[Congressional Record (Bound Edition), Volume 156 (2010), Part 10]
[House]
[Pages 14192-14196]
[From the U.S. Government Publishing Office, www.gpo.gov]




            PROTECTING GUN OWNERS IN BANKRUPTCY ACT OF 2010

  Mr. SCOTT of Virginia. Mr. Speaker, I move to suspend the rules and 
pass the bill (H.R. 5827) to amend title 11 of the United States Code 
to include firearms in the types of property allowable under the 
alternative provision for exempting property from the estate, as 
amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 5827

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

[[Page 14193]]



     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Protecting Gun Owners in 
     Bankruptcy Act of 2010''.

     SEC. 2. EXEMPTIONS.

       Section 522 of title 11, the United States Code, is 
     amended--
       (1) in subsection (d) by adding at the end the following:
       ``(13) The debtor's aggregate interest, not to exceed 
     $3,000 in value, in a single rifle, shotgun, or pistol, or 
     any combination thereof.'', and
       (2) in subsection (f)(4)(A)--
       (A) in clause (xiv) by striking ``and'' at the end,
       (B) in clause (xv) by striking the period at the end and 
     inserting ``; and'', and
       (C) by adding at the end the following:
       ``(xvi) The debtor's aggregate interest, not to exceed 
     $3,000 in value, in a single rifle, shotgun, or pistol, or 
     any combination thereof.''.

     SEC. 3. EFFECTIVE DATE; APPLICATION OF AMENDMENTS.

       (a) Effective Date.--Except as provided in subsection (b), 
     this Act and the amendments made by this Act shall take 
     effect on the date of the enactment of this Act.
       (b) Application of Amendments.--The amendments made by this 
     Act shall apply only with respect to cases commenced under 
     title 11 of the United States Code on or after the date of 
     the enactment of this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Virginia (Mr. Scott) and the gentleman from California (Mr. Daniel E. 
Lungren) each will control 20 minutes.
  The Chair recognizes the gentleman from Virginia.


                             General Leave

  Mr. SCOTT of Virginia. Mr. Speaker, I ask unanimous consent that all 
Members have 5 legislative days to revise and extend their remarks and 
include extraneous material on the bill under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Virginia?
  There was no objection.
  Mr. SCOTT of Virginia. Mr. Speaker, I yield all of the time to the 
sponsor of the bill, the gentleman from Ohio (Mr. Boccieri), and ask 
unanimous consent that he be allowed to control the time.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Virginia?
  There was no objection.
  Mr. BOCCIERI. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, while Congress works to pull our Nation out of this 
economic recession, many people across our great country continue to 
struggle with depleted savings and financial hardship, but those 
financial challenges should not affect a person's individual 
constitutional rights and their ability to protect their family. That 
is why I stand here today in strong support of H.R. 5827, Protecting 
Gun Owners in Bankruptcy Act. My legislation ensures families hit hard 
by the recent economic downturn in the recession and forced to file 
bankruptcy do not hand over their right to protection or their right to 
possess a firearm.
  H.R. 5827 provides an exemption in the Federal Bankruptcy Code for 
personal firearms. Since 2005, debtors who file bankruptcy could retain 
household goods such as radios, TVs, VCRs and linens, but not firearms. 
Currently, bankruptcy for gun owners not only means the seizure of 
family heirlooms, but perhaps the inability for them to protect their 
own family. This means that families who file bankruptcy are left 
without this constitutionally provided right.
  H.R. 5827 ensures a person who files for bankruptcy will not lose a 
treasured family heirloom or sporting equipment passed down from one 
generation to the next.
  I happen to have a weapon that was passed down that my grandfather 
used in the Second World War, an M1 Carbine rifle that is a family 
heirloom. And as a small arms expert in the United States Air Force and 
a hunter in Ohio, I know that firearms are not just mere possessions 
but family heirlooms as well.
  My fellow sportsmen in Ohio want to see the protection of their 
constitutionally protected rights. The Protecting Gun Owners in 
Bankruptcy Act will ensure that families can keep these prized 
possessions and continue to pass them on for generations to come.
  The right protected by the Second Amendment is deeply rooted in our 
Nation's history and tradition. One needs to look no further than the 
woods of Ohio during autumn to know that this is true.
  Mr. Speaker, I reserve the balance of my time.
  Mr. DANIEL E. LUNGREN of California. Mr. Speaker, I rise in support 
of H.R. 5827 and yield myself such time as I may consume.
  Mr. Speaker, I am pleased to support the Protecting Gun Owners in 
Bankruptcy Act of 2010 because the bill does recognize that an 
individual's Second Amendment right to lawful self-defense is not 
suspended during periods of financial hardship.
  The Second Amendment confirms the right of every American to keep and 
bear arms in self-defense. Neither Federal nor any State legislature is 
permitted to enact a law infringing on this most basic right. In 2008, 
the Supreme Court confirmed in its Heller decision that ``There seems 
to us no doubt, on the basis of both text and history, that the Second 
Amendment conferred an individual right to keep and bear arms.''
  This fundamental right to defend oneself and one's family with lawful 
and responsible gun ownership was reinforced just this year when, in 
McDonald, the court prohibited State and local legislatures from 
passing laws infringing on an individual's Second Amendment rights.
  Following passage of this bill, gun owners will be protected against 
overreaching legislatures but also from the harsh realities of the 
current economic crisis. Americans need not be reminded that our Nation 
is still mired in some of the worst economic conditions since the Great 
Depression. In my home State of California, bankruptcy filings in the 
first quarter of 2010 have increased approximately 41 percent over the 
first quarter of 2009.
  The bill we're considering today, recognizing that constitutional 
rights do not halt in the face of financial difficulty, creates a new 
Federal exemption that places a personal firearm beyond the reach of 
creditors and allows the debtor to avoid liens on the firearm if they 
would otherwise prohibit him from taking the new exemption.
  The Bankruptcy Code already exempts a variety of other basic items 
like linens and household goods that a debtor needs during a bankruptcy 
case to live a modest life and reorganize his or her financial affairs. 
The bill confirms that a debtor can maintain his or her own safety 
while the bankruptcy case is pending. The Federal bankruptcy exemption 
we are creating today is consistent with the principles embodied in the 
Second Amendment.
  I would urge my colleagues to join with me in supporting the bill.
  Mr. Speaker, I reserve the balance of my time.
  Mr. BOCCIERI. Mr. Speaker, I yield 5 minutes to the gentlelady from 
New York (Mrs. McCarthy).
  Mrs. McCARTHY of New York. I thank my colleague.
  Mr. Speaker, I rise in strong opposition to H.R. 5827. I fail to see 
why we need to protect guns in a bankruptcy proceeding.
  This bill had no hearings. It was not marked up. It only had 21 
cosponsors. Suspension bills should be reserved for noncontroversial 
items. I know for a fact anywhere from 80 to 100 of our Members will be 
voting against this. This bill should have gone through regular order.
  Bankruptcy is a tough time for everybody. I sympathize greatly with 
individuals and families who are facing a bankruptcy. But as part of a 
bankruptcy proceeding, personal assets are turned over to bankruptcy 
trustees. The trustees collect assets--cars, boats, and so on. 
Bankruptcy calls for all of these items.
  The process is designed to provide some protections for both the 
bankrupt individual and the one who is owed money. Some items are 
exempt as they are essential to one's livelihood. We want someone in 
debt to be able to have a fresh start, and therefore the law prevents 
some items from being turned over.
  Under Federal law, assets like homes, life insurance contracts, 
health aids, and retirement funds are exempt, with reasonable limits. 
What is special about guns, though, that they should

[[Page 14194]]

have a special carve-out? And the bill language would allow any single 
gun worth thousands of dollars from being turned over.
  Take, for example, an engraved shotgun costing tens of thousands of 
dollars or a .50 caliber sniper rifle worth thousands of dollars. The 
bankrupt individual would get to keep these guns. I understand the 
committee has brought up revised text to correct this loophole, but 
this is another reason why the bill should have gone through the normal 
process of hearings and a markup.
  Furthermore, studies have shown that the presence of guns in 
households, especially those experiencing bankruptcy, enhances the risk 
of suicide, or even worse, murder-suicide. According to the National 
Violent Death Reporting System, more than 12 percent of firearm-related 
murder-suicides and suicides were brought on by financial problems. 
Stories of murder-suicides also include descriptions of financial 
struggles.
  In June 2010, a California couple died in a murder-suicide and their 
3-year-old son was shot multiple times. The couple's 5-year-old son 
told authorities that his father tried to shoot him, and then shot his 
mother and brother. The family started missing house payments in early 
2009 and had filed for bankruptcy in February 2010.
  In February 2010, a Florida couple died of gunshot wounds in a 
murder-suicide in what the St. Petersburg Times described as ``the end 
of a long history of money troubles.'' They had filed for bankruptcy in 
December 2004, listing more than $200,000 in debt. The couple's two 
younger daughters hid in the bathroom during the shooting.

                              {time}  1930

  In June 2009, a Florida family of four, including two children, was 
shot to death in a murder-suicide. According to records filed in 
Federal bankruptcy court, the parents were deeply in debt and had 
struggled for 5 years to get out. The couple had filed chapter 13 
bankruptcy in 2004, and the trustee had constructed a plan for the 
couple to repay their debts, but they had failed to make the payments. 
The case was converted to a chapter 7, which forced the couple to 
liquidate their assets. A status hearing on the case was scheduled to 
occur 2 months after the murder-suicide.
  This bill wrongly puts guns before the health and safety of families.
  As far as the Second Amendment rights, especially with the Keller 
decision, people have the right to own guns--I am not disputing that. 
Again, we are talking about bankruptcy, and we are also talking about 
those who collect guns and who have many, many guns which are worth a 
lot of money, and they should be paying that debt.
  Mr. DANIEL E. LUNGREN of California. I yield myself such time as I 
may consume.
  Mr. Speaker, let me just say at the very beginning that I understand 
the sincerity and the strength of conviction of the gentlewoman from 
New York on this issue. I think we have a disagreement with respect to 
the times when firearms have been utilized to protect people from those 
who would otherwise do them harm, and I think there are some other 
reports that would suggest that that happens in far more instances than 
those incidents which result in harm to an owner of a gun or to someone 
in his or her family.
  One of the things I just would like to put on the record is the 
limited effect of today's amendment. When a debtor files for bankruptcy 
relief, he or she must choose whether to claim the package of Federal 
exemptions or the State exemptions available in the State of his or her 
residence. Frequently, debtors claim State exemptions because they are 
typically more generous to the debtors than are the Federal exemptions. 
Moreover, under current bankruptcy law, States may opt out of the 
Federal exemption scheme by passing a law that prohibits debtors in 
those States from claiming the Federal exemptions. It is my 
understanding that, to date, 34 States have enacted such opt-out 
legislation, so debtors in only 16 States will ever be able to take 
advantage of the new Federal firearms exemption we are considering 
today. I do believe it is an appropriate piece of legislation, but one 
should understand the limited nature of its application.
  Mr. Speaker, let me just conclude by saying that, while I support the 
creation of this exemption, the exemptions that Americans really want 
right now are exemptions from unemployment and skyrocketing national 
debt.
  When I was home in my district this past weekend, my constituents 
talked to me about the exemption from the crushing burden of higher 
taxes that is poised to be unleashed upon them by the majority of this 
House at the end of the year. I am bemused at times when I hear people 
saying, Well, you Republicans won't pay for the tax cuts that are 
already in existence, which is another way of saying that the 
government has the first call on your money, and therefore, if we have 
lower taxes than otherwise would be the case, somehow we have done 
something wrong when, in fact, what will occur if we do not extend the 
current rates of taxes on the Federal level will be, by some 
calculations, the most massive, single tax increase in the history of 
the United States.
  That is very, very disappointing. It is sort of a play on the 
language I used to hear on this floor from the majority when they used 
to talk about tax expenditures. That's another way of talking about the 
impact of ``tax cuts,'' meaning that somehow the Federal Government is 
expending something when it allows you or I or any American to keep the 
money in our pockets. That does indicate a philosophical difference 
that does divide us, unfortunately, a philosophical difference which is 
based on the premise that the money you earn is not yours, that the 
money you earn is kept by you only at the sufferance of the government 
and that if, in fact, the government by its generosity allows you to 
keep that money there, that somehow you should genuflect in 
supplication because you have done something to take money that justly 
belongs to them.
  So we are going to find out by the end of this year whether that 
concept of whose money it is prevails or whether it is, in my judgment, 
the proper viewpoint that the money you earn is, in your case, yours 
first and that the government ought to only exact the smallest amount 
of funds, that which is necessary to do those things that are required 
by government function.
  So I must lament that fact while I do continue to support this piece 
of legislation.
  I reserve the balance of my time.
  Mr. BOCCIERI. I yield myself such time as I may consume.
  Mr. Speaker, today, we are talking about what is in a family's 
heirlooms, their possessions. I know the Republican would like to draw 
this into a long debate about how we got into this mess, but I will 
remind the gentleman that, on day one in 2009 when the 111th Congress 
started, we were faced with unprecedented budget deficits that were 
handed over to us from the previous administration--$3.5 trillion to be 
exact--and an economy that was in free fall. We didn't know where it 
was going to land. We were faced with two undeclared, unfunded wars, 
unregulated greed on Wall Street, and a banking crisis that was 
affecting so many small businesses.
  So I will remind the gentleman that, while the policies that allowed 
us to get into this ditch are not at the heart of this debate, 
certainly, he is welcome to debate us, as we proceed further, on how we 
got into this economic mess and on what measures we are taking to get 
ourselves out of this.
  Mr. Speaker, I reserve the balance of my time.
  Mr. DANIEL E. LUNGREN of California. I yield myself such time as I 
may consume.
  Mr. Speaker, I would just remind my colleague from Ohio that the last 
time we had a balanced budget on the Federal level was when we had a 
Democrat in the White House and a Republican-controlled House and a 
Republican-controlled Senate. Perhaps we ought to try that again after 
November.
  I support this legislation. I hope that there will be strong support 
for it.
  I yield back the balance of my time.
  Mr. BOCCIERI. Mr. Speaker, in closing, I would remind the gentleman 
as

[[Page 14195]]

well on the other side that it was a Republican-controlled Congress and 
a Republican President who allowed us to get $11 trillion in debt when 
the last Democratic-controlled White House had a $5.6 trillion 
projected surplus.
  So, now that the facts are straight, I just want to be clear that 
this legislation is about amending the Federal bankruptcy codes, which 
have already been used to exempt furniture, musical instruments, 
jewelry, and other household goods, to be allowed to exempt people's 
heirlooms, their firearms, that have been passed on from generation to 
generation.
  I believe that the majority of Americans agrees with the Second 
Amendment--the constitutional right that we have to bear arms. We have 
continually upheld its validity for hundreds of years because, in many 
cases, a family's guns are heirlooms, treasured pieces of family 
history, which should not be subjected to financial hardship. I spoke 
of my grandfather's M1 carbine that has been handed down to me now 
through two successive generations.
  One fact, one principle this country was founded upon was the ability 
of our people to provide their own protection. Bearing this in mind and 
this historical perspective, we respect the rights of gun owners as a 
shared value we see amongst Democrats and some Republicans. It is not a 
Republican or a Democratic issue but a foundational value of American 
ideals. We must protect the rights guaranteed to us by our Founding 
Fathers no matter what financial circumstances a citizen must face.
  Mr. CRITZ. Mr. Speaker, I rise today in support of H.R. 5827, the 
Protecting Gun Owners in Bankruptcy Act of 2010. As a strong supporter 
of the Second Amendment, I believe that owning a gun is a right and 
that this right extends to all people, including those in bankruptcy.
  After declaring bankruptcy, people are often denied their 
Constitutionally protected rights by being forced to relinquish their 
firearms. While other property, such as televisions, radios, china, 
crockery, and appliances, is protected from repossession, firearms are 
not. If owning a gun is a right, shouldn't guns be protected from 
repossession just as other property is protected?
  Right now, only 10 states have laws that protect gun owners from 
firearm repossession during bankruptcy. Currently, the Commonwealth of 
Pennsylvania is not one of these 10, so I support this bill because I 
believe that my constituents' Second Amendment rights, as well as the 
Second Amendment rights of all Americans, should be protected during 
bankruptcy.
  This is a good bill and I urge my colleagues to vote ``yes.''
  Mr. DINGELL. Mr. Speaker, I rise in support of H.R. 5827, the 
Protecting Gun Owners in Bankruptcy Act of 2010. This legislation will 
ensure that individuals' Second Amendment rights are secure when they 
enter into bankruptcy.
  In these challenging economic times, I have heard from families in 
Michigan's 15th Congressional District concerned they will lose their 
ability to protect themselves and their families should they enter into 
bankruptcy. As the Supreme Court recently ruled in Heller vs. the 
District of Columbia and confirmed in McDonald vs. Chicago, the Second 
Amendment affords individuals across the nation the right to keep and 
bear arms for the purpose of self defense. Hardworking Americans who 
have lost their jobs due to the economic downturn should not fear that 
they will be stripped of those rights because they are trying to turn 
their lives around through bankruptcy proceedings.
  Most States, including Michigan, do not protect gun owners in 
bankruptcy because firearms are not listed among the ``household 
goods'' exempt from the claims of creditors. In 2005, amendments to the 
bankruptcy code made it even more unlikely firearms would be considered 
a ``household good.'' However, H.R. 5827 changes that. Specifically, it 
permits firearms--rifles, pistols and shotguns, up to an aggregate 
value of $3,000--held primarily for the personal, family or household 
use of the debtor to be exempt from the claims of creditors under 
federal exemption law.
  Enacting H.R. 5827 will allow the citizens of Michigan and across the 
United States the ease of knowing they can protect themselves and their 
families in good times and bad. This is an important bill and I urge my 
colleagues to join me in voting for it.
  Mr. MORAN of Virginia. Mr. Speaker, I rise today in opposition to 
Protecting Gun Owners in Bankruptcy Act of 2010.
  This legislation, as it was drafted and brought to this floor, would 
exempt one firearm of any value or a combination of firearms not to 
exceed $1,500 from creditors' claims during bankruptcy proceedings. 
That's right--this bill would allow an unlimited exemption for a single 
firearm. Despite claims from supporters that this bill is intended to 
protect firearms used primarily for personal, family, or household use, 
there is absolutely no reference to this requirement in the bill.
  This means someone could claim an exemption for an antique firearm 
worth tens of thousands of dollars. In essence, Congress is 
incentivizing individuals to game the system by purchasing an expensive 
firearm prior to filing for bankruptcy. While I understand language 
will be added to correct this glaring loophole, this just goes to show 
why this bill should have been vetted first by the Judiciary Committee.
  In addition, supporters of this bill claim that it is a Second 
Amendment issue and that it will allow individuals going through 
bankruptcy to continue to protect their households. While I sympathize 
with those facing bankruptcy, the Second Amendment protects the right 
to bear arms. It is not intended to protect an individual's property 
from legitimate claims during bankruptcy anymore than the First 
Amendment protects an author's novels or other works during those same 
proceedings.
  Finally, this bill was introduced 5 days ago and has a total of 21 
cosponsors. Yet, here it is on the suspension calendar--a process that 
is supposed to be reserved for non-controversial legislation, 
particularly when that legislation has evaded the normal Committee 
process. By contrast, the Gun Show Loophole Closing Act, a bill 
introduced 446 days ago and supported by 109 cosponsors, languishes in 
committee. Closing that loophole, which we know puts guns into the 
hands of criminals and the mentally ill, is something worthy of this 
Chamber's attention. Instead, we are spending floor time on this.
  I urge my colleagues to vote against this flawed and unnecessary 
bill.
  Ms. MOORE of Wisconsin. Mr. Speaker, I rise today to offer 
clarification for my vote in favor of H.R. 5827, the Protecting Gun 
Owners in Bankruptcy Act of 2010.
  I have tremendous respect for our nation's Constitution. In 12 other 
states around the country, including my own state of Wisconsin, there 
are already State protections for gun ownership during bankruptcy 
proceedings. When the Federal Government, and other States, already 
give basic protections for personal property like jewelry and musical 
instruments, I believe that it is fundamentally unfair to deny a second 
amendment protected item from being included in this list.
  I do, however, want to be clear that I remain steadfast in my support 
for the ability of the Federal Government, States, and cities to 
regulate firearms. There have been too many times that we have seen 
preventable deaths from guns that end up in the wrong person's hands. 
Representing the City of Milwaukee, I know first hand how important it 
is to keep guns out of the hands of criminals and others that cause 
harm and undermine safety in our communities. Within the last few 
years, six police officers were shot in my district using guns that 
were traced back to a single store. How did this one store seemingly 
sell so many guns to straw buyers--people purchasing the guns not for 
themselves, but on behalf of other people who are prohibited from 
buying, like convicted domestic abusers, felons, and people with 
outstanding warrants? Had Federal gun laws been adequate to properly 
regulate stores like this, and others around the country, I sincerely 
believe that much of the gun violence could be prevented.
  My record for reducing gun violence in our communities is clear. This 
year I have sent a letter to the director of the Bureau of Alcohol 
Tobacco and Firearms asking what resources they might need to more 
efficiently enforce Federal firearm legislation. I have also sent a 
letter requesting that the Attorney General revitalize and expand upon 
an existing ``demand letter'' program that can give the BATFE essential 
information on potential problem Federal Firearm Licensees. Current 
firearm regulation at the Federal level is simply inefficient and I 
will continue to work hard with my colleagues to make our streets a 
safer place.
  Mr. BOCCIERI. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Virginia (Mr. Scott) that the House suspend the rules 
and pass the bill, H.R. 5827, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.

[[Page 14196]]

  Mrs. McCARTHY of New York. Mr. Speaker, on that I demand the yeas and 
nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

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