Albany-- The House of Representatives officially voted and passed the Family and Farmers Bankruptcy bill last week. It is now awaiting the signature from President Bush.
We spoke with Walter Kelley, a Chapter 12 trustee who tells us that once the President signs the bill, some major changes will be made to criteria and eligibility for farmers filing bankruptcy. Some new benefits allow farmers to have $3.2 million in debt instead of the $1.5 million required under the old law.
Under the bill, fishermen also become farmers and can file too. Additionally, farmers under the old bill had to owe a farm related debt of at least 80%. That has now decreased to only 50%.
For those farmers who have all ready had to file bankruptcy, Kelley tells us about another major change, "At least half your income has to come from farming but under the old law it had to be from the year before you filed so if you filed in 2005 we would look to 2004 to see if you were eligible now you can look to 2003 and 2002."
Kelley also tells us the most important thing about Chapter 12 is that it is now permanent. In the past Congress would have to re-enact it because it was a temporary legislative. Once signed it will mean that the bill will always be available. It was initially designed to help farmers in 1986 when the value of land went down.
If you would like more information about the Family and Farmers bill you can reach Walter Kelley at 229-888-9128 directly.