2026-22649·LEGAL SERVICES CORPORATION

Cost Standards and Procedures; Purchasing and Property Management

Final RuleFinal Rule

Published: Nov 5, 2026
Effective: Jun 1, 2027
Citation: 91 FR 69720

Final rule.

Summary

The Legal Services Corporation (LSC) has updated its rules on how grantees may spend, document, and manage the federal funds they receive. The changes raise the spending level at which a grantee must ask LSC for approval, simplify the paperwork needed for those requests, and clarify how money raised through fund‑supported fundraising can be used. The rule also gives LSC more flexibility when reviewing approval requests, and it tightens the reporting timeline for any real‑estate investments made with LSC money. Overall, the goal is to make the rules easier to follow, cut down on paperwork, and ensure that federal dollars are used responsibly. The regulation is issued by the Legal Services Corporation, an independent nonprofit that distributes federal funding to organizations providing civil legal aid to low‑income Americans. It applies to all LSC recipients—state and local nonprofits that receive LSC grants—and to any staff or contractors who handle LSC‑funded projects, purchases, or property. The final rule was published on November 5, 2026, and will become effective on June 1, 2027. The public comment period closed before the rule’s publication, so no further comments are being accepted. After the effective date, LSC grantees must follow the new thresholds, documentation standards, and real‑estate reporting requirements, and LSC will begin overseeing compliance under the revised framework.

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Official abstract

This final rule revises the Legal Services Corporation's (LSC or Corporation) regulations governing cost allowability, prior approval requirements, and property and procurement standards applicable to LSC recipients. The final rule clarifies when recipients must obtain prior approval for expenditures of LSC funds; increases the monetary threshold for prior approval; clarifies the treatment of proceeds from fundraising activities supported with LSC funds; provides additional flexibility in LSC's review of prior approval requests; clarifies documentation requirements for prior approval requests; and revises the deadline and requirements for accounting for LSC funds invested in real estate. These amendments are intended to clarify existing requirements, reduce administrative burden, promote consistent oversight and enforcement, and strengthen accountability in the use of Federal funds.