Mr. Chairman, I offer an amendment in the nature of a substitute. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, as you know, Chapter 12 family farmers bankruptcy protection is an effective and noncontroversial part…
Mr. Chairman, I offer an amendment in the nature of a substitute.
Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, as you know, Chapter 12 family farmers bankruptcy protection is an effective and noncontroversial part of our Nation's Bankruptcy Code. Since its creation in 1986, it has allowed our Nation's family farmers who face economic hardship a greater opportunity to reorganize their debts and continue in farming.
As with many laws that we pass, the benefits of the direct impact, which can be easily measured, are often exceeded by the indirect benefits. Chapter 12 does not just benefit those using its protections. Many farmers who face the possibility of a bankruptcy never get to the point of a court filing. Bankruptcy trustees and bankruptcy attorneys are quick to point out that the very existence of the option of Chapter 12 filing promotes negotiations between farmers and their creditors, thus preventing bankruptcy filings altogether.
Chapter 12 protection is currently unavailable to our Nation's farmers. It expired on December 31, 2003. The House should have taken up the 6-month extension bill, Senate bill 1920, passed without amendment, and sent it to the President immediately. However, by approving the rule earlier today, we have foreclosed that option; therefore, I am offering this substitute amendment.
Mr. Chairman, my amendment provides the House with a clear policy choice by allowing a vote on passing a permanent Chapter 12 authorization instead of continuing to keep it tied to the controversial larger bankruptcy bill. My amendment simply uses the Chapter 12 language that was agreed to by bipartisan, bicameral conferees during the 107th Congress. It is the same as the bipartisan bill, Senate bill 2004, introduced by Members of the other body.
The amendment does the following: It makes Chapter 12 farm bankruptcy protections a permanent part of our Bankruptcy Code; it would increase the debt limits that a family farm can hold to qualify for Chapter 12 from $1.5 million to $3.2 million; and it would index those debt limits to the consumer price index. It would reduce from 80 percent to 50 percent the percentage of family farm liabilities that are due to farming operations; it would look at the previous 3 years, instead of only the previous year when determining whether 50 percent of income is from farming operations; and it would expand this type of bankruptcy protection to family fishermen.
These changes to Chapter 12 are not controversial and enjoy widespread bipartisan support.
Since I was first elected to Congress 5 years ago, we have passed eight, eight temporary extensions to Chapter 12. It is time to end this repetitive cycle of extensions and extensions. Our struggling family farmers should not be used as leverage. They should not have to continue to wait while we play games with Chapter 12 protections. This bill provides a textbook example that what we do here in Washington directly affects the lives of people facing real financial challenges.
In Wisconsin recently, a farmer from Columbus filed for Chapter 12 bankruptcy. He works day and night to make his farm a success. Unfortunately, like many farmers, the weather and the market conspired to disrupt his cash flow. Filing Chapter 12 bankruptcy gave his family time to negotiate with his creditors while he switched production from corn and soybeans to vegetables, which he now sells in local markets. He sells his produce in farmers markets in Madison and in Princeton, Wisconsin, and he is paying his debts.
Under Chapter 12, it was not only the Columbus farmer that benefited, his family and his creditors now are receiving their money. The people in my district can purchase his bounty, and he can continue to support his farm, his family and his obligations.
Every time we come to the floor to extend Chapter 12, we are told that a permanent extension cannot be passed separately from the big bill because taking out this terribly popular item would slow the bill's momentum. We were told that we had to strip the permanent extension of Chapter 12 from last year's farm bill because it would
slow down the progress of the bankruptcy bill. We were told in June when we extended Chapter 12 again that we had to wait. Our farmers have been waiting for more than 5 years, and it is time to get this done.
Let us end the uncertainty these extensions cause by passing a permanent authorization. That is what my amendment would do. I sort of feel like I am in the middle of the movie ``Groundhog Day.'' Every 6 months we go through a process of extending Chapter 12 extensions again. Every session of Congress we go through a drawn-out debate regarding a larger overhaul of our bankruptcy laws. My amendment would break us out of that cycle.
It is time to stop using our farmers as pawns to push for bankruptcy reform and it is time to restore this important protection. We should not be playing politics with the livelihood of our farmers by putting the special interests who want the bankruptcy overhaul ahead of the real needs of struggling family farmers.
I urge my colleagues to pass the Baldwin substitute amendment.
Mr. Chairman, I reserve the balance of my time.
Mr. Chairman, I yield myself such time as I may consume.
This House has already debated and voted on H.R. 975. My amendment does nothing to change that. This is truly a matter between the Republican leadership of the two bodies.
The gentleman notes that the chapter 12 provisions have expired six times of varying length, most recently on December 31, 2003.
I would note that June 23, 2003, the same gentleman said on this floor that ``it is crucial that this specialized form of bankruptcy relief for farmers not be allowed to sunset for two fundamental reasons. First, family farmers absent chapter 12 would be forced to file for bankruptcy relief under the bankruptcy code's other alternatives, none of which work as well for them as does chapter 12.''
We started the day with a bill before us that was simply a 6-month extension of chapter 12 bankruptcy. We can end the day with a permanent authorization of that bankruptcy code if my colleagues support my substitute amendment.
Mr. Chairman, I yield 2\1/2\ minutes to the gentleman from Pennsylvania (Mr. Holden), who has been extraordinarily active on this issue in fighting for family farmers.
Mr. Chairman, I yield 5 minutes to the gentleman from North Carolina (Mr. Watt).
Mr. Chairman, I yield myself such time as I may consume; and in closing, I would only reiterate what I said earlier, which is that we started the day, this morning, with a very simple bill before us, a bill to extend by 6 months the Chapter 12 protections for family farmers. We could end the day, if we pass this substitute amendment, with permanent authorization of Chapter 12 bankruptcy protections for our family farmers and family fishermen who are struggling today in the United States.
Instead, we have before us a massive bankruptcy overhaul that we have already debated and voted on in this House. These parliamentary maneuvers are most unfair to the farmers across America who woke up today hoping we would provide them relief. That is what we should do, and I urge Members to support the Baldwin substitute amendment.
Mr. Chairman, I yield back the balance of my time.
Mr. Chairman, I demand a recorded vote.