Mayor Adrian Fenty is proposing to bill outside organizations for contract-related legal services that have long been provided free of charge by the city’s Office of the Attorney General.
Under the “Commercial Transactions Cost Recovery” plan, the mayor would be authorized to charge all for-profit ornonprofit entities for legal services tied to loans, grants and revenue bonds they obtain through the District government. Organizations also could be billed for work by the attorney general related to the sale or lease of District-owned property.
For the attorney general’s office, it’s a new source of revenue in the face of fiscal belt-tightening. The legal services have for decades been delivered as a “public service,” but as money grows tighter, the agency must look for ways to recoup its costs, Senior Assistant Attorney General Stephen Lyons said.
“It’s kind of like a user fee,” Lyons said.
The District issues millions of dollars worth of revenue bonds annually on behalf of nonprofits and educational institutions, which take advantage of the government’s tax exempt status to save on interest and fees. The bonds are often used to finance charter schools, college dormitories, classroom buildings or a group’s new headquarters.
The attorney general serves as the District’s legal counselor in such financial transactions. And three full-time lawyers spend roughly 70 percent of their days negotiating and reviewing industrial revenue bond deals, Lyons said.
Add the work of a part-time paralegal, and the staff time adds up to about $420,000 a year, finance officials say.
The menu of prices for legal services has not yet been developed. The proposal, found in the Fiscal Year 2008 Budget Support Act, requires that the amounts should be calculated only “to defray costs.”
“Our fees would be so small compared to what other lawyers charge,” Lyons said.
