LAWREADER COMMENTS ON KBA CHALLENGE TO OUR ARTICLE RE: INCREASE IN DUES – see their response to our dues increase article

LAWREADER COMMENTS ON KBA CHALLENGE TO OUR ARTICLE RE: INCREASE IN DUES – see their response to our dues increase article

This week LawReader posted a discussion of the pending lawyer’s dues increase (and the increase in pro hac vice fees). Our story was inspired by an e-mail news release by the KBA which discussed (a schedule of dues increases beginning in 2012 and being fully effected over a three year period, i.e. 2015. We recall that the press release cited the new dues fee to continue to rise over the next three years until it reached $500 a year. That is our recollection of the KBA news release.

We invite anyone who disagrees with the facts or conclusions of any article we publish to submit their comments. We promise to publish the comments (with restrictions on anything that might be in violation of the SCR’s or defamation laws).

The KBA took advantage of that offer and responded on Feb. 23, 2012 with the following comment which we immediately published on our front page without editing.

RESPONSE BY KBA FEB. 23, 2012:

“THERE ARE NUMEROUS ERRORS CONTAINED IN TODAY’S BLOG REGARDING THE KBA PROPOSED DUES INCREASE, THE MOST IMPORTANT OF WHICH IS THE AMOUNT OF THE PROPOSED INCREASE. THERE IS NO RECOMMENDATION TO INCREASE KBA DUES TO $500 AS YOU PUBLISHED.

FURTHER THE KBA DOES NOT SET ITS MEMBERS’ DUES – THAT IS SOLELY THE PREROGATIVE OF THE SUPREME COURT PURSUANT TO SCR 3.040.

THE KBA BOARD OF GOVERNORS RECOMMENDS TO THE COURT THE ANNUAL DUES AMOUNT AND CURRENTLY THAT RECOMMENDATION IS FOR A DUES AMOUNT OF $350 ANNUALLY FOR MEMBERS LICENSED FOR 5 OR MORE YEARS, WITH NO INCREASE FOR THOSE UNDER 5 YEARS ($220). THESE AMOUNTS WERE ANNOUNCED TO ALL ATTENDEES

AT THE 2011 KENTUCKY LAW UPDATES AND WAS THE SUBJECT OF KBA PRESIDENT MAGGIE KEANE’S PRESIDENT’S PAGE IN THE JANUARY 2012 BENCH AND BAR A COPY OF WHICH IS ATTACHED AND WHICH WE ASK THAT YOU PUBLISH.

THERE ARE OTHER ERRORS IN THE BLOG AS TO THE KBA FINANCES WHICH ARE EVIDENT FROM A REVIEW OF THE KBA FINANCIAL INFORMATION WHICH FOR YEARS HAS BEEN PUBLISHED ON THE KBA WEBSITE AND CAN BE LOCATED UNDER THE TAB “INSIDE KBA” AND BY PROCEEDING TO ‘FINANCIAL INFORMATION.’”

The KBA response disagrees with our reporting that the dues increase would rise to $500 by 2015, but they don’t mention plans to raise the dues past the level that will become effective in 2012, which by itself represents an increase in annual dues of $80 in 2012, and for judges the increase is $240 a year.

If LawReader is incorrect that the KBA plans to raise bar dues to $500 by 2015, we will admit our error (we relied on a KBA e-mail news story) and will continue to provide the KBA with access to LawReader to publish their comments.

But we pose a specific question to the KBA. Is there a plan to further increase the dues over the next three years until they reach $500 by 2015?

The KBA attempts to shift the blame for the dues increase to the Supreme Court. It’s true the Supreme Court has the ultimate authority, but we are not aware that this issue originated in the Supreme Court.

We will gladly correct any errors in our story. But at this point we have not seen the actual dues increase resolution published. What does it say? Did we misread the amount of the increase? The KBA response says the dues will only be $350 in 2012…but it fails to deny plans to increase the dues to $500 by 2015 as reported by LawReader.

We appreciate the KBA responding and informing us they disagree with some of our conclusions. This is possibly a new direction in the Bar to begin discussions with members of the Bar and to not just rely on administrative fiats posted after the fact.

The statement that President Keane reported the dues increase resolution at last summer’s bar convention may be true, but get real, less than 1/3 of the bar members attended classes at the convention, and far less probably attended the class where the dues increase was discussed.

We would like to see the KBA publish a specific budget for the benefit of the bar members. The financial report posted by the KBA does not have the detailed information that the actual budget document will have.

As requested by the KBA we publish the following article:

KBA President Margaret Keane column in Bench & Bar re: Increase in Bar Dues.

LESS THAN A DOLLAR A DAY — IS THE PRIVILEGE TO PRACTICE LAW IN KENTUCKY WORTH THAT?

 

By KBA president Margaret Keane Jan. 2012 http://www.kybar.org/30

A recommendation from the Kentucky Bar Association (“KBA”) Board of

Governors (the “Board”) to raise bar dues is a difficult and unpopular

decision. But with our bar facing the same financial challenges confronted by

each of us in the profession–whether in private practice, public service, or as in house

counsel–the Board, fulfilling its fiscal responsibilities, had the courage

to recommend a dues increase to the Kentucky Supreme Court (the “Court”)

on Dec. 9, 2011.

 

KBA dues are set by the Court based upon a recommendation of the Board

(Supreme Court Rule 3.040(1)). The last dues increase ordered by the Court

occurred on July 1, 2004. That increase was expected to fund the operations of

the KBA only through the 2010-2011 fiscal year.

 

Your Board members and the KBA staff, being good stewards of

KBA funds, have worked diligently to reduce costs, successfully delaying the

need to seek a dues increase.

 

Since 2004, the KBA’s expenses for its “overhead costs,” including

employee retirement contributions, employee health insurance, liability

insurance, taxes, energy and similar recurring and non-controllable costs,

have increased by more than 40 percent.

 

For example, the KBA’s portion of the health care insurance cost for our

employees has increased 91 percent and the KBA’s contribution to the Kentucky

Employees Retirement System for our employees has increased 400 percent.

 

In addition to these operating costs, Court rules require a portion of our KBA

dues to fund certain public service programs. For example, the 2004 Dues

Order requires that $7 of the dues paid by every practicing attorney and $6 of

the dues paid by every judge be allocated to the Clients’ Security Fund. Pursuant to

SCR 3.820, these funds are to provide “indemnification to clients who may

suffer pecuniary losses by reason of fraudulent or dishonest acts” by a KBA

member.

 

From 2004 through June 30, 2011, the Fund has paid over $840,000

to members of the public. The KBA’s total exposure for the fiscal year ending

June 30, 2011, was $563,150, while the amount collected from dues was only

$110,283. At its November and December 2011 meetings, the Fund

made awards of approximately $280,000.

 

Confronted with these financial realities, in 2011 the Board appointed a

Task Force on Dues Structure Evaluation, comprised of Board

members from various areas of the state.

 

At its Nov. 19, 2011, meeting, the Board voted unanimously to accept the Task

Force’s recommendation to seek a dues increase. The Board recommended that

the KBA dues be increased, as detailed in a Dec. 9, 2011, letter to the Court:

(i) for lawyers admitted to practice for five (5) years or more, dues would

be increased from $270 to $350 per year;

(ii) sensitive to the financial challenges faced by new lawyers, dues for new attorneys (those admitted to practice for less than five (5) years) would remain at the current rate of

$220; and

(iii) the separate dues category for judges (who now pay $110 in dues)

would be eliminated and judges’ dues would be set at the same level as other

attorneys, that is either $350 or $220, depending upon the date of the judge’s

admission to practice.

 

The recommendation asks that the dues increase become effective July 1, 2012.

 

If the Court orders a dues increase in the amount requested, the cost of being a

KBA member will still be a “good deal.”

 

As KBA members, we enjoy a benefit no other mandatory bar does. Our Court

rules require that dues payments cover the costs of providing each KBA

member with sufficient CLE hours to comply with education requirements to

maintain a high standard of competence.

 

In 2011, we had the highest number of attendees at the Kentucky Law Updates, 5,191 attorneys (almost one third of our members).

 

Also, all the KBA officers and Board members serve without pay, devoting a

significant amount of time preparing for and attending Board meetings, including

hearing and deciding discipline matters.

 

President’s Notes: (1) The Board at its Nov. 18, 2011, meeting approved a

Resolution in Support of the Report of the KBA Task Force on the Provision

and Compensation of Conflict Counsel for Indigents. Turn to page 27 in this

issue of the Bench & Bar or visit www.kybar.org to read the Resolution.

 

(2) The American Bar Association recently released a report, “Evaluating

Fairness and Accuracy in State Death Penalty Systems: The Kentucky Death

Penalty Assessment Report.” To access the Executive Summary and the

full report, visit www.kybar.org.

 

4 Bench & Bar January 2012

 

KBA members who serve on the Inquiry Commission, CLE Commission, Ethics

Committee and Ethics Hotline, as well as the Clients’ Security Fund Trustees,

IOLTA Board, Kentucky Bar Foundation Board, Bar Center Trustees,

Unauthorized Practice Committee, Attorney Advertising Commission, and

Volunteers For Kentucky Lawyers Assistance Program, devote

innumerable hours of service to KBA members without pay.

 

We have a great bar but we need sufficient funding to maintain it and to

fulfill our mission under SCR 3.025: to “maintain a proper discipline of the

members of the bar in accordance with these rules and the principles of the

legal profession as a public calling, to initiate and supervise, with the approval

of the court, appropriate means to insure a continuing high standard of

professional competence on the part of the members of the bar and to bear a

substantial and continuing responsibility for promoting the efficiency and improvement of the

judicial system.”

 

For most lawyers and judges, the increase would result in our paying less than $1 a day for the privilege of practicing law in the courts of Kentucky – a small price for such an honor. As

commented by one attendee of the 2011 KLUs, a dues “increase is justified and ove

 

 

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