2026-22650·LEGAL SERVICES CORPORATION

Purchasing and Property Management

Proposed RuleComment Period OpenComments open

Published: Nov 5, 2026
Comments close: Dec 21, 2026
Citation: 91 FR 69766

Notice of proposed rulemaking.

Summary

The Legal Services Corporation (LSC) is proposing to change its definition of “capital improvement.” Under the current rule, a project must meet a specific spending threshold before LSC funds used on real‑estate upgrades can be counted as a capital improvement. The revision would eliminate that monetary floor, allowing any improvement funded by LSC to be classified as a capital improvement regardless of cost. The goal is to separate the definition of a capital improvement from approval thresholds, make it easier to track how LSC money is spent on property upgrades, and improve oversight and accountability for those investments. The rulemaking comes from LSC, the independent nonprofit that distributes federal grant money to civil legal‑aid providers. It affects the grantees that receive LSC funding—law firms, legal aid organizations, and other entities that use LSC dollars to purchase or improve real property. By redefining capital improvements, the change will alter how these recipients report and manage any building or facility upgrades financed with LSC funds. The proposal was published in the Federal Register on November 5, 2026 (91 FR 69766) and will become effective after the comment period ends. Interested parties have until December 21, 2026, to submit written comments. After the comment deadline, LSC will review the feedback, possibly revise the language, and then issue a final rule that will formally adopt the new definition.

AI-generated summary — verify against the Federal Register text.

Official abstract

This proposed rule revises the Legal Services Corporation's (LSC) definition of "capital improvement" by removing the threshold amount of LSC funds that must be expended on an improvement to real estate for the expenditure to qualify as a capital improvement. The proposed amendment would distinguish the definition of a capital improvement from the monetary thresholds required for prior approval; promote consistent tracking and oversight of LSC funds used for capital improvements; and strengthen accountability for LSC funds invested in recipients' real property.