SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Small Business Reor-
ganization Act of 2019’’. 
SEC. 2. REORGANIZATION OF SMALL BUSINESS DEBTORS. 
(a) IN GENERAL.—Chapter 11 of title 11, United 
States Code, is amended by adding at the end the fol-
lowing: 
‘‘SUBCHAPTER V—SMALL BUSINESS DEBTOR 
REORGANIZATION 
‘‘§ 1181. Inapplicability of other sections 
‘‘(a) IN GENERAL.—Sections 105(d), 1101(1), 1104, 
1105, 1106, 1107, 1108, 1115, 1116, 1121, 1123(a)(8), 
1123(c), 1127, 1129(a)(15), 1129(b), 1129(c), 1129(e), 
and 1141(d)(5) of this title do not apply in a case under 
this subchapter. 
‘‘(b) COURT AUTHORITY.—Unless the court for cause 
orders otherwise, paragraphs (1), (2), and (4) of section 
1102(a) and sections 1102(b), 1103, and 1125 of this title 
do not apply in a case under this subchapter. 
‘‘(c) SPECIAL RULE FOR DISCHARGE.—If a plan is 
confirmed under section 1191(b) of this title, section 
1141(d) of this title shall not apply, except as provided 
in section 1192 of this title. 
‘‘§ 1182. Definitions 
‘‘In this subchapter:
‘‘(1) DEBTOR.—The term ‘debtor’ means a 
small business debtor. 
‘‘(2) DEBTOR IN POSSESSION.—The term ‘debt-
or in possession’ means the debtor, unless removed 
as debtor in possession under section 1185(a) of this 
title. 
‘‘§ 1183. Trustee 
‘‘(a) IN GENERAL.—If the United States trustee has 
appointed an individual under section 586(b) of title 28 
to serve as standing trustee in cases under this sub-
chapter, and if such individual qualifies as a trustee under 
section 322 of this title, then that individual shall serve 
as trustee in any case under this subchapter. Otherwise, 
the United States trustee shall appoint one disinterested 
person to serve as trustee in the case or the United States 
trustee may serve as trustee in the case, as necessary. 
‘‘(b) DUTIES.—The trustee shall— 
‘‘(1) perform the duties specified in paragraphs 
(2), (5), (6), (7), and (9) of section 704(a) of this 
title; 
‘‘(2) perform the duties specified in paragraphs 
(3), (4), and (7) of section 1106(a) of this title, if 
the court, for cause and on request of a party in in-
terest, the trustee, or the United States trustee, so 
orders;
‘‘(3) appear and be heard at the status con-
ference under section 1188 of this title and any 
hearing that concerns— 
‘‘(A) the value of property subject to a 
lien; 
‘‘(B) confirmation of a plan filed under 
this subchapter; 
‘‘(C) modification of the plan after con-
firmation; or 
‘‘(D) the sale of property of the estate; 
‘‘(4) ensure that the debtor commences making 
timely payments required by a plan confirmed under 
this subchapter; 
‘‘(5) if the debtor ceases to be a debtor in pos-
session, perform the duties specified in section 
704(a)(8) and paragraphs (1), (2), and (6) of sec-
tion 1106(a) of this title, including operating the 
business of the debtor; 
‘‘(6) if there is a claim for a domestic support 
obligation with respect to the debtor, perform the 
duties specified in section 704(c) of this title; and 
‘‘(7) facilitate the development of a consensual 
plan of reorganization. 
‘‘(c) TERMINATION OF TRUSTEE SERVICE.—
‘‘(1) IN GENERAL.—If the plan of the debtor is 
confirmed under section 1191(a) of this title, the 
service of the trustee in the case shall terminate 
when the plan has been substantially consummated, 
except that the United States trustee may reappoint 
a trustee as needed for performance of duties under 
subsection (b)(3)(C) of this section and section 
1185(a) of this title. 
‘‘(2) SERVICE
OF
NOTICE
OF
SUBSTANTIAL 
CONSUMMATION.—Not later than 14 days after the 
plan of the debtor is substantially consummated, the 
debtor shall file with the court and serve on the 
trustee, the United States trustee, and all parties in 
interest notice of such substantial consummation. 
‘‘§ 1184. Rights and powers of a debtor in possession 
‘‘Subject to such limitations or conditions as the 
court may prescribe, a debtor in possession shall have all 
the rights, other than the right to compensation under sec-
tion 330 of this title, and powers, and shall perform all 
functions and duties, except the duties specified in para-
graphs (2), (3), and (4) of section 1106(a) of this title, 
of a trustee serving in a case under this chapter, including 
operating the business of the debtor.
‘‘§ 1185. Removal of debtor in possession 
‘‘(a) IN GENERAL.—On request of a party in interest, 
and after notice and a hearing, the court shall order that 
the debtor shall not be a debtor in possession for cause, 
including fraud, dishonesty, incompetence, or gross mis-
management of the affairs of the debtor, either before or 
after the date of commencement of the case, or for failure 
to perform the obligations of the debtor under a plan con-
firmed under this subchapter. 
‘‘(b) REINSTATEMENT.—On request of a party in in-
terest, and after notice and a hearing, the court may rein-
state the debtor in possession. 
‘‘§ 1186. Property of the estate 
‘‘(a) INCLUSIONS.—If a plan is confirmed under sec-
tion 1191(b) of this title, property of the estate includes, 
in addition to the property specified in section 541 of this 
title— 
‘‘(1) all property of the kind specified in that 
section that the debtor acquires after the date of 
commencement of the case but before the case is 
closed, dismissed, or converted to a case under chap-
ter 7, 12, or 13 of this title, whichever occurs first; 
and 
‘‘(2) earnings from services performed by the 
debtor after the date of commencement of the case 
but before the case is closed, dismissed, or converted
to a case under chapter 7, 12, or 13 of this title, 
whichever occurs first. 
‘‘(b) DEBTOR REMAINING IN POSSESSION.—Except 
as provided in section 1185 of this title, a plan confirmed 
under this subchapter, or an order confirming a plan 
under this subchapter, the debtor shall remain in posses-
sion of all property of the estate. 
‘‘§ 1187. Duties and reporting requirements of debt-
ors 
‘‘(a) FILING REQUIREMENTS.—Upon electing to be 
a debtor under this subchapter, the debtor shall file the 
documents required by subparagraphs (A) and (B) of sec-
tion 1116(1) of this title. 
‘‘(b) OTHER APPLICABLE PROVISIONS.—A debtor, in 
addition to the duties provided in this title and as other-
wise required by law, shall comply with the requirements 
of section 308 and paragraphs (2), (3), (4), (5), (6), and 
(7) of section 1116 of this title. 
‘‘(c) SEPARATE DISCLOSURE STATEMENT EXEMP-
TION.—If the court orders under section 1181(b) of this 
title that section 1125 of this title applies, section 1125(f) 
of this title shall apply. 
‘‘§ 1188. Status conference 
‘‘(a) IN GENERAL.—Except as provided in subsection 
(b), not later than 60 days after the entry of the order
1129(a), other than paragraph (15) of that section, of this 
title are met. 
‘‘(b) EXCEPTION.—Notwithstanding section 510(a) 
of this title, if all of the applicable requirements of section 
1129(a) of this title, other than paragraphs (8), (10), and 
(15) of that section, are met with respect to a plan, the 
court, on request of the debtor, shall confirm the plan not-
withstanding the requirements of such paragraphs if the 
plan does not discriminate unfairly, and is fair and equi-
table, with respect to each class of claims or interests that 
is impaired under, and has not accepted, the plan. 
‘‘(c) RULE OF CONSTRUCTION.—For purposes of this 
section, the condition that a plan be fair and equitable 
with respect to each class of claims or interests includes 
the following requirements: 
‘‘(1) With respect to a class of secured claims, 
the 
plan 
meets 
the 
requirements 
of 
section 
1129(b)(2)(A) of this title. 
‘‘(2) As of the effective date of the plan— 
‘‘(A) the plan provides that all of the pro-
jected disposable income of the debtor to be re-
ceived in the 3-year period, or such longer pe-
riod not to exceed 5 years as the court may fix, 
beginning on the date that the first payment is
due under the plan will be applied to make pay-
ments under the plan; or 
‘‘(B) the value of the property to be dis-
tributed under the plan in the 3-year period, or 
such longer period not to exceed 5 years as the 
court may fix, beginning on the date on which 
the first distribution is due under the plan is 
not less than the projected disposable income of 
the debtor. 
‘‘(3)(A)(i) The debtor will be able to make all 
payments under the plan; or 
‘‘(ii) there is a reasonable likelihood that the 
debtor will be able to make all payments under the 
plan; and 
‘‘(B) the plan provides appropriate remedies, 
which may include the liquidation of nonexempt as-
sets, to protect the holders of claims or interests in 
the event that the payments are not made. 
‘‘(d) DISPOSABLE INCOME.—For purposes of this 
section, the term ‘disposable income’ means the income 
that is received by the debtor and that is not reasonably 
necessary to be expended— 
‘‘(1) for— 
‘‘(A) the maintenance or support of the 
debtor or a dependent of the debtor; or
‘‘(B) a domestic support obligation that 
first becomes payable after the date of the filing 
of the petition; or 
‘‘(2) for the payment of expenditures necessary 
for the continuation, preservation, or operation of 
the business of the debtor. 
‘‘(e) 
SPECIAL
RULE.—Notwithstanding 
section 
1129(a)(9)(A) of this title, a plan that provides for the 
payment through the plan of a claim of a kind specified 
in paragraph (2) or (3) of section 507(a) of this title may 
be confirmed under subsection (b) of this section. 
‘‘§ 1192. Discharge 
‘‘If the plan of the debtor is confirmed under section 
1191(b) of this title, as soon as practicable after comple-
tion by the debtor of all payments due within the first 
3 years of the plan, or such longer period not to exceed 
5 years as the court may fix, unless the court approves 
a written waiver of discharge executed by the debtor after 
the order for relief under this chapter, the court shall 
grant the debtor a discharge of all debts provided in sec-
tion 1141(d)(1)(A) of this title, and all other debts allowed 
under section 503 of this title and provided for in the plan, 
except any debt—
‘‘(1) on which the last payment is due after the 
first 3 years of the plan, or such other time not to 
exceed 5 years fixed by the court; or 
‘‘(2) of the kind specified in section 523(a) of 
this title. 
‘‘§ 1193. Modification of plan 
‘‘(a) MODIFICATION BEFORE CONFIRMATION.—The 
debtor may modify a plan at any time before confirmation, 
but may not modify the plan so that the plan as modified 
fails to meet the requirements of sections 1122 and 1123 
of this title, with the exception of subsection (a)(8) of such 
section 1123. After the modification is filed with the court, 
the plan as modified becomes the plan. 
‘‘(b) MODIFICATION AFTER CONFIRMATION.—If a 
plan has been confirmed under section 1191(a) of this 
title, the debtor may modify the plan at any time after 
confirmation of the plan and before substantial con-
summation of the plan, but may not modify the plan so 
that the plan as modified fails to meet the requirements 
of sections 1122 and 1123 of this title, with the exception 
of subsection (a)(8) of such section 1123. The plan, as 
modified under this subsection, becomes the plan only if 
circumstances warrant the modification and the court, 
after notice and a hearing, confirms the plan as modified 
under section 1191(a) of this title.
‘‘(c) CERTAIN OTHER MODIFICATIONS.—If a plan 
has been confirmed under section 1191(b) of this title, the 
debtor may modify the plan at any time within 3 years, 
or such longer time not to exceed 5 years, as fixed by the 
court, but may not modify the plan so that the plan as 
modified fails to meet the requirements of section 1191(b) 
of this title. The plan as modified under this subsection 
becomes the plan only if circumstances warrant such 
modification and the court, after notice and a hearing, 
confirms such plan, as modified, under section 1191(b) of 
this title. 
‘‘(d) HOLDERS OF A CLAIM OR INTEREST.—If a plan 
has been confirmed under section 1191(a) of this title, any 
holder of a claim or interest that has accepted or rejected 
the plan is deemed to have accepted or rejected, as the 
case may be, the plan as modified, unless, within the time 
fixed by the court, such holder changes the previous ac-
ceptance or rejection of the holder. 
‘‘§ 1194. Payments 
‘‘(a) RETENTION
AND DISTRIBUTION
BY TRUST-
EE.—Payments and funds received by the trustee shall be 
retained by the trustee until confirmation or denial of con-
firmation of a plan. If a plan is confirmed, the trustee 
shall distribute any such payment in accordance with the
plan. If a plan is not confirmed, the trustee shall return 
any such payments to the debtor after deducting— 
‘‘(1) any unpaid claim allowed under section 
503(b) of this title; 
‘‘(2) any payment made for the purpose of pro-
viding adequate protection of an interest in property 
due to the holder of a secured claim; and 
‘‘(3) any fee owing to the trustee. 
‘‘(b) OTHER PLANS.—If a plan is confirmed under 
section 1191(b) of this title, except as otherwise provided 
in the plan or in the order confirming the plan, the trustee 
shall make payments to creditors under the plan. 
‘‘(c) PAYMENTS PRIOR TO CONFIRMATION.—Prior to 
confirmation of a plan, the court, after notice and a hear-
ing, may authorize the trustee to make payments to the 
holder of a secured claim for the purpose of providing ade-
quate protection of an interest in property. 
‘‘§ 1195. Transactions with professionals 
‘‘Notwithstanding section 327(a) of this title, a per-
son is not disqualified for employment under section 327 
of this title, by a debtor solely because that person holds 
a claim of less than $10,000 that arose prior to com-
mencement of the case.’’. 
(b) CLERICAL AMENDMENT.—The table of sub-
chapters at the beginning of chapter 11 of title 11, United
States Code, is amended by adding at the end the fol-
lowing: 
‘‘SUBCHAPTER V—SMALL BUSINESS DEBTOR REORGANIZATION 
‘‘1181. Inapplicability of other sections. 
‘‘1182. Definitions. 
‘‘1183. Trustee. 
‘‘1184. Rights and powers of a debtor in possession. 
‘‘1185. Removal of debtor in possession. 
‘‘1186. Property of the estate. 
‘‘1187. Duties and reporting requirements of debtors. 
‘‘1188. Status conference. 
‘‘1189. Filing of the plan. 
‘‘1190. Contents of plan. 
‘‘1191. Confirmation of plan. 
‘‘1192. Discharge. 
‘‘1193. Modification of plan. 
‘‘1194. Payments. 
‘‘1195. Transactions with professionals.’’. 
SEC. 3. PREFERENCES; VENUE OF CERTAIN PROCEEDINGS. 
(a) PREFERENCES.—Section 547(b) of title 11, 
United States Code, is amended by inserting ‘‘, based on 
reasonable due diligence in the circumstances of the case 
and taking into account a party’s known or reasonably 
knowable affirmative defenses under subsection (c),’’ after 
‘‘may’’. 
(b) VENUE
OF CERTAIN PROCEEDINGS.—Section 
1409(b) of title 28, United States Code, is amended by 
striking ‘‘$10,000’’ and inserting ‘‘$25,000’’. 
SEC. 4. CONFORMING AMENDMENTS. 
(a) TITLE 11.—Title 11, United States Code, is 
amended— 
(1) in section 101—
(A) in paragraph (51C), by inserting ‘‘and 
has not elected that subchapter V of chapter 11 
of this title shall apply’’ after ‘‘is a small busi-
ness debtor’’; and 
(B) in paragraph (51D)— 
(i) in subparagraph (A)— 
(I) by striking ‘‘or operating real 
property or activities incidental there-
to’’ and inserting ‘‘single asset real 
estate’’; and 
(II) by striking ‘‘for a case in 
which’’ and all that follows and insert-
ing ‘‘not less than 50 percent of which 
arose from the commercial or business 
activities of the debtor; and’’; and 
(ii) in subparagraph (B)— 
(I) by striking the period at the 
end and inserting a semicolon; 
(II) by striking ‘‘does not include 
any member’’ and inserting the fol-
lowing: ‘‘does not include— 
‘‘(i) any member’’; and 
(III) by adding at the end the 
following:
‘‘(ii) any debtor that is a corporation 
subject to the reporting requirements 
under section 13 or 15(d) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78m, 
78o(d)); or 
‘‘(iii) any corporation that— 
‘‘(I) is subject to the reporting 
requirements under section 13 or 
15(d) of the Securities Exchange Act 
of 1934 (15 U.S.C. 78m, 78o(d)); and 
‘‘(II) is an affiliate of a debtor.’’; 
(2) in section 103— 
(A) 
by 
redesignating 
subsections 
(i) 
through (k) as subsections (j) through (l), re-
spectively; and 
(B) by inserting after subsection (h) the 
following: 
‘‘(i) Subchapter V of chapter 11 of this title applies 
only in a case under chapter 11 in which a small business 
debtor elects that subchapter V of chapter 11 shall 
apply.’’; 
(3) in section 322(a), by inserting ‘‘1183,’’ 
after ‘‘1163,’’; 
(4) in section 326—
(A) in subsection (a), by inserting ‘‘, other 
than a case under subchapter V of chapter 11’’ 
after ‘‘7 or 11’’; and 
(B) in subsection (b), by inserting ‘‘sub-
chapter V of chapter 11 or’’ after ‘‘In a case 
under’’; 
(5) in section 347— 
(A) in subsection (a)— 
(i) by inserting ‘‘1194,’’ after ‘‘726,’’; 
and 
(ii) by inserting ‘‘subchapter V of 
chapter 11,’’ after ‘‘chapter 7,’’; and 
(B) in subsection (b), by inserting ‘‘1194,’’ 
after ‘‘1173,’’; 
(6) in section 363(c)(1), by inserting ‘‘1183, 
1184,’’ after ‘‘1108,’’; 
(7) in section 364(a), by inserting ‘‘1183, 
1184,’’ after ‘‘1108,’’; 
(8) in section 523(a), in the matter preceding 
paragraph (1), by inserting ‘‘1192’’ after ‘‘1141,’’; 
(9) in section 524— 
(A) in subsection (a)— 
(i) in paragraph (1), by inserting 
‘‘1192,’’ after ‘‘1141,’’; and
(ii) in paragraph (3), by inserting 
‘‘1192,’’ after ‘‘523,’’; 
(B) in subsection (c)(1), by inserting 
‘‘1192,’’ after ‘‘1141,’’; and 
(C) in subsection (d), by inserting ‘‘1192,’’ 
after ‘‘1141,’’; 
(10) in section 557(d)(3), by inserting ‘‘1183,’’ 
after ‘‘1104,’’; 
(11) in section 1102(a), by striking paragraph 
(3) and inserting the following: 
‘‘(3) Unless the court for cause orders other-
wise, a committee of creditors may not be appointed 
in a small business case or a case under subchapter 
V of this chapter.’’; and 
(12) in section 1146(a), by inserting ‘‘or 1191’’ 
after ‘‘1129’’. 
(b) TITLE 28.—Title 28 United States Code, is 
amended— 
(1) in section 586— 
(A) in subsection (a)(3), by inserting ‘‘(in-
cluding subchapter V of chapter 11)’’ after ‘‘7, 
11’’; 
(B) in subsection (b), by inserting ‘‘sub-
chapter V of chapter 11 or’’ after ‘‘cases 
under’’ the first place it appears;