[Congressional Record Volume 144, Number 141 (Friday, October 9, 1998)]
[House]
[Pages H10224-H10240]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




     CONFERENCE REPORT ON H.R. 3150, BANKRUPTCY REFORM ACT of 1998

  Mr. LINDER. Madam Speaker, by direction of the Committee on Rules, I 
call up House Resolution 586 and ask for its immediate consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 586

       Resolved, That upon adoption of this resolution it shall be 
     in order to consider the conference report to accompany the 
     bill (H.R. 3150) to amend title 11 of the United States Code, 
     and for other purposes. All points of order against the 
     conference report and against its consideration are waived. 
     The conference report shall be considered as read.

  Mr. LINDER. Madam Speaker, for purposes of debate only, I yield the 
customary 30 minutes to the gentlewoman from New York (Ms. Slaughter), 
pending which I yield myself such time as I may consume. During 
consideration of this resolution, all time yielded is for the purpose 
of debate only.
  Madam Speaker, House Resolution 586 is a typical rule for conference 
reports and will permit House consideration of H.R. 3150, the 
Bankruptcy Reform Act of 1998, a bill that is designed to improve 
bankruptcy practices and restore personal responsibility and integrity 
to the bankruptcy process.
  H. Res. 56 waives all points of order against the conference report 
and against its consideration. The resolution also provides that the 
conference report will be considered as read.
  The rules of the House provide for 1 hour of general debate equally 
divided between the chairman and ranking minority member of the 
Committee on the Judiciary. In addition, House rules provide for one 
motion to recommit with or without instructions, as is the right of the 
minority.
  Madam Speaker, the statistics of U.S. bankruptcy filings are 
frightening. Bankruptcies have increased more than 400 percent since 
1980, and we expect over 1.4 million bankruptcies in 1998. In the past, 
it was possible to blame many bankruptcies on a recession or a poor 
economic situation. Today, however, we face record numbers of 
bankruptcy filings at a time of economic growth and low unemployment.
  If we take these factors into account, we can realistically come to 
only one conclusion, bankruptcy of convenience has provided a loophole 
for those who are financially able to pay their debts, but simply have 
found a way to avoid personal responsibility and escape their financial 
responsibilities.
  Since the beginning of the 104th Congress in January of 1995, we have 
worked to advance the values of personal responsibility. In the welfare 
bill, we thought that helping the poor escape the welfare trap, 
restoring the dignity of work, and reviving the individual 
responsibility would help people rise from generation after generation 
of despair. We were, of course, attacked as heartless and cruel.
  Today we know that people are relishing personal responsibility and 
are moving from welfare to work in record numbers. In fact, in early 
1996, simply the prospect of the passage of a welfare reform bill 
resulted in people moving from welfare to work.
  This bankruptcy bill is the Congress' next step in cultivating 
personal responsibility on accountability. I expect we will hear more 
hollow charges that we are being heartless and cruel. Nonetheless, the 
abusers of bankruptcy laws need to receive a message that Federal 
bankruptcy laws are not a haven of personal fiscal irresponsibility.
  If a debtor has the ability to pay the debts that have been 
accumulated, then they must be held accountable. We believe strongly 
that individual responsibility is a fundamental norm that Americans 
should accept.
  For the average American who believes that these bankruptcies of 
convenience do not affect them, we should note that the abusers of the 
bankruptcy laws are punishing responsible consumers through increased 
prices and higher credit card fees.
  We have to ask ourselves whether the American laborer who works 9:00 
to 5:00, or longer, and pays his or her bills on time should have to 
pay the penalty for those who abuse our current bankruptcy laws. The 
answer is no.
  We know that many people reach the point where they cannot dig 
themselves out of the financial hole they are in. We know layoffs can 
hit families at any time. We know that an unexpected medical emergency 
can undermine the best laid plans. Under this bill, effective and 
compassionate bankruptcy relief will continue to be available for 
Americans who need it.
  What we cannot condone, however, are those who file for bankruptcy 
relief under Chapter 7 and have the capacity to pay at least some of 
their debts. In order to ensure that those who can pay actually do pay, 
this legislation set in motion a needs-based mechanism.
  If the debtor has the ability to pay, the case would be dismissed by 
the bankruptcy court or guided toward the more appropriate Chapter 13 
where they can repay all or some of the debt.
  The gentleman from Pennsylvania (Mr. Gekas), the bill's author, 
informed us in the Committee on Rules last evening that the conference 
report adopts the Senate's provisions for a post bankruptcy petition 
judicial review and includes the House standard for determining the 
debtor's ability to repay debts.
  It is important to note that this bill is not simply about stopping 
the abuses in the system. It is also about protecting consumers and 
providing help for those who have found themselves in financial 
straits.
  H.R. 3150 guarantees consumer credit counseling and personal 
financial management education before being discharged from bankruptcy. 
It cracks down on misleading credit advertisements and contains 
consumer disclosure requirements.
  H.R. 3150 also recognizes that American farmers face unique 
challenges, and the conference report ensures that bankruptcy laws 
protect farmers from the cyclical risks encountered in the agriculture 
sector.
  I am also pleased that H.R. 3150 ensures the priority treatment 
accorded to child support claims, and in fact improves current law by 
raising child support and alimony payments to first priority. These are 
important protections that are supported by the National Association of 
Attorneys General and by child support agencies across the Nation. This 
bill also gives priority to the payment of judgments against drunk 
drivers and drug users.
  Madam Speaker, in conclusion, I admit that I am disappointed that, in 
the face of a bankruptcy crisis that threatens to undermine our 
economy, I have heard that the President has vowed to veto this common 
sense legislation. Congress has done its legislative duty in crafting a 
bill that ensures the debtor's right to a fresh start and protects the 
system from flagrant abuses from those who can pay their bills.
  We have an opportunity to equalize the needs of the debtor and the 
rights of the creditor, and I hope the President will not follow 
through on his veto threat.
  Madam Speaker, I urge my colleagues to support this rule so we can 
pass this important legislation and send it to the President for his 
signature as soon as possible.
  Madam Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Madam Speaker, I thank the gentleman for Georgia (Mr. 
Linder) for yielding me the customary 30 minutes.
  Madam Speaker, I yield myself such time as I may consume.
  (Ms. SLAUGHTER asked and was given permission to revise and extend 
her remarks.)

[[Page H10225]]

  Ms. SLAUGHTER. Madam Speaker, I rise in strong opposition to this 
rule. I oppose the hasty process the rule embraces. I oppose the damage 
to America's children that the rule does not allow us to challenge. I 
oppose the fact that the minority party was shut out of the process.
  Last year, more than a million American families went through 
bankruptcy, leaving millions of creditors without full payment for 
their goods and services. Is the record number of bankruptcies a 
serious problem? Absolutely. Is this conference report a real answer to 
that problem? Absolutely not.
  This rule waives clause 2(d)(6) of rule XXVIII that requires the 
availability of conference reports 3 days before their consideration. 
The House rule allows Members time to read and study the report before 
they cast their votes. Since this conference report has been available 
to most Members for less than 24 hours, I have grave doubts that most 
Members have any real knowledge of what it includes.
  The rule also waives House rules that will ensure that the conferees 
stayed within the framework of the bills passed by each chamber, an 
obviously important rule. But under this rule, the conferees had carte 
blanche and rewrote a new bill. Unfortunately, they used the freedom to 
craft a creditor-slanted bill and gut consumer protections against 
predatory practices.
  Despite a more than 200-year-old tradition of carefully weighing 
creditors' rights against a new start for the debtor, this rewrite of 
the bankruptcy code has been rushed and partisan. The Committee on the 
Judiciary's markup was so rushed that germane amendments offered by 
committee members were not even considered. In June, the House 
considered the bill under the rule that allowed fewer than one-third of 
the amendments that Members wanted to offer.
  Now we learn that the conference committee, the minority, and some 
Members of the majority were left out of the process. In the one public 
meeting of the conference, no substantive discussion or proposals were 
even allowed.
  So today, after this closed process, what do we know about the 
provisions of the conference report, legislation that will affect the 
lives of millions of families filing for bankruptcy and millions of 
creditors, many of them small businesses needing relief? We know that 
this legislation does nothing to address a major cause of bankruptcy, 
the profligate lending of irresponsible creditors.
  Madam Speaker, I submit that every American gets three or four 
applications for credit cards a week regardless of their credit 
standing. But we did not address that.
  We know that the conference report ignores the votes of a majority of 
both the House and the Senate that credit card companies should not be 
able to charge extra fees to those customers who use their credit cards 
responsibly. Indeed, if we pay all of our credit card bill, they will 
drop us as a customer.
  We know the conference report does virtually nothing to address the 
problems of the enormous variations in State laws regarding the 
treatments of personal residences. We know that the conference report 
has not remedied a major fault to the House-passed bill; the 
devastating impact on the legislation will have on 125,000 children 
owed child support from a parent who declared bankruptcy.
  Just 4 years ago, I introduced the Spousal Equity in Bankruptcy 
Amendments. So, Madam Speaker, that provision was my own. I feel pretty 
seriously about that. But it gave priority to child and spousal support 
payments and bankruptcy proceedings. That legislation became law as 
part of the Bankruptcy Reform Act of 1994. Thanks to those amendments 
and other enforcement reforms, child support collections have increased 
by 68 percent since 1992. This conference report will reverse that 
progress.
  By making large amounts of unsecured consumer dealt non-dischargeable 
in bankruptcy, this legislation would place money owed on credit card 
at the same level as alimony and child support obligations. Under this 
bill, after a debtor goes through bankruptcy proceedings, he or she 
will still have credit card and other types of consumer debt left to 
pay. Those debts will compete with child support and alimony for the 
limited resources of the post bankruptcy debtor.
  While proponents of this legislation claim that they have repaired 
the damage the bill does to child support and alimony, those repairs 
are only cosmetic.

                              {time}  0930

  They ignore the reality that when aggressive credit card collection 
agencies are calling, it will be easier for the debtor to pay them 
rather than the former spouse or the powerless child.
  For these and other reasons, the legislation continues to be opposed 
by consumer groups. One of the original Senate sponsors has promised a 
filibuster in the Senate and the administration will veto the bill if 
it is sent to the President in its current form.
  While I support efforts to truly reform our bankruptcy laws, this 
conference report is severely lacking, and we can and should do better.
  Madam Speaker, I urge my colleagues to oppose this rule and this 
unfair bill.
  Mr. LINDER. Madam Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Madam Speaker, I yield 7 minutes to the gentleman from 
New York (Mr. Nadler).
  (Mr. NADLER asked and was given permission to revise and extend his 
remarks.)
  Mr. NADLER. Madam Speaker, I thank the gentlewoman for yielding me 
this time.
  Madam Speaker, this special interest legislation should not even be 
considered by the House today. It is being brought forward at the 
eleventh hour from a secret, closed-door conference for which the House 
minority was virtually excluded.
  This secret, rushed and closed conference report was written by and 
for the special interests, perhaps best symbolizing everything that has 
gone wrong in this 105th Congress. The majority has ignored the needs 
of the American people in favor of the special interests, acting with 
recklessness and haste. That is what has happened for the last 2 years, 
and perhaps it is fitting that the majority chooses to finish this 
Congress with this bill true to form.
  There was exactly one meeting of the staff of all of the conferees of 
the House and the Senate. There was only one pro forma meeting of the 
conferees. Members were not given the opportunity to deal or even to 
make any motions dealing with any of the substantive issues at that 
meeting. And then there was never another meeting of the conferees and 
there was never another meeting of the conferees' staff.
  The House minority was resolutely excluded from whatever meetings did 
occur. In the final stages of the conference, it was strictly a 
majority event.
  The extent to which this conference has failed even to pay lip 
service to including the minority in the discussions is staggering and 
reflects an unprecedented arrogance and contempt for the views of the 
minority and of the Americans whom we represent.
  This legislation has been written by and for the big banks, the 
credit card industry, and other special interest groups. Its sole 
purpose, everything else being window-dressing, is to take large 
amounts of money from middle income and low-income people in a time of 
distress of personal bankruptcy and give it to the big banks and the 
credit card companies. Everything else is window-dressing.
  All provisions which protected consumers from predatory practices 
have been either dropped or gutted. Any provisions which held wealthy 
debtors of big corporations accountable for their actions have been 
either dropped or gutted.
  For example, the conference report includes a provision which would 
make judgments from the drunken operation of a watercraft 
nondischargeable in bankruptcy. Legislation of this type has already 
passed the House and I was proud to support it.
  Curiously, however, an amendment accepted by the House Committee on 
the Judiciary on a voice vote which would hold tobacco companies 
accountable for the debt and injury they have caused with their product 
and for the death and injury they have caused by misleading the 
American people about the dangers of smoking, that was dropped early in 
the conference.

[[Page H10226]]

 Thanks to that change, the big tobacco companies, if sued 
successfully, will be able to evade responsibility for their 
wrongdoing, if that is proven in court, but they will still evade 
responsibility by filing for bankruptcy protection.
  Another provision which was gutted in conference was one which the 
majority in this House, including 100 members of the majority party and 
the distinguished Chairman of the Committee on the Judiciary, supported 
on a motion to instruct conferees. Section 405 of the Senate bill which 
would prohibit a credit card company from discriminating against the 
most responsible borrowers, those who pay their bills in full every 
month.
  Now, we have heard, and I am sure there will be more rhetoric from 
the Republican side of the aisle, talking about how people have to be 
responsible, how debtors have to be responsible, how they are escaping 
in bankruptcy, how we are going to curb the abuses of the dead-beat 
debtors. But here we are permitting the banks to punish debtors for 
being responsible. If one pays their bills on time, that is terrible. 
We are going to punish you by discriminatory fees or by cancelling your 
credit card. The conferees would allow credit card companies to cancel 
these cards in a discriminatory manner at the end of the term and 
entirely delete the prohibition against discriminatory fees for those 
who have the nerve to pay their bills in full and on time since the 
credit card companies do not get the interest fees, they only get the 
activity fees.
  This bill still threatens parents attempting to collect child 
support, and crime victims seeking compensation from their victimizers, 
favoring banks and big government in collection of limited assets. This 
problem has not been fixed, despite the careful placement of several 
transparent fig leaves.
  While the majority fiddles, out there American communities are 
suffering from inaction in those aspects of the bankruptcy legislative 
agenda which would offer real relief. Chapter 12, which protects family 
farmers in crisis, lapsed on September 30. Although we have been urging 
for more than a year that this noncontroversial legislation be moved 
through this House independently, that has not happened. Now we are in 
the middle of a farm crisis, there is no chapter 12 protection, the 
farm belt is in crisis, and still the Majority has not acted. America's 
family farmers are being held hostage to the agenda of the big banks 
and the special interests. If chapter 12 is going to be renewed, it 
will be done only in this bill to try to get the agenda of the big 
banks. And we know that the President has threatened, has promised us 
he will veto this bill, so chapter 12 is being made veto bait in the 
hope that maybe it could help save the profits of the big banks.
  Similarly, our bankruptcy courts have needed additional judges for 
years. We moved a freestanding bill in the House last year, but nothing 
has happened. Congress could well leave town with that job undone for 
yet another Congress, causing more delays in cases at great cost to all 
parties in these cases. We could enact the UNCITRAL Model Law on Cross 
Border Insolvencies on which there is general agreement and which might 
just come in handy now that there is a global economic crisis, but that 
has not happened. We could have taken these noncontroversial steps to 
modernize the code and stabilize the financial markets, but that entire 
agenda is being held hostage because we must serve the interests of the 
big banks.
  Madam Speaker, this is a flawed bill that will destroy families and 
small businesses and make it harder for small creditors, including 
custodial parents seeking child support payments from debtors, to 
collect what is their due. It still retains the unworkable, one-size-
fits-all means test which bankruptcy judges, trustees, practitioners, 
academics and the nation's leading experts have told us time and again 
will not work. It fails to balance the responsibilities of debtors with 
basic requirements that creditors conduct their businesses in an honest 
and fair manner. It also lets wealthy debtors avoid their 
responsibilities by preserving loopholes, like unlimited homestead 
exemptions, for the very rich.
  Now we are going to vote on this special interest legislation handed 
out in secret and behind closed doors. This rule even waives the 3-day 
layover rule, even though we only received a hard copy of this 300 page 
bill Wednesday night and the electronic version was not available to 
Members and the public until yesterday. The legislative language runs 
301 pages dealing with some of the most controversial and complex 
issues of bankruptcy law. I realize we are late in the session, but 
that is no reason to act with this kind of haste and ignorance. I urge 
my colleagues to vote ``no" on this rule and maybe we will redo this 
bill and get a less obnoxious product.
  Mr. LINDER. Madam Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Madam Speaker, I yield 7 minutes to the gentlewoman 
from Texas (Ms. Jackson-Lee).
  Ms. JACKSON-LEE of Texas. Madam Speaker, I thank the gentlewoman from 
New York for her work, and I thank very much the ranking member for his 
work.
  I had hoped that we would have had a better result today. I voted 
initially against this bankruptcy resolution or this bankruptcy 
legislation when it came to the floor. However, I had good faith and 
good hope that even as the bill was not as I would have wanted it as it 
left the House, that we would have an opportunity in a collaborative 
and working manner of good men and women working together for what is a 
positive idea of balancing the needs of creditors and debtors, that we 
would have the opportunity to put before this body a reasonable, a 
reasonable bankruptcy reform legislation.
  In our Committee on the Judiciary meetings and subcommittee, I worked 
extremely hard, and I really appreciate the leadership of the ranking 
member, the gentleman from New York (Mr. Nadler), for working equally 
hard and for his leadership on issues dealing with balancing the needs 
and the burdens of creditors and debtors. Unfortunately, our voices 
were not heard, our constituencies were not heard, and this legislation 
is simply bad.
  This legislation is not bankruptcy reform, it is bankruptcy 
recession. Webster's dictionary defines recession as ``the act of 
withdrawing and going back.'' That is what this conference report does. 
It takes several steps back.
  First of all, in order for there to be a conference report, a 
conference should first be convened. This conference committee meeting 
was a sham. After meeting for a couple of minutes, maybe an hour or so, 
listening to our respective opening statements, there was no discussion 
about how we could bring about compromise. I thought our constituents 
sent us to this body to deliberate, to collaborate, to compromise, to 
give exchange and interchange. None of that occurred in the conference 
committee. I was appalled as a second-year Member to find out that this 
is what represents or is represented to the American people as work.
  There was no consideration of any of our concerns, no considerations 
of 2 motions that I intended to offer, and I was gaveled down in the 
conference committee. What a sham and an outrage.
  As we met for opening statements, we did not attempt at that time to 
reconcile our opening or our concerns about the bill. The conferees 
were never afforded the opportunity to deal with the substantive 
issues. This again is not bankruptcy reform, it is bankruptcy 
recession.
  I was pleased that the homestead exemption capital, $100,000 that was 
in the Senate version of the bill, is not in the conference report. 
However, I was not pleased to learn that a residency requirement was 
added into the conference report that require people in my home State 
of Texas to live in Texas for at least 2 years or own a home for at 
least 2 years before getting a homestead exemption. This is contrary to 
our Texas State Constitution, and it would not serve our State well. 
Any suggestions that people rove into the State of Texas and buy big 
expensive homes just in order to avoid the process of listing them or 
having them counted in bankruptcy is an outrage on the citizens of 
Texas, and we should be left to our own ways under our own Constitution 
on this issue.
  The conference report does not contain certain provisions for the 
rights of families and children, as well as the right to a fresh start 
for honest debtors. Any bankruptcy legislation that is

[[Page H10227]]

enacted should ensure that the obligations to pay child support and to 
compensate victims of wrongdoing are protected, and that eliminates 
abuse of the bankruptcy system by both debtors and creditors, and does 
not tilt what is ultimately a fair and well run system to an unfair 
advantage of particular interest groups. I heard from so many mothers 
who receive child support and also heard from those who have to pay 
child support. These debts need to be protected.
  I truly believe that without these basic protections, the conference 
report would merit a presidential veto and that the veto would be 
sustained. I am very concerned with the House version passed with child 
support and alimony. I offered an amendment that would put child 
support and alimony not only as a priority, but would have them paid 
first before any secured creditors. One cannot put a mother seeking 
child support in competition with those credit card companies who are 
trying to get paid. It is an unequal, unequal fight.
  This conference report does not do that. It does not list or make 
sure that those who need to receive their child support do not have to 
fight the other nondechargeable debts like credit card debt. I oppose 
creating new nondechargeable debt that could pit post-bankruptcy credit 
card debt against child support, alimony, education loans and taxes. 
The conference report has not fixed that problem.
  This conference report has the language that child support and 
alimony would have first priority, but yet still, this debt must still 
compete with the nondechargeable debt of secured creditors. The fact 
that this provision is in the conference report is outrageous and still 
makes the bill nonviable. Again, this is not bankruptcy reform, this is 
bankruptcy recession.
  I had hoped that we could agree on a conference report that would 
avoid taking indiscriminate aim at debtors and fails to address some 
troubling practices of creditors. The only indisputable evidence in 
this debate is that Americans have significantly more debt than they 
have ever had before. The average bankruptcy filer last year had a 
debt-to-income ratio of 1.25 to 1, as opposed to .74 to 1, 74 percent 
of their income, a few short years ago.
  According to bankruptcy law professor Elizabeth Warren of the Harvard 
Law School, the debtors that enter bankruptcy are usually experiencing 
turbulent times. Sixty percent of bankruptcy filers have been 
unemployed within a 2-year span prior to their filing.

                              {time}  0945

  Twenty percent of filers have had to cope with an uninsurable medical 
expense. Over one out of three filers, both male and female, are 
recently divorced.
  The premise of this bankruptcy conference report is that bankrupt 
people are deadbeats, that they are trying to avoid the system, that 
they are going in and abusing the system. Madam Speaker, this is not 
true. If we had had a conference committee working relationship, we 
would have been able to present to this body one deeming or deserving 
of their consideration.
  I think the idea of forcing bankruptcy filers into Chapter 7 versus 
Chapter 11 is too harsh and too extreme. The damage of trying to 
accomplish this goal through a means test might be irreparable. The 
National Bankruptcy Review Commission rejected the means test formula. 
This is the main reason why there can be no fair bright line to divide 
the irresponsible and fraudulent from the needy and the disadvantaged.
  Again, this is not reform, this is bankruptcy recession. The means 
test is rigid and arbitrary for determining whether a debtor can use 
Chapter 7. In addition, it is very difficult for me to see why those 
small businesses who may want to be in a Chapter 11 are forced into a 
Chapter 7, all their goods taken.
  Madam Speaker, this is not a good conference committee report. It is 
not deserving of the House. It should be vetoed. We should vote it 
down.
  Ms. SLAUGHTER. Madam Speaker, I have no further requests for time, 
and I yield back the balance of my time.
  Mr. LINDER. Madam Speaker, I urge passage of the rule, I yield back 
the balance of my time, and I move the previous question on the 
resolution.
  The previous question was ordered.
  The resolution was agreed to.
  A motion to reconsider was laid on the table.
  Mr. GEKAS. Madam Speaker, pursuant to House Resolution 586, I call up 
the conference report the bill (H.R. 3150) to amend title 11 of the 
United States Code, and for other purposes.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore (Mrs. Emerson). Pursuant to House Resolution 
586, the conference report is considered as having been read.
  (For conference report and statement, see Proceedings of the House of 
October 7, 1998, at page H9954).
  The SPEAKER pro tempore. The gentleman from Pennsylvania (Mr. Gekas) 
and the gentleman from New York (Mr. Nadler) each will control 30 
minutes.
  The Chair recognizes the gentleman from Pennsylvania (Mr. Gekas).
  Mr. GEKAS. Madam Speaker, I yield myself such time as I may consume.
  Madam Speaker, this is an important time in the 3-year saga that has 
preceded the moment at hand. That is, for 3 years we have been 
attempting, in one way or another, to fine-tune the bankruptcy system, 
and, moreover, in the latter stages of that 3-year process, to directly 
confront the escalating number of filings that have brought our 
economic system to the edge of complete chaos in the bankruptcy system, 
over 1.5 million bankruptcies just in one year, 1997.
  That alone prompted action on the part of the various communities 
involved in the bankruptcy system, and particularly did it cause the 
Committee on the Judiciary to entertain hearings and to review the 
Bankruptcy Commission report, and to consult on a daily basis with our 
Senate colleagues and with everyone concerned in this vast problem.
  The final product that the House produced matched the Senate in many 
different ways, but in those ways in which there was room for 
negotiation and compromise, that, too, was accomplished.
  I want to give one example to the gentleman from New York (Mr. 
Nadler), if he will give me his attention. The House bill went out of 
its way, pursuant to the testimony we received at hearings, primarily 
out of the State of New York about the tax provisions that finally 
ended up in the House version.
  It was largely because of these special interests to which the 
gentleman refers, like the taxing authorities in New York, that we were 
able to put into place language that reflected their concerns over the 
years in a weak bankruptcy code that did not give them the opportunity 
to recoup monies from bankrupts.
  Here is another example, the same thing.
  Mr. NADLER. Madam Speaker, will the gentleman yield?
  Mr. GEKAS. I yield to the gentleman from New York.
  Mr. NADLER. Madam Speaker, I just want to observe that I was elected 
to represent 600,000 citizens or residents of the city of New York, not 
to represent the city government of New York, which is interested in 
squeezing money out of people it should not be able to squeeze money 
out of.
  Mr. GEKAS. Reclaiming my time, Madam Speaker, no one accused the 
gentleman of anything. I am pointing out how we compromised on this 
matter.
  The gentleman forgets, in his apology to his constituents, not his 
apology but his standing up for his constituents, that when the taxing 
authorities in New York or in any other State have a difficult time in 
recouping what is due the taxing authorities, every other one of the 
gentleman's constituents has to make up the difference in what is lost 
in tax revenue. That is the important point there.
  I am simply outlining that we in the House were able to adopt these 
tax provisions because of the hearings that we held, the testimony we 
received, and the concerns that were uttered across the Nation.
  Then, in the spirit of compromise, the Senate, which also had taken 
up that particular provision, even had stronger language which we were 
able to adopt in the compromise. That is the important feature of what 
I am discussing here today about how we compromised on a great number 
of issues.
  Especially did that occur in the means testing. We heard right from 
the

[[Page H10228]]

beginning that our means test entry formula was too rigid. This was the 
cry from the opposition, that it forced too many people to go from 
Chapter 7 to Chapter 13, meaning it was too much to take to force 
people who could pay some of their debt back over a period of 5 years, 
it was too much for them to take that they would have to do it over a 
period of 5 years, even though it only rose to a small percentage of 
that debt.
  So what did we do? We worked with the Senate and we came up with a 
compromise, which is now in this conference report, whereby the 707(b), 
that is, that portion of the Senate bill that dealt with abuse, being 
the vehicle for the final compromise in the conference report.
  This, I want to say to the Chair, was a bipartisan effort, 
notwithstanding the rhetoric that we are being pummeled with. The 
results in both the Senate and the House of those separate bills 
indicate that.
  I want the Record to show that in the House, the vote was 306 to 118. 
That is pretty bipartisan. On the Senate side it was 97 to 1, even a 
greater proportion of bipartisanship that approved their version of the 
bankruptcy reform.
  Madam Speaker, here we are in a conference report that includes some 
of the best ideas in a generation for bankruptcy, including a Bill of 
Rights for debtors, a whole panoply of avenues of betterment of the 
plight of the debtor who has to go into bankruptcy and to seek a fresh 
start.
  There is not one poor person or unemployed person in this country, 
who by reason of their plight are overburdened with their financial 
situation, who cannot seek and cannot gain a fresh start. We guarantee 
a fresh start to the poor person, to the person overwhelmed with debt. 
We are not even talking about them in the reforms and fine-tuning that 
we did.
  What we are addressing is the situation of those people over the 
median income of our Nation who have a steady income and assets beyond 
the poor person or the unemployed person who have an ability to repay.
  This conference report, this entire system that we have created here, 
would accommodate the repayment of some of that debt over a period of 
years. That is the strength of this report and that is the target of 
the report, not the person who requires and needs a fresh start. That 
will always be the backbone and the heart of bankruptcy. What we are 
trying to do is to make sure that that portion is not abused.
  In addition to the consumer rights we build into this, I want to say 
to the Chair that we also have absolute ironclad guarantees, both from 
the Senate version and our version and in the conference report, for 
child support on both ends of the spectrum.
  That is, we make sure that the person who owes child support will not 
be able to discharge that debt. That no matter what straits he finds 
himself in, he must pay that child support. Moreover, we even go as far 
as making sure that the arrearages that might have piled up are also 
protected for the purpose of the family that needs that support, and we 
prioritize child support in such a way that it cannot be misread in any 
way that the family is being destroyed, which is the rhetoric that we 
hear; but rather, we have extraordinary ironclad guarantees of the 
priority of support payments. That is in our bill.
  On the homestead exemption, to which reference has been made 
primarily by our colleagues from Texas and Florida, which have a unique 
situation, we believe that the conference report meets the needs, and 
we will be able to discuss that as the gentlemen seek time.
  When they are recognized, I would be glad to engage in colloquies 
with them so that we can firm up the record with respect to the 
homestead exemption, so we are satisfied that we work diligently to 
provide a solution, and, I might say to my colleagues from Texas, to 
ward off those kinds of provisions that would have harmed, I believe, 
the autonomy of the Texas positions on homestead exemption.
  There were many other points that were of contention, and as I think 
of them, I will regain some of my time. I will consult with my staff as 
we go along. In the meantime, I want to say one other thing. I think 
the gentleman from New York, and by the way, I want to personally thank 
the gentleman from New York for staying in the Chamber last night, as 
he dutifully did, to shepherd through the Potomac compact.
  We were misinformed somehow. We were here. The gentleman from 
Maryland, Mr. Bartlett, and I remained on the floor, expecting that the 
bill would come up, and then by some miscommunication we were advised 
that it would not come up last night and that it would come up today.
  The gentleman from New York (Mr. Nadler) stayed on the floor, and I 
commend him for that. I am grateful that he was able to help put the 
final touches on that important piece of legislation.
  By the way, upon the adoption of the conference report, and we also 
have advised the minority, I will bring up a concurrent resolution on 
unanimous consent that directs the Clerk to make a purely technical 
revision to the conference reports' effective date provision.
  Today marks a major epoch in the history of bankruptcy legislation 
reform. The Conference Committee Report on H.R. 3150, the Bankruptcy 
Reform Act of 1998, makes substantial and long-needed reforms to 
bankruptcy law and practice. The scope and extent of these reforms, it 
should be noted, have not been undertaken by Congress since the 
enactment of the Bankruptcy Code in 1978, twenty years ago.
  The Conference Report reflects the guiding principles of both the 
House and Senate's legislative reforms: to restore personal 
responsibility and integrity in the bankruptcy system and to ensure 
that it is fair for both debtors and creditors.
  We adhered to these principles for one simple reason: the 
overwhelming mandate that accompanied each bill. In the House, there 
was a thoroughly bipartisan vote of 306 to 118 for H.R. 3150. In the 
Senate, again, there was a resounding 97 to 1 vote in favor of S. 1301, 
the Senate counterpart to our bill. In recognition of these mandates, 
the Conference Report retains many of the best provisions from each 
bill and, when necessary, appropriate compromises.
  We must also not forget that this Conference Report marks the 
culmination of more than three years of careful analysis and review of 
our nation's current bankruptcy system. Both the House and the Senate 
held numerous hearings and heard from many witnesses, representing a 
broad cross-section of interests and constituencies in the bankruptcy 
community. Every major organization having an interest in bankruptcy 
reform participated in these hearings.
  With regard to consumer bankruptcy, the Conference Report contains 
comprehensive reform measures. Why do we need these reforms? The 
answers are not only easy, but obvious. Last year, bankruptcy filings 
topped 1.4 million and even exceeded the number of people who graduated 
college in that same year. Nevertheless, literally thousands of people 
who have the ability to repay their debts are simply filing for 
bankruptcy relief and walking away from those debts without paying 
their creditors a single penny under the current system.
  The Conference Report combines some of the best aspects of both the 
House and Senate approaches to ensure debtors who have the ability to 
repay their debts are steered into Chapter 13, a form of bankruptcy 
relief whereby debtors repay all or a portion of their debts. It 
accomplishes this objective by adopting the Senate's provisions for 
post bankruptcy petition judicial review and incorporates the House's 
standards for determining repayment capacity to provide greater 
guidance and predictability.
  The Conference Report offers a balanced approach to reform with 
regard to consumer debtors. It creates a debtor's ``bill of rights'' 
with regard to the services and notice that a consumer should receive 
from those that render assistance in connection with the filing of 
bankruptcy cases. Through misleading advertising and deceptive 
practices, ``Petition mills'' deceive consumers about the benefits and 
detriments of bankruptcy. The Conference Report responds to this 
problem by instituting mandatory disclosure and advertising 
requirements as well as enforcement mechanisms.
  Most importantly, the Conference bill contains a panoply of 
heightened protections especially with regard to the treatment of 
domestic support obligations. These claims are accorded the highest 
priority to these obligations. This ensures that they will be paid 
before all other unsecured creditors, including claims of attorneys and 
other professionals. It also requires a Chapter 13 debtor, as a 
condition of obtaining a discharge, to pay outstanding arrearages on 
these obligations.
  The Conference Report also incorporates provisions from both the 
House and Senate bills to stem abuse in the consumer bankruptcy system. 
These include provisions

[[Page H10229]]

broadening the category of debts that a consumer debtor must repay 
notwithstanding his or her bankruptcy filing. It addresses the problem 
of abusive use of credit on the eve of filing and protects secured 
creditors from having their claims rendered unsecured by Chapter 13 
debtors for purchases of personal property made within five years prior 
to bankruptcy.
  In addition, the Conference bill clarifies the grounds for dismissing 
Chapter 7 cases for abuse. While protecting a debtor's homestead 
exemption and preserving states' rights, the Conference bill prevents 
manipulation of the system by those who seek to take advantage of this 
provision to the detriment of their creditors.
  Besides consumer bankruptcy reform, the Conference Report creates a 
new bankruptcy chapter designed to deal with the special concerns 
presented by international insolvencies, a timely and very much needed 
reform. It contains sorely needed provisions requiring the collection 
of statistics about bankruptcy cases and the implementation of various 
studies.
  In sum, this Conference Report is a comprehensive restatement of 
bankruptcy law that will re-introduce personal responsibility and 
integrity into the bankruptcy system while protecting the right of 
debtors to a financial ``fresh start.''
  I commend my fellow Conferees and the dedicated staff members who 
have worked so tirelessly to perfect this legislation. And, I urge my 
fellow Colleagues to vote in support of this Conference Report.
  Upon its adoption, I will offer a concurrent resolution on unanimous 
consent that directs the clerk to make a purely technical revision to 
the Conference Report's effective date provision.
  Mr. Speaker, I reserve the balance of my time.
  Mr. NADLER. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, that the process of the conference report was not open 
we addressed during a debate in the Committee on Rules. I am not going 
to go back through that.
  Let me start by making several general observations about this bill. 
This bill deals with a phony crisis, concocted with a $40 million 
lobbying and propaganda campaign of the big banks and credit card 
companies. It does so by seeking in 30 or 40 different ways to take 
large sums of money, in toto, from middle-income and low-income 
American families in times of personal crisis, personally bankruptcy, 
to enrich the big banks and credit card companies. This bill has no 
other purpose, all the window dressing and fig leaves to the contrary 
notwithstanding.
  Mr. Speaker, we are told that the need for this bill is that the 
number of personal bankruptcy filings has increased greatly over the 
last 15 years, and that it has gone up to 1.4 million filings last 
year. We are told that the reason for this is that Americans are 
basically deadbeats. Americans are basically deadbeats. That is a 
slander on the American people.
  We are told that a couple of generations ago we had moral people in 
this country, and they would not go bankrupt and seek a discharge of 
their debts unless they were really in an extreme position, unless they 
had no other choice, and there was a moral stigma attached to 
bankruptcy.
  Now, in this era today, nobody cares about morality anymore. There is 
no more moral stigma. Therefore, people go bankrupt, they declare 
bankruptcy as a financial planning option, or at the first sign of 
difficulty, instead of in the last resort. They are deadbeats.
  Mr. Speaker, as I said, this is a slander on the American people. It 
is total nonsense. In fact, if we look at the statistics we see what 
nonsense it is. In 1983, 15 years ago, the average Chapter 7 filer 
seeking a discharge of debts in bankruptcy had debts equal to 74 
percent of his annual income.

                              {time}  1000

  Today, the average Chapter 7 filer has debts equal to 125 percent of 
his annual income. In other words, people are much more reluctant today 
to file for bankruptcy than they were 15 years ago. They do not file 
for bankruptcy when they have their debts equal to 74 or 75 percent of 
their income. They wait, they struggle, they work to resolve their 
financial situation until they get to 125 percent debt, 125 percent of 
their income, and only then do they file for bankruptcy. They are a lot 
more queasy about bankruptcy than they were 15 years ago. They are a 
lot more reluctant to enter into bankruptcy than they were 15 years 
ago, to the contrary of the arguments of the proponents of this bill.
  We are told those who file for bankruptcies, who can pay their debts 
but are not because they are given discharges, that this costs every 
American family $400; and if we pass this bill, Americans will get $400 
more money, or will save $400 a year in lower interest rates on their 
credit cards. This is self-evident nonsense.
  We all know what has happened since credit cards were deregulated, 
since interest rates were deregulated in the early 1980s. They shot up 
to an average of 17, 18, 19 percent, which in an era of 17 percent 
inflation in 1980 may have been okay; the banks had to charge at least 
the inflation rate. We were told when the inflation rate and the cost 
of money went down that the interest rates would come down. Well, the 
cost of money has come way down, mortgage interest rates have come 
down, bank loan rates have come down, the prime rate has come down, 
everything has come down, but not interest rates on credit cards. They 
are still averaging 17.7 percent.
  Yes, we can find some small-town banks that will give us much better 
interest rates, but 90 percent of the credit cards, 90-95 percent of 
the credit cards' credit comes from the big banks, which can do the 
marketing and the advertising on television, and those rates are way 
up. If this bill passes, they are not going to lower those rates. They 
will just have bigger profits.
  The fact is that the profit rates of banks, which vary between 1 and 
2 percent of assets, the profit rates of the credit card departments 
are between 4 and 5 percent of assets. In 1983, before credit card 
interest rates were deregulated, and before the ``bankruptcy crisis'' 
started, the profitability of the credit card departments was slightly 
higher than the profitability of the banks as a whole. Now, it is four 
times higher.
  In fact, if we want to know the cause of the ``bankruptcy crisis'', 
of the increase in filings, we do not have far to look. The increase in 
bankruptcy filings tracks directly year-to-year with the increase in 
the ratio of debt-to-income in society as a whole. In other words, 
people are getting more in debt. They are being lulled by the credit 
card companies to take more and more credit cards, get more in debt, 
more in over their heads, and the result is not a surprise.
  Mr. Speaker, let me outline just some of the problems with this bill, 
very briefly. We are told there is a means test. Before we can get a 
Chapter 7 bankruptcy, which now is allowed on request, unless it is 
abusive, we will have to pass this means test. A means test means that 
we should look at the ability of the borrower to repay his debts. What 
is his income; what are his real expenses.
  But we are not going to look at real expenses in this bill. We are 
going to let that wonderful agency the Internal Revenue Agency say what 
the average rent expense is in the northeast United States. Who cares? 
The question is what is his or her rent expenses. We are going to look 
at the average costs for everything else. It does not matter, the real 
cost is what are his or her expenses. If an individual has a major 
medical problem on an ongoing basis, it does not matter what the 
average family spends on medical expenses, it matters what that 
individual spends on medical expenses.
  Mr. Speaker, this bill expands the nondischargeability of credit card 
debts so that they will compete with child support obligations. It 
gives creditors powerful new leverage to coerce reaffirmation 
agreements, which will compete with child support after bankruptcy. It 
requires diversion of family income in chapter 13 to defend meritless 
claims of fraud. It adopts a restrictive definition of household goods 
so that more household goods will be repossessed, household goods of 
little value to the creditors but which are needed by debtors. It 
eviscerates all the Senate's consumer protection provisions. It adds 
new provisions eliminating punitive damages and class actions for 
intentional violations of the bankruptcy stay. It allows wealthy 
debtors to plan bankruptcy cases in advance so none of the bill's 
provisions will affect them.
  In other words, for the rich, they can still use bankruptcy 
abusively, but for the low-income and middle-income people, this bill 
says we are going to take a lot of their money, we are going to

[[Page H10230]]

evade their chance to get it, we are going to eliminate or restrict 
their chance to get a new start, which is the purpose of the bankruptcy 
laws, because the big banks must be served.
  Mr. Speaker, this bill is one of the worst bills I have ever seen. It 
serves only the big banks against the interests of middle- and low-
income Americans. The President, thankfully, has pledged to veto the 
bill, and so, ultimately, this bill will do no harm except to our 
reputations.
  Mr. Speaker, I reserve the balance of my time.
  Mr. GEKAS. Mr. Speaker, I yield myself such time as I may consume to 
repeat that the vote on the House was 300-something to 118, an 
overwhelming bipartisan approval of the language of the bill.
  Mr. Speaker, I yield 4 minutes to the gentleman from Tennessee (Mr. 
Bryant), a member of our committee.
  (Mr. BRYANT asked and was given permission to revise and extend his 
remarks.)
  Mr. BRYANT. Mr. Speaker, I do rise in strong support of this 
conference report on the Bankruptcy Reform Act of 1998. I come to this 
floor as someone who has practiced in the bankruptcy court for a number 
of years and I realize that bankruptcy is good for America. We have 
always been a country that is willing to give people a second chance, 
and certainly that is what the bankruptcy code is about, to help people 
who are financially distressed in a genuine situation to have a second 
chance.
  However, over the years, this process, like so many other processes 
and so many other laws, gets out of focus, perhaps gets a little out of 
balance, and at this time I think the bankruptcy reform that we have 
worked so hard on in this Congress is very appropriate to try to bring 
the process back into balance; allow the courthouse doors to remain 
open to those people who genuinely and sincerely need bankruptcy 
relief, but yet give that balance to the creditors out there who, along 
with the American citizens, bear the cost of bankruptcy abuse.
  There are many reasons for this, and I will not begin to get into a 
great discussion about those, but it seems to me what will be heard 
today on the floor and what has already been said is probably, in large 
part, true. There is enough blame to go around for everyone in terms of 
why there are so many bankruptcies. But what I wanted to see done in 
this bill was to find this proper balance, to work it through the 
process of the House bill, the Senate bill, which were very different, 
and then go into conference and work together and come out with a bill 
that was more uniform and one that was more consistent, that could be 
applied across this country, and perhaps taking out some of the 
discretion, some of the discretion, not all of the discretion, that 
exists in the current bankruptcy code.
  Mr. Speaker, after countless hours of debate and disagreements in 
this conference between the Senators and the Members of the House, we 
conferees have emerged from our negotiation with a good and a serious 
compromise, a bill which, on all sides, has found a workable agreement 
in helping solve the endless complications associated with our 
bankruptcy system.
  What this compromise bill creates is a needs-based bankruptcy system 
which will determine the type of relief. Not that an individual cannot 
file, but determines the type of relief that a debtor needs. It talks 
about the type of relief that a debtor needs and will require people to 
fairly repay what they can.
  This legislation also removes loopholes that have allowed some 
debtors to abuse the system over the years. Our reform puts a greater 
priority on child support and alimony payments that are made through 
bankruptcy proceedings. But one of the main strengths and one of the 
main concerns I have in my district is how the legislation affects 
Chapter 12 bankruptcies.
  Chapter 12 bankruptcy will expire this year, and this bill extends 
that particular provision of the code permanently. This is the 
provision that allows our farmers to reorganize when they are in a 
disastrous situation; to be able to reorganize and pay back their 
debtors and keep those family farms in operation.
  We have seen a number of terrible disasters this year, especially in 
the south, in my home State of Tennessee, and we expect something in 
the nature of some 50 farmers that may have to face the possibility of 
some sort of reorganization this year. But given the willingness of our 
compromise as a whole within this legislation, this particular 
provision will help our family farms have more say in their 
reorganization plans.
  I do urge my colleagues on both sides of the aisle to pass this 
legislation as it is and to give the President the opportunity to sign 
it into law. This is not a time to turn our back on the farmers and a 
reasonable and an appropriate revamping of the bankruptcy code. This 
bill shifts responsibility to the debtors for the first time in a long 
while, in a reasonable fashion, while making adequate protections for 
those who really need it.
  Mr. Speaker, I urge the bill's passage.
  Mr. NADLER. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Michigan (Mr. Conyers), the distinguished ranking member 
of the Committee on the Judiciary.
  (Mr. CONYERS asked and was given permission to revise and extend his 
remarks.)
  Mr. CONYERS. Mr. Speaker, were it not for the gentleman from New York 
(Mr. Jerry Nadler), this bill, one of the worst anti-people bills I 
have ever seen in the Judiciary, would be quietly going through this 
body. The President of the United States, I say to the gentleman from 
Pennsylvania (Mr. Gekas), has pledged he will reward the majority with 
a veto for not listening to the senior ranking member and going off on 
the deep end. He will veto this bill. And even if it is put in an 
omnibus bill, he will veto it. So we are talking serious defects.
  I want to address the distinguished chairman, the gentleman from 
Pennsylvania. He and I have toiled in the Judiciary vineyards together 
for so long. How could the gentleman put a provision in, first of all, 
that takes out the few good provisions that we had? The bill was bad 
enough on its own, but then he gutted the provision, which passed with 
over 100 of his Republican colleagues, that would have ended the 
practice of credit card companies cutting off accounts. Why?
  Why would the gentleman drop the provisions that would prevent the 
horrible tobacco companies, the bad guys of American industry, from 
using bankruptcy to get out of their judgments? Why would he endanger 
youth? I know he is a pro-family man, like me, pro-family values. Why 
would he endanger child support, alimony payments, in a bill coming out 
of the committee with his name on it?
  Why would the gentleman harm small businesses? We represent the 
little guys. And now he is putting them in very precarious positions. 
And then the gentleman dropped the consumer protection and fair credit 
amendments that were in the Senate bill.
  Now, these were the things the gentleman took out of the bill. But 
before he did that, the bill was a nightmare anyway.
  This was the most partisan of anything the Republicans have ever done 
in the Committee on Judiciary. And without consulting me, the gentleman 
has been hurried and partisan and, really, the whole process was not 
the kind that we want.
  By the way, the gentleman mentioned how many people voted for the 
bill. How many people voted for the open-ended, no-scope inquiry 
yesterday? The American people do not want that, and they do not want a 
bill like this. The House makes mistakes all the time. Our job is to 
correct them. And so I wanted to just outline some of these things, and 
I refer the gentleman to the report that we filed of dissenting views 
that is in this matter.
  I thank the ranking member of the subcommittee, the gentleman from 
New York (Mr. Jerry Nadler) for according me so much time.
  Mr. GEKAS. Mr. Speaker, I yield myself such time as I may consume to 
say that I like the gentleman from Michigan (Mr. John Conyers), and 
sometimes, even when he makes sense, he goes to the point of the issue 
at hand. Here, though, he has overlooked the fact that the final 
conference report, which may or may not have had some of the provisions 
which are near and dear to his heart, was the subject of the compromise 
that always occurs between the two bodies when each have passed a 
similar bill and which then

[[Page H10231]]

converge to a compromise level at the conference level.

                              {time}  1015

  So his disappointment, which heartfelt, should not be visited at the 
chairman who has gone to great lengths to try to amalgamate the best 
interests of our body, as the gentleman from Michigan knows. But I will 
take his words and consult with him later in a private manner in which 
we will dispose of our differences.
  Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from Michigan 
(Mr. Knollenberg) who from the very start has had a special interest in 
the best sense of the word in bankruptcy reform.
  Mr. KNOLLENBERG. Mr. Speaker, I rise in strong support of this bill 
and I thank the gentleman from Pennsylvania (Mr. Gekas) for including 
this provision in this bill. This injustice stems from a last-minute 
decision back in the 103rd Congress which placed an arbitrary $4 
million ceiling on the single asset provisions of the bankruptcy reform 
bill. The effect has been to render investors helpless in foreclosures 
on single assets valued at over $4 million.
  While in Chapter 11, and I want to talk just briefly, H.R. 3150 
provides relief to victims by eliminating this arbitrary ceiling. Under 
this law, Chapter 11 of the Bankruptcy Code serves as a legal shield 
for the debtor. Upon the investor's filing to foreclose, the debtor 
preemptively files for Chapter 11 protection which postpones 
foreclosure indefinitely.
  While in Chapter 11, the debtor will continue to collect the rents on 
the commercial asset. However, the commercial property will typically 
be left to deteriorate and the property taxes go unpaid. When the 
investor finally recovers the property through the delayed foreclosure, 
they owe an enormous amount in back taxes, they receive a commercial 
property left in deterioration which has a lower rent value and resale 
value, and meanwhile the rent for all the months or years they were 
trying to retain the property went to an uncollectible debtor.
  H.R. 3150 does not leave the debtor without protection. First, the 
investor brings a foreclosure against a debtor only as a last resort. 
It should be noted, however, that single asset reorganizations are 
typically a false hope since the owner of a single asset does not have 
other properties from which he can recapitalize his business.
  Mr. Speaker, H.R. 3150 is a good bill. I urge my colleagues to 
support it.
  Mr. NADLER. Mr. Speaker, I yield 3 minutes to the gentlewoman from 
Texas (Ms. Jackson-Lee).
  (Ms. JACKSON-LEE of Texas asked and was given permission to revise 
and extend her remarks.)
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I would actually like to speak 
to my colleagues who with their best judgment made the determination to 
vote for what was initially presented to us as an attempt to rid 
ourselves of those people who would abuse the bankruptcy system. Many 
of my colleagues came to the floor of the House with good intentions 
and seeking to respond to the accusations made by the credit card 
industry. I speak to them today because I think they have been sorely 
disappointed and their good intentions have been misused. In fact, the 
distinguished gentleman from Pennsylvania (Mr. Gekas) notes that the 
Senate voted for this bill 97-1. The reason was that Democrats joined 
with Republicans in a bipartisan vote. Why? Because there had been the 
inclusion of a sizable portion of consumer protections in this bill, 
providing for consumer education and counseling. Yet in the dark of 
night, these good provisions that would protect you have been deleted. 
Frankly it is interesting that this bill uses IRS standards to 
determine whether a hardworking American who has fallen upon hard times 
with catastrophic illnesses and other tragedies in their family now can 
go into the bankruptcy court. It ignores that most bankrupt persons may 
have been recently divorced, or they may have been elderly persons with 
catastrophic illnesses falling again upon hard times. It ignores 
frankly the idea that the credit card industry themselves admitted that 
really only 4 percent of the debt in America paid by Americans for 
credit cards is defaulted. So where is the problem? Ninety-six percent 
of the debt that you owe to credit card companies is paid and paid and 
paid and paid. In fact, you all realize that you pay three times more, 
or more, for the item by the time you get through paying. Yet the 
credit card companies have said to us, ``We need relief.''
  Frankly I am concerned about this means test because important items 
like child care payments, health care costs, the costs of taking care 
of ill parents, educational expenses, are those kind of expenses that 
may keep you out of the bankruptcy court or you may have to prove that 
they were in fact necessary. Would you imagine that this legislation 
also takes good, hardworking businesses, small businesses who likewise 
may have come upon hard times but want to keep their doors open by 
filing Chapter 11 in order to pay off their debts, it forces them into 
Chapter 7 which takes away everything that they own.
  Mr. Speaker, this is a bill that needs to be voted down. There are so 
many problems with the bill.
  Mr. Speaker, I support Bankruptcy Reform legislation, but not this 
bankruptcy conference report. This is not bankruptcy reform--this is 
bankruptcy recession. Webster's Dictionary defines recession as ``the 
act of withdrawing and going back.'' That's what this conference report 
does. It takes several steps back. First of all in order for there to 
be a Conference Report, a conference should first be convened. This 
conference committee was a sham. We met one time to read opening 
statements and the democrats were not able to offer any input to 
reconcile the differences between the House and the Senate versions of 
the bill. The conferees were never afforded the opportunity to deal 
with the substantive issues.
  This is not bankruptcy reform--this is bankruptcy recession.
  I was pleased that the Homestead Exemption cap of $100,000 that was 
in the Senate version of the bill is not in the conference report. 
However, I was not pleased to learn that a residency requirement was 
added into the conference report that would require people in my home 
state of Texas to live in Texas for at least two years or own a home 
for at least two years before getting a homestead exemption. This is 
contrary to our Texas state Constitution and would not serve my state 
well.
  The conference report does not contain certain provisions for the 
rights of families, children, as well as the right to a fresh start for 
honest debtors. Any bankruptcy legislation that is enacted should 
ensure that obligations to pay child support and to compensate victims 
of wrongdoing are protected, eliminates abuse of the bankruptcy system 
by both debtors and creditors, and does not tilt what is ultimately a 
fair and well run system to the unfair advantage of particular interest 
groups. I truly believe that without these basic protections, the 
conference report would merit a Presidential veto and that veto would 
be sustained.
  I am very concerned with what the House version passed with child 
support and alimony. I offered an amendment that would put child 
support and alimony not only as a priority, but would have them paid 
first before any secured creditors. This conference report does not do 
that. I oppose creating new, nondischargeable debts that could pit 
post-bankruptcy, credit card debt against child support, alimony, 
educational loans, and taxes. The conference report has not fixed that 
problem.
  This conference report has the language that child support and 
alimony would have first priority, but yet still this debt must still 
compete with the non-dischargeable debt of secured creditors. The fact 
that this provision is in the conference report is outrageous and still 
makes the bill non-viable. This is not bankruptcy reform--this is 
bankruptcy recession.
  I hoped that we can agree on a conference report that would avoid 
taking indiscriminate aim at debtors and fails to address some 
troubling practices of creditors. The only indisputable evidence in 
this debate is that Americans have significantly more debt today, than 
they have ever had before. The average bankruptcy filer last year had a 
debt to income ratio of 1.25 to 1 (125% of their income) as opposed to 
just .74 to 1 (74% of their income) a few short years ago.
  According to Bankruptcy Law Professor Elizabeth Warren of the Harvard 
Law School, the debtors that enter bankruptcy are usually experiencing 
turbulent times. Sixty percent of bankruptcy filers have been 
unemployed within a two year span prior to their filing. Twenty percent 
of filers have had to cope within an uninsurable medical expense. Over 
1 out of 3 filers, both male and female are recently divorced.
  The version of the bill that passed the House was unacceptable to me, 
and I voted against it. I think the idea of forcing bankruptcy filers 
into Chapter 13 versus Chapter 7 is too harsh and two extreme. The 
damage of trying to accomplish this goal through a means test might be 
irreparable. The National Bankruptcy Review Commission rejected the

[[Page H10232]]

means test formula, and this is the main reason why: there can be no 
fair brightline to divide the irresponsible and fraudulent from the 
needy and disadvantaged.

  This is not bankruptcy reform, this is bankruptcy recession.
  I strongly oppose a ``means test'' that includes a rigid and 
arbitrary approach to determining whether a debtor can use Chapter 7 
only to those who genuinely have the capacity to repay a portion of 
their debts successfully under a Chapter 13 plan. Bankruptcy courts 
must have discretion to consider the specific circumstances of a debtor 
in bankruptcy, and the thresholds they consider should be high enough 
to ensure that only those with a strong likelihood of success are 
affected. If we deny access to Chapter 7 to the wrong debtors, and 
those debtors fail to complete required repayment plans, they will 
return to Chapter 7 with a diminished capacity to repay their 
nondischarged debt--including child support and alimony.
  I am also very concerned that some Americans who have small 
businesses will be forced into Chapter 7 instead of having a chance to 
repay their debts under Chapter 11. Small business owners should not be 
allowed to escape their debts unnecessarily, but they should be given 
an opportunity for a fresh start.
  In our House Judiciary Committee Mark-up, I supported an amendment 
that passed by voice vote which would hold tobacco companies liable for 
the death and injury that resulted from the use of their deadly 
products. The conference report changed this ``reform,'' and now the 
tobacco conglomerates will be able to shield themselves from liability 
by filing for bankruptcy protection.
  This is not bankruptcy reform, this is bankruptcy recession.
  There should also be language in the Final Report that addresses 
consumer and debt education. It should be the responsibility of the 
credit card companies to give more and better information so that they 
can understand and better manage their debts. Debtors need to be 
protected against predatory creditor tactics to coerce inappropriate 
and unwise reaffirmations of unsecured debt and secured debts. The 
Consumer education provisions are conspicuous by their absence in this 
conference report.
  Mr. Speaker, this is not Bankruptcy reform, this is Bankruptcy 
recession. This bill pits creditors over families, conglomerates over 
women and children, offers no provisions for the farmers of our nation, 
and provides loopholes for the wealthy. This so-called Bankruptcy 
reform is D.O.A. (dead on arrival) at the White House. This is not 
bankruptcy reform, this is bankruptcy recession. I urge you to vote no 
on this conference report.
  Mr. GEKAS. Mr. Speaker, I yield 1 minute to the gentleman from 
Michigan (Mr. Smith).
  Mr. SMITH of Michigan. Mr. Speaker, it is common sense in my areas of 
Michigan, that if you make it too easy to file bankruptcy and discharge 
your debts, a lot of those lenders are going to have to jack up their 
interest rates on everybody else to compensate for the money they lose 
when that debt is discharged. This legislation provides a better 
balance, a golden mean. I would hope both sides could work together to 
find compromize so that we don't end up with harder to get loans and 
higher interest rates as a result of existing law that makes it easy to 
declare bankruptcy and discharging those debts.
  I have two bills that are now incorporated in this bankruptcy bill. 
One is H.R. 4672, the extension of the Section 12 provision for farmers 
and agriculture; the other is a provision suggested to me by an Eaton 
County Michigan probate Court official, Tom Robinson. That section does 
not allow the discharge of debt for child care that would be owed to a 
local court or municipality.
  I thank Chairman Gekas for yielding me time and for his perseverance 
in developing needed reform to our bankruptcy law.
  Mr. NADLER. Mr. Speaker, I yield 4 minutes to the gentleman from 
Virginia (Mr. Boucher).
  (Mr. BOUCHER asked and was given permission to revise and extend his 
remarks.)
  Mr. BOUCHER. Mr. Speaker, I want to thank the gentleman from New York 
(Mr. Nadler) for yielding this time to me. It is a very generous amount 
of time, particularly in view of the fact that my perspective on this 
issue differs from his. I want to thank him for recognizing me this 
morning.
  Mr. Speaker, I am pleased to rise in support of the conference report 
on the bankruptcy reform measure and urge its approval by the House of 
Representatives. In recent years, the bankruptcy laws have been 
subjected to growing misuse by debtors who can repay a substantial part 
of what they owe but elect instead to file for the complete discharge 
and complete liquidation provisions of Chapter 7 of the bankruptcy 
laws.
  In the past year, more than 1.4 million bankruptcy petitions were 
filed, and that was a 25 percent increase over the prior year's level. 
That dramatic increase occurred at a time when we had the strongest 
national economy and the lowest unemployment that our Nation has 
experienced in decades. Each year, more than $40 billion in consumer 
debt is wiped out through bankruptcy discharges, a cost that is passed 
along to borrowers and passed along to the purchasers of all goods and 
services. That cost amounts to a hidden tax of approximately $400 per 
year on the typical American family.
  The reform legislation that we consider this morning is a positive 
step toward ensuring that individuals with high incomes who need 
bankruptcy protection but who can repay a substantial part of their 
debts use the debt repayment plan of Chapter 13, rather than the 
complete liquidation provisions of Chapter 7. That will ensure that 
more of the debt is paid. That will ensure that the $400 tax that is 
imposed on the typical family because of increased charges for credit 
and the increased prices for goods and services is, to some extent, 
reduced and lowered.
  By combining the best elements of the House and Senate bankruptcy 
reform measures, the conference agreement encourages personal 
responsibility in the use of credit in a manner that is fair to debtors 
and creditors alike and promotes the interests of all consumers.
  It makes a number of other useful changes. Child support and alimony 
payments that today have the seventh priority in the distribution of a 
bankrupt's estate will be moved to the very first priority. That is a 
very significant change. I would note that for people whose concerns 
have been expressed with regard to the condition of the single parent. 
In Chapter 13 cases, a court under this legislation can require that 
all child support and alimony be paid before any other obligations, and 
a debtor will not receive discharge of his debts in bankruptcy until 
child support and alimony payments have been made.
  The legislation also protects consumers. All credit card users will 
benefit from mandatory provisions requiring credit card companies to 
disclose on customer statements the effect that only making the minimum 
monthly payment will have on the length of time it will take to pay the 
balance that is due and also on the overall finance charges that must 
be paid. Credit card companies will also be prohibited from terminating 
a customer's account because that individual elects to pay his bills on 
time and, therefore, is not incurring finance charges.
  The measure also enhances debtor protections. The conference report 
addresses the unscrupulous practices of some debt relief agencies by 
requiring full disclosure to consumers about the bankruptcy process and 
about related fees. Reaffirmations by debtors of wholly unsecured debt 
must comply with strict new disclosure requirements that are imposed on 
creditors, and reaffirmations will also be subjected to review by a 
bankruptcy judge.
  I urge support for the conference agreement.
  Mr. Speaker, I rise in support of the conference report on the 
bankruptcy reform measure and urge its approval by the House.
  In recent years, the bankruptcy laws have been subjected to growing 
misuse by debtors who can repay a substantial part of what they owe, 
but elect to file for a complete discharge of all of the debts under 
Chapter 7.
  In the past year more than 1.4 million bankruptcy petitions were 
filed, an increase of more than 25% over the prior year's level. And 
this dramatic increase has occurred during the strongest economy, with 
the lowest unemployment the nation has experienced in decades.
  Each year, more than $40 billion in consumer debt is wiped out 
through bankruptcy discharges, a cost which is passed along to 
borrowers and to the purchasers of all goods and services. This cost 
amounts to a hidden tax of $400 per year on the typical American 
family.
  The reform legislation is a positive step toward ensuring that 
individuals with high incomes who need bankruptcy protection but who 
can repay a substantial portion of their debts use the debt repayment 
plan of Chapter

[[Page H10233]]

13 rather than the complete liquidation provisions of Chapter 7.
  By combining the best elements of the House and Senate bankruptcy 
reform measures, the Conference Agreement encourages personal 
responsibility in the use of credit in a way which is fair to debtor 
and creditors alike and promotes the interests of all consumers.
  It makes other useful changes: Child support and alimony payments 
will become the first priority in bankruptcy proceedings, a major 
change from the seventh priority in current law. In Chapter 13 cases, a 
court can require that all child support and alimony be paid before any 
other obligations. And, a debtor will not receive a discharge of debts 
in bankruptcy until child support and alimony payments are made 
current.
  The legislation protects consumers: All credit card users will 
benefit from mandatory provision requiring credit card companies to 
disclose on customer statements the effect of only making the minimum 
monthly payments on the overall finance charges paid and on the length 
of time required to repay the balance. Credit card companies will also 
be prohibited from terminating a customer's account solely because the 
customer has not incurred finance charges on the account.
  The measure enhances debtor protections: The conference report 
addresses unscrupulous practices of some debt relief agencies by 
requiring full disclosures to consumers about the bankruptcy process 
and related fees. Reaffirmations by debtors of wholly unsecured debt 
must comply with strict new disclosure requirements imposed on 
creditors and reaffirmations will be subject to review by a bankruptcy 
judge.
  The House passage of this legislation was supported by \3/4\ of the 
membership and by approximately \1/2\ of the Democrats. I encourage 
colleagues on both sides to approve this conference report, and to my 
Democratic colleagues I would point out that the conference agreement 
is somewhat less favorable to the credit industry and somewhat more 
favorable to financially hard-pressed debtors than was the House bill. 
Therefore, it is my hope that an even larger number of my Democratic 
colleagues will support the conference agreement than supported the 
original legislation.
  In summary, the conference report on H.R. 3150 protects consumers, 
reduces abuses of the bankruptcy system by creditors and debtors, and 
ensures that an effective ``fresh start'' is available to those who 
truly need it. Mr. Speaker, H.R. 3150 is a balanced and responsible 
reform of the bankruptcy law.
  Mr. GEKAS. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Florida (Mr. Shaw) who has been very helpful in the consultations along 
the road to this moment.
  Mr. SHAW. I thank the gentleman for yielding me this time. Mr. 
Speaker, I would like to congratulate the chairman and all on the 
Judiciary Committee who took on a most neglected portion of the law 
which has been racked by abuse in the last years and has really brought 
us a very, very good bill. I intend to support this bill, but I must 
express my disappointment as to a provision that was dropped in the 
conference which I feel is very, very important. As the gentleman from 
Virginia (Mr. Boucher) has just stated, bringing up child support from 
down at a lower level on priorities right up to the top was a very, 
very good thing. In order to further implement this, I offered an 
amendment which was accepted by the House during the passage of this 
legislation which put a mechanism for enforcement of this very 
important provision in place. I felt it was very reasonable and I felt 
also it was very necessary because so many times a mother receiving 
child support does not know the ins and outs and legalities of being 
able to enforce her particular priority. I would hope should this bill 
come back to the House for any reason whatsoever either because of 
action of the Senate or action of the President that they will 
reconsider the Shaw amendment and place it back in the bill as a very 
reasonable enforcement tool for those millions of American women who 
are struggling to raise their children and are in desperate need of the 
funds they receive each month in the form of child support.

                              {time}  1030

  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the distinguished 
gentleman from Texas (Mr. Bentsen).
  (Mr. BENTSEN asked and was given permission to revise and extend his 
remarks.)
  Mr. BENTSEN. Mr. Speaker, if I could, I would like to engage the 
chairman of the subcommittee in a colloquy with respect to sections 126 
and 127 of the conference report.
  First, if I might, in understanding, does the 2-year residency 
requirement mean that once residency is met the debtor enjoys the 
benefit of the State's homestead law for so long as he or she is a 
resident of that State even if they move from one homestead to another 
within that State? And, furthermore, does this same residency apply to 
military personnel and expatriates who maintain their residency within 
that State but may well be domiciled in another State or another 
country?
  Mr. GEKAS. Mr. Speaker, will the gentleman yield?
  Mr. BENTSEN. I yield to the gentleman from Pennsylvania.
  Mr. GEKAS. It is a yes-yes to the gentleman's inquiries. It allows 
Texas to set and to keep its homestead exemption theories and laws in 
place subject to the 2-year limitation that we place in the bill.
  Mr. BENTSEN. So once I have established the 2-year residency, I can 
claim homestead on the house I am in now. The house, if I sell that 
house and buy another house, that house and each house thereafter, so 
long as I maintain the initial 2-year residence.
  Mr. GEKAS. That is my interpretation.
  Mr. BENTSEN. Would a gain on the sale of a residence once residency 
is obtained which is then rolled over into a new residence be 
considered an exempt asset or a nonexempt asset?
  Mr. GEKAS. I have not thought that through, but it is my impression 
that that would be protected because, by then, the exemption has 
already been created.
  Mr. BENTSEN. And under Section 127, would a routine prepayment within 
the 730-day period; as my colleague knows, with one's mortgage 
statement they can have a routine prepayment on top of their annual 
mortgage payment or a home equity payment, for that matter, which is 
carried out within the 730 day period. Would that be considered 
routine, or would that be something where the debtor would have to 
fight in court to determine that that is not a fraudulent transfer?
  Mr. GEKAS. My impression would be that it would be routine.
  Mr. GEKAS. Mr. Speaker, I yield 3 minutes to the gentleman from 
Virginia (Mr. Goodlatte).
  (Mr. GOODLATTE asked and was given permission to revise and extend 
his remarks.)
  Mr. GOODLATTE. Mr. Speaker, I thank the gentleman for yielding me 
this time and for his strong leadership on this issue.
  Mr. Speaker, I rise today in support of the conference report. This 
important legislation is an honest compromise between the House and 
Senate passed bills, and while I have serious concerns about the 
retention of certain provisions of the Senate passed bill, the overall 
conference report is a strong agreement that is pro personal 
responsibility and anti bankruptcy abuse. With a record high 1.4 
million bankruptcies filings last year, every American must pay more 
for credit, goods and services when others go bankrupt. I cosponsored 
and voted for House passage of H.R. 3150 because it is high time that 
we relieve consumers from the burden of paying for the debts of others. 
The Bankruptcy Reform Act restores personal responsibility, fairness 
and accountability to our bankruptcy laws and will be of great benefit 
to consumers.
  For too long our bankruptcy laws have allowed individuals to walk 
away from their debts even though many are able to repay them. That is 
not fair to millions of hard-working families who pay their bills, 
mortgages, car loans, student loans and credit card bills every month. 
The loopholes in our bankruptcy laws have led to a 400 percent increase 
in personal bankruptcy filings since 1980 at a cost of $40 billion per 
year. These losses have been passed directly to consumers, costing 
every household that pays its bills an average $400 per year in a 
hidden tax in the form of increased costs of goods that are passed on 
by those who are defaulted upon with credit. In real terms that is a 
year's supply of diapers or 20 tanks of gas.
  The conference agreement retains the strong needs-based formula 
included in the House passed version of the bill but would preserve the 
right of a debtor in bankruptcy to have a judge review his or her case. 
This judicial review would preserve the means test

[[Page H10234]]

that is so necessary for successful bankruptcy reform while allowing a 
debtor's unique circumstances to be taken into account.
  Under the current system, some irresponsible people filing for 
bankruptcy run up their credit card debt immediately prior to filing 
knowing that their debts will soon be wiped away. These debts, however, 
do not just disappear. They are passed along to hard-working folks who 
play by the rules and pay their own bills on time. The Bankruptcy 
Reform Act ends this practice by requiring bankruptcy filers to pay 
back nondischargeable debts made in the 90 days preceding their filing. 
In addition, new debts incurred within 90 days of bankruptcy for luxury 
goods over $250 in value would be presumed nondischargeable.
  While ending the abuses of our bankruptcy laws, the Bankruptcy Reform 
Act is strongly pro consumer in other ways as well. This legislation, 
for example, helps children by strengthening protections in the law 
that prioritize child support and alimony payments.
  Thank you, Mr. Speaker. I rise today in support of the conference 
report on H.R. 3150, the Bankruptcy Reform Act of 1998. This important 
legislation is an honest compromise between the House- and Senate-
passed bills, and while I have serious concerns about the retention of 
certain provisions of the Senate-passed bill, the overall conference 
report is a strong agreement that is pro-personal responsibility and 
anti-bankruptcy abuse.
  With a record-high 1.4 million bankruptcy filings last year, every 
American must pay more for credit, goods, and services when others go 
bankrupt. I cosponsored and voted for House passage of H.R. 3150 
because it is high time that we relieve consumers from the burden of 
paying for the debts of others. The Bankruptcy Reform Act restores 
personal responsibility, fairness, and accountability to our bankruptcy 
laws, and will be of great benefit to consumers.
  For too long, our bankruptcy laws have allowed individuals to walk 
away from their debts, even though many are able to repay them. That's 
not fair to millions of hard-working families who pay their bills--
mortgages, car loans, student loans, and credit card bills--every 
month. The loopholes in our bankruptcy laws have led to a 400 percent 
increase in personal bankruptcy filings since 1980, at a cost of $40 
billion per year. These losses have been passed directly to consumers, 
costing every household that pays its bills $400 per year in a hidden 
tax in the form of increased costs goods each year. In real terms, 
that's a year's supply of diapers, or twenty tanks of gas.
  The conference agreement retains the strong needs-based formula 
included in the House-passed version of the bill, but would preserve 
the right of a debtor in bankruptcy to have a judge review his or her 
case. This judicial review would preserve the means test that is so 
necessary for successful bankruptcy reform while allowing a debtor's 
unique circumstances to be taken into account.
  Under the current system, some irresponsible people filing for 
bankruptcy run up their credit card debt immediately prior to filing, 
knowing that their debts will soon be wiped away. These debts, however, 
do not just disappear--they are passed along to hard-working folks who 
play by the rules and pay their own bills on time. The Bankruptcy 
Reform Act ends this practice by requiring bankruptcy filers to pay 
back nondischargeable debts made in the 90 days preceding their filing. 
In addition, new debts incurred within 90 days of bankruptcy for luxury 
goods over $250 in value would be presumed non-dischargeable.
  While ending the abuses of our bankruptcy laws, the Bankruptcy Reform 
Act is strongly pro-consumer in other ways as well. This legislation, 
for example, helps children by strengthening protections in the law 
that prioritize child support and alimony payments. Additionally, H.R. 
3150 protects consumers from ``bankruptcy mills'' that encourage folks 
to file for bankruptcy without fully informing them of their rights and 
the potential harms that bankruptcy can cause.
  I think that my friends on the other side of the aisle would agree 
with me that none of the parties involved in this debate got everything 
that they wanted in this bill, nor would any of us claim to support all 
of the provisions included in this bill. I know I certainly do not. But 
that is the essence of compromise. On the whole, however, this bill is 
a giant step in the right direction and means real reform for our 
nation's bankruptcy laws.
  Bankruptcy should remain available to folks who truly need it, but 
those who can afford to repay their debts should not be able to stick 
other folks with the tab. Enactment of this conference report will send 
a big signal toward those who would abuse our bankruptcy system that 
the free ride is over. I urge my colleagues to support this fair and 
reasonable compromise. Thank you.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Texas (Mr. Edwards).
  Mr. EDWARDS. Beware, senior citizens; beware, middle class working 
families; beware, hard-working farmers and ranchers. This bill, if 
enacted into law, could put them into debt for the rest of their life.
  Mr. Speaker, this is a perfect example of a good idea, the idea of 
personal responsibility, being turned into a horrible bill in the last 
hours of this Congress behind closed doors by special interests who 
simply went too far.
  Three points:
  First of all, these were the words my Republican colleagues used 
about the Internal Revenue Service this year: dictatorial, unfair, 
arbitrary. And yet, incredibly, in this bill our Republican friends 
turn over the definition of necessary expenses, they turn over to the 
IRS the ability to put people in debt for the rest of their lives. They 
turn over to that IRS that they have been berating all year long. 
Incredibly, under this bill, the Internal Revenue Service could deny 
hard-working families the right to use their hard-earned money to pay 
for child care for their children, to pay for health care or other 
living expenses for their parents that live in their home. Our 
Republicans would allow the IRS under circumstances to exclude major 
health care expenses.
  So, a hard-working family, a responsible family that has a $100,000 
health care bill, could be determined by the IRS, be forced into 
bankruptcy, actually forced into debt rather, for the rest of their 
lives.
  Mr. CONYERS. Mr. Speaker, will the gentleman yield?
  Mr. EDWARDS. I yield to the gentleman from Michigan.
  Mr. CONYERS. The gentleman from Texas is absolutely correct, and our 
hearing supported that. The gentleman from New York (Mr. Nadler), our 
ranking member, brought in witnesses to point this out without any 
shadow of a doubt. Anybody that tries to claim that child support 
payments are enhanced by the provisions in this bill really do not 
understand it.
  Mr. EDWARDS. Absolutely.
  This is a bad bill, Members. Vote no.
  Mr. GEKAS. Mr. Speaker, I yield such time as she may consume to the 
gentlewoman from New Jersey (Mrs. Roukema).
  (Mrs. ROUKEMA asked and was given permission to revise and extend her 
remarks.)
  Mrs. ROUKEMA. Mr. Speaker, I rise in opposition to the provision on 
the child support concerns in this bill.
  Mr. Speaker, I rise in opposition to this legislation and to 
associate my position with the position of Representative Clay Shaw and 
the admirable work he has done on child support enforcement.
  I want to register my opposition to the dropping in conference, which 
would have provided additional protection for a parent trying to 
recover child support monies by giving proper notification to the 
claimant parent.
  While this conference agreement does state that ``nothing shall 
prevent the payments of priority child support obligations,'' an 
additional provision, offered by Representative Clay Shaw of Florida, 
would have required the bankruptcy ``Master'' to notify a claimant 
parent. I am sorry to see that this provision has been dropped.
  I have a long history of standing up for child support enforcement, 
having been a pioneer on child support reforms and having served on the 
U.S. commission for Inter-State Child Support Enforcement.
  It's a national disgrace that our child support enforcement system 
continues to allow so many parents who can afford to pay for their 
children's support to shirk these obligations. The so-called 
''enforcement gap''--the difference between how much child support 
could be collected and how much child support is collected--has been 
estimated at $34 billion!
  If this bill passes, I will continue to press for reforms legislation 
to ensure that claimant parents are not left out of the loop when it 
comes to being able to recover in child support cases. Mr. Shaws 
reforms should be pursued. This bill seriously erodes that effott.
  Mr. Speaker, I will cast my protest vote against this bill.


                             General Leave

  Mr. GEKAS. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days in which to revise and extend their remarks on 
the legislation here under consideration.
  The SPEAKER pro tempore (Mr. Shimkus) Is there objection to the 
request of the gentleman from Pennsylvania?

[[Page H10235]]

  There was no objection.
  Mr. GEKAS. Mr. Speaker, I yield 3 minutes to the gentleman from 
Florida (Mr. McCollum).
  Mr. McCOLLUM. Mr. Speaker, I thank the gentleman for yielding this 
time to me, and I want to compliment the gentleman from Pennsylvania 
(Mr. Gekas) for all hard work in bringing about this conference report.
  Much of what was in the original McCollum-Boucher bill and then later 
the McCollum-Gekas-Boucher-whatever bill, 3150, is in this report. The 
most important portion of it is the needs-based test. Granted, we have 
adopted a certain compromise to the Senate that allows for the judge to 
have a say over this, but there is a presumption that if somebody can 
repay their debt after following the formula that was in the House 
bill, to see if they can afford to repay their debt and have enough 
money left over to do it after deducting their expenses for secured 
credit items and for real living expenses and for child support and so 
forth, if once they have done that, then there is a presumption that 
they are not eligible for Chapter 7 if they have greater than the 
median family income, which is about $52,000 a year for a family of 
four, and they will have to file in Chapter 13 where they have to work 
out a repayment plan. I think that is an enormous reform of very great 
monument in this.
  Also, the bill contains reforms to reduce repeat filings to prevent 
the gaming of the bankruptcy system such as running credit bills right 
before the filing for bankruptcy or filing and dismissing bankruptcies 
cases as a stalling tactic.
  A crucial part of the conference report addresses the recent crisis 
in the financial markets. Title 10 accepts the Senate provision that 
deals with the so-called cross product netting provisions that is based 
on H.R. 4393 as it passed the House Committee on Banking and Financial 
Services. The bankruptcy code and the banking laws contain provisions 
that allow market participants to close out net and set off certain 
types of contracts when a counter party becomes insolvent. This feature 
allows us to reduce the opportunity for the failure of one entity to 
infect others. It also encourages market participants to engage in 
transactions that add market liquidity which leads to lower cost of 
capital.
  I have a letter, Mr. Speaker, that is from the Secretary of the 
Treasury endorsing this provision. I would like to have it inserted in 
the Record at this time.


                                   Department of the Treasury,

                               Washington, DC, September 30, 1998.
     Hon. George W. Gekas,
     Chairman, Subcommittee on Commercial and Administrative Law, 
         Committee on the Judiciary, House of Representatives, 
         Washington, DC.
       Dear Mr. Gekas: I am writing to share the Administration's 
     views on certain bankruptcy provisions in S. 1301, the 
     bankruptcy reform bill before the conference committee, and 
     related provisions in H.R. 4393, the ``Financial Contract 
     Netting Improvement Act of 1998.''
       The Administration supports the financial contract netting 
     provisions in S. 1301. These provisions are based on a 
     proposal from the President's Working Group on Financial 
     Markets, which was the result of an intensive, multi-year 
     interagency effort to improve the regime governing the 
     recognition of netting of certain financial contracts in 
     insolvency situations. As I noted when we transmitted our 
     recommendations to Congress, the proposed legislation would 
     reduce systemic risk in our financial markets, reducing the 
     risk that a failure of a single firm would cause significant 
     disruption and danger to our financial markets. In 
     particular, this proposal will help to reduce systemic risk 
     arising out of activities in the derivatives market.
       The Administration also encourages the conferees to include 
     similar provisions amending the bank insolvency laws, which 
     are contained in H.R. 4393 as approved by the House Banking 
     Committee. One of the goals of the Working Group effort was 
     to harmonize, where appropriate, provisions under the 
     Bankruptcy Code and the bank insolvency laws. The bank 
     insolvency provisions in H.R. 4393 would accomplish that 
     harmonization and would also clarify the power of the Federal 
     Deposit Insurance Corporation to transfer qualified financial 
     contracts to another financial institution. This 
     clarification will help ensure that the resolution of a 
     failed depository institution can be accomplished at the 
     lowest possible cost to the deposit insurance funds 
     administered by the FDIC.
       We look forward to working with the conferees to enact 
     these desirable reforms, in conjunction with moderate and 
     balanced consumer bankruptcy reform legislation.
           Sincerely,
                                                  Robert E. Rubin,
                                        Secretary of the Treasury.
  The conferees struck a good balance between the House and Senate 
bills, I think, and I would like to also comment particularly on 
homestead exemption.
  This conference report doubles the protections that were in the House 
bill. The new protection against abusive use of the exemption includes 
the requirement of a debtor to reside in a State for 2 years before 
they can take advantage of the State's exemptions, but there is no cap 
on the exemption, which is very important to States like Florida and 
Texas.
  In addition, the conference report prohibits the conversion of 
nonexempt assets into exempt homestead property with the intent to 
defraud, which I think is also important to note, within 2 years of 
filing for bankruptcy. The bankruptcy exemptions should not be used as 
a means of hiding assets, and this provision would prevent such an 
abuse.
  It has become clear that reform of the existing bankruptcy system is 
sorely in need. We know we have doubled the number of bankruptcies in 
the United States in the 10 years preceding this, and actually last 
year we had a 25 percent increase, or thereabouts, in the number of 
personal bankruptcies. Most people believe that is because people were 
taking advantage of Chapter 7 and filing pure bankruptcies in greater 
numbers than ever, and this conference report will solve that with a 
needs based test. I encourage the adoption of it, again commend the 
chairman again for his hard work.
  Mr. NADLER. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Texas (Mr. Green).
  (Mr. GREEN. Asked and was given permission to revise and extend his 
remarks.)
  Mr. GREEN. Mr. Speaker, I thank my colleague from New York for 
yielding this time for me and allowing me to speak in opposition to 
this ill-advised bill.
  I want to support bankruptcy reform, but not this conference 
committee report. There are several provisions in this bill that 
prevent it from meeting its intended goal, and we have heard that from 
lots of Members, particularly Members from Texas, the homestead 
protection concerns we have, how it is affecting military personnel. 
But, worst of all, however, is that it is doing nothing to slow the 
growing trend of young people who have to file for bankruptcy each 
year. We are stopping or hindering the filing of bankruptcy on the 
inside, but we are not helping the front end. They change the law on 
bad business practices that allow the loose availabilty of credit to 
young people.
  Let me give some examples. Big banks and credit card companies target 
teenagers and college students with little or no income, they get maxed 
out on their credit cards, and then they only pay the minimum balance. 
And so, with 15 or 18 percent interest, they are getting ready to 
graduate from college with that huge amount, and when we add in their 
student loans that they owe, and that is bad business practices.
  And I know that personally because I have two college students that 
have very little income, but they get blank checks in the mail from 
their credit card companies. Just sign up. Most of their friends in 
college are maxed out on their credit cards because they are having to 
do it. They have credit availability easy.
  Let us make sure we have a bankruptcy farm bill, but let us also make 
the people who are making it available and making these young people 
graduate from college with such a debt load, they owe a responsibility 
to this bill, too, and it is not in this conference committee report.
  We should not put that burden on the people who are the next 
generation of people who are going to be leading our country.

                              {time}  1045

  Mr. GEKAS. Mr. Speaker, I yield 2 minutes to the distinguished 
gentleman from Iowa (Mr. Leach) who is the chairman of the Committee on 
Banking and Financial Services, but also he is the savior of this 
particular chairman. Last night, he saved us on the floor and, together 
with the gentleman from New York (Mr. Nadler), was able to pass the 
responsibility to

[[Page H10236]]

the Committee on the Judiciary, which, by miscommunication, I was not 
able to handle.
  (Mr. LEACH asked and was given permission to revise and extend his 
remarks.)
  Mr. LEACH. Mr. Speaker, I would like to just comment briefly on 
several provisions of this conference report that relate to items under 
the jurisdiction of the Committee on Banking and Financial Services.
  The conference report contains an amendment to the Truth In Lending 
Act designed to protect consumers from having their credit lines 
revoked because they fully pay their outstanding debt in a timely 
manner. I support this change in law. It is individually 
counterintuitive and socially counterproductive that lenders establish 
incentives to pull credit from individuals who pay their debt on time.
  The Senate, however, originally coupled this provision with a 
prohibition against creditors charging any type of fee with regard to 
an extension of credit in which no finance charge has been incurred.
  While perhaps well-intended, this latter provision amounted to a 
public sector dictate and how the private sector should charge to goods 
and services. This price fixing provision would have frustrated 
responsible free market precepts and would have, if it had been 
enacted, resulted in reduction of credit provided to consumers.
  Because of concern for this prohibition, many of us voted last week 
against a construction of conferees. It also included the earlier 
described issue. Now that the conferees have appropriately agreed to 
accept the first part of that instruction but not the second, I and 
many others who voted against this instruction enthusiastically support 
this provision.
  In summary, let me just express again my appreciation to the 
gentleman from Pennsylvania (Chairman Gekas) as well as the gentleman 
from Illinois (Chairman Hyde) and the rest of the conferees for their 
willingness to take the Committee on Banking and Financial Services' 
perspectives into consideration on the parts of the bill that rested 
within the jurisdiction of the Committee on Banking and Financial 
Services which, frankly, is not a major part of the bill.
  Let me just stress that financial netting section which we worked out 
with the administration is of signal significance in this time of 
economic turmoil. This is a provision of the bill that is bipartisanly 
supported and strongly endorsed by the administration, and it is a 
signal reason that this bill should be considered at this particular 
very dicy period of time.
  Mr. NADLER. Mr. Speaker, how much time do we have remaining on both 
sides?
  The SPEAKER pro tempore (Mr. Shimkus). The gentleman from New York 
(Mr. Nadler) has 5\1/2\ minutes remaining. The gentleman from 
Pennsylvania (Mr. Gekas) has 3 minutes remaining.
  Mr. NADLER. Mr. Speaker, I yield 1 minute to the gentleman from Iowa 
(Mr. Leach).
  Mr. Speaker, will the gentleman yield?
  Mr. LEACH. I am delighted to yield to the gentleman from New York.
  Mr. NADLER. Mr. Speaker, on the provision that this House voted on 
the instructions to conferees, we said that the bank should not be able 
to cancel the credit card for the sin of the cardholder having paid on 
time, and they should not be able to charge an extra fee for that 
reason.
  The gentleman stated correctly that the conference report eliminated 
the second provision, they can still charge an extra fee. But my 
understanding is that the conference report says that they can also 
cancel the card, albeit only at the end of the term, which is generally 
a year or two.
  So what is left of this provision to not to penalize responsible 
borrowers?
  Mr. LEACH. Mr. Speaker, reclaiming my time, the only basis for 
canceling the card is if the card would not be in use for better than a 
3-month period. That is a fairly common sense circumstance. So a 
financial institution does not have to carry the cost of dealing with 
people who do not use their card.
  Mr. NADLER. Mr. Speaker, if the gentleman will yield further, if the 
card was used but the bill is paid on time and with no interest, they 
could not cancel it?
  Mr. LEACH. Mr. Speaker, reclaiming my time, that is correct. If the 
card is in actual use. It is only if the individual did not use the 
card could an institution pull it.
  Mr. GEKAS. Mr. Speaker, I do not know where we stand parliamentarily.
  The SPEAKER pro tempore. The gentleman from New York (Mr. Nadler) had 
the time. The gentleman from New York yielded to the gentleman from 
Iowa (Mr. Leach).
  Mr. GEKAS. Mr. Speaker, are we to close?
  The SPEAKER pro tempore. The gentleman from Pennsylvania (Mr. Gekas) 
has the right to close.
  Mr. GEKAS. Mr. Speaker, has the minority time expired?
  The SPEAKER pro tempore. The gentleman from New York (Mr. Nadler) has 
4\1/2\ minutes remaining.
  Mr. GEKAS. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from 
Virginia (Mr. Moran).
  Mr. MORAN of Virginia. Mr. Speaker, I rise in strong support of 
bankruptcy reform. I am a lead sponsor of this measure because the 
system is broken, and it is up to us to fix it.
  What was once the option of last resort is becoming the preferred 
option of choice. A legislative fix is vital to distinguish between 
those who truly need a fresh start and those who want to game the 
system for personal advantage, those capable of assuming greater 
responsibility and making good on at least some of what they owe.
  Mr. Speaker, unless we take the steps now to reform the bankruptcy 
system, while the economic times are good, we will not have the 
political resolve to fix it when they are not so good.
  Trapped in a broken bankruptcy system where they lack the confidence 
that individual borrowers will be able to honor their payment 
commitments, lenders and creditors will have no choice but to restrict 
credit. We cannot let that happen.
  Restricting credit during a downturn in the economy is exactly the 
opposite of what should happen. It is exactly the opposite in the 
national interest. It only deepens the severity of any recession and 
delays the eventual recovery.
  Despite this country's strong economy, the rate of personal 
bankruptcy filings has increased dramatically. Last year, personal 
bankruptcy filings rose nearly 20 percent. They reached a record high 
of 1,400,000 filings. Think about it. More people filed for personal 
bankruptcy than graduated from college last year. What does that say 
about our country in a time of such prosperity?
  We can vilify creditors and lenders and mortgage companies and credit 
card industry. I am glad to see the Truth in Lending Act was modified 
to include an important pro-consumer provision that I tried to offer 
here in the House. That provision will disclose the full consequences 
of paying only the minimum monthly balance.
  But while many of us would like to blame the credit cards industry 
for the sharp increase of bankruptcy filings, it is important to note 
that the credit card industry is not the impetus of the bankruptcy 
crisis.
  The vast majority of individuals recognize their personal 
responsibility they take in using the credit card. More than 96 percent 
of credit card holders pay their bills as agreed to and only 1 percent 
ever end up in bankruptcy.
  This is not an issue about credit cards trying to rip off people. 
Sure there is some unfairness, but that is not what we are having to 
deal with. Regardless about how one feels about yesterday's or today's 
creditors, the key issue before us is that many borrowers capable of 
repaying some or all of their obligations are not acting responsibly. 
That is what this is about. It is the principle of moral responsibility 
and personal obligation. That is why this legislation should pass.
  Mr. NADLER. Mr. Speaker, I yield 15 seconds to the gentleman from 
Michigan (Mr. Conyers).
  Mr. CONYERS. Mr. Speaker, in my continuing education program for the 
gentleman from Virginia, who is a dear friend of mine, the fact that 
more are going into bankruptcy is no proof that the bankruptcy laws are 
being abused. It is really evidence that the credit card industry is 
enticing millions into debt that the should not be, I say to

[[Page H10237]]

the gentleman from Virginia (Mr. Moran).
  Mr. NADLER. Mr. Speaker, I yield 30 seconds to the gentlewoman from 
Texas (Ms. Jackson-Lee).
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I have many good friends in 
this chamber, and I would simply like to say, if the credit card 
companies would stop sending unsolicited questionnaires and 
applications to people who are now deceased and otherwise, we would not 
have this problem.
  On the issue of child support, let me make it perfectly clear, the 
credit card debt now becomes nondischargeable. It survives after 
bankruptcy. It competes with that poor working parent who needs that 
child support for that child. Tell me, Mr. Speaker, who can survive the 
beating and repossession abilities of the credit card company over the 
child support. This is a bad bill.
  Mr. NADLER. Mr. Speaker, how much time do I have remaining?
  The SPEAKER pro tempore. The gentleman from New York (Mr. Nadler) has 
3\1/4\ minutes remaining. The gentleman from Pennsylvania (Mr. Gekas) 
has 30 seconds remaining. The gentleman from Pennsylvania has the right 
to close.
  Mr. NADLER. Mr. Speaker I yield myself such time as I may consume.
  Mr. Speaker, a couple of comments. First, the gentleman from Virginia 
said that, if this bill does not pass, if we continue to have a 
bankruptcy crisis, the credit card companies, the banks are going to 
restrict credit to people who need it.
  I suppose the fact that they will feel the need to restrict credit is 
evidenced by the fact that they are inundating people, inundating 
college students with credit card solicitations. I suppose the grave 
crisis is illustrated by the fact that the credit card departments or 
the banks are between two and three times more profitable than the 
banks as a whole. It is the profit center of the banks that shows what 
a terrible problem we have.
  I will reiterate that the real cause of the problem of increased 
bankruptcy filings is simply that people are going more and more into 
debt. The average chapter 7 filer today is has debt equal to 125 
percent of his income, 15 years ago, it was 74 percent, because he is 
trapped in paying high interest rates and has taken out too much 
credit.
  This, to a large extent, is the fault of the companies that are 
inundating people with credit cards. That is the real problem. Simply 
saying that people who are in over their heads, that we should crack 
donor bankruptcy is the wrong solution to the wrong problem, to a 
misstated problem.
  I heard the distinguished gentlewoman from New Jersey (Mrs. Roukema) 
from the other side of the aisle take exception to this bill because of 
the provisions on child support. I think the gentlewoman from New 
Jersey (Mrs. Roukema), I think most of the Members of this House know 
that the gentlewoman from New Jersey (Mrs. Roukema) knows the issues of 
support, of collection of child support probably better than most other 
Members of the House. She has been working in this area for years.
  When the gentlewoman says that this bill will wreck, will increase 
the problem of child support collections, we should pay attention.
  Mr. Speaker, I am going to introduce a motion to recommit. I have 
that motion at the desk, and I would like to simply explain it for a 
moment now.
  The conference report would allow credit card companies and other 
consumer creditors to have their debts survive bankruptcy. That would 
mean that those debts would compete with child support, with spousal 
support, with debts to drunk driving victims, and other high priority 
debts after the bankruptcy case is over.
  The motion to recommit will change that. The conferees stripped out 
important protections contained in the Senate bill which would have 
prevented creditors from using coercion and other illegal and unethical 
practices to obtain reaffirmation agreements in which debtors agree to 
repay debts which would otherwise be discharged in bankruptcy. We will 
deal with that in the motion to recommit.
  Reaffirmed debts, because they survive bankruptcy, compete with child 
support and spousal support and other high priority debts, which 
already survive bankruptcy, for the scarce resources of the debtor 
after the case is over. As I mentioned a moment ago, we will deal with 
that problem.
  The conferees also adopted broad exceptions to the discharge for 
credit card companies so that the high risk lending practices would 
have the same privilege status as support obligations and tax arrears, 
and we will deal with that in a motion to recommit.
  The motion to recommit would restore important protections for 
families and small creditors that were dumped or gutted in the 
conference report. As I mentioned before, that based primarily on these 
disastrous changes to the Senate bill, the administration has indicated 
that the President will veto this bill, and well he should veto this 
bill.
  We should sustain this veto unless the motion to recommit is granted 
and the provisions of that motion survive subsequent proceedings.
  So I urge the Members to vote for the motion to recommit if they care 
about child support, if they care about spousal support, if they care 
about debts to drunk driving victims, if they care about payments to 
victims of crimes, all of which would be endangered by this.
  So I urge my colleagues to vote for the motion to recommit and, if it 
does not pass, against this very unfortunate bill.
  Mr. Speaker, I yield back the balance of my time.
  Mr. GEKAS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, it should be made clear that the support priorities that 
we have built into this conference report are endorsed by the National 
Association of Attorneys General who supervise all of these matters and 
by every major support organization in the country.

                              {time}  1100

  In fact, they tracked along with us as we moved towards this moment, 
and approved every set of provisions that we adopted along the way. So 
I am confident that support payments and family income are well 
protected in this legislation, as are the consumers in a whole litany 
of provisions that we have.
  Mr. BEREUTER. Mr. Speaker, this Member rises today to express his 
support for the conference report for H.R. 3150, the Bankruptcy Reform 
Act. In particular, this Member is supportive of the provision which 
permanently extends Chapter 12 bankruptcy for family farmers which 
would be retroactively applied to October 1, 1998.
  First, this Member would thank the distinguished gentleman [Mr. 
Gekas], Chairman of the Judiciary Subcommittee on Commercial and 
Administrative Law from Pennsylvania, for introducing this bill and for 
his efforts in bringing the conference report for H.R. 3150 to the 
House Floor. This Member would also like to express his appreciation to 
the distinguished gentleman from Illinois [Mr. Hyde], the Chairman of 
the Judiciary Committee, for his efforts on this measure.
  Unfortunately, Chapter 12 bankruptcy provisions for family farmers 
expired on September 30, 1998. Chapter 12 bankruptcy has been a viable 
option for family farmers nationwide. It has allowed family farmers to 
reorganize their assets in a manner which balances the interests of 
creditors and the future success of the involved farmer. If Chapter 12 
bankruptcy provisions are not extended for family farmers, this will 
have a drastic impact on an agricultural sector already reeling from 
low commodity prices. Not only will many family farmers have to end 
their operations, but also land values will likely plunge downward. 
Such a decrease in land values will affect both the ability of family 
farmers to earn a living and the manner in which banks, making 
agricultural loans, conduct their lending activities. This Member has 
received many contacts from his constituents regarding the extension of 
Chapter 12 bankruptcy because of the situation now being faced by our 
nation's farm families--although the U.S. economy is generally healthy, 
it is clear that agricultural sector is hurting.
  The gravity of this situation for family farmers nationwide makes it 
imperative that Chapter 12 bankruptcy is permanently extended. 
Moreover, this extension must also be retroactively applied since the 
Chapter 12 bankruptcy option for family farms has already expired on 
September 30, 1998. The provisions in the conference report of H.R. 
3150 regarding Chapter 12 are essential.
  If the President vetoes this conference report, as he has threatened 
to do, then this Member would ask the Judiciary Committee to advance 
legislation, through amendment or in stand-alone legislation, to 
provide for the immediate extension of Chapter 12 bankruptcy and to 
make such an extension retroactive to October 1, 1998.

[[Page H10238]]

  In closing, this Member would encourage his support for H.R. 3150, 
the Conference Report on the Bankruptcy Reform Act.
  Mr. LEACH. Mr. Speaker, I would like to comment briefly on those 
provisions of this conference report which amend laws under the 
jurisdiction of the Banking Committee.
  The conference report contains an amendment to the Truth in Lending 
Act designed to protect consumers from having their credit line revoked 
because they fully pay their outstanding debt in a timely manner. I 
support this change in law. It is individually counter-intuitive and 
socially counter-productive that lenders establish incentives to pull 
credit away from individuals who pay their bills on time.
  The Senate, however, originally coupled this provision with a 
prohibition against a creditor charging any type of fee with regard to 
an extension of credit on which no finance charge has been incurred. 
While perhaps well intended, this latter provision amounted to a public 
sector dictate on how the private sector should charge for goods and 
services.
  This price fixing provision would have frustrated responsible free 
market precepts and would have, if it had been enacted, resulted in a 
reduction in credit provided consumers. Because of concern for this 
prohibition, many of us voted last week against an instruction of 
conferees that also included the earlier described issue. The conferees 
approximately agreed to accept the first part of the instruction but 
not the second. Hence, I and many others who voted against the 
instruction can now enthusiastically support the provision.
  The conference report does include a number of other amendments 
designed to provide consumers more protections, including enhanced 
disclosures for credit card debt, which I also support.
  In summary, Mr. Speaker, I want to express my appreciation to 
Chairman Hyde, Chairman Geka's and the rest of the conferees for their 
willingness to take the Banking Committee's views into consideration on 
those relatively small parts of the bill that fall under the 
jurisdiction of the committee. While there are parts of this bill such 
as those related to child support, which I believe are imperfect, as a 
whole it represents reasonable reform.
  If the President vetoes this bill, he will also veto an approach it 
supports to better stabilize the shaky international economy and other 
Banking Committee provisions designed to protect consumers.
  In this regard, Mr. Speaker, let me stress that the conference report 
incorporates the provisions of H.R. 4394, the ``Financial Contract 
Netting Improvement Act of 1998'', which the Committee on Banking and 
Financial Services reported to the full House on August 21, 1998.
  These netting provisions were approved unanimously by the Banking 
Committee and are supported by Federal financial regulators and the 
Administration. They are designed to minimize the risk of a disruption 
within or between financial markets upon the insolvency of an entity 
with large holdings of qualified financial contracts. The near failure 
of Long-Term Capital Management LP highlights the need for the U.S. to 
further refine its bankruptcy and insolvency laws in order to avoid 
systemic risk to the nation's financial system in the event of a 
failure of a large bank, hedge fund, or securities firm with huge 
exposures to interest rate and currency swaps and other complex 
financial instruments.
  Ms. LEE. Mr. Speaker, I rise to strongly oppose H.R. 3150, the 
Bankruptcy Reform Conference Report. I opposed the bill as a member of 
the House Committee on Banking and Financial Services when we voted on 
this measure in the House because it allows unscrupulous creditors to 
continue to exploit uninformed and naive borrowers.
  There is a problem with increasing rates of bankruptcy, but this 
Conference report places the burden of a bad loan not on those who 
knowingly loan to people who are credit risks, but on those who are 
least able to recover should a personal disaster strike, like illness 
or job loss. Household debt has risen sharply and defaulting on payment 
is a serious problem but this bill does not reasonably address these 
problems. Instead, the bill allows the lender to effectively entrap a 
poor person who needs money to borrow beyond the safety point. The 
lending institutions are knowledgeable and sophisticated about the 
credit market and they do know to whom they are lending money. If this 
bill passes, the government and taxpayers will be forced to protect, by 
law, the lending institution, which has deliberately pushed a risky 
loan, at the expense of low-income American consumers.
  Specifically, this bill will allow credit card companies and other 
consumer creditors to compete for repayment with child support, spousal 
support, debts to drunk driving victims, and other high-priority debts. 
The Conference Report strips important Senate bill consumer protections 
which limited undue coercion and the use of other strong-arm practices 
to force a debtor to repay.
  This bill is blatantly unfair. It protects and even rewards 
businesses that use marginally safe lending guidelines and elevates 
their collection rights to the same privileged level as child support 
and tax arrears.
  The President has correctly announced that he will veto this bill. It 
is also strongly opposed by the AFL-CIO, the Consumer Federation of 
America, Consumers Union, Public Citizen, the National Organization of 
Women, the Leadership Conference on Civil Rights, the Association of 
Trial Lawyers of America, the National Bankruptcy Conference, the 
Commercial Law League, the National Conference of Bankruptcy Judges, 
Mothers Against Drunk Driving, and the National Organization for Victim 
Assistance.
  I believe that our function as legislators is to enact laws that are 
fair and that are reasonable, and I believe that we have an obligation 
to be aware of vast imbalances of power and to protect those who need 
protection from more powerful entities. I urge my colleagues to support 
the motion to recommit and to vote against the Conference Report on 
H.R. 3150.
  Mr. CHABOT. Mr. Speaker, I rise in support of this Conference Report.
  I would first like to thank Mr. Hyde, Mr. Gekas, Mr. Hatch and the 
other members of the Conference Committee.
  The current bankruptcy system, which this legislation seeks to 
reform, clearly discourages personal responsibility. Our bankruptcy 
laws often allow those who can afford to pay their bills to declare 
bankruptcy and walk away debt free instead. As a result, personal 
bankruptcies are skyrocketing. In fact, despite economic growth, low 
unemployment and rising incomes personal bankruptcies reached a record 
1.4 million last year, and are projected to rise even further this 
year.
  This places a terrible financial burden on consumers who are forced 
to pay higher prices for goods and services. In fact, the average 
family pays a $400 bad debt tax every year.
  The Conference proposal is, I believe, substantial improvement over 
current law. This legislation will strengthen the bankruptcy code, 
reducing the number of ``bankruptcies of convenience.'' I believe that 
the needs-based test that is implemented in this Conference Report will 
take substantial steps in reforming this system by reestablishing the 
link between one's ability to pay and ability to discharge debt.
  The needs-based test is a balance between the House and Senate bills 
on this issue. It adopts the bright-line standards for measuring 
repayment capacity from the House bill, while at the same time 
preserving the right of a debtor in bankruptcy to have a judge review 
his or her individual case so that their unique circumstances could be 
taken into account.
  This legislation also cracks down on a number of ways in which 
debtors abuse the system bankruptcy. For example, it makes debts that 
are incurred to pay nondischargeable debts, such as taxes, would become 
nondischargeable, as well. In other words if a person uses a credit 
card to pay their income taxes, this legislation prohibits them from 
turning around and declaring bankruptcy, making the credit card company 
in effect pay their income taxes.
  At the same time, however, it recognizes that there is some real need 
for the protections that bankruptcy offers, and it strengthens that 
protection. For example, it strengthens child support and alimony 
payments, making alimony and child support payments the first priority, 
not the 7th, as under current law.
  Finally, while I believe that some sections of the House passed bill 
would have better addressed some of the problems with the bankruptcy 
laws, this strong, pro-consumer bill makes vital reforms to the 
bankruptcy system.
  I urge my colleagues to support this legislation, Mr. Speaker, 
because it takes some significant steps in the right direction in 
restoring some personal responsibility to our bankruptcy laws, while 
protecting those who need the protections of bankruptcy.
  I urge my colleagues to support this Conference Report, and I hope 
that the President will sign this important legislation, giving hard-
working American families protection from those who abuse the 
bankruptcy system.
  Mr. GEKAS. Mr. Speaker, I yield back the balance of my time, and I 
move the previous question on the conference report.
  The previous question was ordered.


                Motion to Recommit Offered by Mr. Nadler

  Mr. NADLER. Mr. Speaker, I offer a motion to recommit.
  The SPEAKER pro tempore. Is the gentleman opposed to the conference 
report?
  Mr. NADLER. In its present form I am, Mr. Speaker.
  The SPEAKER pro tempore. The Clerk will report the motion to 
recommit.
  The Clerk read as follows:
       Mr. Nadler moves to recommit the Conference Report on the 
     bill H.R. 3150 to the Conference Committee with instructions 
     that the Managers on the part of the House

[[Page H10239]]

     disagree to section 110 of the Conference Report and agree to 
     section 210 and section 211 of the Senate Amendment; and 
     disagree to section 149 of the Conference Report and agree to 
     section 315 of the Senate Amendment.

  The SPEAKER pro tempore. Without objection, the previous question is 
ordered on the motion to recommit.
  There was no objection.
  The SPEAKER pro tempore. The question is on the motion to recommit.
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.
  Mr. NADLER. Mr. Speaker, I object to the vote on the ground that a 
quorum is not present and make the point of order that a quorum is not 
present.
  The SPEAKER pro tempore. Evidently a quorum is not present.
  The Sergeant at Arms will notify absent Members.
  Pursuant to clause 5 of rule XV, the Chair will reduce to a minimum 
of 5 minutes the period of time within which a vote by electronic 
device, if ordered, will be taken on the question of adoption of the 
conference report.
  Without objection, each of the 4 possible votes on postponed 
suspensions will be 5-minute votes.
  There was no objection.
  The vote was taken by electronic device, and there were--yeas 157, 
nays 266, not voting 11, as follows:

                             [Roll No. 505]

                               YEAS--157

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baldacci
     Barrett (WI)
     Becerra
     Blagojevich
     Blumenauer
     Bonior
     Borski
     Brady (PA)
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Campbell
     Capps
     Carson
     Clay
     Clayton
     Clyburn
     Conyers
     Costello
     Coyne
     Cummings
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dicks
     Dingell
     Dixon
     Doggett
     Doyle
     Edwards
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Fox
     Furse
     Gejdenson
     Gephardt
     Gonzalez
     Green
     Gutierrez
     Hall (OH)
     Hastings (FL)
     Hefner
     Hilliard
     Hinchey
     Hinojosa
     Holden
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Kanjorski
     Kaptur
     Kennedy (MA)
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind (WI)
     Klink
     Kucinich
     LaFalce
     Lampson
     Lantos
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren
     Lowey
     Luther
     Maloney (NY)
     Manton
     Markey
     Martinez
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McDermott
     McGovern
     McHale
     McIntyre
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller (CA)
     Mink
     Moakley
     Murtha
     Nadler
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rivers
     Rodriguez
     Roukema
     Roybal-Allard
     Rush
     Sabo
     Sanchez
     Sanders
     Sandlin
     Sawyer
     Schumer
     Scott
     Serrano
     Skaggs
     Slaughter
     Spratt
     Stabenow
     Stark
     Stokes
     Strickland
     Stupak
     Thompson
     Thurman
     Towns
     Traficant
     Turner
     Velazquez
     Vento
     Visclosky
     Waters
     Watt (NC)
     Waxman
     Wexler
     Woolsey
     Wynn
     Yates

                               NAYS--266

     Aderholt
     Archer
     Armey
     Bachus
     Baesler
     Baker
     Ballenger
     Barcia
     Barr
     Barrett (NE)
     Bartlett
     Barton
     Bass
     Bateman
     Bentsen
     Bereuter
     Berry
     Bilbray
     Bilirakis
     Bishop
     Bliley
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Boswell
     Boucher
     Boyd
     Brady (TX)
     Bryant
     Bunning
     Burr
     Buyer
     Callahan
     Calvert
     Camp
     Canady
     Cannon
     Cardin
     Castle
     Chabot
     Chambliss
     Chenoweth
     Christensen
     Clement
     Coble
     Coburn
     Collins
     Combest
     Condit
     Cooksey
     Cox
     Cramer
     Crane
     Crapo
     Cubin
     Cunningham
     Danner
     Davis (FL)
     Davis (VA)
     Deal
     DeLay
     Deutsch
     Diaz-Balart
     Dickey
     Dooley
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Ensign
     Everett
     Ewing
     Fawell
     Fazio
     Foley
     Forbes
     Fossella
     Fowler
     Frank (MA)
     Franks (NJ)
     Frelinghuysen
     Frost
     Gallegly
     Ganske
     Gekas
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Gordon
     Goss
     Graham
     Granger
     Greenwood
     Gutknecht
     Hall (TX)
     Hamilton
     Hansen
     Harman
     Hastert
     Hastings (WA)
     Hayworth
     Hefley
     Herger
     Hill
     Hilleary
     Hobson
     Hoekstra
     Hooley
     Horn
     Hostettler
     Houghton
     Hoyer
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Inglis
     Istook
     Jenkins
     Johnson (CT)
     Johnson (WI)
     Johnson, Sam
     Jones
     Kasich
     Kelly
     Kim
     King (NY)
     Kingston
     Kleczka
     Klug
     Knollenberg
     Kolbe
     LaHood
     Largent
     Latham
     LaTourette
     Lazio
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     Livingston
     LoBiondo
     Lucas
     Maloney (CT)
     Manzullo
     McCollum
     McCrery
     McHugh
     McInnis
     McIntosh
     McKeon
     Metcalf
     Mica
     Miller (FL)
     Minge
     Mollohan
     Moran (KS)
     Moran (VA)
     Morella
     Myrick
     Nethercutt
     Neumann
     Ney
     Northup
     Norwood
     Nussle
     Oxley
     Packard
     Pappas
     Parker
     Paul
     Paxon
     Pease
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pickett
     Pitts
     Pombo
     Porter
     Portman
     Quinn
     Radanovich
     Ramstad
     Redmond
     Regula
     Riggs
     Riley
     Roemer
     Rogan
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Rothman
     Royce
     Ryun
     Salmon
     Sanford
     Saxton
     Scarborough
     Schaefer, Dan
     Schaffer, Bob
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherman
     Shimkus
     Shuster
     Sisisky
     Skeen
     Skelton
     Smith (MI)
     Smith (NJ)
     Smith (OR)
     Smith (TX)
     Smith, Adam
     Smith, Linda
     Snowbarger
     Snyder
     Solomon
     Souder
     Spence
     Stearns
     Stenholm
     Stump
     Sununu
     Talent
     Tanner
     Tauscher
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Thomas
     Thornberry
     Thune
     Tiahrt
     Upton
     Walsh
     Wamp
     Watkins
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Weygand
     White
     Whitfield
     Wicker
     Wilson
     Wise
     Wolf
     Young (AK)
     Young (FL)

                             NOT VOTING--11

     Berman
     Burton
     Cook
     Goodling
     John
     Kennelly
     McDade
     Poshard
     Pryce (OH)
     Tierney
     Torres

                              {time}  1122

  Mrs. KELLY, Mrs. WILSON, and Messrs. BATEMAN, ROTHMAN, KNOLLENBERG, 
GILLMOR, WALSH, WICKER, WHITE and HYDE changed their vote from ``yea'' 
to ``nay.''
  Messrs. HOLDEN, McNULTY, BORSKI, LIPINSKI, HASTINGS of Florida, 
ETHERIDGE, McHALE, and SPRATT changed their vote from ``nay'' to 
``yea.''
  So the motion to recommit was rejected.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. Shimkus). The question is on the 
conference report.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.


                             Recorded Vote

  Mr. NADLER. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The SPEAKER pro tempore. This is a five-minute vote.
  The vote was taken by electronic device, and there were--ayes 300, 
noes 125, not voting 9, as follows:

                             [Roll No. 506]

                               AYES--300

     Aderholt
     Andrews
     Archer
     Armey
     Bachus
     Baesler
     Baker
     Ballenger
     Barcia
     Barr
     Barrett (NE)
     Bartlett
     Barton
     Bass
     Bateman
     Bentsen
     Bereuter
     Berry
     Bilbray
     Bilirakis
     Bishop
     Blagojevich
     Bliley
     Blumenauer
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Boswell
     Boucher
     Boyd
     Brady (TX)
     Bryant
     Bunning
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Campbell
     Canady
     Cannon
     Capps
     Cardin
     Castle
     Chabot
     Chambliss
     Chenoweth
     Christensen
     Clement
     Coble
     Coburn
     Collins
     Combest
     Condit
     Cook
     Cooksey
     Cox
     Cramer
     Crane
     Crapo
     Cubin
     Cunningham
     Danner
     Davis (FL)
     Davis (VA)
     Deal
     DeLay
     Deutsch
     Diaz-Balart
     Dickey
     Dicks
     Dooley
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Ensign
     Etheridge
     Everett
     Ewing
     Fawell
     Fazio
     Foley
     Forbes
     Fossella
     Fowler
     Fox
     Frank (MA)
     Franks (NJ)
     Frelinghuysen
     Frost
     Gallegly
     Ganske
     Gekas
     Gephardt
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Goodling
     Gordon
     Goss
     Graham
     Granger
     Greenwood
     Gutknecht
     Hall (TX)
     Hamilton
     Hansen
     Harman
     Hastert
     Hastings (WA)
     Hayworth
     Hefley
     Herger
     Hill
     Hilleary
     Hobson
     Hoekstra
     Holden
     Hooley
     Horn
     Hostettler
     Houghton
     Hoyer
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Inglis
     Istook
     Jenkins
     Johnson (CT)
     Johnson (WI)
     Johnson, Sam
     Jones
     Kasich
     Kelly
     Kennedy (RI)
     Kim
     Kind (WI)

[[Page H10240]]


     King (NY)
     Kingston
     Kleczka
     Klug
     Knollenberg
     Kolbe
     LaHood
     Largent
     Latham
     LaTourette
     Lazio
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     Livingston
     LoBiondo
     Lucas
     Maloney (CT)
     Maloney (NY)
     Manzullo
     Matsui
     McCarthy (NY)
     McCollum
     McCrery
     McHale
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     Menendez
     Metcalf
     Mica
     Miller (FL)
     Minge
     Mollohan
     Moran (KS)
     Moran (VA)
     Morella
     Myrick
     Neal
     Nethercutt
     Neumann
     Ney
     Northup
     Norwood
     Nussle
     Oxley
     Packard
     Pappas
     Parker
     Pascrell
     Pastor
     Paul
     Paxon
     Pease
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pickett
     Pitts
     Pombo
     Pomeroy
     Porter
     Portman
     Price (NC)
     Quinn
     Radanovich
     Ramstad
     Redmond
     Regula
     Riggs
     Riley
     Rivers
     Roemer
     Rogan
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Rothman
     Royce
     Ryun
     Salmon
     Sandlin
     Sanford
     Sawyer
     Saxton
     Scarborough
     Schaefer, Dan
     Schaffer, Bob
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherman
     Shimkus
     Shuster
     Sisisky
     Skeen
     Skelton
     Smith (MI)
     Smith (NJ)
     Smith (OR)
     Smith (TX)
     Smith, Adam
     Smith, Linda
     Snowbarger
     Snyder
     Solomon
     Souder
     Spence
     Spratt
     Stearns
     Stenholm
     Strickland
     Stump
     Sununu
     Talent
     Tanner
     Tauscher
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Thomas
     Thornberry
     Thune
     Tiahrt
     Turner
     Upton
     Velazquez
     Walsh
     Wamp
     Watkins
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Weygand
     White
     Whitfield
     Wicker
     Wilson
     Wise
     Wolf
     Wynn
     Young (AK)
     Young (FL)

                               NOES--125

     Abercrombie
     Ackerman
     Allen
     Baldacci
     Barrett (WI)
     Becerra
     Bonior
     Borski
     Brady (PA)
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Carson
     Clay
     Clayton
     Clyburn
     Conyers
     Costello
     Coyne
     Cummings
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dingell
     Dixon
     Doggett
     Doyle
     Edwards
     Engel
     Eshoo
     Evans
     Farr
     Filner
     Ford
     Furse
     Gejdenson
     Gonzalez
     Green
     Gutierrez
     Hall (OH)
     Hastings (FL)
     Hefner
     Hilliard
     Hinchey
     Hinojosa
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Kanjorski
     Kaptur
     Kennedy (MA)
     Kildee
     Kilpatrick
     Klink
     Kucinich
     LaFalce
     Lampson
     Lantos
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren
     Lowey
     Luther
     Manton
     Markey
     Martinez
     Mascara
     McCarthy (MO)
     McDermott
     McGovern
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Millender-McDonald
     Miller (CA)
     Mink
     Moakley
     Murtha
     Nadler
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Payne
     Pelosi
     Rahall
     Rangel
     Reyes
     Rodriguez
     Roukema
     Roybal-Allard
     Rush
     Sabo
     Sanchez
     Sanders
     Schumer
     Scott
     Serrano
     Skaggs
     Slaughter
     Stabenow
     Stark
     Stokes
     Stupak
     Thompson
     Thurman
     Towns
     Traficant
     Vento
     Visclosky
     Waters
     Watt (NC)
     Waxman
     Wexler
     Woolsey
     Yates

                             NOT VOTING--9

     Berman
     Fattah
     John
     Kennelly
     McDade
     Poshard
     Pryce (OH)
     Tierney
     Torres

                              {time}  1130

  The Clerk announced the following pairs:
  Mr. DICKS and Ms. RIVERS changed their vote from ``no'' to ``aye.''
  So the conference report was agreed to.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.

                          ____________________