Many Americans can recite the two-sentence phrase verbatim, thanks to a true crime flick or a legal procedural TV show. “You have the right to an attorney. If you cannot afford an attorney, one will be provided to you.”
The reality is a little more complicated. State-funded, court-appointed public defenders who represent low-income defendants in criminal cases are often underpaid and “dangerously” overworked. Despite the fact that in small- to mid-sized jurisdictions, public defenders are supplemented by private panel attorneys selected to represent an indigent client, 41% of U.S. counties are considered legal deserts, with less than one attorney per 1,000 residents. Inadequate access to representation causes prolonged pretrial detention and increases the likelihood of wrongful convictions and procedural errors.
With this year’s budget, the General Assembly has rerouted up to $15 million annually to the North Carolina Office of Indigent Services Private Assigned Counsel Fund, enabling PAC to raise hourly compensation for panel lawyers. But that money doesn’t come from the state as a fulfillment of its constitutional obligation to fund public defense. It comes from IOLTA, or interest on lawyers’ trust accounts, a 43-year program that has provided more than $134 million in grants to civil legal aid offices — which also provide pro bono representation for people without the means to hire an attorney.
Civil legal aid entities like Pisgah Legal Services and Legal Aid of North Carolina that previously received IOLTA funding offer services just as important as public defense. But the right to counsel for matters like housing, employment or healthcare, unlike public defense, is not funded by the state, nor is it enshrined by the law.
PLS Executive Director Jackie Kiger said her organization is there to remedy that gap.
“We exist … to make sure that there is access to justice in life-changing basic needs areas where poverty is a big issue and someone cannot afford an attorney to access or protect their rights. And it’s important because we believe that everybody should have access to justice,” she said.
Pearl Phillips was referred to PLS Attorney Becca Eden after a life-altering traumatic experience.
“Three years ago … my husband at the time held me and our son hostage for about six-and-a-half weeks, and mentally and emotionally and physically abused me,” she told The Smoky Mountain News.
Through PLS, Phillips obtained an emergency protective order and a domestic violence protective order. Eden litigated her divorce case and helped her to gain custody of her son. “The court system is not set up to help victims,” she said. “[PLS] step[s] in and they take all of that burden and effort off of the survivors and the people that they serve.”
Phillips said that because one does not have the right to an attorney in civil matters, her ex-husband chose to represent himself in court.
“The biggest way that Pisgah helped me, aside from doing the paperwork and all that, is being a buffer between me and my abuser,” she said.
The root of the problem
IOLTA is not taxpayer money, which left some questioning the Republican-led General Assembly’s authority to determine grant recipients. Regarding legislators’ decision to divert money from legal aid organizations across North Carolina, it seems politics is largely to blame — as well as how IOTLA funding is interpreted. IOLTA is interest earned on certain client funds pooled into a lawyer-managed trust. These funds tend to be short-term and small-sum. When not part of a trust, the value of interest accrued does not satisfy the fee for collecting it.
While IOLTA is policy nationwide, it was established in 1983 upon authorization by the North Carolina State Bar Council and state Supreme Court. Initially a voluntary program, it became mandatory in 2007. The Office of State Auditor Dave Boliek conducted a comprehensive performance audit of IOLTA and the results, released April 2026, reported all-around grant-eligibility compliance. Still, the auditor had choice words about the program.
“Attorneys in North Carolina have no choice but to allow the North Carolina State Bar’s IOLTA program to take interest from their trust accounts,” Boliek said, adding that organizations funded by IOLTA have “clearly partisan, political agendas.”
Yet to lawyers, that money is already off-limits and subject to strict rules of governance. According to the American Bar Association, “it is unethical for attorneys to derive any financial benefit from funds that belong to their clients.”
IOLTA funds are mandatory in every state except for Alaska, Kansas, Nebraska and Wyoming. Nonetheless, the Republican-led General Assembly first challenged the program in 2025, when it froze funding for a year due to concerns about money directed to progressive organizations. Legal aid organizations across the state were forced to terminate staff positions and close county offices.
Though the recent state budget does authorize the distribution of a few million dollars in pre-freeze money earmarked for the program, any office that advocates for policy or community organizing, provides assistance to migrants, or offers services to help access gender-affirming care — the vast majority of major NC legal aid organizations — is barred from receiving those dollars. But legal aid provides a service to everyone, even those who might want to defund it.
“When we can prevent unnecessary evictions, unnecessary foreclosures, or get victims’ protection, or get a senior income, we are keeping people from being homeless, needing shelters, using more safety net resources, calling the police. We are helping the community overall too,” said Kiger, calling the loss of IOLTA funding “devastating.”
Indeed, PLS must cut 14% of its budget.
“It’s a huge chunk of money to lose outright and with very little notice since the freeze,” Kiger said, adding that this could mean losing the capacity to serve thousands across Western North Carolina. “[That funding] allowed us to meet people’s needs where they were.”
When asked if there was anything she’d say to legislators about this state budget provision, Phillips posited, “I would want them to know that they’re doing a huge disservice to this population and a community that is already isolated.”
Phillips, a mom of five, is doing far better than three years prior — and that’s in no small part because of pro bono legal services. She’s enrolled as a full-time student in Southwestern Community College’s transfer program. She plans to later attend Mars Hill University to pursue her bachelor’s degree in social work. But she’s not stopping there.
“I want to go for my master’s in social work as well,” she said.
In the meantime, one thing is certain: as the case continues, Eden will be right beside her.
“I have to renew my protective order, and so [PLS is] still helping me,” Phillips said. “They’re going to help me Thursday in court.”