever.

Okay. Thanks. Again, I think that's my last interruption for at least five minutes.

CHAIR WATLINGTON: We're trying to stay on time.

MR. SMEGAL: Their presentation is going to be over in three minutes.

MR. McCALPIN: I think he visualizes himself as a Supreme Court justice.

MR. GENZ: We also have wonderful nationwide grants that do very good things and that are described in pages 7 to 11.

With that, I'm going to turn it over to Bob for a discussion of where these pieces -- how these pieces, the program piece and the technology piece, fits in the overall building of a state justice community. Thank you.

MR. GROSS: Thank you, Michael. I did once have a Supreme Court argument where I was asked, after I gave my name, a series of questions before I got into -- so do you have some more? Actually, I think those are good questions and I'd like to address some of those as we go along.

But first, I think that because you thought this spoke for itself and was so good, I think we ought to thank Wendy Burnette, who had a hand in making it look so good and organizing it so well.

MR. EAKELEY: Well, I'll just -- this is one of the few -- not few, but I think that the next board should get a care package that is relatively limited so that the members are not overwhelmed with paper, but this is one of the pieces of paper that I have high on my list of things to leave with our successors as very informative.

MR. GROSS: Great. And then Melissa Pershing, who works at LSC but is not here, had a big hand in compiling the information and helping with its organization and development. So just thank you to both of them. And Wendy, did you raise your hand so people know who are you? Great.

You know, you heard a lot today from people who really deserve immense credit. State planning has been an investment. And there's been a lot of sweat equity involved. And you could hear it today, and I think we should all feel very proud of what they've accomplished so far.

We've tried to help when we can, and I'll talk about that a little bit later, with technical assistance funds, with other kinds of help. But the real work is going on, as it always has, in the field by those folks. So they have my respect and the admiration, I think, of everyone here.

When we look forward next year or this year to some of the goals that we want to achieve, you can look at them in a few different ways. One is building capacity in the access to justice arena, building more stakeholder involvement.

I was interested to hear about the challenges in Virginia and Pennsylvania with stakeholders who have been through and have been asked to give a lot of time. And we need to look at how we can keep involving them in productive ways because I think the only real way we're going to increase resources to a sufficient level is by involving other folks.

So I'm really happy to hear today about the partnerships that have been created with other stakeholders, with the agencies, with courts, with other folks who care about justice. And that has been an overriding goal of the state planning effort.

Sometimes we use the phrase now, I guess, designated state planning bodies. But it's more than just someone -- a group that comes together to make a decision. It's about building a committee of people who give of their time.

And I'm thinking of what LaVeeda was able to pull together, with help, at the board meeting in Montgomery. You saw all those folks who came to the table. That's a resource that's precious and is necessary for Legal Services to grow.

So one of our major tasks and goals is to work with the states where we sense that we could help them build that capacity, and where there are capacities already, have those folks travel to other states to help them.

Texas, which has launched its equal justice commission, access to justice commission, which has great promise there, was a product of us actually getting the chief justice from Florida to come there and talk about what was going on in Florida, and getting them some assistance from Washington state. And I think we're going to see a lot of good stuff coming from that state.

A second priority for us is going to be to support the newly reconfigured programs, the ones that you've heard about. In the past three years, we've managed to sort of scrape together from the management and administration lines in the LSC budget over $600,000 that we have distributed to 36 states.

Last year, at the end of the fiscal year, we were able to assist 11 of the states that are going through the kinds of large configuration changes that you've heard with technical assistance dollars. It's not enough, but I think every bit helps.

The other thing we were able to do, and Cindy Schneider is in the room who's been our expert in helping programs with nuts and bolts of merger. So we've provided sort of brain power as well as technical assistance.

And I was glad that we were able to put together the Making Mergers Work training in San Diego, and that people have felt that it was valuable. And we'll have to think about what else we can do for an encore in that area.

One of the things we are going to see -- and boy, it's almost next week -- in two weeks at the meeting of statewide programs, one of the questions I'm interested in is this question of stakeholder involvement.

Some of the statewides have made -- just are very impressive in terms of the work that they do, and they're impressive in the wealth of support that they have. How do they maintain that momentum over time? What can we learn from them?

And it's going to be a fascinating meeting without a lot of talking heads but with folks from the statewide programs across the country talking about how they got to -- like today, challenges, pains, as well as opportunities and gains, so that we can learn from one another.

Another priority will certainly be diversity in the community and leadership, both within programs and in the community as a whole, and others will talk about that later. But Althea Hayward has joined our staff -- hi, Althea -- on the state planning side with a special role of working on those issues in the state justice communities.

The client-centered conference was a big success. Barb Donnelly and Reggie Haley did a terrific job at NLADA in some client board training, and they've been asked to do, I guess, three more, now four, around the country.

We see clients playing -- want to play a different role in this, want to be as involved as they can. I was at the one in San Diego and was excited by the leadership role that people were taking, and by the new folks who were there as well as some of the veterans.

We will also do some assessment of systems aka, I suppose, looking at configuration. There are some states where we are involved in discussions with them, and they are involved in planning and looking at configuration. And we will continue that.

Let me just close by this because I don't want to go over what's already in this book, in the Strategic Directions report. And I don't want to go over too much what's in Building State Justice Communities.

It's worth looking at every once in a while. It was in March, so it's a little bit old. But there were 18 states who we thought deserved attention for the significant achievements that they've made.

And this has been a valuable document for other states. When I was in New York working with a planning group there, they wanted us. They wanted to see what was going on elsewhere.

I guess another way in terms of looking at all those priorities that I just mentioned, the other way to look at it, is a goal is to have 18 more, at least, a year from now. And I see that happening. I see -- this is an investment, but I see the fruits of that investment in so many places and the promises there.

I look at Arkansas, where there has been a new access to justice movement. There are new people involved. There's a quarter-million-dollar investment by IOLTA in the mergers of the programs there.

Vermont. I know Edna is going to continue to be a leader there. And I hope with the new needs assessment there's going to be a lot more money flowing to that state. There's a new commission there to support that.

Massachusetts. Already strong, but they're undertaking a strategic planning effort to look at their structure to see how they can be stronger. And they've put in a lot of resources in a legislative campaign.

New York, the resilience of the folks at LSNY in the face of what they -- what happened in that city is outstanding. They're in the process of restructuring, the largest -- the second-largest grantee that LSC has. I think there's going to be great promise there.

And in the rest of the state, they are on a campaign now. They're going to be in front of the state bar. They're meeting next week with the bar president launching a campaign for justice in that state. There's a recommitment, I think, of the bar there that promises well.

I had Virginia on my list as one state that's going to be in our book next year. Some of these states we did give time to in the way of three-year grants. Sorry that it wasn't five.

I expect to hear a lot more about Virginia. They've gone through an awful lot of change, structural change, and you heard about that. And I think that we're beginning to see, and I think we leaders like this we'll see a lot more, from that state. I think they'll be in the book.

North Carolina birthing a new statewide program. Georgia -- where's Bucky? He's going to make that state soar. I mentioned Alabama. LaVeeda is going to stay involved and see that the resource development activities in that state really -- that state is still about 90 percent LSC-funded. So I'll go down and help her there.

Mississippi is a state where we're seeing innovation in technology. They have a big challenge, as do others, in rural delivery, and they're moving into areas of technology to address that, which are pretty exciting.

Louisiana. Texas. New Mexico. Huge change. Huge change. We've supported each of those with our largest technical assistance -- we called it merger assistance -- funds in September. Interestingly, we have partnerships in a number of states where our technical assistance is actually either matched or administered by a bar foundation, or the IOLTA program, or in some cases the bar itself so that we can increase the support locally for the changes that are occurring in those states.

A state like South Dakota. You don't hear much about South Dakota, but the bar has made access to justice a centerpiece of its campaign. IOLTA has funded a coordinator position that's going to be housed at the bar.

Nebraska. One of the first states that went through configuration. They will be in our book. The changes are taking hold there. And even -- I wager this one -- where's Ramon? I actually think Ramon is a pretty good bet. I wager that we'll see Michigan, that they will heal the wounds that exist there. And that would be a goal of all of us, to see Michigan right in this building state justice.

So that's where we are.

CHAIR WATLINGTON: Any questions?

MR. EAKELEY: Actually, for the record, you answered two of my questions, which were, what are we budgeting for diversity, leadership development, and client-centered legal services. And we've hired, and we're planning more conferences, and that's good. And those are nice documents, too, by the way.

CHAIR WATLINGTON: And you answered my client -- and we have Reggie.

MR. GROSS: And Barb, too.

CHAIR WATLINGTON: And Barb. Sorry about that. About the client-centered conference there.

MR. EAKELEY: Thank you.

MR. GROSS: Thank you.

MR. HALEY: Good afternoon. My name is Reggie Haley. I'm with the Office of Program Performance, and I do promise to be brief. I realize we are supposed to be done at about 1:00, according to the schedule, and I'll try to fit everything in about five minutes.

Before we start talking about helping to create client-centered state communities of justice, I would like the opportunity, with the permission of the chairman, to provide the detailed information on the OPP budget that you are requesting -- if I could provide that to you tomorrow morning.

MR. EAKELEY: Great.

MR. HALEY: Perfect. Okay.

With me here is Barbara Donnelly. She is my partner now in client-centered initiatives. She pretty volunteered for that, and I'm happy to have her. She is program counsel, and she is also with the Office of Program Performance.

What I'd like to do is give you a rundown of the task that we have been successful with this year, and identify those steps we plan to take in 2002, and then open it up for questions.

Since we began talking about creating client-centered state communities of justice about 18 months ago -- and as I recall, it was a dinner meeting in Minnesota. And at the dinner meeting was Ms. Watlington, Ms. Fairbanks-Williams, and of course Randi Youells, our vice president.

We started talking about ways to engage clients in activities that did a couple of things: first of all, empower clients to help themselves; but also, empower clients in such a way that they could help the delivery system provide additional services with clearer understandings of what clients wanted to the client community.

Now, since it all began about 18 months ago, we've accomplished the following things. First, we sponsored a national conference in Hershey, Pennsylvania. Following that conference, we issued a report from the conference. Following that, we prepared a response.

And I believe that you've received a copy of each of these documents earlier in December. I would ask you to take a look at them when you do get a chance. I think that you'll find the information in them to be very useful.

In addition to developing the two reports following the conference, we sponsored a national training just a few months ago at the NLADA conference in Miami.

In addition to that, we have already committed to hold four conferences in 2002. Two of those conferences are going to be national conferences. One is going to be at the Equal Justice Conference, and of course another one at NLADA. But in addition to that, there will be two conferences that will be regional, one in Florida at the Southeast Project Directors Association meeting, and then another for the Region 7 -- sorry, for Region 7.

MS. DONNELLY: Oh, sorry. I thought you were cueing me. Yes, Region 7 in Albuquerque, New Mexico. Actually, we were invited to come there and present because -- so that the clients from there who could not attend the other conference or training at NLADA -- so they thought it was an overwhelming success, so we were actually invited to come there.

MR. HALEY: In addition to those trainings that will hopefully inform client board members well enough so that they can make a lasting and substantive change in their community in working with community leaders.

We're also planning to do another conference that would be comparable to the one that we held in Hershey just last year, in response to your question, Ms. Watlington.

In terms of what we plan to do to promote leadership in the client community in calendar year 2002, here's a rundown.

First, we plan to develop an information exchange system. What I mean by that is a couple of things. First, a national service desk so that clients and client leaders have an opportunity to contact LSC directly by phone, by fax, and by e-mail to share their ideas with us, their issues as well as their concerns and their success stories.

In addition to having that service desk, we also plan to have a link on our website so that we can make information available to client communities immediately based on information we've received through the service desk.

In addition to that, one of the most important things we need to do is to become acquired with existing and emerging leaders in the client community. And we plan to do that in a number of ways.

One way might be to have community forums where we have invited educators, members of the church, advocates, client leaders, community organization leaders, to talk to us about the most critical legal needs in those communities and help us figure out ways to respond to those needs.

The third thing that is very important for us to do is to facilitate partnerships and collaborations between the client committees as well as the national partners. And in doing that, hopefully we will provide an opportunity to give client leaders a voice at some of the national conferences.

The fourth thing that we need to do is to understand first that we cannot do everything by ourselves. We need to inspire and promote client leadership wherever we can find it.

And we plan to do that in a couple of ways. First, we're going to continue with the client training opportunities. But instead of just it being training where it's talking heads from LSC addressing issues such as client board responsibilities and things of that nature, we also plan to bring in guest speakers, speakers that will talk to community leaders about leadership and give them the opportunity to share their concerns about what needs to be developed in their community and how the Legal Services Corporation as well as Legal Services programs can help them with that.

As I mentioned earlier, we held or sponsored a training in Miami as part of the NLADA conference just a few months ago. And I would like for Barbara to talk about that for just a few moments.

MS. DONNELLY: Yes. A committee at LSC put together the training, and we started with the premise that knowledge is indeed power. And we wanted to give our client participants enough information and skill so that they could go back and be good advocates for the client community which they represent.

It was interesting. At one of our meetings, the committee was sitting around talking about what we wanted to do, and one committee member said, "Well, what if we train all of these client board members and client advocates, and they all go back to their communities and their programs and boards and demand CSR reports and audits and timesheets and everything like that?"

And we all looked at each other and were silent for a minute, and then we said, "Good." And we realized at that moment that's exactly the kind of empowerment we were looking for.

Reggie and I co-moderated the training at NLADA, and then several staff members, who are actually all in the room right now, participated in the training: David de la Tour, Bob Gross, Pat Hanrahan, and then Randi talked about the history and mission of LSC and also gave a very inspirational discussion of access to justice issues and the never-ending quest for equal justice for all. And the clients absolutely loved what Randi had to say.

A major part of the training focused on empowerment. We wanted, first of all, that the clients understand what important roles they do have in representing the client community. But also, we wanted them to acquire some techniques for being able to speak up when they are on boards or in leadership positions.

And we're all aware that sometimes the client board members feel somewhat intimidated or less than willing to speak up around attorney board members. That's not always the case, but in some situations --

MS. BATTLE: I was just about to say, I think Ernestine might -- and Edna might be the exception to that. They keep us all straight.

MS. DONNELLY: Right. But we did hear from a lot of client board members, and as a director back in Michigan, I did experience that as well, that client members were less than inclined to speak up and get their message heard.

So we focused on some techniques. Actually, Randi had written a very good pamphlet for clients, you know, Talking Tough, that we used back when she was a program director in Iowa. So that was very helpful and the clients enjoyed that as well.

One thing that worked really well: We assembled a diversified panel of client board members and client advocates. They came from Arizona, Florida, Memphis, and Indiana. And these client advocates shared their personal stories, challenges, difficulties that they have faced in becoming leaders in the community.

And I'll tell you, the passion, the commitment, and the humor of this panel just went over really well, and I think inspired the whole group of participants.

The evaluations, the comments after the training, were very, very good. Most of the participants, if not all, told us that they wanted LSC to conduct more trainings, that this really meant a lot to them. And more importantly, they really enjoyed being able to interact with the LSC staff, that that really made them feel important and was very inspirational to them.

So as Reggie said, we're going to do at least four trainings per year, and we already have four lined up for this year.

MR. HALEY: There is just one other thing that I would like to mention, and that is our work to help develop or inspire, if you will, client-centered state communities of justice.

It's not done in a vacuum. The major projects that are carried out by the Office of Program Performance each lend themselves to this notion of client-centered legal services delivery.

As an example, OPP staff assigned to program performance and quality initiatives have designed program review visits to look at model projects, and initiatives that promote client-centered delivery. That information about those best practices and model projects will be disseminated widely so that other programs can use that information to promote client-centered legal services delivery in their areas as well.

In addition to that, too, our technology initiative grants, websites, telephone intake systems, and self-help systems are all designed in such a way to assure that they are useful to clients.

Our general competition process has long required client-centered standards, including the test of board composition, which requires that 30 percent of all boards be made up of client board members.

CHAIR WATLINGTON: Who do you think initiated that? Clients.

MR. HALEY: I'm sorry?

CHAIR WATLINGTON: Clients initiated that.

MR. HALEY: In addition to that, our competitive grants process tests staff diversity, priority-setting, client access, effective outreach to client leaders, and the inclusion of clients and community leaders in the priority-setting process.

And of course, we request that Legal Services programs use client satisfaction surveys so that they can find out immediately how well they are performing from the perspective of the clients.

CHAIR WATLINGTON: That's not that -- I just wanted to add, I was disappointed when I heard about the training given in NLADA, that Edna -- I know I wasn't going to be there, that Edna wasn't there. The current board members should have been there to help to do that.

I mean, I'm still an advocate for that, and it's still -- because what is happening is the follow-up of what clients said, you know, what we did when we did the training before and followed up from the other first conference.

And these are the things that came out, of how Legal Services Corporation can still be assisting clients to help themselves. And like we always said, too, that an informed client is an effective client. And you still need that client's direct input.

So I was, you know, a little disappointed when I found out that she was not at the NLADA meeting to be at that training for the Corporation because since it had been client-initiated and from the beginning was a client-centered conference, I felt that she should have been there and been aware of that. So I was a little -- that was one of my disappointments.

Maria?

MS. MERCADO: Yes. Now, just a couple of questions or comments, I guess. I'm very excited that we're doing client conferences around the country because it's really important that we have that input.

I know we had a serious problem with the diversity issue in Hershey, Pennsylvania, and because we have clients from different regions, many of them very isolated in rural areas, isolated because of language and working conditions that they are in, it's very important that when we're doing, especially, national conferences, that we make an exerted effort to diversify our participants that are there, not only your presenters, but your participants that participate in client conferences.

I'm curious on the website and client materials or information that you distribute nationally for client participation, are they provided in different languages, or only in English, or how is our information distributed to the different client communities?

I know I heard Michelle DeBord talk earlier about the difficulty of providing access to justice to the Hispanic community in Pennsylvania, which means, of course, looking at diversity issues within their staff, but also in the client community, in the board representation, and in the clients that you hopefully train in pro se advocacy and materials that are provided to them, and just sort of an overall policy to make sure that all our clients are getting access to justice.

Do they even know that it exists? They may not even know that it exists. And so I'm real happy to see that you're sort of taking the show in the road, you know, to various different sections of the country and incorporating that.

But I was just interested in the materials that you were producing and the websites that you're doing, whether you're at least in the main languages, whether those are being produced as well in those other languages other than English.

CHAIR WATLINGTON: Really, right, because there's a large population of Hispanics in the client communities now that it should be diversified so that they can understand and have that accessible information.

MR. HALEY: We really appreciate the point that you've just made. As you know, this initiative and the staffing of this initiative has just begun. It is our intent to invite members of all of the minority communities to share their concerns with us in such a way that they feel free to talk about the concerns they have about any information or any presentations that will be made.

What we will do is make sure that, to the extent we can, information is provided in languages representative of the communities that need that information. And we're going to work with the communities to make sure that that's done.

CHAIR WATLINGTON: Pat's going to be speaking to us about diversity, real quick there, because we want to -- we're a little bit behind schedule.

MR. EAKELEY: And it's my fault, Pat, as you know.

MS. HANRAHAN: That's okay. Thank you, Madame Chair. Good afternoon, Mr. Chairman and committee members and board members.

I just wanted to jump in at this moment because I think Maria Luisa's question was very pertinent to our diversity initiative, which I have reported to you on regularly, and to let you know that we are now moving forward with the next phase of it, which is to develop an action agenda for ourselves and to guide our programs as we continue working and expand our work in an increasingly diverse world.

Census statistics which were recently revealed -- I mean reported -- show that nearly 20 percent of the recent immigrants to the U.S., which is a population that makes up 11 percent of our country's population, do not speak English or speak little English, so that being bilingual, having bilingual staff, having information that's written in various languages to meet the community's needs, is critical to outreach, to access, and to being inclusive, which is the goal of our diversity initiative.

And I wanted to let you know that we have looked at the statistics for our program staff, primarily leadership and supervisory staff. And it doesn't keep pace at all with what's going on in our country.

But there is movement in the right direction. And interestingly enough, in our statewide states, there is more diversity both in terms of gender, race, and ethnicity than there is in our states that have more than one program. So I thought that was a sort of fascinating item as a result of these analyses that we've had a consultant do.

For example, we have 26 -- and I use "statewide" in quotes because I'm also including Guam, Micronesia, Virgin Islands, and D.C. But of the -- and one of those statewide programs currently has a vacancy in terms of executive directors and staff because it's just starting out, and that's North Carolina.

So we have 25 directors. A quarter of them, or 25 percent, are female, and a fifth are African American. Eight are Hispanic and four -- sorry, 8 percent are Hispanic and 4 percent are directors who identify themselves as "Other." And that could be, I suppose, Arab American or -- let's see what else -- Native Alaskan, Native Hawaiian, and so on. So I thought that was an interesting note and a hopeful one.

We have a lot of work to do. Our action agenda is going to point out ways that we can be more inclusive, concrete recommendations, milestones, target dates, and other very specific steps that we can take and that we can help our programs take to meet those goals. So thank you. Thank you, Madame Chair. Excuse me, and thank you.

CHAIR WATLINGTON: Thank you. Is there any other comments? If not, we will end this and we're still just a little bit behind the agenda.

MS. BATTLE: Yes. One real quick comment.

CHAIR WATLINGTON: Okay. That's fine.

MS. BATTLE: I really appreciate that report, Pat. And I do see all of the achievements listed in our Strategic Directions.

And the particular achievement relating to diversity is listed under "Commitment for Internal Capacity and Support," and it doesn't specifically  -- the commitment itself doesn't specifically speak to diversity, though we've implemented diversity as one of the keynotes for that.

So I would just to our chair say that we do need to make sure that explicit in what we set out as one of the things in our strategic plan, that diversity and making sure that this implementation takes place is at least part of our visition at this point.

MS. MERCADO: And I do, though, on behalf of the LSC board, want to thank our partners in this year-long diversity leadership discussion we have had, which have been NLADA and the ABA, that have been with us throughout the whole year in different discussions that we have had; plus our grantees and client participants.

And I particularly want to thank the staff and the coordinators for doing such a great job of making that group very diversified in bringing out all these various issues.

MS. HANRAHAN: Thank you, Maria Luisa. That's true. We worked very well, very closely, together, and I think we're all happy with what we've accomplished so far, realizing that we have a lot more to go.

MR. EAKELEY: What have we -- are we budgeting for?

MS. MERCADO: I did ask that, for a specific budget, at our last board meeting, didn't I?

MR. EAKELEY: Taking advantage of Randi standing up here.

(Laughter.)

MS. HANRAHAN: We need more.

MS. MERCADO: No. And Mr. Chairman, I think that if we go back and look at the transcript for the finance committee, I did specifically request from Mr. Richardson that we set aside some designated funds to continue not only the discussion but the actual implementation of program priorities dealing with diversity, not only for ourselves but for our grantees as well.

And I don't know that we had a figure, but I think we talked about making sure that we used some of the money, especially some of the carryover grant funds that we had. And I'm sure Mr. Richardson is being asked from all directions.

MR. RICHARDSON: I'm making this as I go.

MS. YOUELLS: I have one other item of business that will just take me six seconds. Maybe it will take me ten.

MS. BATTLE: One. Two.

MS. YOUELLS: Before I do that, I also want to note that the invitation to make the presentation at the NLADA conference on client training was in fact extended to LSC by Vita McKnight, who was putting together the six-hour client training in cooperation with NLADA.

And it was done with the permission and approval of Martha Bergmark. I actually received an invitation from her for LSC to become an integral part of that seminar.

So we actually owe our partners for more than just diversity. We owe them for kicking us into the client initiative also.

I just have -- as we go to the more mundane, I just have one little item I want to correct that comes out of something that the board took up at the last meeting, and that is the review process for the state planning and configuration process that you adopted that results in a program letter and the creation of state planning standards.

And you will find this behind your tab under Provision Committee, and I'm going to be talking to you about a change on page 14. So it says in the upper right-hand corner page 14.

Normally, this is the kind of change I would make without bringing it to the board's attention. But given that this has been such an interesting issue for all of us for the last several months, I wanted to make sure you understood that the change we -- make sure you understand the change that we are proposing in the program letter, which has not gone out.

MR. EAKELEY: That's not page 14, Randi.

MS. YOUELLS: We have different books? Where would it be in theirs, Elizabeth? You have different books than me.

MR. EAKELEY: Is this the draft program letter?

MS. YOUELLS: Yes.

MR. EAKELEY: 02/02? That's page 19.

MS. YOUELLS: This is the draft program letter. It would be on the third page of the program letter.

MR. EAKELEY: Page 21 in our board book.

MS. YOUELLS: Page 21 in the board book? The addition is simple, and as I said, it would be not normally something that I would bring before you. But it is footnote number 2 and footnote number 3.

After the board approved the program letter at the last meeting, we realized that we were saying at least 60 days prior to the implementation in the Federal Register the announcement of new service areas, or no later than February 1.

And we realized -- Bob and I realized as we were putting together the program letter that there are certain grantees that are on occasion taken out of the regular competition cycle in order to accommodate problems that are existing in that particular state.

So we have added a footnote that says that: "The February 1 date may not be applicable to states where grants are not on the normal calendar year cycle. In such instances, notice shall be at least 60 days prior to publication of each state's service areas in the Federal Register."

Where this comes into play in particular is something that we did yesterday. We are not ready to respond to the reconfiguration plan that Michigan presented to us on December 27th. It would be premature for us to respond to them without careful consideration of that plan and the opportunity to work with them.

So we notified them yesterday that we intend to take them off the normal competition cycle so that rather than having notice from us on February 1 with publication in the Federal Register in April with the applications due in midsummer, we would actually move that back by two months.

That gives our staff an opportunity to negotiate and talk to the designated state planning body about the proposal they put on the table, so we'll have an opportunity for conversation.

So what we're proposing in those instances, it will still be 60 days prior to the publication in the Federal Register. That date would still be operational. But it may not be February 1 if we have taken the state off the normal competition cycle.

How many seconds is that, LaVeeda?

MS. BATTLE: More than six.

CHAIR WATLINGTON: Is there anything else now? If not, I'll entertain a motion.

M O T I O N

MR. McCALPIN: So move.

MS. BATTLE: Second it.

MS. MERCADO: I'm assuming by consensus we're accepting the footnote. Right?

CHAIR WATLINGTON: Oh, okay. The meeting is adjourned.

(Whereupon, at 1;18 p.m., the meeting was concluded.)

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