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This is an excerpt of the letter. I'm working on a response now.
Thank you for sharing your views on S. 256, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.
Originally introduced in 1998, during the second session of the 105th Congress, bankruptcy reform legislation came close to enactment in both the 106th and 107th Congresses. On February 27, 2003, Chairman Jim Sensenbrenner of the House Judiciary Committee introduced the Bankruptcy Abuse Prevention and Consumer Protection Act of 2003 (H.R. 975), and the full House passed this measure on March 19, 2003, by a vote of 315-113.
On February 17, 2005, the Senate Judiciary Committee approved S. 256 by a vote of 12-5. The full Senate is expected to consider this measure in March.
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 is substantially similar to H.R. 975, which was similar to the legislation (H.R. 333) that the House and Senate approved during the 107th Congress. Like H.R. 975, however, S. 256 omits the Schumer amendment which would have prevented the discharge of liability for willful violation of protective orders and violent protests against providers of "lawful services," including reproductive health services. Similar to earlier legislation, S. 256 addresses many areas of bankruptcy practice, including consumer filings, small business bankruptcy, tax bankruptcy, ancillary and cross-border cases, financial contract provisions, amendments to Chapter 12 governing family farmer reorganization, and health care and employee benefits.
This bill contains a needs-based formula that directs filers into Chapter 7 or Chapter 13 based on their ability to pay. Filers earning less than the national median income are not affected by this legislation. If a filer is above the income limit, this bill protects those who have special circumstances, such as a decline in income or unexpected medical expenses that can be taken into account and preclude moving the filer into Chapter 13. These precautions are taken to ensure that those who can afford to pay their debts are required to do so.
This bill also includes provisions to protect women and children, those individuals who typically have the most to lose in bankruptcy proceedings. It has been suggested that the bill would put women and children in competition with credit and finance companies for scarce resources of the debtor but this is not the case. Currrent bankruptcy law puts child support and alimony payments in seventh priority but this legislation moves alimony and child support to the first priority of debts to be repaid and it protects savings for a child's education and retirement savings. Additionally, it strengthens the ability of a woman to collect marital dissolution obligations.
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