Sen. Sheldon Whitehouse's (D-RI) bankruptcy bill was held over again in the Senate Judiciary Committee's latest business meeting.
S. 3675, the Small Business Jobs Preservation Act, was on the agenda for the meeting on November 18, but the Committee set the bill aside, choosing instead to advance a bill with broad bipartisan support (S. 3804, the Combating Online Infringement and Counterfeits Act).
Committee Chairman Sen. Patrick Leahy (D-VT) broached the subject of S. 3675 before quickly exiting the meeting, leaving Whitehouse and Sen. Jeff Sessions (R-AL) to discuss the bill's prospects. However, Whitehouse used his statement to request a clarifying amendment to the Bankruptcy Code that would govern a judge's authority to compel a lender to produce a high-ranking staff member to discuss a filing debtor's mortgage before foreclosure.
"When someone files in bankruptcy court and they have a foreclosure issue, the court has a process that requires them to sit down and discuss the modification," said Whitehouse, referring to a procedure used in his own home state of Rhode Island. "It has resulted in a flood of successful modifications, and it provides for mediation potentially, but just getting people in the room together produces results."
Whitehouse requested the clarifying amendment due to a pending case filed by a lender against his home state that alleges a bankruptcy judge has no authority to require anyone from the bank to be there. The amendment would ensure that the Code gives the judge this ability and effectively shut down the case.
Sessions sympathized with Whitehouse's concerns and Whitehouse noted that they hoped to move the amendment to the Senate floor in the lame duck session, which may signal that his office will not seek further action on S. 3675 before the end of the legislative session.
NACM has worked closely with Whitehouse's office on S. 3675, which would create a new small business bankruptcy procedure, and continues to do so. Should the year end without action on the bill, Whitehouse is expected to pursue a similar measure in the next Congress.
To learn more about S. 3675 and NACM's other legislative efforts, visit NACM's advocacy page here.
Jacob Barron, NACM staff writer