May 4, 1999 (1:00 p.m.)
SUMMARY OF AMENDMENTS SUBMITTED FOR H.R. 833, BANKRUPTCY REFORM ACT OF 1999
(in alphabetical order)
Barrett (WI) #10 Caps liability for the unauthorized use of a debit card at $50, the same level as credit cards.
Barrett (WI) #11 Provides that if a credit card company rejects an application for credit which is submitted in response to their own "pre-approved" solicitation, they may not report that rejection to credit bureaus or otherwise sell or distribute that information.
Bentsen #15 Strikes all provisions preempting state homestead laws.
Bentsen #16 Changes the effective date of the national homestead exemption so the state legislatures can enact legislation that would opt out of this new national standard.
Bentsen #17 Preserves a state’s ability to enact legislation to opt out of the new national homestead standard prior to the effective date of this legislation.
Conyers #19 Grants debtors in possession of consumer goods under a rent-to-own contract, and the lessor or bailor, as having the same rights and obligations with respect to the consumer goods as would have been accorded if the rent-to-own contract had been a purchase contract.
Conyers #23 Waives the provision of chapter 11 relating to small business debtors or to single asset real estate in cases where the application of those provisions could result in the loss of 5 or more jobs.
Conyers #24 Excludes from the bill’s definition of current monthly income any benefits received under the Social Security Act, in addition to excluding payment to victims of war crimes and crimes against humanity (as the bill already does).
Delahunt/Kanjorski/Houghton/Rothman/Barrett #27 Strikes paragraph (3) of section 147 of the bill, which permits States to "opt out" of the provision in section 147 that establishes a $250,000 Federal cap on the value of real or personal property that a debtor (other than a family farmer) may exempt in bankruptcy under the "homestead exemption."
Delahunt/LaFalce/Watt/Roybal-Allard #28 Adds a new subsection 154 to the bill disallowing claims in bankruptcy for consumer credit card debts if, at the time of the solicitation to open the account, the debtor was not informed in writing in a clear and conspicuous manner of 9 specific factors.
Doggett/Watt #29 Provides residents of continuing care retirement communities with the status of "priority unsecured creditor" so that they may increase their chances of getting some or all of their initial deposit back from a bankrupt continuing care retirement community.
Dooley #35 Late. Requires the Federal Trade Commission to set standards to be used by the United States Trustees in approving credit counseling agencies, programs described in section 109(h) and instructional courses concerning personal financial management.
Gekas #13 Manager’s Amendment. The Amendment (1) makes various technical changes; (2) makes a clarifying revision to the type of expenses that a debtor may claim pursuant to the IRS Other Necessary Expenses categories (the revision specifies that the debtor must claim actual monthly expenses for the specified categories); (3) revises certain provisions so that they conform with the Bankruptcy Code’s other provisions pertaining to an award of attorneys’ fees; (4) clarifies that the chapter 7 trustee must file a statement as to whether or not a case should be presumed to be an abuse in every case administered by such trustee; (5) revises chapter 13's requirements for confirmation to require the court to find that the debtor filed the chapter 13 case in good faith; (6) revises the title of section 134 of the bill; (7) deletes Section 215 (claims relating to insurance deposits in cases ancillary to foreign proceedings) as this provision is included in title XI of the bill, as revised by this Amendment; (8) adds a new provision to describe certain procedural matters pertaining to appeals, as amended by the bill; (9) adds provisions with respect to the treatment of certain funds subject to state insurance law or regulation for the benefit of claim holders in the United States; (10) repeals sections of the Bankruptcy Code that are no longer necessary; and (11) amends a statutory cross-reference so that it better comports with the drafters’ intent, which is to include in the definition of a "financial participant" certain securities contracts, forward contracts, repurchase agreements and swap agreements in addition to certain commodity contracts.
Graham #14 The bankruptcy code prohibits the discharge of federally made, guaranteed or insured education loans or education loans made by non-profit institutions. This amendment would extend the prohibition from discharge to all qualified education loans. Includes exceptions for undue hardships.
Hyde/Conyers #12 Deletes the reported bill’s application of modified IRS expense allowances for determining permissible projected living expenses of debtors and their families during the life of chapter 13 plans. In its place, the amendment adopts a standard that allows only "reasonably necessary" expenses and directs the Executive office of United States Trustees to issue guidelines that will assist in making assessments of whether expenses qualify. The amendment does not affect other provisions of section 102 that are designed to limit the availability of an immediate fresh start in chapter 7, channel significant numbers of chapter 7 debtors into five-year chapter 13 repayment plans, and generate greater recoveries from creditors.
Jackson-Lee #3 Disallows the discharge of debts by corporations under chapter 11 of the Bankruptcy Code, when the debt arises from a tobacco-related action that involves a claim of false pretenses, false representations, or fraud.
Jackson-Lee #4 Changes chapter 11 bankruptcy, disallowing the discharge of debts incurred by health care organizations when they arise from judgments based on false representation, false pretenses, or fraud.
Jackson-Lee #5 Excludes Social Security benefits from the determination of what constitutes an individual’s "current monthly income" for the purposes of this bill.
McCollum #31 Amendment in the nature of a substitute. Substitutes H.R. 833 as introduced for H.R. 833 as reported by the Committee on the Judiciary.
Moakley #34 Late. Provides bankruptcy protection for funds placed in qualified state tuition programs under the Internal Revenue Code for post-secondary education costs. WITHDRAWN
Moran (VA) #32 Late. Inserts a disclosure requiring that a debt relief agency providing bankruptcy assistance to an assisted person shall provide a written notice within three business days after the first date on which a debt relief agency first offers to provide any bankruptcy assistance services to an assisted person, advising assisted persons of their rights and responsibilities of disclosure. Requires that an attorney or bankruptcy petition preparer give an assisted person a written contract specifying what the attorney or preparer will do and the cost. Inserts a "debtor’s bill of rights." Requires that a debt relief agency disclose in any advertisement of bankruptcy assistance services or of the benefits of bankruptcy that the services or benefits are with respect to proceedings under this title of the Bankruptcy Code.
Moran (VA) #33 Late. Amend the Truth in lending Act (TILA) to require Credit Card Issuers to make disclosures regarding minimum monthly payments. It would also ensure that consumers have all the information they need in order to avoid the imposition of late fees and requires that Worldwide Web-Based Credit Card Solicitations are subject to the same "Schumer Box" disclosures as all other credit card solicitations.
Nadler #18 Permits debtors to choose between the Federal law or their state law for determining which property would be exempt in bankruptcy.
Nadler #20 Strikes section 130 of the bill which restructures chapter 13 to apply the standards in the means test to the calculation of repayment plans in chapter 13. The deleted section also gives unsecured non-priority creditors improved status vis-a-vis other creditors in chapter 13.
Nadler #21 Excludes from the bill’s definition of a debtor’s current monthly income, which is used to determine that debtor’s ability to repay debts, any payments received in satisfaction of a domestic support obligation. Strikes that provision of the bill that permits lessors of residential real property from evicting debtors-tenants who have not made payments as required by a lease agreement. Requires that domestic support payments to the parent, child, and government due during the plan be made, but that only arrears due to the custodial parent and child, not the government, must be provided for in the plan. Creates exceptions for the automatic stay actions necessary to assist or protect families and children. Makes alimony, maintenance, support or property reasonably traceable to such alimony, maintenance or support, as well as amounts payable as a result of a property settlement agreement with the debtor’s spouse, or of an interlocutory or final divorce decree – but only to the extent reasonably necessary for the support of the debtor or a dependent of the debtor – exempt from property in bankruptcy. Requires that funds received by a creditor whose debt has been made nondischargeable under the newly added exceptions to discharge in the bill, must hold it in trust for five years, make every effort to pay it to individuals holding debts in the nature of support obligations (but not governments). They must make these payments to any such individual whose identity is reasonably ascertainable.
Nadler #22 Strikes that provision of the bill that prevents debtors who bring lawsuits against creditors for violations of reaffirmation agreements or of discharges of debts from bringing those lawsuits as class actions.
Nadler #25 Makes nondischargeable in bankruptcy any debts that arose out of (1) a violation of Federal, state, or local law that protects access to health care facilities or reproductive health care facilities, (2) harassment or intimidation of any person attempting to enter or use a health care facility or reproductive health care facility, or (3) damage to or destruction of a health care facility or reproductive health care facility, or (4) an actual or attempted violation of a court order or injunction that protects access to a health care facility or reproductive health care facility.
Nadler #26 Would disallow a claim for a debt under 11 USC 502(b) if it is based on the extension of credit to an individual who the lender knew or should have known was already over extended (i.e. the extension of credit would cause the debtor’s aggregate unsecured debts to exceed 40% of the debtor’s annual gross income) or if the claim was based on a secured debt if the creditor has violated section 129(h) of the Truth in Lending Act.
Nadler #37 Late. Substitute. Provides a realistic means test which takes into account the debtor’s actual income and expenses. Does not omit expenses a debtor would have to pay in a chapter 13 plan from the test used to determine whether the debtor must file for chapter 13. Does not rely on IRS guidelines to determine how much a debtor should live on. Allows adequate judicial discretion to determine whether the debtor appropriately belongs in chapter 7. Avoids using a debtor’s ability to repay a specified percentage of unsecured non-priority debts which is easy for debtors to manipulate. Holds both debtor and creditor attorneys to strict application of Rule 9011’s penalties for misconduct or bringing a frivolous case. Contains a safe harbor for families below the median national income. Provides a balance by requiring credit card lenders to behave responsibly and to provide borrowers with the information they need to avoid bankruptcy. Prevents some of the more highly publicized cases in which creditors illegally enforced debts after bankruptcy through "reaffirmation agreements." Deletes a section which would have denied victims in these cases a legal remedy by prohibiting class action suits. Eliminates new grounds for making credit card debts non-dischargeable, but leaves intact current law which makes prebankruptcy debt run-up and fraudulently incurred debt non-dischargeable. Eliminates a provision which would have allowed landlords to evict debtors without obtaining the permission of the bankruptcy court. Removes a provision which allows secured creditors to treat the unsecured part of some loans as secured debt. Modifies the child support portions of the bill to take away the special new rights over families that state and local governments would have obtained in a bankruptcy case. Places families first.
Scott #2 Exempts Veterans benefits from the calculations of monthly income for the purpose of determining income available to creditors.
Thompson (MS) #30 Protects monetary awards given to individuals in cases where the award is made on a finding of discrimination based on race, religion, gender and national origin.
Watt #6 Replaces the provisions of H.R. 833 which require that all bankruptcy filers file their tax returns with the court and instead require that a debtor file tax returns with the court at the request of any party in interest.
Watt #7 Requires that credit card billing statements contain disclosures which advise consumers of: (1) the number of payments it would take the consumer to pay of the current balance if the consumer only pays the minimum payment each month and (2) the total dollar amount which the consumer would pay if the consumer only pays the minimum payment each month.
Watt #8 Allows a bankruptcy filer to object to a creditor’s claim in bankruptcy if the creditor had not made the disclosures to the debtor described in Watt #7.
Watt #9 Clarifies that the burden of proving that a filing is an abuse of the bankruptcy code is on the moving party by a preponderance of the evidence. Deletes the provisions of the bill which allow a debtor to rebut presumed abuse by demonstrating "extraordinary circumstances."
Whitfield #36 Late. Establishes a mechanism whereby bankruptcy trustees may receive compensation when they transfer cases from chapter 7 to chapter 13. Under this provision, the level of compensation would be determined by the bankruptcy judge.
Velazquez #1 To allow the expansion of the credit committee membership under chapter 11 bankruptcies to include a small business when it is determined that the small business’ claims are disproportionally large to its gross revenues. And to ensure better access to information for those small businesses not included in the committee by allowing the committee to be open for comment and subject to additional reports or disclosures.
* Summaries derived from information submitted by the amendment sponsors.