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WASHINGTON-In a few swift maneuvers last week, the Senate passed the bankruptcy abuse reform bill by a margin of 82 to 16 and named conferees, clearing the way for the House to appoint its conferees. The bill passed the Senate more quickly than credit union lobbyists had anticipated. Senator Paul Wellstone (D-Minn.), who threatened to filibuster the bill, discontinued his objections to its proceeding after he was able to insert an amendment to study the effects of the legislation within two years of enactment. NAFCU Senior Lobbyist Murray Chanow told Credit Union Times, “By getting the study in.[Wellstone] has a chance to come to the Senate floor and say `Look, I told you this wasn’t going to work and it’s not.” Then he could possibly have technical corrections added to the bill, Chanow explained. The study to be conducted under section 1602 of the legislation by the General Accounting Office (GAO) will review the impact on the number of chapter 13 and chapter 7 filings; the number of plan confirmations under chapter 13 and those successfully completed; the cost of filing under chapter 13 or 7 in each state; the availability and marketing of credit; the price and terms of credit for consumers; and the ability of debtors below the median income to obtain bankruptcy relief. “The real question is: `Is the means test going to force more people into chapter 13 than chapter 7?’ ” Chanow analyzed. The make-up of the Senate members of the conference committee was fairly predictable, except for the number of members, originally expected to be between five and nine. Senators Patrick Leahy (Vt.); Edward Kennedy (Mass.); Joseph Biden (Del.); Herb Kohl (Wis.); Russ Feingold (Wis.); Chuck Schumer (N.Y.); and Richard Durbin (Ill.) will be representing the Democrats on the committee. Up to bat for the Republicans will be Senators Orrin Hatch (Utah); Chuck Grassley (Iowa); Jon Kyl (Az.); Mitch McConnell (Ky.); Mike DeWine (Ohio); and one other Senator still to be named. All of the Republicans are expected to vote in favor of the bill, while all the Democrats, with the exception of Biden, a strong bankruptcy reform supporter, are expected to vote against it. At press time, the House had not yet named conferees. Following the conference between House and Senate representatives, the bill will return to the House and Senate floors for approval again, with little to no debate, and a vote. No amendments are permitted during the procedure. In view of Biden’s appointment, Hill lobbyists remain optimistic that the bill will ultimately pass by a vote of seven to six and land on the president’s desk. However, President George W. Bush has been less than clear on his position regarding the bankruptcy reform legislation. He has stated that he generally supports bankruptcy reform, but he has expressed concerns over the homestead provision. The homestead provision was designed to prevent wealthy bankruptcy filers from borrowing away their assets in their homes. President Bush, a Texan, is from one of a handful of states that opposes the federal preemption of the state homestead laws. Texas law does not provide a cap for preventing this type of abuse of the bankruptcy system. While Bush has expressed his concerns over the differences, he has not said he would veto the entire bipartisan package over the issue. Credit union supported provisions, including means testing, mandatory financial education, and voluntary reaffirmation for credit unions, are expected to remain intact. [email protected]

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