Washington, D.C. –  House Judiciary Committee Chairman Bob Goodlatte (R-Va.) today gave the following statement on the House floor in support of the Bankruptcy Judgeship Act of 2017 (H.R. 2266).

Chairman Goodlatte: We are here today to address an imposing threat to one of the foundational aspects of our economy, the national bankruptcy system. A well-functioning bankruptcy system provides relief to consumers, allows businesses to reorganize, preserves jobs, maximizes the value of assets, and ensures the proper allocation of resources. Our bankruptcy judiciary is the heartbeat that keeps this system moving.  If that judiciary is strained and undermanned, that system will grind to a halt, eliminating the essential benefits it provides and sending repercussions throughout the economy.

There are presently twenty-nine temporary bankruptcy judgeships in the bankruptcy system with a lapse date of May 25, 2017. These temporary judgeships comprise more than eight percent of the current bankruptcy judgeships nationwide. After May 25th, these judgeships are at risk of being permanently lost, resulting in larger caseloads shared by fewer judges and causing further strain on our judiciary system.

The Bankruptcy Judgeship Act of 2017 converts 14 of the existing temporary judgeships to permanent status and creates four new permanent bankruptcy judgeships in districts with some of the highest caseloads in the country. In fact, since the enactment of the Bankruptcy Abuse Prevention and Consumer Protection Act in 2005, when a majority of the temporary judgeships were created, these districts have seen weighted filings increase by more than 55 percent.

This bill is based on a comprehensive study of judicial resource needs conducted by the Judicial Conference and is supported by the Administrative Office of the U.S. Courts. The Conference has assured us that its request comes only after it has taken steps to maximize all other alternatives to reduce judicial workloads.  Moreover, the Conference has demonstrated that, while a district may have a permanent judgeship, it will not be filled unless completely necessary.

Importantly, this bill will not present any new costs for the taxpayers. The Bankruptcy Judgeship Act includes an increase in the quarterly U.S. Trustee fees for large chapter 11 debtors, excluding small businesses.  This fee increase is directly tied to the balance of the United States Trustee System Fund and will only be applied when the balance of the fund falls below a $200 million threshold, thereby ensuring that the Office of the U.S. Trustee is properly funded.

These “temporary” bankruptcy judgeships were first set to lapse in 2010.  Most have been extended for over 12 years and some even longer.  Despite this Committee’s previous efforts to address the issue, to date there have been only limited, short-term fixes. Additional permanent bankruptcy judgeships have not been authorized since 1992.

The time has come for Congress to address bankruptcy judgeship needs more permanently. We need a bankruptcy system that has a sufficient number of judges to be able to manage the caseloads in a just, economical and timely manner. The efficiency of this system is too important to our economy to risk.  his bill helps ensure that we have such a system.

I’d like to thank Ranking Member Conyers for his efforts on this issue.  I’d also like to thank Regulatory Reform, Commercial and Antitrust Law Subcommittee Chairman Marino and Ranking Member Cicilline for joining me as original cosponsors of the bill.

I urge my colleagues to vote in favor of this important legislation and reserve the balance of my time.

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