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105TH CONGRESS

1ST SESSION S. 1149

To amend title 11, United States Code, to provide for increased education

funding, and for other purposes.

IN THE SENATE OF THE UNITED STATES

SEPTEMBER 4, 1997

Mr. GRASSLEY (for himself, Mr. DURBIN, Mr. COVERDELL, Mr. SHELBY, and

Mr. KYL) introduced the following bill; which was read twice and referred

to the Committee on the Judiciary

A BILL

To amend title 11, United States Code, to provide for

increased education funding, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Investment in Edu5 cation Act of 1997’’.

6 SEC. 2. TREATMENT OF CERTAIN LIENS.

7 (a) TREATMENT OF CERTAIN LIENS.—Section 724

8 of title 11, United States Code, is amended—

9 (1) in subsection (b), in the matter preceding

10 paragraph (1), by inserting ‘‘(other than to the ex-
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1 tent that there is properly perfected unavoidable tax

2 lien arising in connection with an ad valorem tax on

3 real or personal property of the estate)’’ after

4 ‘‘under this title’’;

5 (2) in subsection (b)(2), after ‘‘507(a)(1)’’ and

6 before the comma following thereafter insert ‘‘(ex7 cept that such expenses, other than claims for

8 wages, salaries or commissions which arise after the

9 filing of a petition, shall be limited to expenses in10 curred under Chapter 7 of this title and shall not in11 clude expenses incurred under Chapter 11 of this

12 title)’’; and

13 (3) by adding at the end the following:

14 ‘‘(e) Before subordinating a tax lien on real or per15 sonal property of the estate which has arisen by virtue

16 of state law, the trustee shall—

17 ‘‘(1) exhaust the unencumbered assets of the

18 estate; and

19 ‘‘(2) in a manner consistent with section 506(c)

20 of this title, recover from property securing an al21 lowed secured claim the reasonable, necessary costs

22 and expenses of preserving or disposing of that prop23 erty.

24 ‘‘(f) Notwithstanding the exclusion of ad valorem tax

25 liens set forth in this Section, claims for wages, salaries
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1 and commissions entitled to priority under Section

2 507(a)(3) or claims for contributions to an employee bene3 fit plan entitled to priority under 507(a)(4) may be paid

4 from property of the estate which secures a tax lien, or

5 the proceeds of such property subject to the requirements

6 of Subsection 724(e).’’.

7 (b) DETERMINATION OF TAX LIABILITY.—Section

8 505(a)(2) of title 11, United States Code, is amended—

9 (1) by striking ‘‘or’’ at the end of subparagraph

10 (A);

11 (2) by striking the period at the end of sub12 paragraph (B) and inserting ‘‘; or’’; and

13 (3) by adding at the end the following:

14 ‘‘(C) the amount or legality of any amount

15 arising in connection with an ad valorem tax

16 real or personal property of the estate if the ap17 plicable period for contesting or redetermining

18 that amount under any law (other than a bank19 ruptcy law) has expired.’’.

20 SEC. 3. ENFORCEMENT OF CHILD AND SPOUSAL SUPPORT.

21 Section 522(c)(1) of title 11, United States Code, is

22 amended by inserting ‘‘provided that, notwithstanding any

23 federal or state law relating to the enforcement of liens

24 or judgements on exempted property, exempt property
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1 shall be liable for debts of a kind specified in Section

2 523(a)(5) of this title,’’ at the end of the subsection.

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