Proposed New and Revised Rules Related to Grants Administration

The State Bar seeks comment on recommended changes to Rules of the State Bar governing funds administered by the Legal Services Trust Fund Commission (LSTFC) to support free civil legal services to indigent persons in California.

Deadline: January 15, 2026, 11:59 p.m. (45 days)

Direct comments to

Comments should be submitted using the online Public Comment Form. The online form allows you to input your comments directly.

Background

The Legal Services Trust Fund Commission (LSTFC) is charged with administration and oversight of grant funds that pass through the State Bar to support civil legal aid in California. As part of these obligations, the LSTFC determines eligibility for grant funding and monitors grant compliance among grant recipient organizations. In 2025, the LSTFC Rules committee continued discussions related to fiscal requirements and documentation, and each proposal included here has gone through the Rules committee. Stakeholders—in particular, members of the legal aid community—were invited to comment directly in writing or at the LSTFC’s public meetings before these rules were recommended for release for public comment.

Discussion/proposal

The proposed rules and amendments address the following:

  • Guidelines for use of Interest on Lawyers’ Trust Accounts (IOLTA) grant funds for the purchase of real property,
  • Establishment of investment policies for funds held by the LSTFC as well as for grant funds not immediately spent on legal services by grant recipient organizations,
  • Clarification and confirmation of existing practice that requires a Statement of Functional Expenses as part of grant applicants’ annual submission of audited or reviewed financial statements, and
  • Establishment of a firm audit extension deadline for IOLTA and Equal Access Fund applicants who are not current grantees.

Through the codification process, the LSTFC seeks to improve clarity, fairness, and efficiency in grantmaking as well as oversight of public funds. The LSTFC is charged with recommending rules regarding grant eligibility and administration. (Bus. and Prof. Code § 6210.5(e).) Under that same statute, the Board of Trustees (BOT) shall approve such recommended rule changes unless they conflict with the State Bar’s statutory, fiduciary, or legal obligations. After considering any comments received, the LSTFC will present its final proposal to the BOT for approval and adoption.

Any fiscal/personnel impact

None

Background material

From Legal Services Trust Fund Commission Meeting November 7, 2025:

Source

Legal Services Trust Fund Commission

Deadline

January 15, 2026, 11:59 p.m.

Direct comments to

Comments should be submitted using the online Public Comment Form. The online form allows you to input your comments directly.