[Congressional Record Volume 151, Number 26 (Tuesday, March 8, 2005)]
[Senate]
[Pages S2216-S2230]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   BANKRUPTCY ABUSE PREVENTION AND CONSUMER PROTECTION ACT OF 2005--
                               Continued

  The PRESIDING OFFICER. Under the previous order, the hour of 2:15 
p.m. having arrived, the Senate will proceed to a vote on a motion to 
invoke cloture on S. 256. Under the previous order, the clerk will 
report the motion to invoke cloture.
  The assistant legislative clerk read as follows:

                             Cloture Motion

       We the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     do hereby move to bring to a close debate on Calendar No. 14, 
     S. 256, a bill to amend title 11 of the United States Code, 
     and for other purposes.
         Bill Frist, Arlen Specter, Chuck Grassley, Judd Gregg, 
           Thad Cochran, R.F. Bennett, Wayne Allard, Lindsey 
           Graham, Jeff Sessions, Trent Lott, Rick Santorum, John 
           Warner, John Thune, Orrin Hatch, Lisa Murkowski, Mel 
           Martinez, Sam Brownback.

  The PRESIDING OFFICER. By unanimous consent, the mandatory quorum 
call has been waived.
  The question is, Is it the sense of the Senate that debate on S. 256, 
the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, 
shall be brought to a close?
  The yeas and nays are mandatory under the rule.
  The clerk will call the roll.
  The assistant journal clerk called the roll.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 69, nays 31, as follows:

                      [Rollcall Vote No. 29 Leg.]

                                YEAS--69

     Alexander
     Allard
     Allen
     Bennett
     Biden
     Bond
     Brownback
     Bunning
     Burns
     Burr
     Byrd
     Carper
     Chafee
     Chambliss
     Coburn
     Cochran
     Coleman
     Collins
     Conrad
     Cornyn
     Craig
     Crapo
     DeMint
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Frist
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Johnson
     Kohl
     Kyl
     Landrieu
     Lieberman
     Lincoln
     Lott
     Lugar
     Martinez
     McCain
     McConnell
     Murkowski
     Nelson (FL)
     Nelson (NE)
     Pryor
     Roberts
     Salazar
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stabenow
     Stevens
     Sununu
     Talent
     Thomas
     Thune
     Vitter
     Voinovich
     Warner

                                NAYS--31

     Akaka
     Baucus
     Bayh
     Bingaman
     Boxer
     Cantwell
     Clinton
     Corzine
     Dayton
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Harkin
     Inouye
     Jeffords
     Kennedy
     Kerry
     Lautenberg
     Leahy
     Levin
     Mikulski
     Murray
     Obama
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Wyden
  The PRESIDING OFFICER. On this vote, the yeas are 69, the nays are 
31. Three-fifths of the Senators duly chosen and sworn having voted in 
the affirmative, the motion is agreed to.
  Mr. McCONNELL. I ask unanimous consent that Senator Dole be 
recognized for up to 15 minutes as in morning business, after which 
Senator Jack Reed of Rhode Island be recognized for up to 10 minutes as 
in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The remarks of Mrs. Dole and Mr. Reed are printed in today's Record 
under ``Morning Business.'')
  The PRESIDING OFFICER (Mr. Coleman). The Senator from Illinois.


                       Amendment No. 40 Withdrawn

  Mr. DURBIN. Mr. President, on behalf of Senator Pryor, I ask 
unanimous consent amendment No. 40 be withdrawn.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DURBIN. Mr. President, now that we are postcloture, the number of 
amendments is limited, and the type of amendments will be limited. I 
have three pending amendments before the Senate relative to the 
bankruptcy bill.
  For those of you who have not followed the debate on this bill, this 
bill will change the bankruptcy law in America. Today, many people go 
into bankruptcy court because they have no place to turn. They have 
more debt than they can possibly pay.
  One of the major reasons people reach this point in life, the No. 1 
reason people go to bankruptcy court is medical bills. Three-fourths of 
the people in bankruptcy court with medical bill problems had health 
insurance when they were diagnosed with their illness. If you think, I 
don't have to worry about bankruptcy court because I have health 
insurance, so do these people. What happened? They got sick. The bills 
started piling up. Maybe they lost their job and their health insurance 
and couldn't afford to pay the COBRA premium, which people have to pay 
once they have lost a job and health insurance. They gave up on their 
health insurance, and the bills started stacking up. It reached the 
point for these folks where they had nowhere to turn. They faced 
$50,000, $100,000, or $200,000 in medical bills they could never pay 
off for the rest of their lives. In desperation, and with some 
embarrassment, people then went to bankruptcy court and said: I have no 
place to turn. I just can't do it.
  A court says: What do you owe? Give us all our assets. What do you 
have in checking and savings? How much is your home and your car worth? 
Furniture, everything--what is it all worth? Where are your debts? We 
will let you walk out of bankruptcy court with very little left, but 
your debts will be gone.
  That happens to people. More often than not, medical bills drive them 
there.
  There are other reasons. You lose your job. How many people have you 
met in their fifties in America--I have met many in Illinois--who had a 
great career and a great job and lost it, then went out looking for a 
comparable job only to learn they were ``too old for the market''? 
There they sat, taking a job that paid less, trying to maintain a 
family and household that was basically financed with a higher salary 
not that long ago. In desperation, they try to keep things together, 
and it starts to fall apart. The debts they incurred when they had a 
good job they cannot handle anymore.
  What else happens to people? Some people live on the margins already. 
Some single mothers trying to raise kids are in a situation where 
finally something happens to them--a medical bill, an unforeseen 
circumstance--and they are stuck in bankruptcy court.
  The credit industry comes in and says: We have to do something about 
these payments. We have to make it more difficult for them to walk out 
of that bankruptcy court having given up their assets with their debts 
basically behind them. So the law is changed here in this 500-page bill 
written by the credit card industry, written by the financial industry, 
to make it more difficult for a person to walk out of court with their 
debts behind them. They make sure in this bill that it is more likely 
for many that they will walk out of court still paying, on and on. As 
little as $165 a month is enough to say that you will never be forgiven 
in bankruptcy. You will just keep paying and paying. The creditors will 
keep calling and calling. That is what the credit industry wanted. They 
worked hard for 9 years. They are going to win this battle.

  We came to the Senate floor and said, at least let us carve out some 
people who really should be treated differently. I am sorry that the 
marines who were here earlier didn't stick around. I wish they could 
have, I wish they could have heard the debate on the floor of the 
Senate when I offered an amendment and said: If you activate a 
guardsman or a reservist for a year or a year and a half and they go 
over to serve their country as they promised, leaving behind a 
restaurant or a small business which falls into bankruptcy while they 
are gone--and it has happened--shouldn't we give them a break in 
bankruptcy court? For goodness'

[[Page S2217]]

sakes, these people aren't morally deficient; they are our best, and 
they are serving our country. They are protecting you, me, and everyone 
else.
  I put in an amendment that said, at least for the men and women in 
the military who face this kind of bankruptcy--and it happens--let us 
give them a break in this bill. Let us not put them through the 
harshest parts of this bill. I lost the amendment 58 to 38. Many of the 
Senators who go back home and cheer the troops and how much we love 
them and how much we want to stand behind them couldn't wait to vote 
with Visa and MasterCard and against the Army, Navy, Marine Corps, Air 
Force, and Coast Guard. That is what it came to. We lost that 
amendment.
  Senator Kennedy came to the Senate floor and said: If you get swamped 
with a medical crisis in your family and go into bankruptcy court 
trying to get out from under something you will never pay off, 
shouldn't you, when it is all over, at least be able to go home? 
Shouldn't you have a roof over your head when it is all over if it is 
medical bills that put you in bankruptcy court? He offered an amendment 
and said: Let us at least protect $150,000 in equity in your home that 
you can go back to after bankruptcy.
  Think about that. What will $150,000 buy you? In Springfield, IL, it 
buys you a nice little house. What does it buy you in Washington, 
Boston, New York, and California? Not much. But when we offered that 
amendment, only 40 Senators voted for it and 58 or 59 voted against it.
  The argument behind this bill originally was that too many people 
went to bankruptcy court because of their moral failure. They didn't 
understand that they can't game the system, they can't use it in a way 
that is fundamentally unjust and immoral by going to bankruptcy court 
when you shouldn't go. But in the two examples I have given you, does 
that argument apply? Is there something fundamentally wrong with the 
values of men and women in uniform serving our country who can't keep 
that business afloat back home? Of course not. Is there something 
fundamentally wrong with a person who feels as if he is on top of the 
world, goes in for a diagnosis at the doctor, and ends up with a life-
threatening disease which costs hundreds of thousands of dollars where 
his health insurance fails him? Is that a moral failure? It is a 
failing of Congress. It is a failing of your Government to deal with 
the realities of the challenges of life, whether it is health care or 
service in the military.

  We went in and argued: What if you were the victim of an identity 
theft? And it happens; it happened to me. What if someone steals your 
identity and runs up bills in your name? It can happen to anyone 
listening to this debate. Senator Bill Nelson of Florida said, in that 
situation; if all the bills that have swamped you are not even bills of 
your creation, shouldn't we give you a break under this tough new 
bankruptcy bill? Overwhelmingly, on a partisan rollcall, the answer 
was, no. No. Ultimately you shouldn't be discharged from bankruptcy 
even if those weren't your debts.
  We said: What if the people lending the money to you break the law 
while they are lending it to you? What if they take--and you know this 
story; it happens in every community. What if they take advantage of an 
elderly widow or widower living in that little home they have always 
had? They knock on the door: Boy, you sure could use a new roof, Ma'am. 
Luckily, I have a company out here that will do it if you just sign a 
few papers.
  The next thing you know, you have one of these phony, predatory 
lenders coming in with a subprime mortgage with a balloon clause, and 
grandma's little house disappears. He looked so trustworthy. He seemed 
like such a nice man. He told me this was a standard contract. Yes, I 
signed it. I should have called you, but I just signed it.
  What about those people? Should they be able to take away her home; 
go to bankruptcy court and stand in line with all the other creditors 
and say, Treat me like another legal creditor? I didn't think so.
  So I offered an amendment saying those people should not have the 
advantage of going to court if they have broken the law in the way they 
make the loan. I didn't have a chance on that amendment. Those who are 
supporting this bill did not want to talk about that. One Republican 
Senator supported me. Just one.
  Time and again, whether we are talking about victims of bankruptcy 
who deserve a little help, or whether we are talking about those gaming 
the system from the creditor's side, we found this stone wall that 
separates this Chamber. The Republican side does not want to consider 
any changes to this bill. The credit card industry has written it, and 
they are sticking with it.
  The only perfect laws ever written were written by God and Moses, as 
far as I am concerned. All of the rest are amendable. All the rest can 
be improved. Here we assume that if it was generated by the largest 
credit card companies in America, we cannot argue with them.
  One of the best arguments that has been made is, this bill does not 
apply to people who make less than the median income. That has been a 
point made over and over and over again during the course of this 
debate. Why is it important? Because this new law imposes a brandnew 
set of requirements in bankruptcy court for those who are above the 
median income. At least that is the argument.
  Let me show this listing of all the documents that now have to be 
filed in bankruptcy court. It is pretty long. I used to practice law. I 
know it takes time to fill these out. You sit down with your client. 
You say: Get your income tax returns. Get all the checks you can find. 
Let's sit down. This will take some time. This is the current 
requirement under the law. So it is not as if you walk into bankruptcy 
court, sign your name, and wave and leave out the other door. It is a 
long process.

  During the course of the process, your creditors and the trustee in 
bankruptcy decide whether you are telling the truth. If you aren't, 
they will throw you out of court on your ear. That is the way it ought 
to be.
  Now comes this bill which says these papers are not enough. Here we 
have the new means test. This is an example of what you have to do in 
addition to all the current requirements to file bankruptcy. This is 
the means test in this bill. It not only adds to the complexity of this 
process, it adds to the cost. So here you are without enough money to 
pay your bills, trying to figure out how to come up with a filing fee 
of $200, how to pay that lawyer who is going to represent you in 
bankruptcy, and along comes this bill which says let me give you some 
more paperwork to fill out before you can qualify for bankruptcy.
  The argument has been made over and over again in the Senate that 
people below the median income do not have to go through this. My 
amendment will clarify that, amendment No. 110. We want to make it 
clear that if you have below the median income, you do not have to go 
through the means test. In other words, on the first line up here, 
``current monthly income,'' if you have proof your current monthly 
income is in the lower income categories, supposedly protected from 
this bill, that ought to be the end of the story.
  It is not now. I want to clarify that. I want to make sure that 
Members of the Senate who have come to the Senate and said people below 
a median income could not have to worry about this bill, really mean 
what they say. I emphasize and underscore my amendment does not in any 
way relieve those filing for bankruptcy from meeting all the other 
requisite steps. They still need to complete a lot of forms and 
schedules outlining assets and liability. We add language that makes it 
abundantly clear that a court may not dismiss a case based on any 
formal means testing if the current monthly income of the debtor falls 
at or below the median family income of the applicable State. The 
language I offered merely reinforces what Members of the Senate on both 
sides of the aisle, particularly on the Republican side of the aisle, 
have said over and over and over again from the beginning of the 
debate.
  Let's look at the statement of my friend and colleague, Senator Orrin 
Hatch. Here is what Senator Hatch said in the Senate:

       It is possible that during this debate some may falsely 
     suggest that this bill unfairly treats low-income persons. 
     Let me tell you at the outset that the poor are not affected 
     by the means test. The legislation provides a

[[Page S2218]]

     safe harbor for those who fall below the median income, so 
     they are not subjected to the means test at all.

  But they are. Under the current language of this bill, it is not 
clear that they are exempt from the means test, as Senator Hatch has 
argued.
  Now, let's take a statement from Senator Frist, the Republican leader 
of the Senate. Senator Frist, on March 1, last week, said:

       It [the Bankruptcy Reform Act] establishes a means test 
     that is based on fair principle, a simple principle, and that 
     is this, that those who have a means should repay their 
     debts. A simple principle: Those who have the means should 
     repay their debts. It specifically exempts anyone who 
     earns less than the median income in their State.

  That is what my amendment says. If you earn less than the median 
income, finish the forms that are already provided in bankruptcy court, 
the new law does not affect you. But if you earn over the median 
income, you have to fill out more forms. So it means the lower income 
people, just as Senator Hatch and Senator Frist have said, will not 
have to go through the extra expense and the extra time of going 
through mountains of paperwork.
  Let me also take a quote from Senator Sessions from Alabama who has 
been on the Senate floor in support of this bill. Here is what he said:

       Chairman Sensenbrenner pointed out that the means-based 
     test only applies to people with incomes above the median 
     state average. Anyone below the state median income does not 
     qualify on the means-based test and their bankruptcy petition 
     cannot be tossed out of chapter 7 and put into chapter 13 
     where some debts are paid back.

  That is as clear as can be. Senator Sessions told us that. Now we 
have another statement from Senator Sessions:

       I remind all of my colleagues that people who are 
     economically distressed and if the income is below the median 
     income already will be exempt from the means test.

  So my challenge to all those who made those statements is, prove it. 
Prove it by voting for this amendment. Prove it that if you establish 
that you have an income below the median income in your area, that you 
do not have to go through this means test. They have all said it. Now 
they will have a chance to vote on it.
  Let me speak to one of my other amendments. I tried earlier in my 
first amendment to protect the soldiers activated and fighting overseas 
who lost their businesses. I failed, 58 to 38. I was surprised by that 
rollcall, but I watched what happens. Virtually every amendment has 
failed. As I said, some view this as holy writ. I just view it as a 
product of the credit industry, their best hope of something they want 
to pass in the Senate.
  So I will offer amendment No. 111 to exempt certain veterans and 
current members of the Armed Forces from the onerous administrative 
burdens resulting from the means test. We say in this amendment it 
applies to members and spouses of members of the Armed Forces on active 
duty performing a homeland defense activity under title 32, veterans or 
their spouses whose indebtedness occurred primarily during a 6-month or 
longer period of active duty or performance of a homeland defense, 
reservists of the Armed Forces or their spouses, same situation, 
surviving spouses of those who died while serving as a member of the 
Armed Forces.

  We take a category of Americans to whom we all owe such a great debt 
of gratitude and say if their debts overwhelm them because they are 
serving our country, we are going to give them a break, a chance to 
avoid this lengthy, expensive means test in this bill. I hope my 
colleagues will reconsider their earlier vote against this amendment. 
This is a much more compact, succinct, and limited break for those who 
are serving.
  The last amendment I will offer, amendment No. 112, is if I fail on 
the previous amendment. Let me tell you what it says. It provides an 
exemption from the means test only for disabled veterans who incurred 
their indebtedness primarily during a period of service. It covers 
service on active duty or during a National Guard homeland security 
operation. Certainly we can give something of a break to these 
Americans who have given so much to us.
  I go out to Walter Reed Hospital. Many of the men and women who have 
been injured are amputees. I remember one in particular. I said: How 
are you?
  He said: My rehab is coming along just fine. I think I will be great. 
I have my new leg. I am learning how to walk on it. I would like to go 
back to my unit, but I am going to go back home. I am a little bit 
concerned. I had a job back home. I was an automobile mechanic. I don't 
know if I will be able to return to that job.
  That situation for that man and for so many others reflects this 
change in their life. Yes, they will receive disability payments, but 
some of them, because of the serious injuries they have faced--head 
injuries, the loss of both hands, the loss of both legs--will not be 
able to return to the life they had before. Some of them may find they 
can't keep up with the debts that have been incurred while they have 
served our country. Is it possible the Members of the Senate, for 
disabled veterans, would give them a break if they are forced into 
bankruptcy because of debts incurred while they served our country? 
That is my last amendment.
  I hope it doesn't reach that point. I hope all of us who come to the 
floor to give important speeches in tribute to the men and women in 
uniform will cast important votes on behalf of those men and women.
  The credit card industry is important to America. I think they can do 
a better job in the business in which they are involved. They ought to 
take care, with the flood of credit cards that they send to everybody 
under the sun--the 3-and-a-half-year-old little boy of an attorney on 
my staff, a 9-month-old daughter of a friend of mine, all receiving 
credit card applications. They are throwing them at America. Many 
Americans, without thinking twice, are signing up, going more deeply in 
debt than they should.
  The monthly statement from the credit card company--I am telling you 
this as a lawyer--flip that over and try to read the fine print. 
Senator Akaka of Hawaii said: Shouldn't they tell you at least if you 
make a minimum monthly payment how much it is going to cost you over 
the period of time it will take to pay it off? Simple enough. The 
credit card industry opposed it. It was defeated on the floor. The idea 
of giving Americans more information so they can make the right credit 
decisions was defeated on the floor.

  You have to believe the industry that opposed providing that 
information is an industry that doesn't care if you go head over heels 
in debt. They think they are going to win. They are certainly going to 
win if this bill passes because that credit card debt is going to hang 
on for a lifetime. You won't be able to shake it. When we hear the 
stories of people who are going to be victimized, I hope we will think 
twice about the wisdom of this legislation.
  The trustees in bankruptcy were asked to take a look at what 
percentage of people filing for bankruptcy were fraudulent, had no 
business in court. They came up with the number 3 percent, 3 out of 100 
are fraudulent and should not be in court. Most of them are discovered. 
The credit card industry said, no, it is much larger. It is 10 percent, 
1 out of 10. This bill doesn't apply to the 10 percent of fraudulent 
filers. This bill applies to every filer in bankruptcy. That is why 
many of us think it is fundamentally unfair.
  I can read the votes. I have been around Congress to know this is 
going to pass. I certainly hope with these three amendments that my 
colleagues will take some time and consider whether they want to live 
up to what they have said. If they want to exempt lower income families 
from the means test, my amendment lets them do it. If they do believe 
we owe something to the men and women in uniform, my amendment gives 
them a chance to vote that way. And if for no other reason they want to 
show some sympathy and concern for disabled veterans who have given so 
much to our country, they will have a chance with amendment No. 112.
  I hope the solid wall of opposition to every single amendment will 
break down. I hope my colleagues will take the time to read and 
consider these amendments. It will be a lot easier to face the people 
back home if we at least give some flexibility to this bill when it 
comes to these important exceptions.
  I yield the floor and suggest the absence of a quorum.

[[Page S2219]]

  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. SESSIONS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. SESSIONS. Mr. President, I am proud of the bipartisan bankruptcy 
bill moving forward. We were excited over the strong vote for cloture 
to bring this debate to an end, 66 or more votes for cloture. That was 
a tremendous bipartisan show of support. I know my friend, the Senator 
from Illinois, opposes the bill. He has offered a lot of amendments. 
Fundamentally he doesn't like the bankruptcy bill. At one point he did. 
At one point he was a sponsor of it. For whatever reason he is now not 
supporting the bill. That is all right.
  Our goal with regard to the bankruptcy bill was to continue the 
historic privilege that Americans can wipe out debts and have a fresh 
start. However, since the new bankruptcy bill was passed in 1978--that 
is the new one we are now under, a big bankruptcy reform--then we had 
about 200,000 filers in bankruptcy. Now there are 1.6 million filers in 
bankruptcy. A lot of people are using bankruptcy as a way to avoid 
paying their just debts. We wrestled with that. There was a lot of 
concern that something is out of sync, that the classic American moral 
value that you ought to pay your debts if you can ought to be honored.
  At the same time we ought to create a circumstance in which people 
can start over. As many Americans have learned, if they fall behind in 
payment of debts, creditors call. You can have lawsuits filed against 
you. Families get embarrassed. Court orders get issued. Those kinds of 
things can be upsetting to a family. Sometimes you get so far behind 
there is no way you can get out of it. That is what bankruptcy is for. 
So we looked at it and tried to figure how we could reach the right 
balance.
  How do we crack down on those who want to get off scot-free, not pay 
their debts, when they have the money to pay them, and do we protect 
those who need a fresh start? First, let me tell you the power of 
bankruptcy. A person making $200,000 a year, who owes maybe $150,000 in 
various debts, can go into bankruptcy court and file bankruptcy today 
and get all those debts discharged, when he or she could easily have 
paid back most of them. That is the way the system works. You read one 
of those ads and call one of those guys or ladies who advertises in the 
free newspaper at the checkout counter, and they tell you to call your 
bankruptcy lawyer and wipe out your debts. People do it--sometimes only 
after talking to that lawyer who only gets paid, frankly, if the client 
retains him to file a bankruptcy. They may have other alternatives to 
get out of that financial difficulty and they may not understand that.
  What I want to emphasize is that we decided to create a bright line, 
a rule that would apply easily across the country in bankruptcy court, 
and that is what we are doing--amending the law of bankruptcy court, 
which is a Federal court, under Federal law. All bankruptcies are done 
in Federal bankruptcy court, so it is our responsibility to deal with 
the problems in that court. So we created a bright line rule.
  If you make below median income and you owe debts, you can wipe them 
out, as you always have. You don't have to pay your doctor, your 
hospital, the automobile mechanic down the street who fixed your car, 
your brother-in-law back for his loan, the credit card company, or 
anybody else you owe--the bank, the credit union, wipe them out. So if 
you make below median income, the law is basically still the same for 
the debtor; he wipes it out. We had expert testimony in the Judiciary 
Committee, of which I am a member, that said 80 percent of the people 
who file bankruptcy make below median income, only 20 percent above. We 
said what about people who make above median income, but they might 
have special circumstances? Maybe they have a child who has a high 
monthly expense. Maybe the debtor himself is disabled, with 
extraordinary medical expenses, or things of that nature. We said we 
would make an exception for those people who have extraordinary 
expenses, and the estimates show that would add another 7 to 10 percent 
who would be able to automatically file under the median income and, 
therefore, would not have to pay any of their debts back under this 
other provision of bankruptcy law, chapter 13. So we agreed on that.
  That is the bill that passed. That means test philosophy passed this 
Senate, one time, 97 to 1. It passed three times in this body. The last 
time we voted on it, it was 83 to 15 to pass the bankruptcy bill. We 
had the Schumer amendment on it--which we voted down recently--at that 
time, and the House of Representatives refused to take the bill and 
pass it. It died because of the Schumer amendment, which was a 
maddening thing for those of us who had been working on it for 4 years. 
I thought it was unbelievable that such a small but poison pill could 
kill the legislation. I have heard a lot of times about how a poison 
pill can kill a piece of legislation. Since I have been in the Senate, 
I have never seen a more perfect example of a poison pill. It came back 
up. Senator Schumer offered it and we voted it down earlier today.
  This bill will not have the poison pill in it. We sent it over there 
with bipartisan support every time and, for one reason or another, it 
didn't become law. The House supports it. I am confident if we pass 
this legislation, without the Schumer amendment, it will pass the House 
of Representatives and go to the President for signature. I emphasize 
all this to say there is nothing wrong with the means test. People who 
make high incomes--lawyers, doctors and accountants are examples--and 
file bankruptcy, wiping out all their debts, who don't care who 
got hurt by their failure to pay and they care only about themselves, 
this will crack down on those people who are abusing this system. I 
don't think there is anything wrong with it. I believe it is the right 
thing to do.

  As a matter of fact, I hear even those who oppose the bill say they 
don't oppose the bill, but they have spent all the time trying to 
confuse this, suggesting that poor people are going to have to pay 
something back. The chances are, if they are poor and are making below 
median income in America, they won't have to pay back anything. What if 
they make above median income? Perhaps they will have to pay back a 
portion of their debts. The bankruptcy judge, under certain 
circumstances, may order that they pay back a certain percentage. They 
can be made to pay a certain percentage of those debts back through the 
court, and it is distributed on a fair basis to the creditors who have 
claims against the debtor for a period not to exceed 5 years. That is 
what is commonly and legally known as chapter 13.
  A lot of people all over America choose chapter 13 and agree to pay 
back their debts because they think it is the right thing to do, and it 
has some personal advantages. A lot of people find it hard to believe, 
but in my home State of Alabama, about one-half of the filers in 
bankruptcy court choose to file under chapter 13. What happens when you 
go into chapter 13? All the phone calls have to stop. You cannot be 
sued. If a lawyer tries to execute a judgment against your property 
after you filed in bankruptcy under either chapter 7 or 13, they are in 
contempt of court immediately. The family gets to calm down. The court 
helps set up a repayment schedule for a part of the debts the debtor 
owes, and their paycheck may go to the bankruptcy court and they parcel 
it out to the various creditors, and the debtor gets to keep a certain 
amount to live on, whatever he or she needs. That is the way chapter 13 
works. It is not oppression to go into chapter 13. Almost half of the 
people in my State who file bankruptcy choose to file under chapter 13.
  Well, Senator Durbin quoted me. I was impressed that out of all those 
out here, he quoted me. I suppose he quoted me correctly, but maybe he 
was a little bit incorrect in interpreting what I had to say, or 
perhaps I spoke in a way he did not understand. I thought I was clear. 
I said in my remarks that if you make below median income, you are not 
subject to the means test. I guess that technically may be a 
misspeaking. What I meant was you are not required to pay anything back 
under chapter 13. He said, well, why fill out the forms? Well, you fill 
out the forms to see whether your income falls below the median income 
in America; that is why

[[Page S2220]]

you fill out the forms. Surely, people would expect you, if you want to 
ask a U.S. bankruptcy court in whatever State in America you are in and 
you want to ask them to discharge your debts, and you want them to 
order that you do not owe anybody you have been owing for the last 10 
years, and your debts are built up and you don't want to pay any of 
them a dime, surely it is not too much to ask somebody to show what 
their income is, to bring in a payroll stub to see what your paycheck 
is, and bring in an income tax return to see what you have been showing 
on your income tax. What is wrong with that? They say, oh, we have all 
these documents. I am telling you, I don't think we ought to be shocked 
that before a court wipes out maybe hundreds of thousands or tens of 
thousands of dollars in debt, they at least find out how much income 
the guy has and how much property. What if they own 500 acres of land 
out in the country? Should they not have to declare their assets?
  Why should they keep property, stocks, bonds, or anything else of 
value and not pay the people they solemnly committed to pay? If they 
have assets, let's find out what they are. That is all we are talking 
about.
  How are you going to tell whether a person qualifies for a means test 
if you do not have them produce some information about their income? I 
do not think that is oppression, and I do not think people are being 
oppressed if a credit card company lets them have $5,000 and they do 
not pay a dime of it back. I do not think a person is being oppressed. 
This is not some sort of anti-capitalist body. People get money all the 
time. They borrow money. They promise to pay it back. If nobody pays 
back their debts, everybody who uses a credit card will find their 
costs going up. Every bank loan will go up; every housing loan will go 
up. We have to have integrity, but we are going to give people--1.6 
million of them a year last I heard--the ability to wipe out their 
debts. For probably 90 percent of them, they can wipe out all of them 
if they choose, and for the remaining 10 percent, they may have to pay 
some back. Some of those people absolutely ought to be paying back some 
of their debts.
  We are all just victims here. It is so discouraging to me to hear 
skilled Members of this body talk about the American people as if they 
are just victims and pawns. I have seen the polls. Overwhelmingly, the 
American people believe you ought to pay your credit card debt back 
rather than pay other things because they know their interest rates are 
higher there. Frankly, I think everybody ought to reduce their credit 
card debt. They ought to chop them up and throw them away.
  I was glad that my children--my two daughters and son--when they were 
off at college had a credit card. I told them not to use it unless they 
had to, but if they were out on the road and the car broke down, or 
something happened, I trusted them to use that credit card. What a 
wonderful thing. Anywhere in America--actually anywhere in the world--
you can stick that card in a machine and out pops money. And if you pay 
it on time, you hardly pay any interest.
  I am not here to condemn the credit card companies, and I reject and 
am offended by the repeated suggestion that this bill is supposed to do 
nothing but protect credit card companies. That is false. It demeans 
the integrity of the Members of this Senate, in my view, who have 
worked hard on a bipartisan basis, 85 to 15, the last time we passed 
this legislation. I guess that is all they have to say when they 
complain about the bill.
  We talked about the military, and I am concerned about our military. 
I offered--and I was pleased that the President made part of his 
supplemental appropriations bill--an amendment to increase the death 
benefits of our soldiers, raising the basic death benefit from $12,000 
to $100,000 and increasing the SGLI, Servicemen's Group Life Insurance, 
to $400,000 from $250,000, retroactive to the beginning of the war on 
terrorism. It will help all those families.
  I, like other Senators, visited soldiers in the hospital at Walter 
Reed. I visited them in Germany. I have been in Iraq three times. I 
have talked with all the families from Alabama who have lost soldiers 
in the war. I served in the Army Reserve for 10 years, missing by 
several years being activated in the first Gulf War. Some of my best 
friends are still in the Army Reserve. I understand what they are going 
through. I talked with them in Iraq in January of this year. Some have 
suffered financial difficulties as a result. We know that.
  I offered the amendment that would make clear and explicit that a 
service man or service woman who has been activated and is not able to 
pay their debts would, in fact, be a special circumstance that could 
keep them from having to pay back their debts under chapter 13, and 
they would be able to wipe out all their debts. No matter what their 
debts are, if their income is below median income, they get to wipe 
them out anyway. It is just in that top 20 percent, they may need 
special circumstances.

  I defined it, and we passed--at the same time, Senator Durbin's 
amendment was voted down--to give them that special protection. I think 
that was the right way to do it. Senator Durbin had an automatic 
guaranteed set-aside for them in a way that I think was not as 
appropriate as the route the Senate chose to take. But he got a vote on 
his amendment and I got a vote on my amendment.
  I also recall, for those who are listening, that we do have a 
powerful Soldiers and Sailors Relief Act that has been updated. That is 
the new title. The old, classical Soldiers and Sailors Relief Act says 
if you are off on active duty serving your country, you cannot be sued, 
they cannot take a judgment against you, they cannot foreclose on your 
home, and there are a host of other protections for them.
  They have those protections. Plus, when you come back, you can 
bankrupt against any of the debts you may have. If you make above 
median income, the judge can consider and should consider military 
service as a special circumstance. I think that is the right way to do 
it. I believe we did the right thing on that issue.
  It really hurts me to hear people suggest, because they are unhappy 
with this bill and they filed an amendment that was not adopted exactly 
like they wanted it, that we who adopted the amendment to deal with 
this issue are insensitive to military men and women serving America.
  Those are some of my thoughts, Mr. President. I think the bill does a 
lot of good. There are some things about which we have not talked. We 
had the critics dominate the debate and point out everything they think 
is wrong and offer amendments. Senator Feingold has 15 amendments. 
Remember now, this is the fourth time this bill has been on this floor. 
The last time, we debated over 2 weeks on the legislation with 
amendment after amendment. This time we are going to be 2 weeks on it. 
I think we debated 2 weeks the other two times. There has been 
extensive debate. We have had debate and amendments offered in the 
Judiciary Committee likewise on these issues where Senator Feingold, 
Senator Durbin, and others serve.
  We have tried to be fair and open. Everybody has had a chance to 
raise their concerns, but it is time to vote and get this bill in the 
barn and move on to other issues.
  I want to mention a couple points that are so important for people in 
America who are having a hard time. Women and children who are victims 
of divorce and separation, deadbeat dads--what about that issue?
  In the course of our deliberations, we made a bipartisan commitment 
to raise the top debts that arise from alimony or child support to the 
highest level of a bankruptcy court. In other words, when there is a 
limited amount of money, the bankruptcy judge decides who gets paid 
first. In the past, they have always paid the lawyers and the court 
fees, and then they had some other things, and then women and children 
came along. We raised women and children to the top of the list. Of 
course, that is one reason they are unhappy with the bill--trust me. We 
also put some other provisions in it to reduce some of the litigation 
that goes on in bankruptcy court.
  We raised women and children to the top of the list. The National 
Child Support Group and the National District Attorneys Association 
that handles child support issues said it is absolutely a fact that 
women and children have a substantial benefit under this

[[Page S2221]]

act. One person said it is a veritable wish list for helping women and 
children who are owed child support and alimony to collect those debts. 
And they get paid even above so many other people.
  Also, I note that secured creditors are next, and the unsecured 
creditors, such as the credit card people, and those with personal 
notes and bills, such as your local gas station. Those debts come in as 
unsecured debts, and they are further down the list.
  We do not raise credit cards above people. We actually raised women 
and children up to the highest group. So I think there are a lot of 
good things in it, including a requirement that people who want to pay 
their debts, cannot handle their money and manage it well, must attend 
a financial management course before being discharged from bankruptcy. 
We want to see people manage their money well, get rid of those credit 
cards, contain their spending and manage their money wisely. That is 
what we would like to see them do. That is what the bill requires.
  It also says a person at least ought to talk with a credit counselor. 
These exist all over America. Many times they can help people manage 
their money. They get the whole family around the table, they talk 
honestly about what their financial situation is, what their debts are, 
and how they would have to be paid back. They have the ability to call 
the bank, the credit card company, or the mortgage company and say: We 
believe this client could file bankruptcy, but if you will allow them 
to reduce their payment to you for the next year and pay down some of 
these critical debts they owe, we will get back to you in full speed. 
We will help them achieve that. We will work out a budget with them.
  Many creditors agree to extend--some even forgive a part of their 
debts in order to help debtors so they do not have to file bankruptcy, 
and they learn something in the process. They do not have to go into 
credit counseling. They can go straight to the lawyers and file 
bankruptcy in the traditional way. I think some may decide that maybe 
this is the better alternative for them.
  If they go in response to one of those late night ads on television, 
or one of those newspaper ads to the bankruptcy mill, they are not 
going to get that information in most instances, although some lawyers, 
I am sure, do give them advice.
  Mr. DURBIN. Will the Senator yield for a question?
  Mr. SESSIONS. Yes.
  Mr. DURBIN. We are having an exchange, and maybe since we are both in 
the Chamber we can at least come to an agreement on our disagreement. 
And I will yield some of my own time if it reaches the point where the 
Senator thinks it is taking advantage of his time.
  Mr. SESSIONS. I was about to yield the floor, but, please, go ahead.
  Mr. DURBIN. If the Senator would stay for a few moments, I would like 
to see if we can get to an agreement on our disagreement.
  Right now, under current law, when I go into chapter 7 filing for 
bankruptcy, I am bound by the requirements of the Bankruptcy Code under 
section 521 to file a list of my creditors, unless the court orders 
otherwise, a schedule of assets, liability, current income, current 
expenditures, and statement of debtor's financial affairs and more when 
it comes to consumer debt currently. That is what happens when one goes 
into bankruptcy court--and that is this sheath of paper--they have to 
fill these things out. These are the documents that get one into court.
  Mr. SESSIONS. I would just add, one has to list those debts, and if 
they do not list them they are not discharged and they can still be 
liable for them. So the debtor has to list his or her debts.
  Mr. DURBIN. So one has to be careful. They better put all of their 
debts down if they want to have them discharged.
  Mr. SESSIONS. Right.
  Mr. DURBIN. In comes the new law, and the new law says if one is 
below median income, that is the end of the story. They continue as 
currently required under chapter 7. They do not have to go through and 
prepare and file this means test which is required here because they 
are not required to.
  Page 18 of the bill, no one can challenge a person if in the case of 
a debtor in a household of one person, the median family income of the 
applicable State is applicable. So this is the point that has been made 
over and over, again that having filed the basic documents in 
bankruptcy, if it is then established that one is below the median 
income, end of the story. This bill does not apply. That is the way I 
understood it.

  My amendment is trying to clarify it to make sure that is the way the 
Senator understands it. In other words, if I have done all of the basic 
filing and I disclose my monthly income and I am below median income, 
then I do not have to fill out the forms for the means test; it does 
not apply to me.
  I quoted the Senator earlier, Senator Frist, and Senator Hatch, who 
have all said that on the Senate floor. My amendment clarifies that and 
says that unequivocally, after someone has filed their basic documents, 
if they demonstrate their monthly income is below the median income, 
they do not have to fill out the forms for the means test as to what 
they can pay over the next 10 years. They are not covered by that.
  Is that the Senator's understanding of what this law says?
  Mr. SESSIONS. I think that is my understanding of it.
  Mr. DURBIN. Well, my amendment is only trying to clarify that. That 
is all it is doing. What I just described to the Senator is to say 
unequivocally, if someone files the initial documents currently 
required under chapter 7 and demonstrates to the court that their 
monthly income is below a median income, they do not have to fill out 
all of the additional paperwork required in the means test, which is 
substantial and expensive. If the Senator feels as I do, that that is 
what the law says or should say, I hope the Senator will look at my 
amendment. It is not a trick amendment. It is just trying to clarify 
that point.
  Mr. SESSIONS. I would be glad to review the amendment. It would 
appear clear to me that one does need to meet certain basic filing 
requirements.
  Mr. DURBIN. Absolutely.
  Mr. SESSIONS. So the income can be determined, and we did step that 
requirement up to require more in connection with income tax return 
filings and things of that nature.
  I know the Senator is a member of the Judiciary Committee and has 
worked hard on this bill, so I respect his concern over this issue. I 
am not one who believes we have a problem, but I will be willing to 
look at it.
  Mr. DURBIN. If the Senator would be kind enough to review my 
amendment, I would appreciate it very much.
  I yield to the Senator.
  Mr. SESSIONS. I yield the floor.
  Mr. DURBIN. I suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Martinez). The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. FEINGOLD. Mr. President, I ask unanimous consent the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                            Amendment No. 89

  Mr. FEINGOLD. Mr. President, I call up amendment No. 89 and ask for 
its immediate consideration.
  The PRESIDING OFFICER. Without objection, the amendment is once again 
pending.
  Mr. FEINGOLD. Mr. President, I ask unanimous consent that Senator 
Kerry, who is the ranking member of the Small Business Committee, be 
added as a cosponsor to the amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. FEINGOLD. Mr. President, we have spent a great deal of time 
debating and trying to improve provisions of this bill that affect 
consumer bankruptcies. Most of my colleagues may not even be aware that 
this bill actually contains provisions that make significant changes to 
portions of the Bankruptcy Code that relate to small businesses. They 
may not realize it, but it does. Subtitle B of title IV of the bill is 
entitled ``Small Business Bankruptcy Provisions,'' and I doubt more 
than a handful of people in this body have any idea what is in the 
subtitle.
  The subtitle includes a number of new restrictions and requirements 
for small businesses that want to reorganize under chapter 11. That is 
right, these are requirements and restrictions for small businesses 
that do not apply

[[Page S2222]]

to large companies. I was shocked when this came to my attention, but 
there it is in black and white, subtitle B, ``Small Business Bankruptcy 
Provisions.''
  These are not provisions to help small businesses, as one might 
expect from a bill that is going through the Senate. No, these 
provisions penalize small businesses. They make it harder for small 
businesses to reorganize in order to survive.
  Here is an example. Section 434 would require regular reports on the 
small business's profitability. They will have to report all kinds of 
things: profitability, cash receipts and disbursement, requirements to 
be in compliance with postpetition requirements, timely filing of tax 
returns, and ``such other matters as are in the best interests of the 
debtor and creditors.''
  This is a mountain of information. Mom-and-pop operations will have 
to spend a great deal of time pulling these reports together, and the 
reports probably will not even be useful. Creditors and judges 
examining a debtor's profitability rely on cash disbursements and 
receipts, not self-reporting, because they are more informative and 
less subject to manipulation. It seems to me these reports will not be 
of much use to anyone, but they will be quite burdensome for a small 
business to produce on a regular basis.
  What is the penalty for failure to jump through this bureaucratic 
hoop? Dismissal. Again, not for large corporations, mind you, which 
have armies of accountants to handle paperwork like this, but for the 
small entrepreneurs who could be spending that time keeping their 
businesses afloat instead of producing these piles of paper for some 
government file which basically no one will ever use.
  I do not want to have to go back to Wisconsin and have to explain to 
a grocery store owner who is already working late into the night, 
trying to pull her business through a financial crisis, that the 
Federal Government has decided to keep her even longer to put together 
a report that nobody even plans to read. I am very concerned, almost 
ashamed of this Chamber to think I would have to tell her that if she 
were a big corporation, if she were the big chain of huge grocery 
stores, then the law would not require this of her. It would not treat 
her this way.
  Professor Elizabeth Warren wrote, when the same language was proposed 
during the 107th Congress:

       A decision by Congress in 2001 that small businesses should 
     bear greater costs, face shorter deadlines, file more papers 
     and lose any flexibility that a supervising judge might 
     provide is a decision to shut down small businesses simply 
     because they are small.

  That is what Professor Warren wrote.
  I can see no justification for imposing burdens on small business in 
the bankruptcy code that will not be imposed on large corporations. It 
has always been our responsibility as legislators to protect small 
businesses. My amendment calls on us to fulfill that responsibility in 
a very significant way. It would simply strike a number of the 
provisions in title IV, subtitle B of the bill.
  Small businesses are the backbone of the American economy. According 
to the Small Business Administration, small firms represent 99.7 
percent of all employers and pay 44 percent of the total U.S. private 
payroll. Small businesses have generated from 60 to 80 percent of the 
net new jobs created annually over the last decade. I can't figure out 
why, for the life of me, we are trying to make life harder for small 
businesses.
  What is particularly puzzling is that I have heard a number of my 
colleagues complain about the burdens that they believe federal 
regulations impose on small businesses. The head of the Small Business 
Administration recently testified before the Small Business Committee 
that ``[s]ome of the heaviest burdens borne by small business in 
America are the result of unnecessary federal regulation and redtape.'' 
If my colleagues share that belief--and even if they don't--why would 
we want to impose further Federal regulations and red tape on small 
business chapter 11 bankruptcies?
  The worst thing about this attack on small business is that it is 
utterly unprovoked. Another provision of this bill would impose harsh 
deadlines on small businesses seeking to reorganize under chapter 11, 
but these deadlines are apparently designed to solve a problem that 
doesn't exist. The bill's drafters perhaps believed, back in 1998, that 
chapter 11 offers a shelter for failing small businesses, allowing them 
to delay the inevitable and die a lingering death to the detriment of 
their creditors. But this is just not the case.
  The bill would impose an arbitrary 300-day hard deadline for a small 
business to file its reorganization plan. But a recent study of small 
business bankruptcy cases by Professor Douglas Baird of the University 
of Chicago Law School and Professor Edward Morrison of Columbia Law 
School shows that this deadline is completely counterproductive. 
According to this study, more than half of small business chapter 11 
cases that fail--in other words, those that are dismissed, or converted 
to chapter 7 liquidations--are terminated within 4 months of filing. 
Over 70 percent are terminated within 6 months. By 300 days more than 
90 percent have already left the system. In other words, the 300-day 
deadline imposed by this bill will affect a very small percentage of 
small business plans that are actually bound for failure. It constrains 
the discretion of bankruptcy judges, without any apparent justification 
for doing so, since reorganization cases without merit are already 
being terminated in a timely manner.
  Instead of protecting the system against abuse by small businesses 
doomed to eventual failure, this bill will punish primarily small 
businesses that would otherwise succeed. Professors Baird and Morrison 
found that of the small businesses that successfully reorganize under 
chapter 11, nearly 40 percent need more than 300 days to do so. In 
other words, the facts show that by 300 days, most failing small 
businesses have already failed but many viable small businesses are 
still struggling. We should be helping them, not terminating them. 
Forcing small businesses capable of successfully reorganizing into 
chapter 7 liquidation proceedings is bad for their creditors, and 
tragic for the entrepreneurs who will see their livelihoods and their 
hard work over years or even generations needlessly destroyed.
  Compare the hard deadline in the bill to what happens in the 
bankruptcies of large corporations. United Airlines filed for chapter 
11 protection in December 2002. That is over 2 years ago. And the court 
has continually allowed the effort to come up with a reorganization 
plan that the creditors can accept to continue rather than force the 
airline to liquidate. We still don't know what will happen in that 
case, but clearly it is worth trying to save that company, with all its 
employees and devoted customers. Why don't we want to allow the courts 
to exercise the same flexibility for small businesses? Are they just 
not as important as the big corporations like United? Is that the 
message the Senate is trying to send with this bill? I can hardly 
believe that my colleagues want to send that message. But this could 
have a big impact on the ability of small businesses across the country 
to survive, so I urge my colleagues to take a close look at this 
amendment.
  These new burdens on small businesses are simply wrong. Congress 
simply should not be in the business of forcing viable small businesses 
into liquidation. And why are large corporations seeking to reorganize 
not similarly burdened? Do the bill's drafters think that large 
businesses are more important than small businesses, so we should give 
them extra time to reorganize?

  There is an additional irony here when you compare the requirements 
we put on large and small businesses in bankruptcy that my colleagues 
should consider. Large companies are often subject to a variety of 
reporting requirements by the federal securities laws that are not 
applicable to small businesses. But the SEC often exempts companies in 
chapter 11 from those requirements. At the same time that large 
companies are often excused from onerous reporting because of their 
bankruptcy, this bill puts additional reporting requirements on small 
businesses. Where is the fairness in that?
  If there is a crisis with small business bankruptcies, I am not aware 
of it. Professor Warren, one of the country's leading bankruptcy 
experts, was one of the authors of a 1999 Small Business Administration 
study. That study

[[Page S2223]]

found that one-third of bankrupt businesses had less than $100,000 in 
debts and almost four out of five had less than half a million dollars 
in debts. What is more, almost half--45 percent--of the small 
businesses had one or no employees when they filed for bankruptcy. 
These numbers don't give me any reason to think that small business 
bankruptcies are such a serious problem that we need to enact special 
provisions targeting them.
  Bankruptcy experts tell me that these small business provisions are 
just crazy. But they have been in the bill forever, and most of the 
focus is on the consumer provisions when we debate this bill. Someone 
needs to stand up and say, ``Wait a second. Why are we discriminating 
against small businesses in the bankruptcy laws?'' I can't think of a 
single bill in my entire time in the Congress--over 12 years--where a 
single law on the books treats small businesses worse than big 
corporations. That is the opposite of what we usually do in this body. 
We always protect small businesses. Why is this bill any different?
  When I offered this amendment in the Judiciary Committee, I heard two 
arguments against it. The first was that the provisions were 
recommended by the National Bankruptcy Commission. This is a very odd 
argument, coming from the same people who completely ignored the 
commission's work on consumer bankruptcy issues and drafted a bill 
largely in response to the credit industry's recommendations. But more 
importantly, I have been told that the commission provisions were 
created by certain commissioners who wanted to reform chapter 11 for 
all companies, large and small. The big companies came in and said: 
``No, don't do that to us. Those deadlines are too restrictive.'' Here 
is what happened. The recommendation was amended to apply only to small 
businesses. There was no showing that there are more abuses in small 
business bankruptcies than in chapter 11 filings for large companies. 
Small businesses apparently just didn't have the right lobbyists 
watching the process. So they got stung by these wrongheaded provisions 
that live on year after year in this bill without anyone coming forward 
to explain why they are necessary or useful.

  The second argument that came up in the committee was that small 
businesses support this bill. That is true, at least for some small 
businesses. But they don't necessarily support the particular 
provisions that I am talking about. They may not even know about these 
provisions. Small businesses, like large businesses, support the bill 
because it makes it harder for consumers to file for bankruptcy. But I 
doubt very much that they want the law changed to make it harder for 
struggling small businesses to reorganize under chapter 11.
  This is an important example of how this bill fails to reflect 
lessons we have learned in the years since it was first proposed. Given 
the recent history of large-scale corporate bankruptcies and scandals, 
the way this bill cracks down on small businesses is not only 
misguided, it is shocking. We should be focusing our energies on the 
real problem, not penalizing small businesses.
  I urge adoption of this amendment, and I hope that small businesses 
all across this country will be watching this debate. Those people who 
think the Senate is devoted to the interests of small businesses may be 
in for a rude awakening if this amendment is not agreed to.
  I yield the floor.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DeWINE. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DeWINE. Mr. President, I ask unanimous consent to proceed in 
morning business and I also ask unanimous consent that the time be 
counted as postcloture time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The remarks of Mr. DeWine and Mr. Dodd are printed in today's Record 
under ``Morning Business.'')
  Mr. DeWINE. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DODD. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                            Amendment No. 67

  Mr. DODD. Mr. President, I call up amendment No. 67.
  The PRESIDING OFFICER. That amendment is pending.
  Mr. DODD. Mr. President, this amendment--we have checked with the 
Parliamentarian--is a germane amendment to the bill. It was filed prior 
to the appropriate time, at the hour of 2:30 p.m. yesterday. Let me 
explain what this amendment does and why I am offering it this 
afternoon.
  I am offering this amendment to enable parents to meet the needs of 
their children. We just heard our good friend and colleague from Ohio 
talk about Mothers Against Drunk Driving and the problems that occur 
with underage drinking. It is appropriate, after that discussion, that 
I offer this amendment because it is not unrelated, we know the 
difficulty of single parenthood, of how hard it is for single parents, 
the overwhelming majority of whom are women, to try to raise children 
on their own, all of the pressures of holding down jobs and managing a 
family. It will not come as any great surprise to my colleagues to know 
that a significant percentage of underage drinking and children who 
have problems with the juvenile justice system and other related issues 
come from broken homes, unfortunately. The tremendous pressures of a 
single head of household holding down a job and keeping their family 
together is not easy.

  This amendment I am offering today on this bankruptcy bill relates to 
these familial circumstances, and it comes in several parts. I am going 
to take a few minutes and explain this amendment and why I believe it 
is important.
  Very simply, during the financial crisis of living through a 
bankruptcy, children should be protected to the maximum extent 
possible. That is my strong belief. I believe it is the belief of all 
of us. Regardless of one's politics or ideology, I think we all 
understand that when a family is going through bankruptcy, we ought to 
do what we can to protect the innocent. Whatever one's feelings may 
have been about the parents, about their responsibility or 
irresponsibility, children should not be penalized because of the sins 
or the faults of their parents. This amendment is designed to at least 
attempt, under those trying circumstances of a family going through 
bankruptcy, to protect those who are innocent--the children--to the 
maximum extent possible.
  About 39 percent of those filing bankruptcy in the United States are 
single women raising children, almost 40 percent. About 29 percent, 
almost 30 percent of those filing for bankruptcy are men, and 32 
percent of households filing for bankruptcy are married couples. So we 
are talking about 70 percent of those who are filing fall into the area 
of single parents and their problems related to it. While there may be 
some people who are trying to scam the system--and there certainly are, 
and I do not argue with that point at all--I believe most people do not 
file bankruptcy lightly. It is a highly emotional time and one of 
financial crisis.
  The most common reasons for 90 percent of women filing for bankruptcy 
include medical emergencies, job loss, and divorce. Women are 
especially vulnerable because they tend to have lower incomes and fewer 
assets and are more likely to be caring for children on their own.
  If my colleagues truly cared, and I believe they do, about protecting 
mothers and the innocent children who are caught up in the tremendously 
disruptive time of bankruptcy, I think they will end up supporting this 
amendment. At least I hope they do. If our colleagues truly care about 
marriage and strengthening marriages, they also would support this 
amendment. I cannot think of many more things more stressful on a 
marriage than filing bankruptcy.
  My amendment covers four main areas to protect children during this 
turbulent and emotional time. The amendment would modify the means test 
to provide greater flexibility and reasonableness when calculating a

[[Page S2224]]

debtor's ability to pay. Allowable expenses are broadened to ensure 
that parents, whether married or divorced, can still support their 
children as they live through a bankruptcy.
  For example, the amendment would allow a single mother, recently 
deserted by her husband, raising children who has filed for bankruptcy 
to continue paying education expenses for her child. Let us say that 
the mother, being a religious person and from a family that had used 
parochial schools for generations, is struggling to keep her child in 
one of these parochial schools. In this case, her 10 year old son has 
gone to a parochial school since kindergarten. It is where his friends 
go. After being fairly shy and withdrawn, he has begun to thrive there, 
has developed close relationships with several of his teachers. 
The mother was able to obtain a hardship reduction in tuition from the 
archdiocese, reducing the tuition to $3,500 a year.

  Under the means test in the pending legislation, under our bankruptcy 
bill, this mother could not file chapter 7 or chapter 13 if she 
continued to send her son to parochial school. The means test allows 
only $1,500 for tuition and any other education expenses--not enough 
for any religious school. We are not talking about some fancy prep 
school or boarding school; we are talking about a basic parochial 
school education, which in many areas of the country costs around 
$5,000 per year, sometimes even slightly more. One of my neighbors told 
me that the parochial high school his son attends costs roughly $8,000 
a year.
  The child did not file for bankruptcy. Why during this turbulent time 
should the child be ripped away from his circle of friends and moral 
mentors? This should be a time when the child needs his friends and 
trusted teachers the most, his circle of security, particularly during 
a time of separation by parents and a bankruptcy.
  The amendment would allow expenses associated with employment, such 
as child care, and it would allow alimony and child support to be used 
as intended to cover the needs of children in the household. 
Particularly with children, there are emergency expenses that arise, 
and any means test ought to reflect that reality.
  Second, this amendment would ensure that support payments and other 
funds, such as refunds from the earned income tax credit or child tax 
credit, intended for the current needs of children do not become the 
property of the bankruptcy estate with the corollary potential of being 
distributed to creditors. Money intended to support children and their 
needs should go to children who need it, not creditors, in my view. Why 
should the earned income tax credit or the refundable child credit be 
yanked away from supporting children so that the depth of poverty in 
which they may live becomes even greater?
  Thirdly, the amendment enables debtors going through bankruptcy to 
keep personal property normally found in or around the home, excluding 
automobiles. This would ensure that in bankruptcy situations, families 
with children are able to keep, without fear of repossession, household 
goods that typically have no resale value.
  Fourth, the amendment would ensure that debtors are not forced into 
bankruptcy court to seek to prove that some of these items have any 
value for resale and would necessarily have to be added, forced into 
bankruptcy court to prove these items were not luxury goods.
  This amendment, which I had hoped the managers of the bill would 
agree to, it is more technical than anything else. I am sorry it is not 
being accepted, because it goes to the very heart of what many of us 
have talked about and tried to accomplish over the years since 
bankruptcy laws were first modernized and adopted over a century ago in 
1903. This amendment deals with families and spouses, with child 
support issues and where they come into context of priorities when it 
comes to discharging responsibilities under the Bankruptcy Act.
  In 2003, as much as $95 billion in child support payments remained 
uncollected in the United States. It is a staggering sum of money and 
makes a huge difference to children growing up under adverse 
circumstances. It is estimated that one out of every other child living 
in poverty could be taken out of poverty if we were able to collect 
child support. Forget about appropriations or tax provisions we may 
adopt. if we could just collect the $95 billion in unpaid child 
support, we could virtually eliminate poverty in one out of every two 
children growing up under those circumstances in the United States.
  The bankruptcy bill before us is going to make it more difficult in 
many ways for those families out trying to find those spouses who owe 
this child support to make it available. Thus, I believe we are going 
to exacerbate the problem of children who rely on child support and 
families who rely on alimony being able to get those resources to 
minimize the effects that a divorce and separation can cause.

  When one excludes the ability to receive the financial support 
necessary to make ends meet, the problem becomes, obviously, even more 
pronounced, and children bear the price. Again, I repeat, whatever one 
may feel about the parents and their irresponsibility, putting 
themselves and their families in jeopardy, we ought to be highly 
sensitive to what happens to children. It is not their fault that their 
parents are filing bankruptcy. I do not believe necessarily it is the 
parents' fault either in many instances, with medical expenses, with 
divorce and job loss being the reason a large percentage of 
bankruptcies occur.
  Putting aside that for a moment, whether one agrees with those 
numbers, I do not know of a single person in this Chamber who would 
disagree with what I am about to say. Children should not have to pay 
the price of their parents' mistakes, and yet that is what we are going 
to do with this bill if we do not take some steps to try to correct the 
situation.
  Since 1903, our Nation's bankruptcy laws have been guided by the firm 
principle that women and children must be first in the distribution 
line of available assets during a bankruptcy proceeding. For over a 
century, debt owed to children and families has been nondischargeable. 
Thus, if a head of a household fails financially, whatever remaining 
assets he has could be used to spare his spouse or ex-spouse and his 
children from impoverishment. We do this because those who are most 
vulnerable in our society deserve the most protection.
  Today's bill, the Bankruptcy Abuse Prevention and Consumer Protection 
Act, would fundamentally alter this delicate balance achieved after a 
century of jurisprudence. We are altering the bankruptcy landscape for 
the benefit of credit card industry without understanding or 
recognizing what the consequences for families will be. Women and 
children will be disproportionately affected by this legislation unless 
it is amended, which is what I am trying to do with the amendment now 
before us.

  Whether as debtors filing for bankruptcy themselves or as creditors, 
three-quarters of a million women will be affected this year by the 
bankruptcy system, and it is estimated that as many as 1 million women 
will be affected in the coming year. I agree with those of my 
colleagues who think the bankruptcy law needs to be reformed and 
tightened. I do not disagree at all with that. But in my view it is 
possible to enact legislation that tightens the laws without depriving 
debtors and their families of reasonably necessary living expenses to 
care for their children.
  As this legislation is currently drafted, however, the credit card 
industry is protected, more protected than they have ever been. 
Unfortunately, families are not, in my view. This bill could turn the 
lives of children and families literally upside-down.
  I think it is enough of an emotional roller coaster for a parent to 
file bankruptcy, but I think to elevate the needs of the credit card 
companies over the needs of children is simply wrong. I am greatly 
concerned about the means test, which requires the trustee in 
bankruptcy to review all chapter 7 cases for ability to pay debts under 
a rigid IRS formula devised originally for delinquent taxpayers, now to 
be applied to bankruptcies. These standards neither take into 
consideration differences in the cost of living from region to region, 
nor do they ascribe rational expenses for the use of individual 
families. In my view, these rigid standards will deprive children and 
families of reasonably necessary living expenses.

[[Page S2225]]

  While moving child support to a first priority among unsecured 
creditors in chapter 7 sounds good, it is virtually meaningless, 
however.
  Listen to this. Fewer than 4 percent of chapter 7 debtors have 
anything to distribute to unsecured creditors. Listen to that again. 
Fewer than 4 percent of chapter 7 debtors have anything to distribute 
to unsecured creditors. That is to say 96 percent of these debtors have 
nothing to give out. So saying under chapter 7, ``you are first in 
line,'' means absolutely nothing except to 4 percent of those debtors. 
First in line when there is nothing means nothing. This is not a 
protection for women and families. It sounds good, but it is totally 
hollow when it comes to seeing to these children and these families 
whom, for 100 years, we have done a better job of protecting.
  Additionally, because the means test increases the potential for 
dismissing chapter 7 cases, this bill channels many debtors into the 5-
year, chapter 13 repayment plans, even though we know for a fact that 
two-thirds of such plans fail today. What will families live on during 
this time? What are proponents of this legislation going to do, go back 
to the time of Charles Dickens or debtors prisons?
  Under chapter 13, the bill would require that larger payments be made 
to credit card companies. As a result, payments of past-due child 
support would be made in smaller amounts and over a longer period of 
time, thus increasing the risk that children will not receive the 
support they need and the full debt would never be paid.
  Mothers and children would be in direct competition with credit card 
companies employing well-financed collection departments. How do you 
think mothers and children will fare when it comes down to competing? 
It is hard enough under the present system for these people to collect 
the $95 billion they are owed in one single year in child support, when 
they now are going to also have to compete, under chapter 13, with 
credit card companies who are well heeled and in a far better position 
financially, with teams of lawyers, to go after these debtors. I do not 
believe anybody could rationally conclude that a mother raising two or 
three children on her own, with limited resources, is going to be able 
to hire the lawyers to compete with the credit card companies going 
after the debtor husbands in these cases.
  Those are the practical realities. So for children and families, this 
bill makes life a lot worse because of exactly what I have explained: 
we are moving people out of chapter 7, where there was nothing much to 
give anyway, into chapter 13, where it becomes far easier for larger 
amounts of these resources, larger payments, to be made to the credit 
card companies.
  I am very concerned about the provisions of the legislation that make 
certain credit card debt nondischargeable. While the family support 
provisions added to this legislation are positive improvements, they 
have not cured the problems caused by the other provisions of the bill. 
In fact, they are negated by them, in my view. These are provisions 
that give far greater collection rights to the credit card lenders and 
fewer, in my view, to families and children.
  This bill elevates credit card debt to a presumed nondischargeable 
status. If a debtor purchases items or services on credit from a single 
creditor within 90 days of bankruptcy, and such items exceed $500 in 
value, these items would be presumed luxuries.
  Listen to that again. Within 90 days, if you make purchases from a 
single creditor exceeding $500, they are presumed luxuries--in 90 
days--3 months.
  Again, if you are a single parent with two or three kids, over 90 
days $500 is not a huge amount when you are talking about groceries or 
other essentials. Over a 3-month period--stretch it out and do the 
math--$500 over 90 days is really, in 21st century dollars, even if you 
go to the best discount stores, not going to be enough to make it. 
Current law allows up to $1,225 to be discharged within 60 days of 
bankruptcy. The bill as reported would limit it to $500 within 90 days, 
as I have said. The amendment I will offer when the time comes to vote 
on it will allow not $500 but less than $1,200 to $1,000 within 70 
days. So it is less than 90, a bit more than 60. It is less than $1,200 
under current law but certainly more than $500 to get you to $1,000.
  Again, I don't think this is any great luxury. You are trying to meet 
the needs of your family. To declare them to be luxuries--it doesn't 
seem a lot to me. Over a 90-day period it is not that hard to spend 
$501 at Wal-Mart to meet kids' needs. Most would agree such purchases 
are not luxuries. In 90 days alone, a family with children could exceed 
$500 on other expenses that arise with children.
  My amendment requires creditors to prove at a hearing that such items 
were not reasonably necessary for the maintenance and support of the 
debtor and her dependents, shifting the burden to creditors rather than 
the parents. If the creditor wants to make the case, let them do it, 
but don't lay the burden for $501 on a single mother with young kids to 
hire lawyers to go in and make the case these are not luxury items. I 
shift the burden over to the creditors. If they want to make the case, 
they can do so.
  I don't know what the proponents of this legislation are intending 
here, other than to protect the credit card companies at the expense of 
children. If you have $501 of food, medicine, and clothing expenses, 
and it is incurred within the last 90 days, then you have to go to 
court and spend money to prove these are not luxuries--food, medicine, 
and clothing. This point is one I find stunning in its potential 
implications. By the very fact that you are in bankruptcy court, how 
are you going to hire a lawyer to go in and prove that $501 was for 
necessities and not luxuries? We need to be far more practical than 
that, it seems. To go to Wal-Mart and buy food and clothes for your 
children, necessities they may need, that is considered a luxury if it 
is more than $500.
  If you are a single woman as a creditor, then you must wait until 
your ex-husband tries, or does not try, to defend a similar purchase. 
If he is unsuccessful, there will be less money for him to pay child 
support.
  So on either side of the equation, if you are the woman raising 
children on your own, either as a debtor or a creditor, this places 
tremendous burdens on your family. If this section is sustained in the 
bill, then I urge the President to veto it, which I am told he would 
not do, but I hope he would. This legislation, regardless of what else 
is here, I think putting credit card debt ahead of kids is just wrong.
  I think all my colleagues are probably familiar with the popular TV 
ad where a father takes his son to a baseball game, they rack up maybe 
$100 in costs--tickets, parking, hot dogs, sodas, maybe a popcorn to 
share and a small souvenir. The tag line in the commercial says: ``Cost 
of the memory--priceless.''
  What the commercial doesn't tell you about is the memory may be 
priceless, but if the next day that dad is unlucky enough to lose his 
job, have a heart attack, incur enormous hospital expenses without 
health insurance, and can't make his minimum payments on time, the 
credit card companies are only too happy to turn priceless into pricey. 
Unfortunately, pricey for the family with finance charges, overcharges, 
penalty fees, and other means, can turn a dream into a nightmare.
  This bill allows families to take a backseat to lenders, if lenders 
say their claims are secured by the debtors' property. For the first 
time in over 100 years, we have allowed these heretofore unsecured 
creditors to get into the bankruptcy courthouse. Currently, child and 
family support, taxes, and student loans are not dischargeable debts. 
For the first time in a century, the proposed legislation before us 
would bring into this unique category these other creditors--i.e., 
credit card companies--which will make the competition for scarce 
assets that much more fierce. These creditors have historically been 
unsecured because they have received the benefit of high interest and 
finance charges. Now they are becoming effectively secured creditors.
  With all of these concerns in mind, the amendment I am offering this 
afternoon seeks to address some of these problems. I hope these efforts 
will win broad bipartisan support. I have been terribly disappointed 
that there has been no willingness to even talk about some of these 
amendments. I don't know why we can't do this. This is not the end of 
the session. We are only in the month of March.

[[Page S2226]]

  This is an important bill. I understand that. But it is going to have 
huge implications for years to come if we don't sit down and listen to 
each other carefully to try to work out some of these matters so we can 
put a bill together. Yes, it may require a conference; it may require 
some negotiation. But isn't that a wiser course to follow than to 
rubberstamp a proposal because the other body doesn't want to sit down 
in conference on the bankruptcy bill, particularly when we are talking 
again about the most vulnerable in our society; that is, our children?
  Again, I emphasize what I said at the outset. We are talking about 
the innocents here. I don't want them to fall prey to the claim that 
people taking bankruptcy are guilty of something somehow.
  Again, if you accept the notion that most people who file bankruptcy 
are not doing so lightly, I don't know of anyone who likes to admit 
they are so messed up in every way possible that they put themselves in 
that situation. Are there people who take advantage? Yes. I know that 
is true. As we try to cure that problem, let us not create more 
problems for those who through no fault of their own find themselves in 
that situation; and, even worse yet, those who are completely innocent 
who find themselves so disadvantaged that the ability of parents--
particularly single women raising children--to find it harder and 
harder to collect those child support payments they desperately need to 
lift these children out of poverty, to make ends meet in the 21st 
century, with companies going bankrupt every day. We must see to it 
that those families who are already going through an awful lot don't 
find themselves going through even more.
  This amendment is a modest attempt to readjust this section of the 
bill, to inject some practicalities, to say that as we consider the 
rights of credit card companies we are not going to forget the rights 
of children, so we will put some reasonable ceiling in here to make it 
possible for everyone to be a winner, so people can go to bankruptcy 
court to get themselves out of debt, get on their feet again, see to it 
that creditors are going to have an opportunity to collect the 
obligations that are owed them, and not penalize those who ought not be 
a part of this debate in any consideration.
  I urge my colleagues to think about these amendments. I know it means 
changing the bill. I know it may mean going to a conference for a day 
or two. But I urge my colleagues to at least look at these proposals. 
If they make some sense, as some of them do, can't we sit down and try 
to resolve some before we go ahead and pass a bill that I think many 
may regret down the road when we consider the implications for those 
who are going to be adversely affected by this legislation?
  I also would like to add as part of the Record a couple of pieces of 
correspondence that speak to these particular issues. One is from the 
National Women's Law Center, a letter dated February 23, 2005. I will 
not read the whole letter. Let me read a couple of paragraphs, because 
they go to the heart of what I am talking about here.
  The letter reads:

       S. 256 would make it harder for women to access the 
     bankruptcy system because the means test requires additional 
     paperwork of even the poorest filers, harder for women to 
     save their homes, cars and essential household items through 
     the bankruptcy process and harder for women to meet their 
     children's needs after bankruptcy because many more debts 
     would survive. The bill also would put women owed child or 
     spousal support who are bankruptcy creditors at a 
     disadvantage by increasing the rights of many other 
     creditors, including credit card companies, finance 
     companies, auto lenders and others. The bill would set up an 
     intense competition for scarce resources between mothers and 
     children owed support and these commercial creditors during 
     and after bankruptcy.

  The letter goes on.
  I ask unanimous consent that the letter from the National Women's Law 
Center be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                  National Women's Law Center,

                                Washington, DC, February 23, 2005.
     Re oppose S. 256, the Bankruptcy Act of 2005.

       Dear Senator: The National Women's Law Center is writing to 
     urge you to oppose S. 256, a bankruptcy bill that is harsh on 
     economically vulnerable women and their families, but that 
     fails to address serious abuses of the bankruptcy system by 
     perpetrators of violence against patients and health care 
     professionals at women's health care clinics.
       This bill would inflict additional hardship on over one 
     million economically vulnerable women and families who are 
     affected by the bankruptcy system each year: those forced 
     into bankruptcy because of job loss, medical emergency, or 
     family breakup--factors which account for nine out of ten 
     filings--and women who are owed child or spousal support by 
     men who file for bankruptcy. Contrary to the claims of some 
     proponents of the bill, low- and moderate-income filers--who 
     are disproportionately women--are not protected from most of 
     its harsh provisions, and mothers owed child or spousal 
     support are not protected from increased competition from 
     credit card companies and other commercial creditors during 
     and after bankruptcy that will make it harder for them to 
     collect support.
       The bill would make it more difficult for women facing 
     financial crises to regain their economic stability through 
     the bankruptcy process. S. 256 would make it harder for women 
     to access the bankruptcy system, because the means test 
     requires additional paperwork of even the poorest filers; 
     harder for women to save their homes, cars, and essential 
     household items through the bankruptcy process; and harder 
     for women to meet their children's needs after bankruptcy 
     because many more debts would survive.
       The bill also would put women owed child or spousal support 
     who are bankruptcy creditors at a disadvantage. By increasing 
     the rights of many other creditors, including credit card 
     companies, finance companies, auto lenders and others, the 
     bill would set up an intensified competition for scarce 
     resources between mothers and children owed support and these 
     commercial creditors during and after bankruptcy. The 
     domestic support provisions in the bill may have been 
     intended to protect the interests of mothers and children; 
     unfortunately, they fail to do so.
       Moving child support to first priority among unsecured 
     creditors in Chapter 7 sounds good, but is virtually 
     meaningless; even today, with no means test limiting access 
     to Chapter 7, fewer than four percent of Chapter 7 debtors 
     have anything to distribute to unsecured creditors. In 
     Chapter 13, the bill would require that larger payments be 
     made to many commercial creditors; as a result, payments of 
     past-due child support would have to be made in smaller 
     amounts and over a longer period of time, increasing the risk 
     that child support debts will not be paid in full. And, when 
     the bankruptcy process is over, women and children owed 
     support would face increased competition from commercial 
     creditors. Under current law, child and spousal support are 
     among the few debts that survive bankruptcy; under this bill, 
     many additional debts would survive. But once the bankruptcy 
     process is over, the priorities that apply during bankruptcy 
     have no meaning or effect. Women and children owed support 
     would be in direct competition with the sophisticated 
     collection departments of commercial creditors whose 
     surviving claims would be increased.
       At the same time, the bill fails to address real abuses of 
     the bankruptcy system. Perpetrators of violence against 
     patients and health care professionals at women's health 
     clinics have engaged in concerted efforts to use the 
     bankruptcy system to evade responsibility for their illegal 
     actions. This bill does nothing to curb this abuse.
       The bill is profoundly unfair and unbalanced. Unless there 
     are major changes to S. 256, we urge you to oppose it.
           Very truly yours,
     Nancy Duff Campbell,
        Co-President.
     Marcia Greenberger,
       Co-President.
     Joan Entmacher,
       Vice President and Diretor, Family Economic Security.

  Mr. DODD. Mr. President, I want to quote a letter from the Children's 
Defense Fund, again expressing their concern about these sections of 
the bill. I will read from this letter as well.

       The Children's Defense Fund is writing to urge you to 
     oppose S. 256, the bankruptcy bill, that would hurt many 
     Americans facing financial problems through job loss, 
     divorce, child rearing, lack of medical insurance, or 
     predatory lending practices. This bill would inflict hardship 
     on more than 1 million economically vulnerable women and 
     families who are affected by the bankruptcy system each year. 
     Medical emergency, job loss and family breakup are important 
     factors which account for nine out of ten filing for 
     bankruptcy. The bill would also hurt women who are owed child 
     or spousal support by men who file bankruptcy. The bill would 
     make it far more difficult for women to collect support 
     because credit card companies and other commercial creditors 
     will have greater claims to the debtor's resources during and 
     after bankruptcy. Being first among unsecured creditors in 
     chapter 7 bankruptcy is meaningless when over 95 percent of 
     debtors have no resources to pay unsecured creditors.
       In chapter 13, the bill would require larger payments to be 
     made to many commercial creditors resulting in smaller 
     payments to past-due child support over longer periods of 
     time increasing the risk that child support debts will not be 
     paid in full. And after the

[[Page S2227]]

     bankruptcy is over, more and more debts owed to commercial 
     creditors will survive, and mothers and children owed support 
     are not a match for the collection departments of the 
     commercial credit industry.
       S. 256 contains a number of provisions which would have a 
     severe impact on families trying to regain their economic 
     stability through the bankruptcy process.

  The letter goes on. Those are pertinent paragraphs when it comes to 
the amendment which I am offering here today.
  I ask unanimous consent that this letter be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                      Children's Defense Fund,

                                                     March 3, 2005
     Re Oppose S. 256, The Bankruptcy Act of 2005.
       Dear Senators: The Children's Defense Fund is writing to 
     urge you to oppose S. 256, a bankruptcy bill that would hurt 
     many Americans facing financial problems due to job loss, 
     divorce, child-rearing, lack of medical insurance, or 
     predatory lending practices. This bill would inflict hardship 
     on more than one million economically vulnerable women and 
     families who are affected by the bankruptcy system each year. 
     Medical emergency, job loss or family breakups are factors 
     which account for nine out of ten filings.
       The bill would also hurt women who are owed child or 
     spousal support by men who file for bankruptcy. The bill 
     would make it more difficult for mothers to collect support 
     because credit card companies and other commercial creditors 
     will have greater claims to the debtor's resources during and 
     after bankruptcy. Being first among unsecured creditors in 
     Chapter 7 bankruptcy is meaningless when over 95 percent of 
     debtors have no resources to pay unsecured creditors. In 
     Chapter 13, the bill would require larger payments to be made 
     to many commercial creditors, resulting in smaller payments 
     of past-due child support over a longer period of time, 
     increasing the risk that child support debts will not be paid 
     in full. And after the bankruptcy is over, more more debts 
     owed to commercial creditors will survive--and mothers and 
     children owed support are not a match for the collection 
     departments of the commercial credit industry.
       S. 256 contains a number of provisions which would have a 
     severe impact on families trying to regain their economic 
     stability through the bankruptcy process. S. 256 would make 
     it harder for women to access the bankruptcy system. Low and 
     moderate income families are not protected from many of the 
     bill's harsh provisions. Parents who desperately need to 
     preserve their homes from foreclosure or prevent their 
     families from being evicted, or keep a car to get a work, 
     would find it more difficult to do so. And, when the 
     bankruptcy process was over, parents already facing economic 
     disadvantage would find it harder to focus their income on 
     reasonable and necessary support for dependent children 
     because many more debts would survive.
       Passage of the bankruptcy bill would make it harder for 
     families struck by financial misfortune to get back on track. 
     It would benefit the very profitable credit card industry at 
     the expense of the modest-income families who represent the 
     great majority of these who declare bankruptcy. Congress 
     should not enact reform that puts women and children at 
     greater risk. The bill is profoundly unfair and unbalanced. 
     Unless there are major changes to S. 256, we urge you to 
     oppose it.
           Very truly yours,
                                             Deborah Cutler Ortiz,
                               Director of Family Income and Jobs.

  Mr. DODD. Mr. President, the Association for Children for Enforcement 
of Support is supporting this amendment and opposes the legislation. 
The American Association of University Women, American Medical Women's 
Association, the Business and Professional Women of the United States, 
the Center for Law and Social Policy, the Center for the Childcare 
Workforce, Child Welfare League of America, the National Council of 
Jewish Women, the National Organization for Women, the National 
Partnership for Women and Families, the YWCA of the United States--all 
are groups which support the amendment and oppose this legislation.
  Again, I realize the hour is late. We are getting closer to passage 
of this bill. I don't think it is so late, however, not to try to make 
some modest changes in this legislation that I think would go a long 
way to providing some relief for families.
  Again, this is one of the areas of law that is written into our 
Constitution. Article I, section 8 of the U.S. Constitution, drafted 
back in the 18th century, specifically provided and called upon the 
Congress of the United States to enact bankruptcy laws. To understand 
why they did so, go back and look at the Federalist Papers. They talked 
about doing it as an opportunity for people to get back on their feet 
again. That was the idea--to see to it that creditors could be 
compensated to the maximum extent possible, but that also those filing 
for bankruptcy would begin a new chapter in their lives, to get on 
their feet again.
  It seems to me we ought to be trying to do that with this 
legislation, not only helping the creditors collect what is due them, 
but simultaneously making it possible for good people to get a fresh 
start.
  If in the process of helping the creditors get paid we make it more 
difficult for people to get on their feet again, we are lacking the 
balance which I think we ought to be striking with this bill.
  I urge my colleagues not to necessarily rely on what I have said here 
today, but to review these sections of the bill and ask yourself 
realistically whether in this day and age the kind of caps we are 
putting on, kind of forcing people into the chapter 13 category, if we 
are not exactly undoing what we have done for 100 years to modern 
bankruptcy laws.
  The modern bankruptcy laws put not only families first but they also 
left them alone. If you were dealing with child support and alimony, 
once you paid those, or set up a payment schedule, whatever is left 
over, you dispensed to your creditors, you were not only the first in 
line, you were the only one in line. This changes that. You can be 
first in line under this bill, but you are not the only one in line, 
and other people in line have far more resources and strength to be 
able to compete for those debtors' funds to compensate these creditors. 
It puts families at a disadvantage.
  There are a lot of other reasons to be concerned about this bill. I 
know my colleagues care about children. I know they care about 
families. They want to see these innocents have a chance for a decent 
life. This bankruptcy bill, if not amended, will make it far more 
difficult to achieve those goals.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Alexander). The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. McCONNELL. Mr. President, I ask consent that at 5:45 today the 
Senate proceed to a vote on or in relation to the Feingold amendment 
No. 89, with the time equally divided in the usual form until the vote; 
provided further that no amendments be in order to the amendment prior 
to the vote.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. McCONNELL. I ask the action we just took be vitiated. I will wait 
until Senator Durbin gets to the floor and I will reoffer the consent 
agreement.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that at 5:45 
today the Senate proceed to a vote on or in relation to Feingold 
amendment No. 89, with the time equally divided in the usual form until 
the vote; provided further that no amendments be in order to the 
amendment prior to the vote.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DURBIN. If the majority whip would yield for a question, I have 
three germane amendments pending. I think others are in the same 
position, including Senator Feingold. It is my hope to move as quickly 
as possible to a quick, limited debate, for just very short periods of 
time, and then to vote on these amendments in an effort to keep the 
bill moving forward. I ask the Republican whip whether or not there are 
plans to call any other votes today or early tomorrow.
  Mr. McCONNELL. Mr. President, I might say to my friend from Illinois, 
we have been reviewing amendments. I am hopeful we can have some 
discussion between now and the vote about how we proceed from here.
  Mr. DURBIN. I thank the Senator.
  Mr. McCONNELL. I yield the floor.
  Mr. DURBIN. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.

[[Page S2228]]

  The bill clerk proceeded to call the roll.
  Mr. CRAIG. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                            Amendment No. 89

  Mr. CRAIG. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The yeas and nays were ordered.
  Mr. CRAIG. I ask unanimous consent that Senator Feingold have 2 
minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. FEINGOLD. I thank the Senator from Idaho.
  Mr. President, we are about to vote on an amendment that will tell 
this Nation's small businesses whether we stand with them. This bill 
includes a number of new restrictions and requirements for small 
businesses that want to reorganize under chapter 11. These requirements 
and restrictions for small businesses don't apply to large companies. I 
was shocked when this came to my attention, but there it is in black 
and white: Subtitle B, Small Business Bankruptcy Provisions. And these 
are not provisions to help small businesses as one might expect from a 
bill that is going through the United States Senate. No, these 
provisions penalize small businesses. They make it harder to reorganize 
in order to survive.
  These new provisions are entirely unnecessary. There is no crisis in 
small business bankruptcies. And a new study shows. that most failed 
attempts at chapter 11 reorganization are concluded within 300 days, 
which is the hard deadline in the bill. But 40 percent of 
reorganizations that succeed take longer than 300 days. That means that 
this bill is going to make some small businesses fail that don't have 
to. That is an absurd result. Remember the United Air Lines Chapter 11 
reorganization is over two years old and it is still going on. Why 
shouldn't small businesses get that kind of leeway if there is a chance 
they can pull through?
  These provisions haven't received nearly the attention in this body 
that the portions of the bill that deal with consumer bankruptcies have 
received. We need to take these provisions out. Doing so won't have any 
effect on the core provisions of this bill. But it will prevent a real 
injustice from being done to small businesses. Forcing a small business 
to liquidate rather than reorganize is bad for creditors, bad for 
consumers, and bad for small businesses. I urge the adoption of the 
amendment.
  The PRESIDING OFFICER. The Senator from Idaho.
  Mr. CRAIG. Mr. President, Chairman Grassley would ask for a no vote, 
as would Senator Hatch.
  The PRESIDING OFFICER. The question is on agreeing to the Feingold 
amendment No. 89.
  The yeas and nays have been ordered.
  The clerk will call the roll.
  The bill clerk called the roll.
  The PRESIDING OFFICER (Mr. Isakson.) Are there any other Senators in 
the Chamber desiring to vote?
  The result was announced--yeas 54, nays 59, as follows:

                      [Rollcall Vote No. 30 Leg.]

                                YEAS--41

     Akaka
     Baucus
     Bayh
     Bingaman
     Boxer
     Byrd
     Cantwell
     Clinton
     Conrad
     Corzine
     Dayton
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Harkin
     Inouye
     Jeffords
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Obama
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--59

     Alexander
     Allard
     Allen
     Bennett
     Biden
     Bond
     Brownback
     Bunning
     Burns
     Burr
     Carper
     Chafee
     Chambliss
     Coburn
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeMint
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Frist
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Johnson
     Kyl
     Lott
     Lugar
     Martinez
     McCain
     McConnell
     Murkowski
     Nelson (NE)
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Thune
     Vitter
     Voinovich
     Warner
  The amendment (No. 89) was rejected.
  Mr. FRIST. Mr. President, for the information of our colleagues, we 
are making great progress on the bill. We are in the cloture period. We 
will not have further rollcall votes tonight, although we will keep the 
clock running in the cloture period and we will continue debate over 
the course of tonight. So we are here. We do encourage people who do 
want to speak on the bill to come and speak.
  Tomorrow morning we will, after discussion on both sides of the aisle 
with the managers, have a series of stacked rollcall votes in the 
morning in order to not have rollcall votes tonight. But we are on the 
bill. The clock will continue to run, and debate should continue. There 
will be no rollcall votes tonight, stacked votes tomorrow. We would 
expect to finish this bill in all likelihood sometime tomorrow, late 
tomorrow.
  I yield the floor.
  Mrs. BOXER addressed the Chair.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. BOXER. Mr. President, I ask unanimous consent that the pending 
amendments be set aside so I may call up amendment No. 62, and then I 
will ask it be laid aside.
  The PRESIDING OFFICER. Is there objection?
  Mr. SESSIONS addressed the Chair.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. SESSIONS. Mr. President, will the Senator restate her request?
  The PRESIDING OFFICER. The Senator will suspend. The clerk will 
report the amendment.
  The bill clerk read as follows:

       The Senator from California (Mrs. Boxer) proposes an 
     amendment numbered 62.

  Mr. SESSIONS. Mr. President, reserving the right to object.
  The PRESIDING OFFICER. The Senator from Alabama.
  Mr. SESSIONS. Would the Senator propound her unanimous consent 
request again?
  Mrs. BOXER. I think it has already been agreed to.
  Mr. SESSIONS. I sought recognition.
  The PRESIDING OFFICER. The Chair did not hear the Senator originally; 
however, precedent allows the Senator to reserve the right to object at 
this time.
  Mr. SESSIONS. Will the Senator restate her unanimous consent? There 
was noise on the floor, and I just did not hear it.
  The PRESIDING OFFICER. The Senator will suspend a moment.
  Will the Senator from California restate her request.
  Mrs. BOXER. I ask unanimous consent the pending amendment be set 
aside so I may call up amendment No. 62. It would then be my intent to 
ask it be laid aside. I believe we have an agreement that I be given 10 
minutes in the morning, followed by a vote at a time both sides can 
agree to.
  The PRESIDING OFFICER. Is there objection? The Senator from Alabama.
  Mr. SESSIONS. I object at this time, but I would check with our 
colleagues, and if that is acceptable--I could check that, but I would 
object at this time.
  Mrs. BOXER. Mr. President, I will suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DURBIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                      Amendment No. 111 Withdrawn

  Mr. DURBIN. Mr. President, I ask consent my pending amendment No. 111 
be withdrawn.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                            Amendment No. 62

  Mr. DURBIN. Mr. President, I ask unanimous consent the pending 
amendments be set aside so that Senator Boxer may call up amendment 
numbered 62.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from California [Mrs. Boxer] proposes an 
     amendment numbered 62.


[[Page S2229]]


  Mrs. BOXER. I ask unanimous consent reading of the amendment be 
dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To provide for the potential disallowance of certain claims)

        On page 132, between lines 5 and 6, insert the following:

     SEC. 234. DISALLOWANCE OF CLAIM IF BASED ON EXTENSION OF 
                   CREDIT TO CERTAIN INDIVIDUALS UNDER 21 YEARS OF 
                   AGE.

       Title 11, United States Code, as amended by this Act, is 
     further amended by inserting after section 112 the following:

     ``Sec. 113. Disallowance of claim if based on extension of 
       credit to certain individuals under 21 years of age

       ``(a) In General.--In making a determination of whether to 
     disallow a claim under this title, the court shall consider 
     if the claim is based upon an extension to an individual of 
     unsecured credit and the factors listed in subsection (b) are 
     present. The factors listed in subsection (b) may be the 
     basis for a disallowance of a claim under this title.
       ``(b) Factors.--The factors under this subsection are the 
     following: if the individual, at the time unsecured credit 
     was extended--
       ``(1) was under 21 years of age;
       ``(2) did not have a co-obligor on such unsecured credit 
     who was a parent or spouse of the individual;
       ``(3) had an income level that was below or at the poverty 
     line (as defined by the Office of Management and Budget, and 
     revised annually in accordance with section 673(2) of the 
     Community Services Block Grant Act (42 U.S.C. 9902(2))); and
       ``(4) already had 6 or more unsecured credit cards.''.

  Mrs. BOXER. I ask unanimous consent the amendment be set aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. BOXER. I thank my colleagues very much.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that when the 
Senate resumes the bankruptcy bill tomorrow morning, the Senate begin 
10 minutes of debate equally divided on each of the following 
amendments in the order mentioned below; provided further that 
following that debate the Senate begin a series of votes on or in 
relation to the amendments in that same order; provided that no 
amendment be in order to the amendments prior to the ordered votes. I 
further ask that there be 2 minutes equally divided for debate between 
the votes after the first vote and, lastly, that all votes in this 
sequence after the first vote be limited to 10 minutes in length.
  The amendments are Durbin, No. 110; Harkin, No. 66; Boxer, No. 62; 
Dodd, No. 67.
  I further ask unanimous consent that notwithstanding the adjournment 
of the Senate, all time overnight until the Senate resumes 
consideration of the bill be counted under the provisions of rule XXII.
  The PRESIDING OFFICER. Is there objection?
  Mr. DURBIN. No objection.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRASSLEY. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LEAHY. Mr. President, my amendment, cosponsored by my friend and 
colleague, Senator Cantwell, would greatly assist the many victims of 
domestic violence whose physical well-being or whose children's 
physical well-being would be threatened by summary eviction as a result 
of filing or bankruptcy. I ask unanimous consent that the text of our 
amendment be printed in the Record after my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit 1.)
  Mr. LEAHY. The connection between domestic violence, economic abuse, 
and housing is overwhelming. Women and children who are fleeing 
domestic violence make up a significant portion of the homeless 
population. According to the United States Conference of Mayors, 57 
percent of cities surveyed identified domestic violence as a primary 
cause of homelessness.
  These women and children are homeless because in their desperate 
attempt to leave their abusers they find themselves with few, if any, 
funds with which they can support themselves. Victims of domestic 
violence have a tough time finding room at emergency homeless or 
domestic violence shelters, and often fail to find adequate housing 
because affordable, long-term housing is not available in so many 
communities. If housing is available there are often long waiting 
lists. Victims face unique causes of their financial hardships due to 
the fact that batterers frequently harass their victims at work, and 
survivors are often fired or cannot maintain steady employment 
resulting in losing the ability to pay for housing. Faced with the lack 
of stable housing, finances and services, victims must choose between 
life with an abusive partner and life on the streets.
  Our amendment would provide leniency for women and children who are 
affected by domestic violence and would, in fact, help victims to move 
forward and start new lives. Without the threat of losing their 
housing, women and children who are survivors of domestic violence will 
not be forced to a situation where they are homeless or returning to 
their abuser.
  This amendment would modify the bankruptcy code to ensure better 
protection for victims of domestic violence by granting them relief 
from summary eviction from their rental housing. Relief may be granted 
only under the condition that the debtors certify under penalty of 
perjury that they are victims of domestic violence whose physical well-
being or whose children's physical well-being would be threatened 
through eviction. our amendment would not allow families to take 
advantage of the system, but it will be a life-saver for those who 
would face danger if they lost their homes.
  This amendment is supported by the National Coalition Against 
Domestic Violence, the National Network To End Domestic Violent and the 
Family Violence Prevention Fund. I ask unanimous consent to print in 
the Record letters from those groups voicing that support.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                    March 7, 2005.
       Dear Senator: As national organizations working to address 
     the varied needs of victims of domestic violence, we urge you 
     to support Senator Leahy's proposed amendment to the 
     Bankruptcy Abuse Prevention and Consumer Protection Act of 
     2005, S. 256. This provision is essential for the many 
     victims of domestic violence whose physical well-being or 
     whose children's physical well-being would be threatened by 
     summary eviction as a result of filing for bankruptcy.
       Economic abuse is an integral part of domestic violence. 
     Abusers often assert economic control by forbidding their 
     victims from working, giving them little or no access to 
     family finances, or destroying their credit. Many battered 
     women have current or former partners who actively interfere 
     with their efforts to work, harass them at work, threaten 
     them and their children, withhold transportation or 
     childcare, or beat them so severely that they cannot work. 
     These victims are sometimes pushed into filing for bankruptcy 
     as a result of this abuse.
       Evicting these victims from their homes not only 
     exacerbates an already difficult situation, but also puts 
     many families in direct danger. On average, it takes six to 
     ten months to secure housing. During this time, victims would 
     be forced to stay at emergency homeless or domestic violence 
     shelters. Unfortunately, those shelters are often full; in 
     2003, 32% of the requests for shelter by homeless families 
     went unmet due to the lack of emergency shelter beds 
     available. Even when space is available, most shelters limit 
     the length of stay to 30 days.
       Faced with this lack of housing and services, victims must 
     choose between life with an abusive partner or life on the 
     streets. Studies indicate that victims of domestic violence 
     often return to their abusers because they cannot find long-
     term or transitional housing. At the other extreme, more than 
     50% of homeless women and children are homeless because they 
     are fleeing domestic violence. Once homeless, women are at 
     high risk for experiencing further violence. Many studies 
     have found that 90-100% of homeless women have been 
     physically or sexually assaulted.
       The tremendously negative impact of such evictions becomes 
     greater when victims with children are forced out of their 
     homes. Children without a home are in fair or poor health 
     twice as often as other children, and

[[Page S2230]]

     have higher rates of asthma, ear infections, stomach 
     problems, and speech problems. Homeless children are also 
     more likely to experience mental health problems, such as 
     anxiety, depression, and withdrawal. They are twice as likely 
     to experience hunger, and four times as likely to have 
     delayed development. School-age homeless children face 
     barriers to enrolling and attending school, including 
     transportation problems, residency requirements, inability to 
     obtain previous school records, and lack of clothing and 
     school supplies.
       Individuals claiming relief under this provision would be 
     required to testify, under penalty of perjury, that they were 
     victims of domestic violence and that they or their children 
     would be in physical jeopardy if they were evicted. Thus, 
     this amendment will not allow families to take advantage of 
     the system, but will be life-saving for those who would be in 
     danger if they lost their homes.
       We urge you to support Senator Leahy's amendment and 
     provide this much needed assistance to domestic violence 
     victims.
           Sincerely,
     Allison Randall,
       National Network to End Domestic Violence.
     Jill Morris,
       National Coalition Against Domestic Violence.
     Kiersten Stewart,
       Family Violence Prevention Fund.
                                  ____

                                        National Coalition Against


                                            Domestic Violence,

                                                  February 28,2005
     Senator Patrick Leahy,
     Russell Senate Office Building,
     Washington, DC.
       Dear Senator Leahy: It is with great support that I write 
     to you on behalf of the National Coalition Against Domestic 
     Violence and the more than 3,000 local shelter programs that 
     we represent to thank you for your efforts to assist those 
     individuals that are or have been impacted by the vast 
     epidemic of domestic violence. '
       Women fleeing domestic violence make up a significant 
     portion of the homeless population. According to The United 
     States Conference of Mayors (December, 1999) 57 percent of 
     cities surveyed identified domestic violence as a primary 
     cause of homelessness. Therefore, amending the bankruptcy 
     code, as proposed in S. 256, with a provision that provides 
     leniency on persons who are affected by domestic violence 
     would, in fact, help victims to move forward and start new 
     lives. Without the threat of losing their housing victims 
     will not be forced to a situation where they are homeless or 
     returning to their abuser.
       Victims of domestic violence often cannot find adequate 
     housing. One very important--reason is that affordable, long 
     term housing is not available in their communities. If 
     housing is available there are often long waiting lists or 
     the abuser is able to quickly locate and begin abusing the 
     survivor at her new residence. Secondly, due to the fact that 
     batterers frequently harass their victims at work, survivors 
     are often fired or cannot maintain steady employment 
     resulting in loss ability to pay for housing. Lastly victims 
     of domestic violence are forced to remain in abusive 
     relationships because of financial dependency and the lack of 
     stable housing. The amendment to S. 256 recognizes that 
     victims of domestic violence are in a dangerous situation and 
     should not be forced from housing due their financial 
     difficulties.
       We commend you on your efforts to ensure that those who are 
     affected by domestic violence are taken into consideration 
     when the Senate reviews this legislation.
           Sincerely,
                                                      Jill Morris,
                                           Public Policy Director.

  Mr. LEAHY. Congress must recognize that victims of domestic violence 
face dangerous situations and should not be forced from housing due to 
their financial difficulties. We cannot force women and children who 
have endured domestic violence from safe spaces that provide the 
stability needed to make a new life.


                               Exhibit 1

    (Purpose: To protect victims of domestic violence who file for 
   bankruptcy from summary eviction if their physical well-being is 
                              threatened)

       On page 156, line 18, insert ``, unless the debtor 
     certifies under penalty of perjury that the debtor is a 
     victim of domestic violence whose physical well-being or 
     whose children's physical well-being would be threatened if 
     relief from the stay is granted'' before the semicolon.

                        regulating credit cards

  Mrs. FEINSTEIN. I appreciate the willingness of the chairman and 
ranking member of the Banking Committee to work with Senators Kyl, 
Brownback, and me on this important issue. And I understand that the 
Banking Committee has an interest in regulating credit cards.
  I would like to state here, for the record, the key points of the 
agreement that we have arrived at:
  Senators Shelby and Sarbanes have agreed to hold a hearing within 6 
months on the substance of the amendment to the Bankruptcy Bill that 
Senator Kyl, Brownback, and I offered, on increasing notice to credit 
card holders who pay only their minimum monthly payments. I understand 
that this hearing will address a set of issues relating to credit cards 
and consumer rights. However, I also understand that Senators Shelby 
and Sarbanes will ensure that the substance of agreement, will be 
directly considered, and will be an area of focus, during that hearing, 
and that I will be afforded the opportunity to testify.
  I understand that Senators Shelby and Sarbanes will work with me, 
with Senator Kyl, and with members of the Banking Committee to ensure 
that this issue and my bill are carefully considered. My bill would 
give those consumers who make only the minimum required payments for 6 
months detailed notice about the interest and length of time that it 
will take them to pay their own individual debt and interest.
  Because the chairman and ranking member of the Banking Committee 
agree to take these actions, I will agree to withdraw my amendment. Do 
Senators Shelby and Sarbanes agree?
  Mr. SHELBY. I absolutely agree with Senator Feinstein and look 
forward to working with the Senator.
  I say to Senator Sarbanes, through the course of the debate on the 
bankruptcy bill it has become clear that there are many Senators who 
have concerns about numerous aspects of the credit card industry.
  I want to indicate for the record that I share many of these 
concerns. Furthermore, I want to point out that I am aware of his 
particular concerns as well as those of Senators Kyl and Feinstein.
  Mr. SARBANES. I thank Chairman Shelby and Senator Feinstein. I 
appreciate their interest in this matter and believe these are serious 
issues that merit further attention.
  Mr. SHELBY. I fully agree and therefore I am willing to commit to 
holding a hearing in the Banking Committee to examine the practices 
within the credit card industry. I believe it is our responsibility to 
develop a complete record on these matters so that we can make informed 
judgments as to whether we need to take any specific actions.
  I look forward to obtaining input from Senator Sarbanes and from 
Senators Kyl and Feinstein in putting together this hearing.
  Mr. SARBANES. I thank Chairman Shelby for his leadership on this 
issue. I look forward to working with the Senator on developing a 
hearing at which the Banking Committee will receive testimony on credit 
care disclosures and other practices. A number of Senators have raised 
significant issues regarding the credit card industry and I appreciate 
the Senator's willingness to examine them and hear all interested 
Senators.
  Mr. SHELBY. I agree.
  Mr. SARBANES. I will support the Chairman's efforts.

                          ____________________