The House will pass legislation overhauling the bankruptcy code next month, a key Republican proponent predicted Tuesday.

While cheered by prospects of quick House action, industry lobbyists said the Senate must also act swiftly if legislation is to be enacted this year.

Speaking to a meeting of America's Community Bankers, Rep. George W. Gekas said bankruptcy reform has bipartisan support in the House because it is based on a compromise lawmakers overwhelmingly approved last year.

"Those who need a fresh start will get a fresh start, and those who might be able to and can repay some of the debt over a period of time will be able to do so," the Pennsylvania Republican said. "America will be better off for it."

Efforts to enact bankruptcy reform fizzled last year after Democrats charged the legislation favored credit card companies over women and children dependent on alimony and support payments. Lawmakers added protections for these payments, but Congress adjourned before the Senate could vote.

Rep. Gekas said the compromise on support payments will "smooth the way" for House Judiciary Committee votes this month. House Republican leaders have pledged a floor vote as soon as mid-April, he said.

The Gekas bill would require bankruptcy trustees to inform the court if a consumer trying to eliminate debts in Chapter 7 earns more than the median national income and could afford to repay either $5,000 or 25% of unsecured debt over five years. The judge then would require the consumer to repay some debts in Chapter 13. The bill also would let lenders ask the judge to force a consumer into Chapter 13, give the court some discretion to let debtors use Chapter 7 even if they have high incomes, and require more credit card disclosures.

Sen. Charles E. Grassley, R-Iowa, is expected to introduce a consumer bankruptcy reform bill shortly that echoes the Gekas approach.

"The odds for anything in this Congress are fifty-fifty," said Philip S. Corwin, a principal at Federal Legislative Associates who lobbies for the American Bankers Association. "There are going to be a lot of politics in this Congress."

Robert R. Davis, the ACB's director of government affairs, gave the legislation better odds. "Last year the bill came out late, and there was just too much going on," he said. "There will be more time this year to debate and resolve differences."

Serious obstacles, however, remain. The Senate is far more divided over bankruptcy reform, and a single senator can block consideration of any bill. Also, the 2000 presidential and congressional elections will become a distraction by late summer or early fall. "Things are going to become very polarized next year so this all comes down to a timing question," Mr. Corwin said. "How quickly can this get done this year?"

Bankers attending the ACB meeting said whittling the nearly 1.5 million bankruptcy petitions filed annually is a top priority.

Harry D. Doherty, chairman of Staten Island (N.Y.) Savings Bank, said Congress should act now. "If the economy goes into the tank, this is going to be an even bigger problem," he said.

"There are people with good credit that are just abusing the system," said P. Scott Carson, president of First Federal Savings and Loan, Defiance, Ohio. "That should not be rewarded."

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