Lawmakers in Raleigh halted access to a state program that funds free civil legal services in June 2025. That funding is still frozen, leading many civil legal aid services in North Carolina to lay off staff and close offices.
“Fewer legal aid attorneys mean more individuals will appear in court without representation, resulting in longer hearings, more continuances and increased administrative burdens on clerks, judges and attorneys,” the North Carolina State Bar stated in November.
What is IOLTA?
Although there is a constitutional right to an attorney in criminal cases, there exists no such right for civil cases, such as for domestic violence and disaster relief lawsuits. Without access to an attorney, plaintiffs struggle to adequately advocate for themselves in court.
For example, victims of domestic violence cases who have an attorney representing them in court are 2.5 times more likely to get protective orders, according to a study by the American Bar Association. Civil legal aid services have also been instrumental in western North Carolina’s recovery from Hurricane Helene.
The Interest on Lawyers’ Trust Accounts (IOLTA) framework seeks to fill this gap by drawing funding from trust accounts – not taxpayer dollars. 49 states currently support the program. N.C. does not.
The funding freeze will remain in effect until at least June 30, at which point the N.C. legislature will have to decide whether it wants to continue the freeze or open access to the funding. The General Assembly has yet to pass a statewide budget for 2025-2027 and plans to meet in a short legislative session in April to resolve this issue.
Nonprofit provider feels effects
Legal Aid of North Carolina (LANC), the largest nonprofit provider of civil legal aid in North Carolina, said they lost approximately $6.3 million in funding due to the IOLTA freeze. In November, the nonpartisan organization laid off 45 staff positions and closed multiple offices. They estimate they will be able to provide services to 8,000 fewer clients as a result.
Ashley Campbell, the executive director of LANC, said in a statement that the funding freeze surprised the firm and has made their work much more difficult.
“Even though the amount has varied by year, [IOLTA has] always been a consistent source of funding for civil legal aid in North Carolina and in every other state in the United States,” Campbell said. “So when it became an issue, it was a big shock. We didn’t know that there was any interest in changing how IOLTA funding was used until late spring of 2025.”
Campbell added that attorney support can significantly influence the results of civil cases.
“We know from decades of doing that work that our clients have better outcomes when they have lawyers by their side,” Campbell stated. “Oftentimes, they’re able to secure child custody or child support or possession of their home or vehicle, which all of those are really stabilizing factors in a family’s life that’s had domestic violence in the home.”
“I’m also concerned that if we have another natural disaster in the fall, we aren’t going to have any funding to serve disaster survivors,” Campbell continued.
Campbell said she and her colleagues have worked to communicate the advantages of funding civil legal aid to lawmakers in Raleigh. She said she hopes they understand the detrimental effects of the funding freeze.
“We sent a letter to every member of the Oversight Committee to communicate more about the work that we do and to share accurate information about what we can and cannot do,” Campbell stated. “So we continue to have those meetings and again [and] are encouraged by the conversations that we’re having that show that there’s bipartisan support for restoration from the funding.”
Campbell emphasized that LANC will continue providing legal assistance statewide, but that the quality of this assistance may suffer due to staffing shortages.
“What we really value, and we think the community values, is the ability to walk up to our front door and see a real person and talk to that person about your legal problem. And that’s really what’s going to go away for North Carolinians if funding is not restored,” Campbell said.
Wake Forest Law pro bono director weighs in
Corey Frost, the pro bono faculty director at the Wake Forest School of Law, said IOLTA funding is paramount to support civil legal aid efforts.
“When legal aid becomes inaccessible… there’s just people who are having to navigate the legal process on their own when they may not even realize they qualify for help from organizations like Legal Aid,” Frost said.
He emphasized that pro bono programs like the ones at the law school do not have the capacity to handle these needs on their own.
“We don’t have the capacity to take over entire cases or represent a victim of domestic violence, start to finish, in getting a restraining order,” he said. “Law students don’t have the knowledge and ability to do that, and the staff at law schools don’t have the capacity to supervise law students in doing all of that. So we can help with some things, but we are by no means a replacement for IOLTA funding.”
