II 113th CONGRESS 1st Session S. 1579 IN THE SENATE OF THE UNITED STATES October 28, 2013 Mr. Sanders (for himself and Mr. Rockefeller ) introduced the following bill; which was read twice and referred to the Committee on Veterans' Affairs A BILL To amend the Servicemembers Civil Relief Act to improve the protections provided to members of the uniformed services and their families, and for other purposes.

1. Short title; table of contents (a) Short title This Act may be cited as the SCRA Enhancement and Improvement Act of 2013 . (b) Table of contents The table of contents for this Act is as follows: Sec. 1. Short title; table of contents. TITLE I—Enhancement of rights under Servicemembers Civil Relief Act Sec. 101. Extended period of protection under installment contracts for purchase or lease. Sec. 102. Modification of period determining which actions are covered under stay of proceedings and adjustment of obligation protections concerning mortgages and trust deeds of members of uniformed services. Sec. 103. Prohibition on collection of penalties for early prepayment of mortgage. Sec. 104. Protections for members of uniformed services regarding professional licenses. Sec. 105. Expansion of protections for members of uniformed services regarding taxes respecting real property occupied by businesses owned by such members. Sec. 106. Prohibition on denial of credit because of eligibility for protection. TITLE II—Improvements to Servicemembers Civil Relief Act Sec. 201. Improved protection of members of uniformed services against default judgments. Sec. 202. Modification of period in which a waiver of a right pursuant to a written agreement may be made under Servicemembers Civil Relief Act. Sec. 203. Clarification regarding application of enforcement authority of Attorney General and private right of action under Servicemembers Civil Relief Act. Sec. 204. Expansion of protections relating to mortgages to include obligations on real or personal property for which a servicemember is personally liable as a guarantor or co-maker. TITLE III—Enforcement of rights under Servicemembers Civil Relief Act Sec. 301. Election of arbitration to resolve controversies under Servicemembers Civil Relief Act. Sec. 302. Issuance and service of civil investigative demands by Attorney General under Servicemembers Civil Relief Act. Sec. 303. Increase in civil penalties for violation of Servicemembers Civil Relief Act. TITLE IV—Other matters Sec. 401. Clerical amendments. I Enhancement of rights under Ser­vice­mem­bers Civil Relief Act 101. Extended period of protection under installment contracts for purchase or lease Section 302(a)(1) of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 532(a)(1) ) is amended, in the matter following subparagraph (B), by striking or during that person's military service and inserting , during, or within one year after such servicemember's period of military service . 102. Modification of period determining which actions are covered under stay of proceedings and adjustment of obligation protections concerning mortgages and trust deeds of members of uniformed services (a) In general Section 303(b) of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 533(b) ) is amended by striking filed and inserting pending . (b) Conforming amendments Section 710(d) of the Honoring America's Veterans and Caring for Camp Lejeune Families Act of 2012 ( Public Law 112–154 ; 126 Stat. 1208) is amended— (1) by striking paragraph (1) and inserting the following new paragraph (1): (1) Sunset and revival (A) In general Subsections (b) and (c) of section 303 of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 533 ), as amended by subsections (a) and (b) of this section, are amended by striking within one year each place it appears and inserting within 90 days . (B) Effective date The amendments made by subparagraph (A) shall take effect on January 1, 2015. ; and (2) by striking paragraph (3). 103. Prohibition on collection of penalties for early prepayment of mortgage Section 203 of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 523 ) is amended by adding at the end the following new subsection: (c) Prohibition on prepayment penalties for certain mortgages (1) In general When a servicemember discharges an obligation arising under a mortgage contract and would otherwise thereby incur a prepayment penalty, such penalty shall not accrue if— (A) the servicemember is in military service at the time the prepayment penalty is incurred; and (B) the reason the servicemember discharges the obligation, thereby incurring the penalty, is materially affected by such military service. (2) Materially affecting military service For purposes of paragraph (1)(B), the requirement that the reason a servicemember discharged a mortgage obligation, thereby incurring a prepayment penalty, be materially affected by military services requires— (A) that the mortgage be secured by the servicemember's primary residence; and (B) that the servicemember receive permanent change of station orders. (3) Relief, costs, and attorney fees An assessment of a penalty in violation of this subsection shall be considered a violation of this Act for purposes of title VIII. . 104. Protections for members of uniformed services regarding professional licenses (a) In general Title VII of the Servicemembers Civil Relief Act (50 U.S.C. App. 701 et seq.) is amended by adding at the end the following new section: 707. Professional licenses (a) Expiration during period in which servicemembers are eligible for hostile fire or imminent danger special pay If a license issued by a State or local licensing authority to a servicemember would otherwise expire during a period in which such servicemember is eligible for hostile fire or imminent danger special pay under section 310 of title 37, United States Code, such State or local licensing authority shall delay the expiration of such license until not earlier than the date that is 180 days after the date on which such period of eligibility ends. (b) Continuing education requirements during period in which servicemembers are eligible for hostile fire or imminent danger special pay If a State or local licensing authority otherwise requires a servicemember to meet any continuing education requirements to maintain a license for a trade or profession during a period in which such servicemember is eligible for hostile fire or imminent danger special pay under section 310 of title 37, United States Code, such State or local licensing authority shall delay such continuing education requirement until not earlier than the date that is 180 days after the date on which such period of eligibility ends. . (b) Clerical amendment The table of contents in section 1(b) of such Act (50 U.S.C. App. 501(b)) is amended by inserting after the item relating to section 706 the following new item: Sec. 707. Professional licenses and certifications. . 105. Expansion of protections for members of uniformed services regarding taxes respecting real property occupied by businesses owned by such members (a) In general Subsection (a)(2) of section 501 of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 561 ) is amended by striking the matter before subparagraph (A) and inserting the following: (2) real property occupied for dwelling, professional, trade, business, or agricultural purposes by a servicemember, the servicemember's dependents or employees, or a business which (without regard to the form in which such profession, trade, business, or agricultural operation is organized or carried out) is owned entirely by a servicemember or by a servicemember and the spouse of the servicemember— . (b) Notice Such section is further amended by adding at the end the following new subsection: (f) Written notice to taxing authorities In order for real property owned by a business which is owned entirely by a servicemember or by a servicemember and the spouse of the servicemember to be subject to the protections provided in this section, the servicemember shall provide to the applicable taxing authority written notice and a copy of the military orders calling the servicemember to military service and any orders further extending military service, not later than 180 days after the date of the servicemember's termination or release from military service. . 106. Prohibition on denial of credit because of eligibility for protection Section 108 of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 518 ) is amended— (1) by striking Application by and inserting (a) Application or receipt .—Application by ; and (2) by adding at the end the following new subsection: (b) Eligibility (1) In general In addition to the protections under subsection (a), an individual who is entitled to any right or protection provided under this Act may not be denied or refused credit or be subject to any other action described under paragraphs (1) through (6) of subsection (a) solely by reason of such entitlement. (2) Construction Nothing in this subsection shall be construed to prohibit a lender from considering all relevant factors, other than the entitlement of an individual to a right or protection provided under this Act, in making a determination as to whether it is appropriate to extend credit. . II Improvements to Servicemembers Civil Relief Act 201. Improved protection of members of uniformed services against default judgments (a) Modification of plaintiff affidavit filing requirement (1) In general Paragraph (1) of section 201(b) of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 521(b) ) is amended— (A) by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively, and indenting such clauses two ems to the right; (B) in the matter before clause (i), as redesignated by subparagraph (A), by striking In any and inserting the following: (A) In general In any ; and (C) by adding at the end the following new subparagraph (B): (B) Due diligence Before filing the affidavit, the plaintiff shall conduct a diligent and reasonable investigation to determine whether or not the defendant is in military service, including a search of available records of the Department of Defense and any other information reasonably available to the plaintiff. The affidavit shall set forth all steps taken to determine the defendant’s military status and shall have attached copies of the records on which the plaintiff relied in drafting the affidavit. . (2) Applicability Paragraph (1)(B) of such section, as added by paragraph (1), shall apply with respect to actions and proceedings filed on or after the date of the enactment of this Act. (b) Appointment of attorney To represent defendant in military service Paragraph (2) of such section ( 50 U.S.C. App. 521(b) ) is amended— (1) by striking If in an action and inserting the following: (A) In general If in an action ; (2) in subparagraph (A), as designated by paragraph (1), by striking If an attorney and inserting the following: (C) Limitations on appointed attorney If an attorney ; (3) by inserting after subparagraph (A), as designated by paragraph (1), the following new subparagraph: (B) Due diligence If the court appoints an attorney to represent the defendant— (i) the attorney shall conduct a diligent and reasonable investigation to determine whether or not the defendant is in military service, including a search of available records of the Department of Defense and any other information reasonably available to the attorney; and (ii) the plaintiff shall submit to the attorney such information as the plaintiff may have concerning the whereabouts or identity of the defendant. ; and (4) by adding at the end the following new subparagraph: (D) Treatment of attorneys fees The reasonable fees of an attorney appointed to represent a servicemember shall be treated as costs of court for court cost purposes, unless the creditor seeks relief from such charges from the court. . 202. Modification of period in which a waiver of a right pursuant to a written agree­ment may be made under Ser­vice­mem­bers Civil Relief Act Section 107(a) of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 517 ) is amended in the third sentence by striking during or after the servicemember's period of military service and inserting after the occurrence of the event that gave rise to the rights or protections to be waived . 203. Clarification regarding application of enforcement authority of Attorney General and private right of action under Servicemembers Civil Relief Act Sections 801 and 802 of the Servicemembers Civil Relief Act (50 U.S.C. App. 597 and 597a) shall apply as if such sections were included in the enactment of the Soldiers' and Sailors' Civil Relief Act of 1940 (54 Stat. 1178, chapter 888) and included in the restatement of such Act in Public Law 108–189 . 204. Expansion of protections relating to mortgages to include obligations on real or personal property for which a servicemember is personally liable as a guarantor or co-maker Section 303(a) of the Servicemembers Civil Relief Act (50 U.S.C. App. 533) is amended, in the matter before paragraph (1), by inserting or an obligation on real or personal property for which a servicemember is personally liable as a guarantor or co-maker after by a servicemember . III Enforcement of rights under Ser­vice­mem­bers Civil Relief Act 301. Election of arbitration to resolve controversies under Servicemembers Civil Relief Act (a) In general Section 102 of the Ser­vice­mem­bers Civil Relief Act ( 50 U.S.C. App. 512 ) is amended by adding at the end the following new subsection: (d) Election of arbitration (1) Consent Required Notwithstanding any other provision of law, whenever a contract with a servicemember provides for the use of arbitration to resolve a controversy subject to a provision of this Act and arising out of or relating to such contract, arbitration may be used to settle such controversy only if, after such controversy arises, all parties to such controversy consent in writing to use arbitration to settle such controversy. (2) Explanation required Not­with­stand­ing any other provision of law, whenever arbitration is elected to settle a dispute pursuant to paragraph (1), the arbitrator shall provide the parties to such contract with a written explanation of the factual and legal basis for any decision made by the arbitrator in the course of such arbitration. . (b) Applicability Subsection (d) of such section, as added by subsection (a), shall apply with respect to contracts entered into, amended, altered, modified, renewed, or extended after the date of the enactment of this Act. 302. Issuance and service of civil investigative demands by Attorney General under Servicemembers Civil Relief Act (a) In general Section 801 of the Ser­vice­mem­bers Civil Relief Act ( 50 U.S.C. App. 597 ) is amended by adding at the end the following: (d) Issuance and service of civil investigative demands (1) In general Whenever the Attorney General has reason to believe that any person may be in possession, custody, or control of any documentary material relevant to an investigation under this Act, the Attorney General may, before commencing a civil action under subsection (a), issue in writing and serve upon such person, a civil investigative demand requiring— (A) the production of such documentary material for inspection and copying; (B) that the custodian of such documentary material answer in writing written questions with respect to such documentary material; or (C) the production of any combination of such documentary material or answers. (2) False claims The provisions of section 3733 of title 31, United States Code, governing the authority to issue, use, and enforce civil investigative demands shall apply with respect to the authority to issue, use, and enforce civil investigative demands under this section, except that, for purposes of applying such section 3733— (A) references to false claims law investigators or investigations shall be considered references to investigators or investigations under this Act; (B) references to interrogatories shall be considered references to written questions, and answers to such need not be under oath; (C) the definitions relating to false claims law shall not apply; and (D) provisions relating to qui tam relators shall not apply. (3) Annual report (A) In general Not later than one year after the date of the enactment of the SCRA Enhancement and Improvement Act of 2013 and not less frequently than once each year thereafter, the Attorney General shall submit to the Committee on Veterans' Affairs of the Senate and the Committee on Veterans' Affairs of the House of Representatives a report on the issuance of civil investigative demands under this subsection during the previous one-year period. (B) Elements Each report submitted under subparagraph (A) shall include the following for the year covered by the report: (i) The number of times that a civil investigative demand was issued under this subsection. (ii) For each civil investigative demand issued under this subsection with respect to an investigation, whether such investigation resulted in a settlement or conviction. . (b) Effective date Subsection (d) of such section, as added by subsection (a), shall take effect on the date of the enactment of this Act and shall apply with respect to all violations of the Servicemembers Civil Relief Act (50 U.S.C. App. 501 et seq.), regardless of when the violations are alleged to have occurred. 303. Increase in civil penalties for violation of Ser­vice­mem­bers Civil Relief Act (a) In general Section 801(b)(3) of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 597(b)(3) ) is amended— (1) in subparagraph (A), by striking $55,000 and inserting $110,000 ; and (2) in subparagraph (B), by striking $110,000 and inserting $220,000 . (b) Effective date The amendments made by subsection (a) shall take effect on the date that is 180 days after the date of the enactment of this Act and shall apply with respect to violations of the Servicemembers Civil Relief Act (50 U.S.C. App. 501 et seq.) that occur on or after such date. IV Other matters 401. Clerical amendments (a) In general The heading for section 305 of the Servicemembers Civil Relief Act ( 50 U.S.C. App. 535 ) is amended by striking residential or motor vehicle leases and inserting leases of premises occupied and motor vehicles used . (b) Table of contents The table of contents in section 1(b) of such Act ( 50 U.S.C. App. 501(b) ) is amended by striking the item relating to section 305 and inserting the following new item: Sec. 305. Termination of leases of premises occupied and motor vehicles used. .