WASHINGTON - The Senate Judiciary Committee on Tuesday began what could turn into drawn-out debate on legislation to overhaul the nation's bankruptcy laws.

Despite Chairman Orrin G. Hatch's desire to move the bill quickly and cleanly out of his committee, panel Democrats started firing the first of an expected 28 amendments at the measure, which is all but identical to legislation the House and Senate passed by veto-proof margins last year. Then-President Clinton killed it with a pocket veto while Congress was out of session, but the bill's prospects were rekindled after the election of President Bush.

Sen. Hatch, R-Utah, said at a morning news conference that he hoped to pass the legislation in committee before the end of the day and send it to the full Senate this week. He warned Democratic opponents not to bog down the vote in lengthy discussions of frivolous amendments and told them that they should avoid "petty parliamentary delay tactics."

But the committee adjorned after considering five amendments. That included the defeat of amendments that would have limitied some finance charges and credit card marketing to consumers under 21 years old. The committee plans to resume work today.

The bulk of the Democratic amendments mirror ones that ultimately doomed the bill last year. One provision would prohibit debtors from keeping expensive homes that cannot be seized by creditors because of homestead exemptions. Another would block abortion-clinic attackers from using bankruptcy laws to avoid paying for damages they have caused.

Sen. Hatch said that he hoped none of the proposed amendments would be added to the bill, though he said an amendment that would prohibit violent criminals from declaring bankruptcy to avoid fines made sense. "There is no excuse for anybody who commits violence to be discharged," he said.

The financial services industry, which has made passage of bankruptcy reform a top legislative priority, would specifically be affected by Democratic amendments that would "require credit card companies to be more open with consumers," said Sen. Russ Feingold, D-Wis. Current "disclosures do not go far enough."

One amendment would change the Truth-in-Lending Act by requiring that credit card issuers not only prominently display warnings on statements about the long-term costs of making minimum payments, but also include a toll-free number that cardholders could call to learn how many months it would take to repay their balance with minimum monthly payments.

Another amendment would create a stricter means test. The current version of the bankruptcy bill would force debtors into Chapter 13 reorganization if they could afford to repay the lesser of $10,000 or 25% of unsecured debt over five years. Those with incomes less than or equal to their state median income would be exempted. Democrats want national rather than state median income levels so that poor people in wealthy states are not penalized.

Sen. Patrick Leahy of Vermont, the top Democrat on the committee, has drafted an amendment that would prohibit businesses that have filed for bankruptcy from selling customer lists as assets.

Still, momentum for the bill's passage is strong. The full House is scheduled Thursday to vote on the bill, which cleared the Judiciary Committee without any substantive amendments on Feb. 14.


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