The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Judiciary
BILL: CS/SB 498
INTRODUCER: Judiciary Committee and Senator Grall
SUBJECT: Trust Fund Interest for Purposes Approved by the Supreme Court
DATE: March 12, 2025
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Davis Cibula JU Fav/CS
2. BI
3. RC
Please see Section IX. for Additional Information:
COMMITTEE SUBSTITUTE - Substantial Changes
I. Summary:
CS/SB 498 establishes two interest rate alternatives that financial institutions must pay on lawyer
or law firm trust accounts. These accounts generate interest or dividends that fund an entity
established by the Supreme Court which provides free legal services to low-income individuals
or other purposes authorized by the Court.
The two interest rate alternatives under the bill are:
• The highest interest rate or dividend generally available from the institution to comparable
business or consumer accounts or nonmaturing deposit accounts; or
• 25 percent of the federal funds target rate or 0.25 percent, whichever is higher, net of fees.
The Florida Bar Rules, however, have set criteria to determine whether a financial institution is
eligible to participate in the Interest on Trust Accounts (IOTA) program. One of the eligibility
criteria is the minimum interest rate that must be paid by participating financial institutions.
According to the rules, when the Wall Street Journal Prime Rate is between 325 and 499 basis
points, the minimum yield or interest rate paid net of all fees and service charges must be no less
than 300 basis points below the prime rate. When the rate is 500 basis points or above, the yield
must be no less than 40 percent of the prime rate in effect on the first business day of each
month.
Accordingly, the interest rates on trust accounts established by the bill are inconsistent with those
that are part of the eligibility criteria established by rules of The Florida Bar to participate in the
REVISED: BILL: CS/SB 498 Page 2
IOTA Program. If the rates established by the bill are found by the courts to be a regulation of
banking, not the practice of law, the bill will likely require The Florida Bar to revise its
eligibility criteria for financial institutions to participate in the lawyer or law firm trust account
program.
These provisions do not apply to interest rates that are established by written contract or
obligations that are unrelated to the trust accounts described in this bill.
The bill takes effect upon becoming law.
II. Present Situation:
The central issue in this legislation involves weighing the competing needs of The Florida Bar
foundation to fund its legal aid programs against the ability of banking institutions to pay
sufficient and sustainable interest rates that fund the foundation’s legal aid programs. Both
organizations estimate that between $9 and $10 billion is deposited annually into IOTA accounts
at banking institutions.
The Jurisdiction of the Florida Supreme Court, The Florida Bar, and the IOTA Program
The State Constitution grants exclusive jurisdiction to the Florida Supreme Court to regulate the
admission of people to practice law in the state. The Court also has exclusive jurisdiction to
discipline those people once they are admitted to practice law.
1
Florida is a mandatory bar state
and all members who are admitted to practice in Florida must be members of The Florida Bar.
2
The Florida Supreme Court has established the “authority and responsibilities of The Florida
Bar” in the Rules Regulating the Florida Bar.
3
Chapter 5 contains the “Rules Regulating Trust
Accounts” which all attorneys who maintain trust accounts must abide by. Funds that are placed
in an attorney’s trust account produce interest income exclusively for the IOTA program. The
interest-producing program generates millions of dollars in interest each year. Once generated,
the interest funds are swept by The Florida Bar directly into the Bar’s foundation, Funding
Florida Legal Aid.
The Florida Bar created the foundation in 1956 and changed its name to Funding Florida Legal
Aid in 2023. The foundation functions to increase legal access for people with limited means by
funding legal services, developing programs, and supporting legal aid providers selected by the
foundation for grant awards. The foundation’s primary financial support comes from the IOTA
program but donations are also received from attorneys, law firms, corporations, foundations,
and individuals.
4
1
FLA. CONST. art. V, s. 15. The Court conducts these official functions through two separate entities: the Florida Board of
Bar Examiners and The Florida Bar.
2
The Florida Bar, Frequently Asked Questions, https://www.floridabar.org/about/faq/ (last visited March 7, 2025).
3
The Florida Bar, Rules Regulating the Florida Bar, https://www-media.floridabar.org/uploads/2025/02/2025_06-DEC-
RRTFB-12-30-2024.pdf. The Rules are divided into 21 chapters consisting of 807 pages.
4
FFLA, Funding Florida Legal Aid, Leadership and Funding for Justice in Florida, https://fundingfla.org/about-ffla/ffla-
overview/ (last visited March 7, 2025). BILL: CS/SB 498 Page 3
It is important to note that, while the IOTA program is mandatory for attorneys, it is technically
voluntary for banks to participate in the program.
Interest on Trust Accounts (IOTA) Program and Funding Florida Legal Aid (FFLA)
Background on Attorney Trust Accounts
A trust account is a short-term account set up by an attorney in which he or she deposits funds on
behalf of a client. The account generally contains funds that are combined such as a retainer
payment, discovery or litigation costs paid in advance, filing fees, or a settlement award. The
amount of money in the account changes often because deposits and withdrawals are made
frequently. These fees may not be commingled with an attorney’s operating account but must be
kept separately.
A trust account has been described as an “unusual” creation that is significantly different from
other accounts. Although an attorney opens the account and is responsible for managing the
funds in the account, he or she is not technically the owner of the funds.
5
While an attorney is not
the owner of the account, and therefore not entitled to interest generated by the account, neither
is the client entitled to interest generated by the funds. The U.S. Court of Appeals for the
Eleventh Circuit issued a decision in 1987 determining that a client was not entitled to the
interest generated in a trust account.
6
How the accounts may be regulated or restricted has presented a quandary for almost 200 years.
The earliest attempt to regulate trust accounts can be traced to the Legislative Council of the
Territory of Florida in 1828. In 1936, the Florida Supreme Court incorporated the regulation of
trust accounts into the Court’s rules. Additional measures were adopted over the years to ensure
that attorneys, acting as “trustees” would not misuse their clients’ funds or neglect to return them
when requested to do so by the client.
7
The Evolution of Interest Earned on Trust Accounts
Trust accounts have evolved from simple accounts that earned no interest and benefitted no one
in particular to today’s accounts in which The Florida Bar, with Florida Supreme Court approval,
mandates participation by attorneys, establishes the interest rates, and requires that the interest be
remitted to The Florida Bar’s foundation, Funding Florida Legal Aid.
For many years, attorneys deposited their clients’ funds in non-interest-bearing checking
accounts because trying to apportion multiple clients’ interest earnings on short-term deposits
was too complex. However, in 1978 and in response to a petition by The Florida Bar,
8
the
5
In re Amendments to the Rules Regulating the Florida Bar-Miscellaneous: The Florida Bar’s Response to the Florida
Bankers Association’s Motion for Rehearing, Case No. SC22-1292 (April 14, 2023), https://acis-
api.flcourts.gov/courts/68f021c4-6a44-4735-9a76-5360b2e8af13/cms/case/baa8ed04-2926-4922-b099-
9d51fd7ab2ae/docketentrydocuments/a8e413ea-a6d4-417f-a1b0-2536bb7c9292.
6
Cone v. State Bar of Florida, 819 F.2d 1002 (11th Cir. 1987).
7
A Petition of Florida Bar, 356 So. 2d 799 (Mem), 800-801 (Fla. 1978). (The lengthier case style is In re Interest on Trust
Accounts, A Petition of The Florida Bar to Amend the Code of Professional Responsibility and the Rules Governing the
Practice of Law.)
8
More specifically, the petition to amend the rules was brought by the Board of Governors of The Florida Bar with the
concurrence of the Board of Directors of The Florida Bar Foundation. BILL: CS/SB 498 Page 4
Florida Supreme Court amended the Bar rules and authorized attorneys to invest trust funds held
for their clients to generate investment income that would, among other things, provide legal aid
to the poor and help provide student loans.
9
Participation in the program would be voluntary. The
interest payments would be transmitted directly from the financial institutions to The Florida Bar
Foundation. In implementing these changes, Florida became the first state in the nation to adopt
an Interest on Trust Accounts Program, commonly called IOTA.
10
After several adjustments
were made, the program became operational in 1981 and permitted voluntary participation by
attorneys and their firms.
11
In 1989, the Rules were amended and participation in the program
became mandatory for all attorneys.
12
The next significant development occurred in 2001 when the trust account rules were amended to
define institutions that are eligible to hold IOTA accounts. These eligible institutions were
limited to the institutions that pay IOTA account depositors “the highest interest rate or dividend
generally available from the institution to its non-IOTA account customers when IOTA accounts
meet or exceed the same minimum balance” or other eligibility requirements. In essence, The
Florida Bar Foundation was asking that IOTA accounts be placed on an equal par with non-
IOTA accounts in an institution.
13
For purposes of clarity, it is worth noting that these rules are not found in the Florida Statutes,
but are rules adopted by The Florida Bar Association and approved by the Florida Supreme
Court.
2023 Amendments to Interest on Trust Accounts
The Florida Bar’s Position
The Florida Bar petitioned the Court on October 3, 2022, to once again amend the IOTA rules.
The stated goal of the proposed amendments was to “include all possible accounts that can be
used as trust accounts” and “ensure the highest possible interest is available for IOTA
accounts.”
14
The net effect of these amendments would be to increase funding to the Bar’s legal
aid funding organization, Funding Florida Legal Aid.
On March 16, 2023, the Florida Supreme Court adopted amendments to Rules Regulating The
Florida Bar, including provisions regulating trust fund accounts. The amendments:
9
In re Interest on Trust Accounts, A Petition of The Florida Bar, 356 So. 2d 799 (Mem) (Fla. 1978).
10
Id. at 800-801.
11
It should be noted that the establishment of IOTA or IOLTA (Interest on Lawyers’ Trust Accounts as they are called in
other states) was possible only after Congress made changes to federal banking laws in 1980 that allowed certain checking
accounts to pay interest. American Bar Association, Interest on Lawyers’ Trust Accounts,
https://www.americanbar.org/groups/interest_lawyers_trust_accounts/overview/. See also Matter of Interest on Trust
Accounts, 402 So. 2d 389 (Mem) (Fla. 1981).
12
Matter of Interest on Trust Accounts: Petition to Amend the Rules Regulating the Florida Bar, 538 So. 2d 448, 449-450,
(Fla. 1989).
13
Amendment to Rules Regulating the Florida Bar—Rule 5-1.1(e)--IOTA, 797 So. 2d 551 (Fla. 2001).
14
In re Amendments to the Rules Regulating the Florida Bar – Miscellaneous: Petition to Amend the Rules Regulating the
Florida Bar, Case No. SC2022-1292 (10/03/2022), https://acis-api.flcourts.gov/courts/68f021c4-6a44-4735-9a76-
5360b2e8af13/cms/case/baa8ed04-2926-4922-b099-9d51fd7ab2ae/docketentrydocuments/60ddf5a7-6ae4-425a-a90b-
2cebcc635bd0. BILL: CS/SB 498 Page 5
• Expand the definition of an interest or dividend-bearing account to include a business or
consumer deposit account so that the definition is expanded to include all possible accounts
that can be used as trust accounts.
15
• Revise eligibility criteria for financial institutions to hold trust accounts and participate in the
IOTA program. The revised criteria require eligible institutions to tie minimum interest rates
for IOTA accounts to the Wall Street Journal Prime Rate.
16
The formula to determine interest rates and dividends based on the Wall Street Journal Prime
Rate is described by the amendments as follows:
When the Wall Street Journal Prime Rate (“indexed rate”) is between 325 and
499 basis points (3.25% and 4.99%), the minimum interest rate paid net of all
fees and service charges (“yield”) must be no less than 300 basis points (3.00%)
below the indexed rate in effect on the first business day of each month. When
the indexed rate is 500 basis points (5.00%) or above, the yield must be no less
than 40% of the indexed rate in effect on the first business day of each month.
17
The Wall Street Journal Prime Rate is a lending rate. It is the “base rate posted by at least 70% of
the nation’s largest banks.” To establish this rate, the Wall Street Journal regularly surveys the
largest banks in the country to determine what interest rate they are charging their customers
with the highest-rated credit for short-term loans.
18
As of March 5, 2025, the Wall Street Journal
Prime Rate is 7.5 percent.
19
In a January 16, 2024, article published in the Florida Bar News, the amended rule was
explained this way:
For instance, under the amended rule, when prime rate is between 3.25% and
5%, then the trust account rate banks pay out is between .25% and 2%, a 3%
gain. After that the gains get even better for banks. At a 7% interest rate, for
example, banks will pay out 2.8%, a 4.2% gain.
20
Another article explained the rule change in these terms:
As a result of this change, for a financial institution to be eligible to participate
in the program, it must pay a minimum interest rate of 3.00% when the Wall
Street Journal Prime Rate (index rate) is between 3.25% and 4.99%. When the
index rate is above 5.00%, to stay eligible, financial institutions are required to
pay a minimum interest rate equal to 40% of the index rate.
21
15
R. Regulating Fla. Bar Rule 5-1.1(g)(1)(E).
16
R. Regulating Fla. Bar Rule 5-1.1(g)(5)(B).
17
Id.
18
Fulton Bank, What Is Wall Street Journal Prime Rate and Why It Matters https://www.fultonbank.com/Education-
Center/Managing-Credit-and-Debt/Prime-rate-and-why-it-matters (last visited March 7, 2025).
19
The Wall Street Journal, WSJ-Markets, https://www.wsj.com/market-data/bonds (last visited March 5, 2025).
20
Florida Bar News, Measure Would Have Florida’s CFO Set the Rate Paid on Iota Accounts (Jan. 16, 2024)
https://www.floridabar.org/the-florida-bar-news/measure-would-have-floridas-cfo-set-the-rate-paid-on-iota-accounts/.
21
The Bank of Tampa, Invested in You, https://www.bankoftampa.com/iota/ (last visited March 7, 2025). BILL: CS/SB 498 Page 6
Opposition to the 2023 Rule Amendments
One criticism of the amended rule is that the Wall Street Journal Prime Rate is a benchmark for
lending purposes and is not used to set deposit account interest rates. As a result, the interest rate
is significantly higher than interest rates paid for other deposits.
The Florida Bankers Association (FBA) filed a motion for rehearing on March 31, 2023, stating
that it did not receive adequate or meaningful notice of the proposed IOTA amendments.
22
The
FBA contended that the amended rules, while admirable, would “have a significant and negative
impact on participating banks” and go far beyond its intended purpose. The FBA argued that
basing the interest rate for IOTA accounts on the Wall Street Journal’s Prime Rate would mean
that the minimum interest paid on IOTA accounts would be significantly higher than any other
interest rate offered by a bank on consumer or business accounts. The FBA also argued that the
judicial branch had violated the separation of powers doctrine and encroached impermissibly on
the executive branch’s power to regulate banks through the Office of Financial Regulation, The
Department of Financial Services, and the Financial Services Commission.
The new rule became effective on May 15, 2023, and remains in effect. The Court allowed
comments from interested parties until November 1, 2023, and directed The Florida Bar to file a
report on the status of the implementation of the rules.
Negotiation Attempts Have Failed to Reach a Compromise
According to documents filed in the Florida Supreme Court, the Florida Bankers Association and
The Florida Bar have attempted for months to reach a compromise rate that is agreeable to both
parties. This has resulted in an impasse and no compromise has been reached.
23
On August 7,
2024, the Court denied the Florida Bankers’ Association for rehearing.
IOTA Data for Funding Florida Legal Aid
Amounts Received by FFLA From the IOTA Program
Funding Florida Legal Aid supplied the information below on remittances from the IOTA
accounts. The fiscal year begins July 1 and ends June 30 of the following year.
FY 2018-19 $12,711,423
FY 2019-20 $16,233,686
FY 2020-21 $7,749,737
FY 2021-22 $9,498,692
FY 2022-23 $45,547,390
FY 2023-24 $279,656,155
22
In re: Amendments to Rules Regulating the Florida Bar 5-1.1; Florida Bankers Association’s Motion),
Case No. SC22- 1292 (Mar. 31, 2023), 70f6bc15-9b6e-41b5-8c56-65db9b750a31 (flcourts.gov).
23
In re Amendments to the Rules Regulating the Florida Bar, The Florida Bankers Association’s Comment to the Florida
Bar’s Report on Implementation Status, Case No: SC2022-1292, https://acis-api.flcourts.gov/courts/68f021c4-6a44-4735-
9a76-5360b2e8af13/cms/case/baa8ed04-2926-4922-b099-9d51fd7ab2ae/docketentrydocuments/f5381851-24da-4ff6-932d-
487a9ca0b99c. BILL: CS/SB 498 Page 7
Information for FY 2024-25 is only partially complete. However, for remittances received from
July 2024 through January 2025, FFLA reports receiving $155,378,419.
24
It is significant to note that the IOTA collections increased by $234,108,765 between fiscal year
2022-23 and fiscal year 2023-24. This is attributable to the newly implemented funding formula
authorized by the Supreme Court in May 2023 for the benefit of the Bar foundation.
25
The FFLA shows with the chart below how the annual revenue collections through the IOTA program
have changed over the years.
26
The effect of the 2023 amendments is clear:
24
Email from Amanda Fraser, Governmental Consultant on behalf of Funding Florida Legal Aid (March 5, 2025) (on file
with the Senate Committee on Judiciary).
25
In re Amendments to the Rules Regulating the Florida Bar – Miscellaneous: The Florida Bar’s Report on Implementation
Status (April 2, 2024) Case No: SC2022-1292, https://acis-api.flcourts.gov/courts/68f021c4-6a44-4735-9a76-
5360b2e8af13/cms/case/baa8ed04-2926-4922-b099-9d51fd7ab2ae/docketentrydocuments/e5b1ae2c-d317-4a98-8c2e-
79231698b18d.
26
Florida Funding Legal Aid, Financial Stewardship, https://fundingfla.org/about-ffla/ffla-finances/ (last visited March 10,
2025). BILL: CS/SB 498 Page 8
Participating Banking Institutions and IOTA Program Accounts
The number of state banking institutions that participate in the IOTA program has not changed
significantly since the interest formula was amended in May 2023.
27
March 2023 154
December 2023 162
December 2024 170
The number of trust accounts in the FFLA system as of January 2025 is 33,823.
28
Receipts and Disbursements by Funding Florida Legal Aid
Funding Florida Legal Aid received $279,656,155 in IOTA collections for the fiscal year that
ended June 30, 2024. The Court granted FFLA’s request to distribute $94,832,278 to qualified
organizations and place the remaining $142,875,455 in reserve for the benefit of present and
future organizations. According to the Court’s administrative order, this represents a 145 percent
increase over the previous year’s distribution.
29
Trust Account Programs in Other States
According to the American Bar Association (ABA), interest paid on trust account programs,
sometimes called IOLTA, or Interest on Lawyers’ Trust Accounts, are found in all 50 states,
Washington, D.C., Puerto Rico, and the U.S. Virgin Islands. The ABA estimates that, since
1981, these programs have generated over $4 billion to fund legal services for people living in
poverty, often through legal aid and pro bono programs.
30
Chief Financial Officer
The State Constitution provides that the Chief Financial Officer (CFO) serves as the chief fiscal
officer of the state. He or she is a member of the cabinet and is responsible for settling and
approving accounts against the state and keeping all state funds and securities.
31
Additionally, the CFO is required by statute to set the rate of interest that will be payable on
judgments or decrees for the calendar quarter beginning January 1 each year. He or she must
adjust the rate quarterly on April 1, July 1, and October 1, by averaging the discount rate of the
Federal Reserve Bank of New York for the preceding 12 months, then adding 400 basis points to
27
Email from Amanda Fraser, Governmental Consultant on behalf of Funding Florida Legal Aid, SB 498 Fiscal Analysis
from FFLA (March 5, 2025) (on file with the Senate Committee on Judiciary).
28
Email from Amanda Fraser, Governmental Consultant on behalf of Funding Florida Legal Aid (March 5, 2025) (on file
with the Senate Committee on Judiciary).
29
In Re: FFLA-FY 2023-24 IOTA Collections, Request for Approval of Additional Reserve Amount, No. AOSC24-70, (Oct.
4, 2024) https://supremecourt.flcourts.gov/content/download/2441648/file/AOSC24-70.pdf.
30
American Bar Association, Interest on Lawyers’ Trust Accounts, Overview, The Impact of IOLTA,
https://www.americanbar.org/groups/interest_lawyers_trust_accounts/overview/.
31
FLA. CONST. art. IV, s. 4(c). BILL: CS/SB 498 Page 9
the averaged federal discount rate.
32
As of January 1, 2025, the annual interest rate is
9.38 percent.
33
III. Effect of Proposed Changes:
The bill provides two interest rate alternatives for financial institutions to select between when
paying interest or dividends on a lawyer or law firm trust account. The interest or dividends will
be remitted to an entity established by the Florida Supreme Court that facilitates free legal
services to low-income people or a program that is consistent with other court-authorized
purposes.
If a financial institution holds a lawyer’s or law firm’s trust account, it must quarterly select
which of the two options it will pursue.
Alternative One – Measured with Deposit Rate Interest
The first interest-rate option requires the financial institution to pay the highest interest rate or
dividend that is generally available to its comparable business or consumer accounts or
nonmaturing deposit accounts if the trust account meets or exceeds the same minimum balance
or other account requirements. Under this option, the institution must submit a rate validation
sheet and affidavit to the Chief Financial Officer by the tenth day of each quarter attesting that it
will pay at least the same interest on the trust accounts that it pays on comparable business or
consumer accounts or nonmaturing deposit accounts. The affidavit must attest that the rate
information submitted on the rate validation sheet is true and factual. The Chief Financial Officer
must verify that the rate validation sheet and affidavit have been received by the Department of
Financial Services.
Alternative Two – Measured with Federal Funds Target Rate or a Set Rate
The second interest rate option must be set at 25 percent of the federal funds target rate
determined by the Federal Open Market Committee of the Federal Reserve System or 0.25
percent, whichever is higher, net of fees. The “federal funds target rate” is the interest rate that
commercial banks charge one another for short-term loans or the interest rate that banks use to
borrow or lend their excess reserves to one another overnight to meet the reserve balance
requirements.
34
As of January 29, 2025, the Federal Open Market Committee did not change the
federal funds target rate and it remains at 4.25 percent to 4.50 percent.
35
If an institution selects
this rate alternative, it is not required to submit a rate validation sheet to the CFO.
32
Section 55.03(1), F.S.
33
My Florida CFO, Current Judgment Interest Rates, https://myfloridacfo.com/division/aa/audits-reports/judgment-interest-
rates (last visited March 4, 2025).
34
Investopedia, Federal Funds Rate: What It Is, How It’s Determined, and Why It’s Important (Jan. 27, 2025)
https://www.investopedia.com/terms/f/federalfundsrate.asp.
35
Board of Governors of the Federal Reserve System, Federal Reserve Issues FOMC Statement (Jan. 29, 2025)
https://www.federalreserve.gov/newsevents/pressreleases/monetary20250129a.htm. BILL: CS/SB 498 Page 10
Under this option, the Chief Financial Officer must determine the interest rate on the first day of
December, March, June, and September. That rate will take effect on the first day of the
following January, April, July, and October, respectively.
Within 3 days after determining the interest rate under this option, the Chief Financial Officer
must inform the entity established by the Florida Supreme Court as to what the interest rate will
be for the upcoming quarter.
These rate alternatives do not apply to interest rates that have been established by written
contracts or obligations unrelated to the trust accounts described in this bill.
The bill takes effect upon becoming law.
IV. Constitutional Issues:
A. Municipality/County Mandates Restrictions:
None.
B. Public Records/Open Meetings Issues:
None.
C. Trust Funds Restrictions:
None.
D. State Tax or Fee Increases:
None.
E. Other Constitutional Issues:
Separation of Powers
The State Constitution divides the powers of state government into three branches: the
legislative, executive, and judicial branches. The Constitution prohibits a person in one
branch from exercising any powers that belong to the other two branches of government
unless it is expressly provided.
36
The Florida Supreme Court under s. 15 of Article V of the State Constitution, has the
“exclusive jurisdiction to regulate the admission of persons to the practice of law and the
discipline of persons admitted.” The Supreme Court exercises this responsibility through
The Florida Bar and its rules. If the bill is determined to be a regulation of attorneys or
the practice of law, it may be declared unconstitutional.
36
FLA. CONST. art. II, s. 3. BILL: CS/SB 498 Page 11
The Legislature, however, has the authority to regulate financial institutions. If the bill is
determined to be a regulation of financial institutions, The Florida Bar will likely be
required to revise its rules governing the obligations of attorneys to establish IOTA
accounts or the eligibility of financial institutions to participate in the IOTA program.
V. Fiscal Impact Statement:
A. Tax/Fee Issues:
None.
B. Private Sector Impact:
The new interest rates established in this bill will most likely be lower than the interest
rates currently mandated by the Bar rules. As such, banking institutions may see greater
profits under this bill, be able to pay higher interest rates to other customers, or charge
lower fees for services. Moreover, additional financial institutions may be able to afford
to participate in the interest programs in this bill, thereby giving lawyers more choices for
financial institutions. In contrast, the Bar foundation will likely see a reduction in the
interest revenue it receives to fund its legal aid programs.
C. Government Sector Impact:
None.
VI. Technical Deficiencies:
None.
VII. Related Issues:
None.
VIII. Statutes Affected:
This bill creates section 655.97 of the Florida Statutes.
IX. Additional Information:
A. Committee Substitute – Statement of Substantial Changes:
(Summarizing differences between the Committee Substitute and the prior version of the bill.)
CS by Judiciary on March 12, 2025:
The committee substitute differs from the underlying bill by:
• Removing references to Interest on Trust Account programs and Funding Florida
Legal Aid. BILL: CS/SB 498 Page 12
• Requiring the institutions that choose the first interest rate alternative program
submit an affidavit to the Chief Financial Officer in addition to the rate validation
sheet.
• Clarifying that the Chief Financial Officer sets the interest rate only on the second
interest rate alternative, not both interest rate alternatives.
• Clarifying that the bill is a regulation of financial institutions and is not a regulation
of The Florida Bar.
B. Amendments:
None.
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.