Board of Trustees Authorizes Changes to Composition and Clarifies Scope of the Closing the Justice Gap Working Group in Response to Legislative Concerns

February 25, 2022

At its meeting on February 25, the State Bar Board of Trustees approved changes to the makeup and charter of the Closing the Justice Gap Working Group, responding to concerns raised by Legislative partners and other stakeholders. The working group is charged with evaluating a regulatory sandbox that would gather data on how legal services access might be expanded through innovations in technology.

“The changes made today by the Board enable this important access initiative to move forward, addressing the concerns expressed recently by key stakeholders and ensuring greater involvement by representatives of the Board,” said Board Chair Ruben Duran. “We thank the members of the working group and the many members of the public who have contributed to this process, and we look forward to our continued partnership with the Legislature as the work proceeds.”

The working group’s charter will be amended so that the group’s recommendations will focus only on a regulatory sandbox proposal and will:

• Specify the roles sought of the Legislature and the Supreme Court in setting parameters for and/or approving who would be permitted to operate in the sandbox;
• Clarify whether existing statutes and rules would apply to sandbox participants; and
• Determine procedures to reduce the risk that corporate interests will unduly influence or compromise professional judgment and objectivity in the delivery of legal services.

Working group membership will be revised to limit it to those with California-specific experience, and to add one or more Trustees. The working group was originally scheduled to complete its work by September 2022. The deadline will be extended, with the revised deadline set when the Board approves the revised charter.

2022 budget approved

In other actions at the February meeting, the Board approved a 2022 budget that projects $244.3 million in revenues and $256.8 million in expenses. The majority of the $12.5 million deficit is attributed to new planned grant expenditures. The General Fund is projected to run a $3.9 million nonstructural deficit, to be covered by a planned use of reserves.

Revenues are projected to increase by $56.3 million, or approximately 30 percent compared to 2021 budgeted revenues. The Legislature allocated approximately $65 million in increased funding over the prior year’s budget for grants distributed by the State Bar to legal services organizations targeting homelessness prevention and other expanded legal aid needs.

The 2022 budget proposes several strategic investments, including:

• Seed funding for the Client Trust Account (CTA) Protection Program, which will require attorneys to report annually whether they are responsible for CTAs and increase the State Bar’s oversight of this important area;
• Information technology investments to support continued migration from legacy systems, expanded automation of key business processes, continued improvements to the Odyssey Case Management system—the technological engine for the attorney discipline system—and e-filing for the State Bar Court;
• Technology enhancements to enable “blind” recruiting, supporting one of the Bar’s internal diversity, equity, and inclusion goals; and
• Funding for a new Office of the Ombuds/Consumer Advocate, prioritizing the consumer voice through a new dedicated office tasked with acting as an independent, impartial, and confidential resource to ensure that complaints about State Bar staff or actions receive full and impartial review.

Also spotlighted in the budget is a significant deficit in the Office of Admissions budget, approximately $8.8 million. The deficit this year can readily be absorbed by the Admissions Fund’s healthy balance, however, a portion of the deficit is structural and unsustainable long term. State Bar staff will analyze options for fee modifications or other measures that could address the deficit in future years.

The final budget will be submitted to the Legislature by February 28, 2022.

Strategic Plan discussed

The Board also discussed a draft outline for the next five-year strategic plan, structured around four main goals to protect the public by:

• Strengthening the attorney discipline system: Administer an attorney discipline system that is efficient, accountable, and transparent.
• Enhancing access to and inclusion in the legal system: Increase access to the legal system through public education, improved access to legal advice, and a legal profession that reflects the diversity of California.
• Supporting the legal profession: Promote the ethical and competent practice of law and reduce misconduct by providing education, resources, and support for the legal profession to enhance public protection.
• Engaging partners: Engage partners to enhance public protection and restore the State Bar’s credibility, reputation, and impact.

The goals were refined in discussion during the meeting, and a final version of the strategic plan is scheduled to be reviewed and approved by the Board at its next meeting, March 24–25.

General Counsel Search Committee formed

Finally, Chair Duran announced the formation of a search committee of Trustees to oversee the recruitment of a new general counsel to replace Vanessa Holton, who recently announced her upcoming retirement. The committee will consist of Hailyn Chen, Arnold Sowell, Melanie Shelby, Ruben Duran, and Brandon Stallings. They will be assisted in their work by Bob Murray & Associates, the search firm that was instrumental in the recent successful hires of the State Bar’s Executive Director and Chief Trial Counsel.