Debt of Gratitude
Federal loan repayment assistance offers relief for young legal aid lawyers discovering that high loan payments and low salaries don't add up.

As a result of the skyrocketing costs of law school, legal services leaders are now facing a genuine human-resource crisis. Recent graduates are being forced to abandon their public-interest career plans out of financial necessity, while young lawyers drowning in debt are leaving legal aid after brief tenures to take more lucrative jobs in the private sector. In response to this problem, Congress has approved funding for a new pilot program that offers loan assistance to qualified advocates, so they can meet their monthly expenses and continue their vital work on behalf of the poor.

Jessica Kerkhofs might still be working at Legal Aid of Nebraska if it were not for the Thursdays, twice a month, when she opened the financial budgeting software on her home computer. The figures didn’t add up. Student loans totaling $117,248 stared back at her from the screen. With monthly repayments of $1,100, the loans gobbled up more than half of her take-home salary.

 “I was freaking out about the payments,” says Kerkhofs, a 2001 graduate of Creighton University School of Law in Omaha. “I would wake up in the middle of the night thinking about finances. I didn’t want to shirk my responsibility. They deserve their money. It was just really difficult to deal with.”

Kerkhofs started her legal services job right out of law school, carrying a heavy domestic relations caseload and an equally weighty law school debt load. In her work, she helped a neglected child move into a safe environment. She came to the aid of an Asian immigrant locked into a frightening marriage to a man who knocked out her teeth and physically abused their kids. It was gratifying and important work, to say the least.

However, Kerkhofs and her husband, a modestly paid employee of an Internet service firm, were starting their own family. They tried to get on top of their finances, scrimping, withdrawing 401(k) funds to pay off a 2001 car, consolidating loans, and accepting forbearance offers. But still, the debt was too much to manage.

Finally, Kerkhofs decided to change course rather than continue struggling against the tide. She accepted a job as a city attorney in Lincoln, Neb. The position called for an hour commute to and from work and lacked the rewards of a career providing help to those desperately in need, but the extra $10,000 in annual salary meant she and her husband could pay their mortgage, child care expenses, and the law school loans. “We really needed a break for our kids,” says Kerkhofs, who is now the mother of a toddler and a newborn. “If there were a program at legal services where I could have gotten loan assistance, I would have stayed. I really miss that atmosphere.”

High student debt constitutes a “serious impediment” for legal services programs trying to retain qualified staff attorneys, according to one-third of the 105 legal aid executive directors who responded to a December 2003 survey conducted by the Legal Services Corporation. According to the survey, nearly one-quarter of legal services lawyers who leave do so because of low salary, while 12 percent of those point directly to educational debt as their reason for jumping ship.

Getting good lawyers in the door may be even harder, according to the survey. Fifty-seven percent of program directors polled said the educational debt of recent graduates is a serious impediment to their recruitment efforts. “We have had student interns who have indicated that they could not contemplate taking a position with us because they faced large student debt upon graduation,” says one respondent.

LSC President Helaine M. Barnett says the survey follows years of concern in the legal services community, in which the American Bar Association, law schools, directors of state Interest on Lawyer Trust Account funds, LSC, and other funders have all searched for ways to make careers in legal aid financially possible for those saddled with high student debt.

“Starting salaries in legal aid average $37,500, which can make it very difficult for graduates who are faced with an average law-school debt of $80,000 to work in legal services,” Barnett says. “More than 75 percent of directors [at LSC-funded programs] indicated loan forgiveness programs would be effective for recruitment and retention of staff attorneys.”

This May, LSC will implement the first-ever federally funded Loan Repayment Assistance Program (LRAP) pilot specifically designed to help legal services attract and retain qualified advocates. The $1 million experiment will ease the loan burden over three years for approximately 60 legal services attorneys, and as importantly, offer an opportunity to gauge the effectiveness of such a program so LSC leaders can make the case for permanent sources of funding for loan repayment assistance.

Congressman Frank Wolf (R-VA), Chairman of LSC’s Appropriations subcommittee in the U.S. House of Representatives, was the catalyst behind the pilot’s creation. At an appropriations hearing last spring, the Congress­man suggested that LSC use $1 million to implement the pilot LRAP. He then shepherded authorization of the measure through a House-Senate conference committee during last year’s appropriations process. “You want people to come into legal services who are competent and capable and went to good schools,” Wolf says. “With the loans these young kids have, they just can’t do it.” Wolf, himself a graduate of Georgetown University School of Law, was inspired by programs that help teachers who work in impoverished school districts with loan repayment assistance. “It makes sense,” Wolf says. “The poor need legal services as well as the rich. It’s important that we remember the poor so that equal justice is a reality.”

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