BILL NUMBER: S7488

SPONSOR: RYAN
 
TITLE OF BILL:

An act to amend the judiciary law and the state finance law, in relation
to the attorney licensing fund

This measure is being introduced at the request of the Judiciary.

This measure would amend section 465(1) of the Judiciary Law to codify
in the Consolidated Laws a provision directing the deposit of bar exam-
ination fees into the Attorney Licensing Fund. Such fees already are
deposited in such Fund by operation of a provision included annually in
the Judiciary's appropriation bill (see e.g., L.2022, c.  51, § 2).

This measure also would amend the State Finance Law to add a new section
94-c to continue the Attorney Licensing Fund and clarify that moneys in
the Fund are to be used by the Judiciary to pay the costs of three
programs critical to discharge of the court system's statutory obli-
gations regarding bar admission and attorney discipline: i.e., candidate
examination (the State Board of Law Examiners), candidate fitness
(Committees on Character and Fitness) and attorney discipline. See Judi-
ciary Law §§ 90, 460.
              

The Attorney Licensing Fund was first established in 1990 as part of an
amendment to section 468-a(4) of the Judiciary Law. L. 1990, c.  190, §
255. Since 1981, when it was first enacted (L. 1981, c. 714), section
468-a had required each attorney licensed to practice law in New York to
register with the Office of Court Administration every two years and, at
such times, to pay a registration fee. The 1990 amendment to subdivision
four of this section introduced the Attorney Licensing Fund and statuto-
rily memorialized it in such subdivision, directing that its revenue
stream consists of a portion of each biennial attorney registration fee
paid. While no other instruction was given at the time - either in this
enactment or elsewhere in law - the general understanding was, and ever
since has been, that it is State policy for attorneys to bear the costs
of the Judiciary's administration of the bar admission process and of
attorney disciplinary programs; and that this policy is to be given
effect by the Judiciary paying these costs out of the attorney-supported
Attorney Licensing Fund.

This measure is proposed because, in our view, the Attorney Licensing
Fund (and its mission) cannot remain viable unless it is given a higher
statutory profile than it now enjoys. Giving the Fund greater visibility
- by including it in the State Finance Law's codification of the many
State funds - will, we believe, ensure that the Legislature and the
Executive remain aware of that mission and the policy underlying it; and
serve as a reminder that any further efforts they undertake to divert
portions of the attorney registration fee for other State purposes' can
only make it more difficult for the Attorney Licensing Fund, in the
future, to continue to bear the costs of the bar admission process and
attorney disciplinary programs2. Contributing to the same salutary end -
i.e., preserving the viability of the Attorney Licensing Fund - will be
codification of its entitlement to bar examination fee revenues, now a
vital component of its funding stream.

This measure, which would take effect immediately, would have no fiscal
impact upon the State. It will not change the mission of the Attorney
Licensing Fund, nor will it change the allocation it receives from the
biennial attorney registration fee.

 
LEGISLATIVE HISTORY:

2021-22: S6500 (Sen Ryan) (PASSED) OCA 23  
LEGISLATIVE HISTORY:

2019-20:  A7527 (M/A - Quart) (Ref to Ways and Means) OCA 2019-42(R1)

1 Since 1990, when the Attorney Licensing Fund was first established,
the Legislature has twice amended section 468-a(4) to increase the
attorney registration fee and, in both instances, dedicated all of the
additional revenues to be produced to beneficiaries other than the
Attorney Licensing Fund. See L. 2003, c. 62, Pt. J, § 17  
INCREASING THE
FEE BY $50 AND DEDICATING ALL OF THE INCREASE TO THE INDIGENT LEGAL
SERVICES FUND; L. 2010, c. 56, Pt. K, § 9  
FURTHER INCREASING THE FEE
BY $25 AND DEDICATING ALL OF THE INCREASE TO THE LEGAL SERVICES ASSIST-
ANCE FUND.  -With none of the increases in the attorney registration
fee since the 1990 creation of the Attorney Licensing Fund going to
enhance the latter's revenue stream, the Fund is fast growing insuffi-
cient to meet the costs of the attorney-related programs it was estab-
lished to underwrite. These costs have grown steadily with inflation
since 1990, and we project that, by the 2020-2021 State Fiscal Year, the
Attorney Licensing Fund will be insufficient to meet them. While deci-
sions whether to increase the attorney registration fee and, if so, how
to allocate the proceeds of that increase properly belong to the Execu-
tive and Legislature, we would be remiss not to point out that, with
each such increase and dedication of its proceeds to programs other than
those for which the Attorney Licensing Fund was established, it will be
that much more difficult for the State to sustain its now decades-long
policy of requiring the Bar to pay the costs of bar admission and attor-
ney disciplinary programs. Should the Fund actually become insolvent,
and unable fully to cover these costs, the Judiciary will have no option
but to use General Fund moneys i.e., State taxpayer dollars - to make up
the difference.  2