The interest earned on IOLTA/IOTA accounts are essential to closing the justice gap.
Connecticut Bar Foundation receives and distributes the interest generated from IOLTA accounts, established by the Connecticut General Assembly in 1984, and IOTA accounts, established in 2005, to support nonprofit organizations that provide civil legal services to low-income people in Connecticut. Every year, CBF's Board of Directors awards grants to fund nonprofit organizations that provide civil legal services. Grants are also given to the three Connecticut law schools for scholarships.
Investing in justice makes "cents"
Every $1 of public funding invested in civil legal aid yields $2.90 in economic activity!
CBF released two reports that assess the state’s civil legal aid system, which demonstrate the economic value of investing in legal services for low-income residents.
The Economic Impact Report, prepared by Downstream Strategies, quantifies the direct financial benefits people receive when they can solve their legal problems and how that contributes to a stronger economy. Analysis shows that every dollar of public funding for legal aid generates approximately $2.90 in economic activity, saving the state money and stabilizing communities.
IOLTA/IOTA in Connecticut
IOLTA: Connecticut General Statute 51-81c stipulates that the interest is to be used to “. . . provide funding for (1) the delivery of legal services to the poor by nonprofit corporations whose principal purpose is providing legal services to the poor, and (2) law school scholarships based on financial need.”
In 2006, the Judges of the Superior Court charged CBF with determining which financial institutions are eligible to offer IOLTA accounts under the rate parity requirements of Rule 1.15.
In 2011, the Judges of the Superior Court voted to amend Rule 1.15 to include the basic financial records and documentation that a lawyer must maintain with regard to all trust accounts of a law firm.
IOTA: The General Assembly amended General Statute 51-81c in 2005 to include funds from mortgage lenders and is referred to as the Interest on Trust Accounts (IOTA) program. The statute provides that each entity, other than a borrower, having an account established to receive loan proceeds from a mortgage lender shall participate in the program regardless of the amount or the period for which funds are held.
IOLTA in North America
Every U.S. state, Canada, and other countries have IOLTA programs. The National Association of IOLTA Programs (NAIP) was established in 1986 to enhance legal services and justice for low-income and vulnerable individuals through the growth and development of IOLTA programs as effective grant-making organizations.
Learn about IOLTA programs in other states at IOLTA.org.
The American Bar Association Commission on IOLTA has additional information regarding IOLTA programs, news, litigation, and resources. Learn more on the ABA Commission on IOLTA.
