[Congressional Record (Bound Edition), Volume 161 (2015), Part 14]
[House]
[Pages 20278-20279]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              {time}  0930
     NATIONAL GUARD AND RESERVIST DEBT RELIEF EXTENSION ACT OF 2015

  Mr. GOODLATTE. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 4246) to exempt for an additional 4-year period, from the 
application of the means-test presumption of abuse under chapter 7, 
qualifying members of reserve components of the Armed Forces and 
members of the National Guard who, after September 11, 2001, are called 
to active duty or to perform a homeland defense activity for not less 
than 90 days.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 4246

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``National Guard and Reservist 
     Debt Relief Extension Act of 2015''.

     SEC. 2. NATIONAL GUARD AND RESERVISTS DEBT RELIEF AMENDMENT.

       Section 4(b) of the National Guard and Reservists Debt 
     Relief Act of 2008 (Public Law 110-438; 122 Stat. 5000) is 
     amended by striking ``7-year'' and inserting ``11-year''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Virginia (Mr. Goodlatte) and the gentleman from Tennessee (Mr. Cohen) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Virginia.


                             General Leave

  Mr. GOODLATTE. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days within which to revise and extend their 
remarks and to include extraneous material on H.R. 4246, currently 
under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Virginia?
  There was no objection.
  Mr. GOODLATTE. Mr. Speaker, I yield myself such time as I may 
consume.
  Every day at home and abroad, uniformed men and women risk their 
lives to protect our freedom and way of life. Among those brave souls 
are military reservists and members of the National Guard, who have 
been called to duty in Iraq, Afghanistan, and in many other places 
across the globe. We are eternally grateful for their service to our 
country.
  The Federal Government has a responsibility to ease the transition of 
reservists and guardsmen back into civilian life upon their return 
home. Some may return home with physical handicaps. For others, 
psychological challenges face them and their families. Some of these 
veterans and their families have suffered financial hardships, and, 
occasionally, bankruptcy is the unfortunate last resort. In a chapter 7 
bankruptcy, debtors surrender virtually all of their assets to the 
bankruptcy trustee and receive a discharge from their debts at the end 
of the short case.
  In 2005, Congress made a number of reforms to the Bankruptcy Code 
under the Bankruptcy Abuse Prevention and Consumer Protection Act. A 
significant policy goal of that Act was to address abuses of the 
chapter 7 bankruptcy process. To that end, Congress inserted into the 
Bankruptcy Code a threshold test to gauge whether debtors have 
disposable income that can be used to pay their debts. This is commonly 
referred to as the ``means test.''
  If debtors are able to pay some portion of their debts from their 
disposable monthly incomes, then the filing of a chapter 7 bankruptcy 
case is presumed to be an abuse of the bankruptcy system. Debtors can 
contest that presumption or can seek relief under other bankruptcy 
chapters, including chapter 13, under which they can restructure how to 
pay for their debts over time from their disposable incomes.
  In 2008, Congress recognized that military reservists and National 
Guardsmen sometimes confront unique financial challenges as a 
consequence of their military service. For instance, if these military 
members receive hazard pay during their service, that could actually 
inflate the results of the disposable income calculation under the 
means test, lifting them out of chapter 7 eligibility. So Congress 
enacted the National Guard and Reservist Debt Relief Act, which 
President Bush signed into law in October of 2008. This Act allows 
reservists and National Guardsmen to bypass the means test, making it 
easier for them to file a chapter 7 case.
  The original Act expired in 2011, but it was extended for an 
additional 4 years. The exemption is, once again,

[[Page 20279]]

set to expire on December 19. H.R. 4246, introduced by Mr. Cohen and 
Mr. Forbes, further extends the existing exemption to 2019.
  We continue to call on our guardsmen and reservists to serve our 
country. We should ensure that those military members who fall on hard 
times are not denied access to bankruptcy because of their service to 
their country. The bill before us today extends the sunset date by 4 
years, at which time Congress will have the opportunity to reexamine 
whether this exception to the means test continues to be necessary.
  I thank the gentleman from Tennessee (Mr. Cohen) and the gentleman 
from Virginia (Mr. Forbes) for introducing this legislation; and I urge 
my colleagues to vote ``yes'' on the bill.
  Mr. Speaker, I reserve the balance of my time.
  Mr. COHEN. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Conyers is the ranking member, and I appreciate his support just 
as I appreciate Mr. Goodlatte for bringing this bill to the floor. 
Bills don't get to the floor without the chairman of the committee 
having recommended them; so I thank Mr. Goodlatte and I thank Mr. 
Conyers, as I have been thinking about the apology for slavery and Jim 
Crow that came to this floor 7 years ago but that wouldn't have without 
the work of then-Chairman Conyers; so I thank him again.
  Today, I thank Mr. Forbes and my other sponsors, Mr. Nadler and Mr. 
Rohrabacher, who have cosponsored this bill with me.
  Mr. Speaker, I rise today in support of H.R. 4246, the National Guard 
and Reservist Debt Relief Extension Act of 2015.
  This bipartisan legislation ensures that certain members of the 
National Guard and Reserves who fall on hard economic times after their 
service will continue to obtain the bankruptcy relief which we have 
granted them in the past so they won't have to fill out substantial 
paperwork that is required by the so-called ``means test'' under 
chapter 7 of the Bankruptcy Code and meet that test.
  The means test came into effect about 10 years ago when President 
Bush signed into law what is called the BAPCPA, the Bankruptcy Abuse 
Prevention and Consumer Protection Act, which made numerous amendments 
to the bankruptcy law. It provided a means test, which made it more 
difficult to get into bankruptcy court. This gives National Guardsmen 
and reservists an opportunity to extinguish their debts without having 
to go through that difficult test.
  The National Guard and Reservist Debt Relief Act of 2008 created an 
exception to the means test's presumption of abuse for members of the 
National Guard and Reserves who after September 11 served on Active 
Duty or in a homeland defense activity for at least 90 days. The 
exception remains available for 540 days after the servicemember leaves 
the military.
  Many servicemembers, we know, are subjected to unscrupulous lenders 
and payday loans, and we have seen stories that show that up to, I 
think, 11 percent of servicemembers have been taking out payday loans. 
Eleven percent of enlisted personnel in the Active Duty military obtain 
these loans, which include vehicle title loans, pawnshop loans, and 
other high-interest loans; so they are preyed upon.
  In understanding they give service to our country and are preyed upon 
by folks near the military establishment in the communities, it is 
appropriate that we give them this relief. It is a way for our Nation 
to recognize the sacrifices made by National Guard and Reserve members 
who have served on Active Duty or in homeland defense since September 
11 and who may be suffering from financial hardship.
  The bill is supported by the National Association of Consumer 
Bankruptcy Attorneys and by the Veterans of Foreign Wars.
  Again, I thank Mr. Goodlatte and Ranking Member Conyers and my fellow 
cosponsors; and I urge all of my colleagues to support this bill.
  Mr. Speaker, I yield back the balance of my time.
  Mr. GOODLATTE. Mr. Speaker, I urge my colleagues to support this 
important legislation that continues a very good practice that benefits 
our Guard and Reserve members.
  I yield back the balance of my time.
  Mr. CONYERS. Mr. Speaker, I rise in strong support of H.R. 4246, the 
``National Guard and Reservist Debt Relief Extension Act of 2015.''
  It has been ten years since President Bush signed into law the 
Bankruptcy Abuse Prevention and Consumer Protection Act, a bill that 
made numerous amendments to the Bankruptcy Code, many of which 
pertained to consumer debtors.
  In particular, the Act established a means test mechanism--
purportedly intended to determine a debtor's ability to repay debts--
that requires a presumption of abuse if the debtor has income in excess 
of specified thresholds.
  H.R. 4246 would continue the current exemption from this presumption 
for certain qualifying National Guard members and reserve component 
members of the Armed Services.
  This exemption, which was first enacted in 2008 on a bipartisan 
basis, is due to expire in just a few days on December 19th.
  H.R. 4246 recognizes that some of those who serve in the military 
encounter financial difficulties during or in the wake of their service 
and that they merit relief from the additional proof requirements of 
the means test.
  In fact, servicemembers are often targeted by unscrupulous lenders. 
As reported by the Wall Street Journal earlier this year, payday 
lenders prey on service members and their families at twice the rate 
that they use to target civilians.
  These short-term, high-interest loans are often used to provide small 
amounts of money to pay for unexpected or emergency expenditures or to 
obtain advances on tax refunds.
  Yet, as a result of excessive interest rates, these loans can quickly 
balloon into overwhelming debt obligations. According to the Journal, 
some servicemembers have paid as much as 600 percent to 700 percent for 
the life of their loans, or even four times the amount of the original 
loan.
  In 2013, about 11 percent of enlisted personnel in the active duty 
military obtained payday loans, which included vehicle title loans, 
pawnshop loans, and other high-interest loans.
  So, at least for those servicemembers who seek bankruptcy protection 
in response to financial distress, H.R. 4246 ensures that they are 
exempted from the presumption of abuse if he or she is on active duty 
or is performing a homeland defense activity for a specified period.
  I commend the gentleman from Tennessee, Steve Cohen, for his 
leadership on this legislation and for his enduring commitment to our 
Nation's servicemembers.
  Accordingly, I urge my colleagues on both sides of the aisle to join 
me in supporting H.R. 4246.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Virginia (Mr. Goodlatte) that the House suspend the 
rules and pass the bill, H.R. 4246.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Mr. COHEN. 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, further 
proceedings on this motion will be postponed.

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