With the 1994 congressional elections, LSC suffered a dramatic reversal of political fortune. Conservatives included the elimination of LSC in the infamous “Contract with America.” The leadership of the new Congress, under House Speaker Newt Gingrich (R-GA), committed itself to the elimination of LSC and ending federal funding for legal services. The House leadership sought to replace LSC with a system of limited block grants to the states that would severely restrict the kind of services for which the funds could be used. The House of Representatives adopted a budget plan that assumed that LSC’s funding would be cut by one-third for FY 1996, another third in FY 1997, and completely eliminated thereafter. Opponents of legal services dubbed this funding plan “the glide path to elimination.”
Senator Pete Domenici (R-NM) led a bipartisan majority in the Congress that remained committed to maintaining a federally funded legal services program. Nevertheless, key congressional decision-makers, led by Reps. Bill McCollum (R-FL) and Charles Stenholm (D-TX), determined that major “reforms” in the delivery system would be required if the program was to survive.
The FY 1996 appropriation for LSC (Pub. L. 104-134, April 26, 1996) incorporated these reforms. Grants were to be awarded through a system of competition, rather than through presumptive refunding of current recipients. Funding was to be distributed on a strict, census-based formula, eliminating any LSC discretion over funding amounts.
More fundamentally, congressional conservatives were determined to redefine the role of federally funded legal services by refocusing legal services advocacy away from law reform, lobbying, policy advocacy, and impact litigation and toward basic representation of individual clients. Congress set out to accomplish this goal by restricting the broad range of activities that programs had engaged in since the early days of OEO, many of which had been mandated in the past. These restrictions are described in the separate history of Restrictions. Most significantly, Congress eliminated LSC funding for national and state support centers, the National Clearinghouse (which published the Clearinghouse Review), regional training centers, and computer assisted legal research centers.