US Senate News:
Source: United States Senator for Illinois Dick Durbin
Legislation helps small businesses stay open and individuals keep their homes as they find their financial footing through bankruptcy
WASHINGTON – U.S. Senate Majority Whip Dick Durbin (D-IL), Chair of the Senate Judiciary Committee, and Senator Chuck Grassley (R-IA), Ranking Member of the Senate Judiciary Committee, along with Senators Sheldon Whitehouse (D-RI) and John Cornyn (R-TX), today released the following statements after President Biden signed into law their bipartisan legislation to help small businesses and individuals stay afloat during bankruptcy.
“Too many mom-and-pop shops are getting caught up in a complicated bankruptcy system while working to get back on their feet,” said Durbin. “At the same time, many families are struggling with overwhelming levels of debt. This bipartisan bill brings relief to both. I’m grateful to my Senate colleagues for their partnership on this critical legislation, and applaud President Biden for acting swiftly to sign this into law—a testament to this Congress’s, and this Administration’s, commitment to supporting American businesses and families.”
“As American families and small businesses face mounting economic uncertainty amid historic inflation and spiking interest rates, it’s more important than ever that we remove hurdles to reorganizing when folks fall on hard times. Our bipartisan bill – now law – builds on my Small Business Reorganization Act in 2019 with Sen. Whitehouse to streamline the bankruptcy process for small businesses by eliminating onerous paperwork requirements designed for major corporations,” said Grassley.
“The bankruptcy process should assist small businesses and working families to weather financial hardship and emerge stronger. This new law will help them do that,” said Whitehouse. “I’m gratified to see President Biden sign this bipartisan effort. I was pleased to work with Senators Grassley, Durbin, and Cornyn to improve our bankruptcy process.”
“For small businesses and families who fought their way through the pandemic and are now facing economic hardship, our complicated bankruptcy process can be another barrier to survival,” said Cornyn. “I’m glad we could come together on this reprieve from burdensome requirements, especially given record-high inflation and rising interest rates.”
The Bankruptcy Threshold Adjustment and Technical Corrections Act would aid small businesses by extending for two years an increase of the debt limit threshold for expedited Ch. 11 bankruptcy filings from $2.7 million to $7.5 million. It would also give substantial assistance to families struggling with high levels of mortgage, student loan, and medical debt by altering and increasing the debt limit for consumers to file for Ch. 13 bankruptcy repayment plans. This bill passed the Senate unanimously on April 7, 2022, and passed the House with a strong bipartisan majority two months later.