skip to main content

Senate to Continue Bankruptcy Reform Debate

The Senate conducted several days of debate on bankruptcy reform legislation (S. 420) after taking up the bill on March 5. Consideration is expected to resume during the week of March 12. Senate Majority Leader Trent Lott (R-MS) has indicated he may file a cloture motion to bring the measure to a final vote by March 15.

A bankruptcy reform bill (H.R. 333) received House approval on March 1 (see The Source, 3/2/01, p. 1). Although S. 420 and H.R. 333 both were drafted to reflect a conference report (H.R. 2415) approved last year by both chambers and pocket-vetoed by President Clinton, the Senate is debating several amendments that the House did not consider.

On March 8, the Senate tabled, 55-41, an amendment by Sen. John Kerry (D-MA) to remove from S. 420 all provisions relating to small business bankruptcies. The Senate also tabled, 50-49, an amendment by Sen. Richard Durbin (D-IL) designed to discourage lending practices targeting bankruptcy filers and other financially vulnerable individuals.

On March 8, the Senate approved, by voice vote, an amendment by Sen. Jeff Bingaman (D-NM), which is unrelated to bankruptcy reform. The amendment would authorize $3.4 billion in federal funds to help low-income individuals to pay heating and cooling bills. The current authorization for the energy assistance program is $2 billion.

When the Senate resumes its debate, votes are expected on several pending amendments, including a Republican amendment to create a “lock box” for the Social Security and Medicare trust funds. A Democratic “lock box” amendment also will be considered. In addition, Sen. Charles Schumer (D-NY) is expected to offer another amendment on predatory lending practices, and Sen. Dianne Feinstein (D-CA) is expected to offer an amendment to place a cap on a minor’s allowable credit card charges.

Further Differences Between S. 420 and H.R. 333
Before reporting the bill for floor consideration, the Senate Judiciary Committee backed several changes not contained in the House bill. For instance, the committee approved a compromise amendment to bar those found guilty of threats, violence, harassment or property damage aimed at “anyone who provides or obtains legal services” from filing for bankruptcy to discharge any fines resulting from those convictions.

Originally, Sen. Schumer sought to create the restriction for those convicted under the Freedom of Access to Clinic Entrances (FACE) Act (P.L. 103-159). However, following negotiations with Committee Chair Orrin Hatch (R-UT), the amendment’s language was broadened. The House bill does not contain a related provision.

By unanimous consent, the Senate committee also approved an amendment by Sen. Patrick Leahy (D-VT) to allow bankruptcy filers to include as reasonable and necessary expenses any funds spent on chronically ill or disabled children and grandchildren who are not their own dependents, as well as an amendment by Sen. Russ Feingold (D-WI) to forestall eviction for single mothers who file for bankruptcy.

The Spring 2023 internship applications are now open!Apply Now!
+