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Vol. 28, No. 3

Legal community works toward forgiveness of student debt

Kimberly Smith

Seventh grade U.S. history was an exciting class for Jennifer Keith. Her study of the civil rights movement and the Constitution was the divine spark that motivated her into law school. Knowing even then that she wanted to work toward social justice and equality, Keith knew that being a lawyer—a public service lawyer—would satisfy her passion for justice. Little did she know that following her life’s dream would cost her so much.

While in law school, Keith realized she faced a problem that confronts nearly every new public service attorney in the United States—high debt incurred from law school loans, combined with low income. “I was looking at the amortization schedule of my loan and realized that, in the end, I would pay back $700,000,” she says. “But I was so committed, I knew this was what I wanted to do. So, I put my blinders on, saw my objective, and took on this gigantic debt.” When she graduated from Golden Gate University School of Law in 1998, she had borrowed $90,000 for her education.

In 2002, nearly 87 percent of the nation’s law students took out loans to finance their education, with the average graduating more than $80,000 in debt. Between 1992 and 2002, the cost of tuition for public law schools has risen 134 percent for residents and 100 percent for nonresidents, while private law school tuition has increased by 76 percent. Government public service law jobs offer about $42,000 per year, while legal services organization public service jobs offer about $36,000.

In 2001, under the leadership of then-president Robert E. Hirshon, the ABA Board of Governors created the ABA Commission on Loan Repayment and Forgiveness to examine the issue and its far-reaching impact on access to justice, and to make recommendations on strategies to address it. That Commission has completed its work and was sunset at the ABA Annual Meeting in August.

During Hirshon’s term as president-elect, news reports about the decline of pro bono hours among younger lawyers had troubled him. “I was concerned that the newer generation had gone to law school not because they wanted to make a difference, but because they wanted to make money,” he says. A different dynamic emerged as he traveled the country and talked to law students. “I was wrong,” he says. “They were telling me in no uncertain terms that they wanted to do pro bono work, they wanted to do a couple years of legal service, some wanted to work for an NGO, but because they had this debt, they had no choice. They couldn’t live otherwise.”

Commission member Nancy Rapoport, dean and professor of law at the University of Houston Law Center, believes Jennifer Keith’s story perfectly illustrates the problem at hand. “She is living her life’s dream making the justice system more fair for the people who have the least voice,” Rapoport says. How can the legal community make sure the best and brightest can take low paying jobs to help the public? “This is the educational issue of the 21st century,” she says.

This educational issue is also, of course, an access to justice issue. “A very important sector of public need in both the criminal justice system and the civil justice system has been given second-class treatment because of the disconnect between the importance of the job and the salary it pays, on the one hand, and the cost of education and the burden of the loan on the other,” says Judge Frank M. Coffin, U.S. Senior Circuit Judge with the First Circuit Court of Appeals, and co-chair of the Commission. According to Curtis Caton of San Francisco law firm Heller Ehrman White & McAuliffe LLP, and also co-chair of the Commission, 80 percent of the legal needs of people below the poverty line in the United States go unmet.

Finding solutions

During its two-year study, the Commission addressed the many facets of the issue from its root to possible solutions. “Many of us in leadership positions like to point the finger elsewhere, and while law schools may be the origin of the debt, if we paid our lawyers what they paid in the private sector we wouldn’t have this problem,” says Ramon Arias, executive director of Bay Area Legal Aid (where Keith works) in California, and a Commission member. While low salaries have long been a characteristic of legal services programs, the tuition increases and corresponding debt burdens are “a phenomenon that quadrupled in the last eight years or so,” Arias adds.

Rapoport attributes the staggering increases in tuition to many factors. “The cost of educating a law student, even at the tuition that some private schools charge, is nowhere near the actual cost to the school of educating the law student,” she explains. Hit hard by a flailing economy, public, private, and independent law schools have all been impacted by reduced endowments, grants, and private donations that would help offset the cost of tuition. Additionally, fixed costs to the school must be spread over all of the students, and, Rapoport adds, “the days of large state subsidies are over.”

The ABA Commission endorsed the creation of loan repayment assistance programs (LRAPs) to provide financial assistance to new attorneys employed in the public interest and government sectors, “thus helping public service employers attract and retain gifted and committed young lawyers whose work will, in turn, benefit the communities in which they live,” Caton says.

LRAPs can be set up in many different ways by many different sponsors, including law schools, state governments, and foundations. Low-interest loan consolidation programs, fellowships, and scholarship programs are some of the methods LRAPs use. Currently, more than 50 law schools and some public service employers have created LRAPs, and there are statewide LRAPs in Arizona, Florida, Maine, Maryland, Minnesota, New Hampshire, North Carolina, and Texas.

While each operates differently, Caton says, “In essence, if someone wants to go into a public service job, they take out a new loan to pay off their cumulative educational debt, and so long as they stay in the public service job, portions of the new debt are forgiven. If somebody stays the course in the public service job, his or her educational debt is completely forgiven. The more years you stay in public interest law, the bigger the forgiveness.”

Some LRAPs, such as those operating in Arizona, Florida, Maine, and New Hampshire, are administered by bar foundations and are funded primarily through IOLTA and IOTA grants. Others, such as Minnesota’s LRAP—MN, and North Carolina’s NC LEAF, are run by independent 501(c)(3) organizations. Created by statute and totally funded by taxpayers’ dollars, Maryland’s Janet L. Hoffman Loan Assistance Repayment Program (LARP) is the only one that does not limit its recipients to attorneys, but also awards benefits to those working in certain areas of education and health care.

Authorizing legislation has been enacted in California, Texas, and Georgia to create statewide LRAPs, but funds have not been appropriated for them. While waiting for funding, the Texas Supreme Court created a stopgap program administered by the Texas Access to Justice Commission, operating completely from private donations.

What can bar leaders do?

“Bar associations and their related foundations should lead and support state-level initiatives to create and expand loan repayment assistance programs,” Caton says. “There is no single approach to this that will work universally: Some states have actually established LRAPs legislatively, others privately through bar foundations, and still others in a hybrid of the two.”

Some bar associations, such as the New York State Bar Association and the Washington State Bar Association, and some legal aid organizations, such as the Access to Justice Foundation in Kentucky, have created pilot programs or initiatives to examine and develop possible solutions. “Do something now,” Arias says. “Do it now and then improve whatever you want to improve because this is a critical need.”

Coffin outlines some specific goals bars can work and lobby toward. “We need more federal funds, we need more liberalization of Stafford Loans and Perkins Loans, and William Ford Direct Loan programs,” he says. “We need to ameliorate changes in the tax laws that will help students pay the debt. But this is a long-range goal, and changes will take time.”

Like Arias, Coffin encourages bar leaders to become involved now. “This is one project that is not only needed in your state, it is a project that if pursued, is going to indicate to the people of your state that lawyers are not just interested in a high paycheck from a private firm, but they’re really interested in serving the public.

“It is a professional achievement that goes down to the welfare of the whole profession as well as to serve the local needs. Any bar association or bar foundation could afford to be proud of that and sing its praises from the rooftop.”

Work that makes a difference

With the sunsetting of the Commission, much has been initiated that is left for others to carry on. During its two-year tenure, the Commission developed three publications: State LRAP Tool Kit: A Resource Guide for Creating State Loan Repayment Assistance Programs for Public Service Lawyers; Meeting the Challenge of Law Student Debt: Loan Repayment Assistance Programs; and its final report, Lifting the Burden: Law Student Debt as a Barrier to Public Service, and set into motion a number of program initiatives and lobbying efforts across the nation.

The tool kit, at, may be particularly useful for bar leaders looking to assist in the creation of a statewide LRAP: It outlines the similarities and differences in existing programs, offering a template for the creation of and administration of these programs, and also has sample legislation that may be used in lobbying efforts. Meeting the Challenge is a tri-fold brochure that promotes law school LRAPs, and the Commission’s final report makes recommendations for the legal profession, federal and state governments, law schools, and public service legal employers.

According to Bill Whitehurst, chair of the ABA Standing Committee on Legal Aid and Indigent Defendants (SCLAID), LRAP efforts are being initiated in many additional states, and are being examined by Congress and by the board of the Legal Services Corp. Whitehurst and his committee will oversee the continuance of the Commission’s work. Whitehurst, of Whitehurst, Harkness, Ozmun & Brees in Austin, Texas, is pleased to have this important matter under the auspices of his committee. “This issue is very much alive and needs to be continued and to make progress,” he says, “because we know for a fact it makes a difference.”

Jennifer Keith can attest to that. Bay Area Legal Aid (also known as BayLegal) started providing a loan repayment assistance program to its employees in 2001, of which Keith is a recipient. Because the benefit is through her employer, it is heavily taxed, but Keith still considers it critical to her survival. “There were times I considered leaving because I didn’t see how I could ever make it,” she says. “There were times that I sat across the table from a client who, in many ways, was better off than I was.” With the LRAP, Keith was able to stay the course and is now the managing attorney of BayLegal’s San Mateo regional office.

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