Consumers continue to file for bankruptcy at an alarmingly high rate.  In 1999, about 1.28 million consumers filed for bankruptcy -- an almost 50% increase since 1995, causing American families to pay an additional $400 a year in increased costs of goods and services.

As bankruptcies have increased, so has the need for a "needs-based" system that would provide Chapter 7 relief only to individuals who truly need it.  Higher-income filers with an ability to repay some of their debts would be required to do so.

Large bipartisan majorities of both the House and Senate adopted comprehensive bankruptcy reform legislation at the end of the 106th Congress (1999-2000), but President Clinton vetoed the legislation. Bankruptcy reform, then, will remain a super priority issue for ABA in the new Congress.