The Legal Services Corporation Board of Directors' Compensation and Expenses and the New President's Employment Contract

HRD-83-69: Published: Aug 31, 1983. Publicly Released: Aug 31, 1983.

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In response to a congressional request, GAO reviewed the compensation and expenses paid to members of the 1982 Legal Services Corporation (LSC) Board of Directors and interviewed individuals about the LSC-related activities they performed. Further, GAO considered laws, regulations, and policies pertaining to LSC and two other corporations and interviewed officials of all organizations to determine whether payments to LSC Board members complied with the law and LSC regulations and policies and whether LSC practices for compensating Board members were comparable to those followed by other government corporations. GAO examined the employment contract of the current LSC president to ascertain its consistency with those of past LSC presidents and presidents of other government corporations. GAO also determined whether LSC Board members, appointed by the President while the Senate was in recess, were entitled to compensation.

LSC laws and regulations entitled Board members to a specified per diem for compensation expenses incurred in connection with their duties. LSC-related services for which members could be compensated or reimbursed for expenses were found to be specified in Board-member compensation policies. Although LSC Board-member compensation and expense payments in 1982 complied with LSC laws, regulations, and compensation policies, LSC procedures for reviewing and authorizing Board-member compensation were determined to lack internal controls. LSC was found to compensate its Board members differently than other government corporations and most private-sector corporations. In the opinion of GAO, the current LSC president's contract, with the exception of severance pay provisions, was consistent with past LSC presidents' contracts and complied with statutory restrictions on salary, but it was found to be different than the contracts of other government and private corporation presidents. In addition, GAO determined that LSC Board members were entitled to compensation if appointed by the President while the Senate was in recess.

Recommendation for Executive Action

  1. Status: Closed - Not Implemented

    Comments: This recommendation is no longer valid because Congress has made clear its intention to restrict Board member compensation in the last three continuing resolutions. As long as these restrictions continue, there is no need to implement this recommendation.

    Recommendation: The President of LSC should: (1) require Board members, when requesting compensation, to specify the LSC activities they performed; (2) direct the LSC Comptroller to review and certify Board members' compensation requests for compliance with established compensation policies; and (3) prepare periodic reports to the Board on payments to its members.

    Agency Affected: Legal Services Corporation


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