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Overview of Cost Effectiveness of Civil Legal Services

November 11, 2008

 Generating Economic Activity, Client Benefits, and Savings for State and Local Governments

  • Client Benefits: In 2006 civil legal services generated $131 million in benefits for their clients, a return of 93 cents on the dollar. The majority of the benefits flow almost immediately into state and local economies resulting in sales tax revenues and business income to state and local businesses.
  • Economic Activity and Jobs: In their 2001 Grantee Activity Report, the IOLA Fund used a standard economic activity multiplier to estimate that in 1999 grantees generated $634.9 million in new economic activity and 10,793 jobs resulted from both the benefits generated for clients and federal funding secured by grantees to provide services.
  • Leveraging Federal and Private Funding: Members of the Statewide Campaign for Civil Legal Services leveraged $29,519,602 in federal funding, and $34,482,395 in private dollars to provide legal assistance to low income clients resulting in payroll taxes, health benefits, rent, utilities, and staff salaries paid here in New York.
  • Increasing Child Support Payments: legal services programs generated a total of $12,391,387 in child support payments to clients in 2006, increasing family resources and thus decreasing the need for publicly funded benefits including public assistance and child care subsidies.
  • Maximizing SSI/SSD payments to clients and to state and local government:
    • In 2007 DAP advocates generated $24,494,483 in retroactive awards for their clients and $7,620,771 in interim assistance for benefits provided for the State.
    • According to the Office of Temporary and Disability Assistance’s most recent Biennial Report to the Legislature, it is estimated that in 2005 DAP generated $10.5 million in public assistance cost reduction, resulting in a net gain of $14.6 million for the state and localities, more than twice the initial investment.
  • Maximizing Food Stamps ‐ For every family of three who receives Food Stamps, as much as $5,556 in federal dollars is generated in nutritional support and subsequent expenditure in the local economy. 
  • Avoiding the High Cost of Homelessness: In 1999 legal services providers helped a total of 48,014 adults and children avoid homelessness. We estimate that for each family in New York City that avoids eviction as a result of civil legal services representation, $31,215 in savings is generated. Savings around the state will vary, but are still substantial. One study estimates a $4 savings for every $1 invested.
  • Averting Foster Care Costs: For every child a legal services program is able help keep out of the system, government will save an average of 16,200, at bare minimum. For many children, the savings would be much higher
    • as much as $48,600 for children without special needs, and much more for those who have disabilities or need therapeutic care.
  • Creating Efficiencies in the Courts: Civil legal services program resolve an estimated two out of three client problems by providing advice or non litigation services. Increasing the availability of legal services will help cut down on the number of cases that wind up before a judge unnecessarily.

 

 





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