United States. Congress. Senate. Committee on Labo.

Oversight of the Legal Services Corporation, 1984 : hearing before the Committee on Labor and Human Resources, United States Senate, Ninety-eighth Congress, second session, on review of the Corporation's documents to ascertain whether there are any problems with the agency's policies that need to be online

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Online LibraryUnited States. Congress. Senate. Committee on LaboOversight of the Legal Services Corporation, 1984 : hearing before the Committee on Labor and Human Resources, United States Senate, Ninety-eighth Congress, second session, on review of the Corporation's documents to ascertain whether there are any problems with the agency's policies that need to be → online text (page 26 of 42)
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9 here in Washington, received calls from the staff of a member of

this Committee regarding his investigative reports following your


hearings' and if attorneys representing past officials of the LSC
we nt to his station's management in an effort to censor and intimi -
date his efforts, you can understand why some clients and some pro -
ject directors would be reluctant to have their names divulRed .

I only brought this letter and these comments to your attention
so that you would know that there were people who were telling me
and other members of the Board that our efforts were not in vain
and that we should proceed. This did give us a bit of encouragement
notwithstanding all the other negatives.

I do hope that you will continue your efforts to look into this
issue, and I applaud you and Senator Denton for your diligence and
the judicious exercise of Congressional oversight which has been
long overdue in this program. It is only form such legislative and
administrative oversight that the mission of the legal services
program and its Congressional mandate to truly serve the poor people
of this country can be achieved. The clients of the program and
the legislative process will be the real beneficiaries of your
actions nothwithstanding the disinterest which is presently being
shown by other members of your Committee and the press on this
issue. I would be pleased to answer any questions.


Ipiiwlin llUirlb-iii'i-iiliJ



JUL 2 7 B82



^Are There Other Unspent Funds?

It s common practice, when a
budget for a branch of government is
trimmed, to cut back or eliminate one
of the most popular activities of the
agency. This brings pressure that
sometimes restores funds.

But now^comes a different wrinkle
from the Legal Services Corp.

New memuers oi me DoariT, await-
ing confirmation by the Senate, were
shocked recently to learn the corpora-
tion has S-il million in unspent money
from fiscal 19S1. That's about a fifth of
all (he money /;e corporation dis-

bursed during that period.

Clarence McKee, a Washington at-
torney appointed to the board by Presi-
dent Reagan, said he thought the
money was "hidden — sent out to the
field so we (the incoming board mem
bers) don't know about it."

Regardless of the explanation for
the handsome surplus, this revelation
leaves one to wonder what other
boards or investigators might find if
they poked further into the finances of
the multitude of pther agencies.





Remarks of Clarence V. McKee , Esq., Member
of the Board of Directors , Legal Services Corporation

Before the


Regency Hotel
Shreveport, Louisiana
May 28, 1982





It is a great honor and pleasure to be invited as your
Banquet speaker this evening.

Since President Reagan granted me a Recess Appointment to,
and subsequently nominated me to the Board of Directors, I
have been asked to speak before several organizations. However,
I promised myself that my first appearance before any group or
organization within the Legal Services Community would be before
an organization composed of and representing the clients for
whom this program exists, and without which it would not exist.
Therefore, I thank all of you and particularly Ms. Hamilton, for
inviting me .

There are many issues which I could address this evening.
However, I have decided to limit my remarks to my views on your
role as clients in this program. I am the first to admit that
I owe my present position to only two entities: you, the clients,
becau.'jL; Lhc proj^jram in dt'slj^icul to servo you; and President Reagan
who made it possible for me to be on the Board.

What issues face us in the legal services community? What
problems must be addressed? What is the mechanism or mechanisms
for achieving the most economical and efficient delivery of legal


services to eligible clients? These and many more questions face
the new Board and you as clients.

Directors of any corporation have a duty to its stockholders
or members to exercise good faith, loyalty and commitment in
exercising their duties and responsibilities. In this case, you
are the members/ or stockholders to whom we as directors owe that
duty. We must enforce the law and implement the regulations
of the Legal Services Corporation for the benefit of the client
whom we serve as well as the taxpayers of the United States who
are paying the bill.

In this regard, my first duty is to set the record straight
as to the new Board and its commitment to you, the clients of
this program. Since our appointments, you have been flooded with
literature, newspaper articles and editorials, and "gossip"
concerning the "demise of the corporation" by the new "Reagan
Board". You have read and heard of lawsuits instituted to keep
this Board from exercising its duties. What you have not read
and have not been told is who ultimately must bear the costs of
lawsuits and delays in terms of dollars, time and lost hours which
could have been dedicated to having this Board proceed to do its
job under the law.

You have read, as have I, how this Board has been attacked
as a group and, in some cases, as individuals. Notwithstanding
the fact that, to a person, every member of the Board has indicated
his and her support for the goals and purposes of the Act, a "rumor
mill"of anxiety and of actual fear, anger and depression has
swept through client and field community of this program.


Therefore, I want you to know that the real facts have been
distorted during the past several months. Because of the blurring
of facts and the "storms" of protest challenging credibility of
appointees - even after they have made clear their commitment, we
are fast approaching the end of the Corporation's fiscal year
and, as of this date, the nominees have yet to be confirmed.
But for the Recess Appointment of the President there would be
even more uncertainty than apparently exists now.

Let me inform you tonight that this Board is comprised of
dedicated people. They are committed to serving your needs by
implementing the laws and the regulations. It is a Board with
which you can and should have a dialogue.

Therefore, from this moment on, the time has come to end the
bitterness which has evolved; the uncertainties regarding commit-
ment of this Board. It is time for you to make sure that those
who inform you of what is going on in Washington are giving you
the real facts. When you read in a major newspaper: "the new
Board that Reagan has appointed to run the Corporation is controlled
by men who have opposed the Corporation in the past or have opposed
suits filed on behalf of the poor or minorities", you should be
told that it is not an accurate statement or representation of
the facts. Wlien you read or hear that a nationally known columnist
has stated that "Mr. Reagan is naming a new, conservative Board
of Directors who will harass, restrict and undermine Legal Services
so that none of its lawyers can cause real trouble for the lords of en-
trenched greed", you should know that it is not true and that those


who provided reporters with such false information apparently are
more concerned with their own futures than with accuracy.

This program was not created to foster social or political
advocacy by those who had no other vehicle, or who were in a
"shadow" government", or who had their own agenda's - it was
created to provide access to you to the legal system of this
nation and to protect your rights under the United States Con-
stitution. If, in doing so, the indirect or direct effect was
to effectuate change in public policies, or to offend vested
interests, then so be it. The Consitution makes no distinctions
as to who you can or can not offend, whether it be a governmental
or private interest.

As I have listened to witnesses before the Board and its
committees, I have become concerned when so many people in this
program tell us "do not touch the rules"; "do not tinker with the
regulations"; "you do not need to concentrate on this or that
problem or issue". It makes me suspicious as it should you.

Clients of this program must be the "watchdogs" and "guardians"
of this program in terms of its effectiveness and service. We
have corporate staff, project staff, staff of contractors, support
center staff, all of whom are under the "legal services" umbrella,
and who comprise the recipients of $2A1 , 000 ,000 - for your benefit.
You, the clients, must tell us on the Board in Washington, those
on local boards , and those at the Regional level , your views on
how that money is and has been utilized. If you do not approve
of how and where it is being spent, or if you do, let us and the
other entities mentioned know. I believe in local control of


programs. It is necessary; it is important; and it is required.
However, I also believe that we as Members of the Board^ with a
statutory obligation and duty to insure that the purposes and
goals of the Act are being implemented by our grantees and
contractors, can not and should not sit with our hands on the
chair while the program marches on. That would be unfair to you
and would be a breach of our duty.

I would now like to discuss a few important issues - client
representation, accountability of programs to clients, and finally,
lobbying by recipients of Corporation funds.

Under the Act, the Corporation is directed to insure that
"recipients .. .adopt procedures for determining and implementing
priorities" for the provision of legal assistance "taking into
account the relative needs of eligible clients for such assistance".
Our regulations implement that mandate by requiring governing
bodies at the local level to "establish and enforce broad policies
governing the operation of a recipient".

The crucial and operative language of both the statute
and our regulations are "accountable to clients", "needs of eligible
clients" and "implement priorities". Accordingly, as a Board
member, I am most interested in the answers the clients of in-
dividual prof^rams throughout this nation and here in Louisiana
would have to the following questions:

- Are our grantees generally accountable to you?

- Do local boards respond to client's views and
needs in establishing priorities for the program?

- What role does and should clients on local governing
boards play in establishing local priorities of service?


- Is there any problem of clients being "overpowered" and
having to take a "back-seat" in establishing local

- Are clients havinj? any input into discussions regarding
a local program's "surplus/carryover/fund-balance"?

- Are clients being consulted, or do they have a say as
to whether a carryover should be used for purchase of a
building/office, or whether it should be used for direct
legal assistance to more clients?

- Are clients having input into the program's budgetary process
and decisions regarding the utilization of funds which have
been "carried over"?

- Are clients concerned and asking about the fund balance
and carryovers and why they continue to exist at levels
beyond 15%?

- If, due to limited resources, a choice must be made
between client cases regarding food stamps, medicaid,
consumer fraud, domestic relations, landlord/tenant
problems or other areas, are clients having major input
into that decision/priority setting process, the result
of which directly effects their lives and that of their

I must ask and you should answer these questions. If they are
answered in the affirmative, then everything is fine. If not,
why not? How can we as a Board of Directors best direct the
expenditure of our funds through the grants, contracts, rules,
and regulations process to best serve your direct and immediate
needs for legal services? These are the questions I have and will
continue to ask of both the client ocmmunity and grantees. I
believe that client needs should be, in large measure, determined
by clients as tliey arc porceivcul by cliont.s. Tliey should not,
as is too often the case in ray experience, be determined by a non-
client who says or perceives "what is best for the poor". The
"let us tell those poor people what is best for them" attitude of
the 1960 's should not be the p,uiding light for priority setting
in 1982.


It has been my experience in working in a variety of so-called
"poverty programs", that people classified as poor have the same
ability to tell a lawyer what his or her problem is as does
the corporate executive. I have found that both the "poor" person,
and the corporate executive will say, "this is what is going on; I
do not like it; I want to change it; tell me how it can be done".
The lawyer's responsibility is to advise, inform and institute
the necessary action in the appropriate forum to respond to the
needs of the client. The main difference between these two clients
is that the corporate executive evaluates service and performance
and makes the lawyer accountable through the leverage of fees
and retainers. Elegible clients in our program do not have that
direct kind of leverage. However, the statute and the regulations
of this program say that your leverage is informing the program, local
board, and the national Board, if necessary, when you think your
needs are not being met.

I want to be sure that those who receive the millions of
dollars through grants , contracts and other funding mechanisms
are providing the most economical and effective delivery of
legal service possible in both rural and urban areas. That
requires review, oversight, evaluation and recommendations by the
Board and its Committees as to the impact and effectiveness of
existing rules and regulations on insuring that objectives are
being met and that our rules are being enforced. You, I hope, want
the same. You should demand review and evaluation at the local and
national level. It is your right. It is your duty.


As I stated earlier, I have become rather suspicious of
those who tell me not to "tinker" with the regulations and of
those who tell me "you should not get into that area". 'When
individual clients and some project directors in different parts
of the nation give me a "green light" to go forward with evaluation
and review, while some who recieve corporate funding give me a
"yellow" and some times a "red" light on that issue, I wonder
why. Well, you can be certain that I do listen to the client
viewpoint and will continue to do so. But remember, I need your
help and your support in this review if we, Board Member and the
client, are to work together to make sure that clients are listened
to as to accountability, composition of Boards and the establishing
of priorities at the local level.

In addition to my interest in the above areas , I am deeply
concerned and troubled by a major issue in the legal services pro-
gram- -lobbying and restricted activities by recipients of the
Corporation's and hence, the taxpayers' funds. I want you to
know the facts on this issue.

The American System of jurisprudence is founded upon the
adversarial concept. Plaintiffs and defendants do not usually
agree on the merits of each other's claim. Hence, the very nature
of our system creates controversy.

Clients want and netjd a viable legal services program - a
program which is capable of addressing any or all issues not
precluded by statute or regulation in any and every appropriate
forum for the - redress of their greivances and the vindication
of their constitutional rights. However, it is most important that

37-965 0—84 21


those who serve the clients in asserting those rights do so within
the ambit of the laws of the United States in compliance with the
intent of the Congress. There are some in the legal services
program who have stretched the law, and sometimes, in my view,
violated the statutory prohibitions against lobbying and restricted
activities - all in the name of clients.

Section 1508 of our rules was designed to insure that the
Corporation's resources "will be used to provide high quality
legal assistance and not to support or promote political activities
or interests." The reality of accepting public funds is that "he
who pays the piper calls the tune". If Congress provides the
funds, then Congress will tell you how those funds can and cannot
be spent. That is Congress' right, and duty and obligation to
the electorate. It is the Corporation's duty, to you and to the
public, to implement and enforce the laws.

In May of 1981, the Office of the Comptroller General of the

United States informed the Corporation and the Chairman of the House

Committee on the Judiciary, in an Opinion , that certain activities

of the Corporation and its recipients constituted "grass roots"

lobbying in violation of the Legal Services Act and restrictions

on the use of Fculcral funds contained in other appropriations

measures. The Opinion discussed the proviso to the 1979 fiscal

year appropriation bill which stated, in part,:

"...No part of this appropriation shall be used
for publicity or propaganda purposes designed to
support or clcfcal; legislation pending before Congress
or any StTate legislature..."


The Opinion went on to state:

"This amendment has been applicable to the Corporation's
appropriation each year since 1978. Under this restriction,
appropriated funds may not be used by recipients to appeal
to members of the public to urge elected representatives
to support or defeat legislation pending in Congress or
in any State legislature."

"Through the use of recipient organizations and their
contacts at the State and local level, LSC has developed
an extensive lobbying campaign to support reauthorization
legislation for the Corporation and related appropriation
measures being considered by the Congress. This activity
violates the anti-lobbying statutes .. .described above."

Keep in mind, if you will, that these words and this Opinion
was not written by any partisan political interest; it was not
written by the Office of Management and Budget; it was not written
by President Reagan; it was not written by any Senator on the
Labor and Human Resources Committee; and, it was not written by
any of the President's recess appointees or nominees. It was
written by the Office of the Comptroller General of the United
States, perhaps one of the most respected entititcs of the United
States government, the Opinions of which are not taken lightly
by the Congress or any Federal agency.

Therefore, we must look at the facts involved and ask real
questions in this area. Efforts undertaken to "help the client"
which have been called unlawful by the Comptroller General of
the UniUcd States do not help clients. Thoy may temporarily
allow the advocates of such action to "let off steam" and attack
a particular proposal they do not philosophically agree with,
however, the bottom line is the impact on the program and its
clicnLs? So chaL I will noU be misinUcrpre tod , my concerns in
this area do not mean that this Board or the Corporation should
shy away ri-ciin con trovcr.sy or Ijc fearful of offending any group


or any interests. I am saying that the rights of clients can be
vindicated and redressed within the law as is the case in the
vast majority of situations.

When any recipient, or employee of a recipient of corporation
funds violates the law by doing a prohibited act under the
statute, the real victim, in the long term, is neither the re-
cipient nor the employee. Rather, it is the mother who has been
denied due process in the food stamp, medicaid of housing bureaucracy;
the migrant worker who is perhaps being denied full rights under
applicable laws; the mother seeking child support or custody; or
the family whose utilities have been cut off because the landlord
did not pay the bill when the tenant had paid the rent. People
in our program who violate our rules and the statute in this
regard will find other jobs or go somewhere else. However, you,
the client, will still awake ' the morning after the rhetoric
is over to those legal problems and needs which should have been
addressed correctly within the bounds of the statute in the first
place. Therefore, I again urge you to be the "guardians" of the
trust and to make sure, since this program is for you, that its
funds are utilized in your best interests and in a lawful manner
by those who have been entrusted to provide you with quality
legal services .

In conclusion, I want all of you to know that I, as well as
my fellow Board Members, want your in-put, your guidance, your
advice, and your counsel as we proceed to do our job to insure

that you receive quality lcy,al services. As I stated at the begin-
ning of these remarks, you are the reason for our existence. As

a member of Lhc Bo;iril, 1 want and need your support. You can be

confident that you have mine.

Peace and Power to you all.


Report and Recc.Tjaendations of the

Special Committee en

Grant and Contract Procedures


The Board of Directors
Legal Services Corporation

December 16, 1982

Submitted By

Clarence V. McKee, Esq.



The Special Comn-ittee on Grant and Contract Procedures,
after r.everal months of deliberation, receipt of testimony,
and review of corporation files and documents, is pleased to
submit its recommendations to the Board of Directors regarding
. the provision of legal services to eligible clients pursuant
to the Legal Services Corporation Act, Regulations and
Congressional directives related thereto for its recipients
of funds by grant and contract for Fiscal Year 19S3.

The Legal Services Corporation Act of 19 7 4 as amended in
1977, and the changes thereto embodied in the Continuing
Resolution of October 17, 1982, govern the use of Congressionally-
appropriated funds for the delivery of legal services to
eligible clients. Congress has stated as the first purpose
of the Act the need "to provide equal access to the system of
justice in our Nation for individuals who seek redress of
grievances". 42 U.S.C. §2996(1). It further provides that
there is a need for "high quality legal assistance to those
who would be otherwise unable to afford adequate legal counsel.
42 U.S.C. §2996(2). Legal Assistance is defined as "the
provision of any legal services consistent with the purposes
arid provisions of this title" with a directive to the Corpora-
tion to, inter alia, "insure that grants and contracts are
made so as to provide the most economical and effective
delivery of legal assistance..." 42 U.S.C. §2996 (a) and
U.S.C. §2996 (f) respectively.


Accordingly, the Powers, Duties, and Limitations section
of the Act supports the view that appropriations thereunder
be channeled only into those sources necessary tc facilitate
the direct delivery of legal assistance:

(1) (A) [the Corporation is authorized — ] to provide
financial assistance to qualified prograrr.s furnish-
ing legal assistance to eligible clients, and to
make grants to and contracts with [certain authorized
entities] for the purpose of providing legal assis-
tance to eligible clients under this title, and
(B) to make such ether grants and ccntrac-s as are
necessary [emphasis added] uc carry the purpc¥ss and
provisions of this tinle; . . ,

(3) to undertake directly, or by grant or contract,
the following activities relating co rhe deo-ivery of
legal assistance —

(A) research, except that broad general
legal or policy research unrelated to
representation of eligible clienrs may
not be undertaken by grant or ccntracr,

(B) training and technical assistance, and

(C) to serve as a clearinghouse for infor-
mation. [42 U.S.C. §2996 (e).]

The Committee believes that many of the frustrations,
problems and controversy which have surrounded the Corporation's
implementation of the Act have been created by an unwillingness
of some persons within and without the legal services community
to distinguish between the purposes and intent of the Act and
the purposes and intent of the 19 6 4 Economic Opportunity Act.
The statutory purpose of the Economic Opportunity Act and
Community Action Programs under whose direction Legal Services
was established was to enable low- income families and


individuals to attain the skills, motivations and opportunities

Online LibraryUnited States. Congress. Senate. Committee on LaboOversight of the Legal Services Corporation, 1984 : hearing before the Committee on Labor and Human Resources, United States Senate, Ninety-eighth Congress, second session, on review of the Corporation's documents to ascertain whether there are any problems with the agency's policies that need to be → online text (page 26 of 42)