Bankruptcy Administration Improvement Act of 2025

Floor Speech

Mr. Speaker, I rise in strong support of this bipartisan legislation, which will help ensure that Americans have access to bankruptcy relief when financial disaster strikes and they need it.

The legislation would increase compensation for chapter 7 trustees for the first time in more than 30 years, extend vital temporary bankruptcy judgeships, and ensure that our bankruptcy system continues to be self-funded and poses no cost to the American taxpayer.

Chapter 7 proceedings are designed for people who are most in need of financial relief. In chapter 7 bankruptcy, an individual debtor who has fallen on hard times, rather than go to debtor prison, which was the old-school method, can settle his or her debts, pay off back taxes, stop further collection actions, and secure a fresh start.

The process is means-tested, so it is available only for those who really need it, and it often comes with credit counseling and debtor education courses that can help our constituents achieve financial literacy and avoid bankruptcy a second time.

Nationwide, this process is overseen by trustees who help to distribute millions of dollars annually to local, State, and Federal Government agencies and private creditors of all types. In 1994, Congress set the pay for trustees at $60 per case, and we have not revisited that $60 pay rate in the decades since.

This bill would increase that paltry amount at long last. By doubling their fee to $120, we help to ensure that debtors will have the assistance they need to navigate the complicated and convoluted world of bankruptcy proceedings.

The bill also extends 29 temporary bankruptcy judgeships that are set to expire. In my State of Maryland alone, we are on track to lose three out of seven temporary judgeships. That is nearly half of our entire bankruptcy bench. We cannot afford to lose these judges at the very moment that bankruptcy filings are rising everywhere, up 30 percent in our State alone over the last couple of years.

Mr. Speaker, I strongly support this bill to increase the access and opportunity provided to all Americans under the bankruptcy system. I ask all of our colleagues to read it and to support it.

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Mr. RASKIN. Mr. Speaker, again, I restate my strong support for this bipartisan legislation, and I yield back the balance of my time.

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