We believe that it is important to keep our grantees and partners up-to-date on the status of our revenue. This is the first of a series of quarterly financial updates, specifically aimed at sharing information about the IOLTA program. In these updates, we will also report on other revenue streams (such as cy pres awards and settlements) as relevant.
One of LFW’s key sources of funding is the interest generated on IOLTA (Interest on Lawyers’ Trust Accounts) accounts. For the first quarter of 2016, IOLTA revenue totaled $421,235, a 15% increase year-on-year. This increase is due simply to more funds being on deposit rather than any upward movement in interest rates by banks.
Despite the Federal Reserve’s much anticipated rate increase last December, banks have not yet increased their IOLTA interest rates. On April 27, 2016, the Federal Reserve decided against a further increase of interest rates but will meet again in June to consider potentially raising rates. We will continue to monitor the rates in the upcoming quarters to assess any trends and keep you informed.
In related news, LFW received two cy pres awards this quarter, totaling $12,499. Also, LFW was the recipient of a $6.7M distribution from the Bank of America settlement to fund community redevelopment and foreclosure prevention programs. See our Special Grants page for more information about how those funds will be used and how to access the application process.
If you have any questions about our first quarter revenue, please contact us.