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California Attorneys Face First Annual Fee Hike in 20 Years

Sept. 12, 2019, 3:27 AM

California lawyers’ fees could increase for the first time in 20 years under a measure headed to the governor’s desk.

The bill, S.B. 176, would more than double 2020 base licensing fees for active California attorneys, rising from $315 to $438 a year. Total fees for active attorneys would rise from $430 to $544, under the legislation.

The Senate Sept. 11 passed the bill by a 31-6 vote after accepting amendments that were in the Assembly’s version. Gov. Gavin Newsom (D), has until Oct. 13 to sign or veto the measure.

Some attorneys and bar groups, including Orange County Bar Association, questioned the measure, which was less than the state auditor’s recommended fee increase to $572.

“We certainly could not support such an increase if it were merely the first of several anticipated increases,” OCBA President Deirdre M. Kelly for the 9,000-member organization wrote in a May letter to state Sen. Hannah-Beth Jackson (D).

The bill also would require the California State Bar, a state agency, to compete with other agencies for funding in the annual state budget process starting in the 2021-22 fiscal year. The bar has always separately sought fees that fund the state’s chief lawyer discipline system.

The fee bill is part of the Legislature’s annual State Bar oversight legislation. Lawmakers prevoiusly focused oversight on reforming the state agency to ensure a public safety focus. The Legislature in 2017 made expansive changes that split attorney discipline and regulation from the trade functions.

California lawyers are subject to the state Supreme Court for admission and discipline and to the Legislature under the State Bar Act, which is in the Business and Professions Code.

Fee Complaints

Fees have remained a constant source of frustration for lawyers and the bar itself. The bar’s fees would be near $550 if the state had made normal inflationary adjustments over the last 20 years, California State Bar President Jason Lee told the Assembly Judiciary Committee in July.

The State Bar “asked us for a large chunk of money, justified by some statements and documentation that seemed inadequate,” Assembly Judiciary Committee chairman Mark Stone (D) said Sept. 10 during the floor vote.

Last year’s bill ordered bar audits by the Legislative Analyst’s office and State Auditor. The State Auditor concludedthe bar needed to balance fee increases with other actions to raise revenues and decrease costs.

“The information obtained through those audits showed that what they were asking for was significantly more than they could justify. So while this bill does include an increase for the dues, it is something that we feel is now much more reasonable, and this bill has provisions to ensure the state bar is spending the money in ways that the state auditor and LAO suggested,” Stone said.

Service Employees International Union Local 1000, which represents bar employees, wanted a bill passed. Employees remember the distress in past years when fees weren’t authorized. The state Supreme Court in November 2016 ordered attorneys to pay $297 in licensing fees after the Legislature failed to pass an annual bill for 2017.

It was the second time since 1998, when then-Gov. Pete Wilson (R) vetoed the annual dues bill, that the Supreme Court stepped in to ensure funding of the bar, which investigates complaints against lawyers and makes recommendations on discipline to the court.

If the fee bill isn’t approved, “the State Bar has to make abrupt reductions, limiting the ability of the State Bar employees to process complaints against attorneys,” Local 1000 said in an Assembly analysis.

To contact the reporter on this story: Joyce E. Cutler in San Francisco at jcutler@bloomberglaw.com

To contact the editor responsible for this story: Rebecca Baker at rbaker@bloomberglaw.com

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