|Legal Services Corporation
America's Partner For Equal Justice
PROGRAM LETTER 02-7
John N. Erlenborn
Board of Directors
Douglas S. Eakeley
LaVeeda M. Battle
Hulett H. Askew
John N. Erlenborn
As you know, the 2000 Census
figures are out and will result in a significant reallocation of funding
among Legal Services Corporation programs.
Pending some final adjustments, the total computed national poverty
population increase is around the 5.6% range.
Assuming a constant level of LSC appropriations, a program whose
poverty population remains the same, will lose approximately 5.6% of its
funding. Thus, programs
whose service areas experience a decrease in poverty population will
suffer a significant reduction in funding because of the implementation of
the new Census figures in 2003.
The relationship between poverty population
loss/gain and funding will not be exact, for several reasons, including
the impact of Migrant funding and statistical effects of the computation
of percentages. To give
programs an idea of the likely funding changes, a program that has a 2.4%
decrease in poverty population would experience a funding lose in the
neighborhood of 8%. Meanwhile,
a program that has a poverty population increase of 7% would receive a
funding increase in the neighborhood of 1.4%.
Where available, 2002 carryover fund balances
are one source of resources to ameliorate the transition to lower funding
levels for such programs. Accordingly, LSC will view a reduction in Basic
Field – General service area poverty population to be a “special
circumstance” under 45 CFR 1628.4, supporting a waiver of excess fund
balances up to 25% of LSC support.
Thus, any program that loses poverty population in its Basic Field
service area may plan to accumulate its LSC support in an amount over 10%
and up to 25% and will receive a waiver upon request if the request cites
a loss of poverty population in its service area.
Programs that have a fund balance in excess
of 10% of LSC support as shown in their 2002 audit must still submit a
waiver request under 45 CFR 1628. However,
as discussed above, the fact of a loss of poverty population in their
Basic Field service area will be considered sufficient basis for granting
the waiver. Programs will
still be required to comply with the other provisions of 45 CFR 1628,
including those regarding accounting for the funds for which they received
a waiver and expending these funds during 2003.
If a merger or reconfiguration combines two or more service areas where
some lost and some gained poverty population, a waiver will still be
allowed for the amount of the cumulative excess fund balance that is
derived from a carryover of more than 10% and less than 25% in the service
area(s) that experienced a loss of poverty population.
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