Facing budget cuts of more than $2 million, Legal Aid of North Carolina plans to eliminate about 30 positions and close its offices in Smithfield, Boone and Henderson by the end of September.

Those three offices have served about 2,000 households a year in Johnston, Harnett, Sampson, Alleghany, Ashe, Avery, Mitchell, Watauga, Wilkes, Vance and Yancey counties.

The nonprofit looked at furloughs and salary cuts, but the reduction in funding was too great, said George Hausen, Legal Aid of North Carolina's executive director.

Legal Aid's total budget had been about $20 million a year before the cuts.

By closing rural offices, Legal Aid hopes to maximize the number of poor people it serves at its current funding level.

"We serve poor people, and in the rural areas we have to travel a much greater distance to serve fewer people," Hausen said. "In order to keep the numbers high and serve as many poor people as we possibly could, we decided that we needed to circle the wagons in the big, urban offices."

Legal Aid of North Carolina has about 150 attorneys on staff who assist more than 40,000 low-income and moderate-income households with various legal matters each year. In recent years, the organization has been heavily involved in providing mortgage assistance to people facing foreclosure.

Those programs have been spared from cuts, Hausen said.

Legal Aid gets its funding from a range of sources, but its biggest sources are the state and federal governments, which have been cutting spending in a range ofareas.

Some of Legal Aid's funding is also tied to commercial real estate transactions, which are down significantly in recent years.

Need for services rises

The cuts come at a time when there is increased demand for Legal Aid's services as a result of the economic downturn.

"Even under the best funding that we had, we're still turning away over half theclients who apply to us with good cases," Hausen said. "We have a burgeoning poverty population here in North Carolina, and we're cutting these services at a very critical time."

Legal Aid of North Carolina faces the prospect of further cuts later this year. A proposal in the U.S. House of Representatives would cut the nonprofit organization's funding by an additional 26 percent, Hausen said.

The three offices slated to be closed have already stopped accepting new cases.

Clients in those areas are advised to travel to another one of Legal Aid's offices, find a local attorney or call Legal Aid's toll-free help line at 866-219-5262.

david.bracken@newsobserver.com or 919-829-4548