II 

110TH CONGRESS 

2D SESSION S. 3197 

A bill to amend title 11, United States Code, to exempt for a limited 

period, from the application of the means-test presumption of abuse 

under chapter 7, qualifying members of reserve components of the Armed 

Forces and members of the National Guard who, after September 11, 

2001, are called to active duty or to perform a homeland defense activity 

for not less than 90 days. 

IN THE SENATE OF THE UNITED STATES 

JUNE 25, 2008 

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

to the Committee on the Judiciary 

A BILL 

A bill to amend title 11, United States Code, to exempt 

for a limited period, from the application of the meanstest presumption of abuse under chapter 7, qualifying 

members of reserve components of the Armed Forces 

and members of the National Guard who, after September 11, 2001, are called to active duty or to perform 

a homeland defense activity for not less than 90 days. 

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


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘National Guard and 

3 Reservists Debt Relief Act of 2008’’. 

4 SEC. 2. AMENDMENTS. 

5 Section 707(b)(2)(D) of title 11, United States Code, 

6 is amended— 

7 (1) in each of clauses (i) and (ii)— 

8 (A) by indenting the left margins of such 

9 clauses 2 ems to the right; and 

10 (B) by redesignating such clauses as sub11 clauses (I) and (II), respectively; 

12 (2) by striking ‘‘if the debtor is a disabled vet13 eran’’ and inserting the following: 

14 ‘‘if— 

15 ‘‘(i) the debtor is a disabled veteran’’; 

16 (3) by striking the period at the end and insert17 ing ‘‘; or’’; and 

18 (4) by adding at the end the following: 

19 ‘‘(ii) while— 

20 ‘‘(I) the debtor is— 

21 ‘‘(aa) on, and during the 540-day pe22 riod beginning immediately after the debt23 or is released from, a period of active duty 

24 (as defined in section 101(d)(1) of title 10) 

25 of not less than 90 days; or 


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1 ‘‘(bb) performing, and during the 

2 540-day period beginning immediately 

3 after the debtor is no longer performing, a 

4 homeland defense activity (as defined in 

5 section 901(1) of title 32) performed for a 

6 period of not less than 90 days; and 

7 ‘‘(II) if, after September 11, 2001, the 

8 debtor while a member of a reserve component 

9 of the Armed Forces or a member of the Na10 tional Guard, was called to such active duty or 

11 performed such homeland defense activity.’’. 

12 SEC. 3. GAO STUDY. 

13 (a) COMPTROLLER GENERAL STUDY.—Not later 

14 than 2 years after the effective date of this Act, the Comp15 troller General shall complete and transmit to the Speaker 

16 of the House of Representatives and the President pro 

17 tempore of the Senate, a study of the use and the effects 

18 of the provisions of law amended (and as amended) by 

19 this Act. Such study shall address, at a minimum— 

20 (1) whether and to what degree members of re21 serve components of the Armed Forces and members 

22 of the National Guard avail themselves of the bene23 fits of such provisions, 

24 (2) whether and to what degree such members 

25 are debtors in cases under title 11 of the United 


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1 States Code that are substantially related to service 

2 that qualifies such members for the benefits of such 

3 provisions, 

4 (3) whether and to what degree such members 

5 are debtors in cases under such title that are materi6 ally related to such service, and 

7 (4) the effects that the use by such members of 

8 section 707(b)(2)(D) of such title, as amended by 

9 this Act, has on the bankruptcy system, creditors, 

10 and the debt-incurrence practices of such members. 

11 (b) FACTORS.—For purposes of subsection (a)— 

12 (1) a case shall be considered to be substan13 tially related to the service of a member of a reserve 

14 component of the Armed Forces or a member of the 

15 National Guard that qualifies such member for the 

16 benefits of the provisions of law amended (and as 

17 amended) by this Act if more than 33 percent of the 

18 aggregate amount of the debts in such case is in19 curred as a direct or indirect result of such service, 

20 (2) a case shall be considered to be materially 

21 related to the service of a member of a reserve com22 ponent of the Armed Forces or a member of the Na23 tional Guard that qualifies such member for the ben24 efits of such provisions if more than 10 percent of 

25 the aggregate amount of the debts in such case is 


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1 incurred as a direct or indirect result of such serv2 ice, and 

3 (3) the term ‘‘effects’’ means— 

4 (A) with respect to the bankruptcy system 

5 and creditors— 

6 (i) the number of cases under title 11 

7 of the United States Code in which mem8 bers of reserve components of the Armed 

9 Forces and members of the National 

10 Guard avail themselves of the benefits of 

11 such provisions, 

12 (ii) the aggregate amount of debt in 

13 such cases, 

14 (iii) the aggregate amount of debt of 

15 such members discharged in cases under 

16 chapter 7 of such title, 

17 (iv) the aggregate amount of debt of 

18 such members in cases under chapter 7 of 

19 such title as of the time such cases are 

20 converted to cases under chapter 13 of 

21 such title, 

22 (v) the amount of resources expended 

23 by the bankruptcy courts and by the bank24 ruptcy trustees, stated separately, in cases 

25 under title 11 of the United States Code in 


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1 which such members avail themselves of 

2 the benefits of such provisions, and 

3 (vi) whether and to what extent there 

4 is any indicia of abuse or potential abuse 

5 of such provisions, and 

6 (B) with respect to debt-incurrence prac7 tices— 

8 (i) any increase in the average levels 

9 of debt incurred by such members before, 

10 during, or after such service, 

11 (ii) any indicia of changes in debt-in12 currence practices adopted by such mem13 bers in anticipation of benefitting from 

14 such provisions in any potential case under 

15 such title; and 

16 (iii) any indicia of abuse or potential 

17 abuse of such provisions reflected in the 

18 debt-incurrence of such members. 

19 SEC. 4. EFFECTIVE DATE; APPLICATION OF AMENDMENTS. 

20 (a) EFFECTIVE DATE.—Except as provided in sub21 section (b), this Act and the amendments made by this 

22 Act shall take effect 60 days after the date of enactment 

23 of this Act. 

24 (b) APPLICATION OF AMENDMENTS.—The amend25 ments made by this Act shall apply only with respect to 


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1 cases commenced under title 11 of the United States Code 

2 in the 3-year period beginning on the effective date of this 

3 Act. 

Æ 


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