What: All Issues : Justice for All: Civil and Criminal : Equal Access to Justice : S. 256. Bankruptcy/Vote on Amendment to Cap "Homestead Exemptions" in Republican-Sponsored Bill to Alter Federal Bankruptcy Rules.
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S. 256. Bankruptcy/Vote on Amendment to Cap "Homestead Exemptions" in Republican-Sponsored Bill to Alter Federal Bankruptcy Rules.
senate Roll Call 35     Mar 09, 2005
Y = Conservative
N = Progressive
Winning Side:
Conservative

In this vote, the House defeated an amendment offered by Edward Kennedy (D-MA) to S. 256 that would have put a $300,000 cap on the amount of a "homestead exemption" allowable under the bill. (A "homestead exemption" may sometimes be claimed by people filing for bankruptcy to shelter their homes from creditors. The amount of allowable exemption varies greatly from state to state, with a few states permitting unlimited exemptions while other states impose limits as low as $5,000.) S. 256 was a Republican-sponsored bill to alter federal bankruptcy rules. On behalf of most Democrats, including Progressives, Kennedy condemned the bankruptcy bill for "fail[ing] to deal effectively with the unlimited homestead exemptions in a few [s]tates which allow the rich to hold on to their multimillion-dollar mansions while middle-class families in other [s]tates lose their modest homes." He argued that the $300,000 limit would ensure an "adequate" exemption for most people to allow them to keep their homes while curbing the systemic abuse of the bankruptcy system by the very wealthy, who can presently take advantage of larger exemptions to shelter mansions from creditors in bankruptcy proceedings. Republicans countered that this amendment would have gutted a hard-won compromise on the homestead provision that would permit states to retain high homestead exemptions as long as they comply with certain anti-fraud requirements. Kennedy's amendment was one of a series offered by Progressives to limit the bill's scope because overall, they viewed S. 256 as benefiting large corporations, and, in some cases, wealthy people at the expense of middle and lower-class Americans. Republicans countered that the bill would curb abuses of the bankruptcy system by making it harder for those who could pay their debts to escape them. In addition, Republicans were anxious to keep the bill "clean," meaning free from most amendments, because the House had already indicated it would not accept a bankruptcy bill laden with amendment language. Progressives' loss in this amendment by a vote of 47 to 53 would continue to permit the very wealthy to shelter their homes from creditors in bankruptcy proceedings.

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