September 27, 1999

CHAPTER 12 EXTENSION ENSURES FARMERS WON’T SUFFER FOR SENATE’S FAILURE TO PASS BANKRUPTCY REFORM

WASHINGTON, D.C.--Congressman George W. Gekas (R-PA) steered legislation through the House today that would extend Chapter 12 of the U.S. Bankruptcy Code for three months. Chapter 12 provides relief for farmers by permitting them to reorganize debts.

The Bankruptcy Reform Act of 1999, which passed the House but remains stalled in the Senate, would extend Chapter 12 permanently. Chapter 12 is currently set to expire on October 1, 1999. "I had hoped that the Senate would have acted on Bankruptcy Reform by this late date, making further extension of Chapter 12 unnecessary," said Gekas. "We are now forced to provide a ‘stop-gap’ measure so that farmers are protected in the absence of Bankruptcy Reform."

H.R. 2942, which Gekas, along with Congressman Smith (R-MI) drafted late last week upon learning that the Senate would not take up Bankruptcy Reform, grants a three month extension to Chapter 12. It is unclear when the Senate will reschedule action on the Bankruptcy Reform Act.

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