An increasing number of states are adopting new rules aimed at bolstering revenue from Interest on Lawyer Trust Account (IOLTA) programs, according to a recent article in the National Law Journal.

IOLTA programs provide a significant source of funding for legal services organizations by collecting the interest from lawyers' client accounts and distributing the funds as grants. LSC-funded programs earned $79 million in IOLTA funds during 2006.

According to the article, nine states-Alabama, Indiana, Maine, Mississippi, Missouri, North Carolina, Oklahoma, South Carolina, and Utah-have made their IOLTA programs mandatory since 2004, requiring all lawyers in the state to deposit their client funds in IOLTA accounts. Thirty-six states have mandatory programs, thirteen states and the District of Columbia have opt-out programs, while South Dakota and the Virgin Islands have strictly voluntary programs.

States are also strengthening their IOLTA programs by adopting "comparability" rules, which require lawyers to use IOLTA accounts that earn interest at rates similar to commercial accounts of comparable size. Eighteen states have passed comparability rules recently, which have doubled the interest rates for IOLTA accounts in some states.

Click here to read, "States scramble to boost IOLTA cash," from the National Law Journal.