New legislation will funnel revenue to Ohio legal aid organizations as the pandemic continues to hamper access to justice for at-risk Ohioans.

Chief Justice Maureen O’Connor is calling on Ohio’s 44,000 attorneys to make it work.

Attorney Unclaimed Funds, a new category created under the Ohio Department of Commerce’s Division of Unclaimed Funds, directs unclaimed money to the Ohio Access to Justice Foundation.

“COVID-19 has exacerbated the already overwhelming need for civil legal services for low-income Ohioans,” Chief Justice Maureen O’Connor said.

“The new law directing Attorney Unclaimed Funds to the foundation presents a good opportunity to support civil legal aid and access to justice in Ohio. All attorneys should report these funds as soon as possible,” she said.

Effective this week, Senate Bill 276 gives the Justice Foundation authority to hold unclaimed funds to provide financial assistance to legal aid societies, enhance access to justice, or operate the foundation.

The new law identifies three categories under Attorney Unclaimed Funds:

• Money held in interest on lawyer trust accounts (IOLTA)
• Interest on trust accounts (IOTA)
• And residual settlement funds.

IOLTA revenue is produced by nominal client funds or sums held for a short period of time. Capital from IOTA comes from nondirected escrow accounts.

Residual funds are cash payments remaining in an account after all financial obligations – such as claims and attorney’s fees – have been settled.

Although it has always been a requirement that attorneys and title agents remit these funds to the Division of Unclaimed Funds, the new law requires a specific code – TR88 – when reporting to ensure the foundation receives the funds.

In Ohio, the current sum of unclaimed attorney funds is uncertain since there hasn’t been a required code designation until now.

Oregon initiated a similar reform in 2010, and receives approximately $100,000 annually in unclaimed attorney funds. By comparison, Ohio has roughly three times as many lawyers as Oregon.

The new law does not affect an owner’s ability to make claims on the funds.
If a client comes forward to collect attorney unclaimed funds after the attorney has remitted the funds to the state, the client must file a claim with the Division of Unclaimed Funds.

The Justice Foundation, the largest funder of civil legal aid in Ohio, is dependent upon court filing fees and income generated from the IOLTA and IOTA streams. Due to the pandemic, both sources were significantly diminished in 2020 as interest rates fell and cases filed declined.

In 2020, Ohio’s legal aid organizations helped nearly 125,000 Ohioans resolve their civil legal issues.

The state’s legal aids and the Ohio Access to Justice Foundation grantee, Ohio Legal Help, together served more than 58,000 citizens with legal issues directly related to the pandemic, such as changes in unemployment benefits and housing issues.

“This change provides a much-needed boost to support access to justice in Ohio,” said Angie Lloyd, executive director of the foundation.

“As Ohio emerges from the pandemic, access to civil legal services is critically important to a full recovery, and these funds will help,” Lloyd said.