From the Law Foundation of BC
Financial update: Law Foundation facing financial pressure
The Law Foundation has seen its income decline significantly in recent years, as a result of consistently low interest rates. The Foundation has had to make some difficult decisions about funding for the 73 programs and 50 or so projects that it supports each year. These programs provided legal assistance to over 70,000 people last year, as well as supporting significant work in the other mandate areas of the Law Foundation – legal education (both public and professional), legal research, law reform and law libraries. The Foundation’s annual budget is currently over $20 million, but in 2012 its income was only $16.3 million ($12.8 million from interest on trust accounts).
Fortunately, the Law Foundation has a Grant Stabilization Fund to stabilize grants during fluctuations in income. Over each of the past four years, the Foundation has had to use the Stabilization Fund to maintain funding for its programs. To date, the Fund has been reduced from $42 million to $31.7 million, and the Foundation anticipates having to use another $10 million in 2013.
The Foundation has taken a variety of steps to limit costs and increase revenue. It continues to negotiate with financial institutions to improve rates paid on lawyers’ trust accounts, as well as exploring other sources of revenue. At its November 2012 meeting, the Foundation’s Board reduced the Large Project Fund to $500,000 (down from $750,000) and the Small Project Fund to $60,000 (down from $150,000). In total, the Board voted to reduce various funds and other grants by over $500,000 for 2013. The Foundation also watches its own costs, and ensures that its operations adhere to the 10% administrative costs guideline expected of all its grantees. The Board is also considering how to operate on a lower budget if its grants cannot be met by its income.
Despite low interest rates, the Law Foundation was able to maintain funding to numerous programs in 2012. For details, see the 2012 Annual Report, which will be published on the Law Foundation’s website at http://www.lawfoundationbc.org/ this spring.