TH D CONGRESS SESSION S. 4996...13 cases, and other fees, that together fund the courts, 14 judges, United States trustees, and chapter 7 case 15 trustees necessary for the bankruptcy

II

116TH CONGRESS 2D SESSION S. 4996

To ensure funding of the United States trustees, extend temporary bankruptcy

judgeships, and for other purposes.

IN THE SENATE OF THE UNITED STATES

DECEMBER 9, 2020

Mr. GRAHAM (for himself, Mr. COONS, Mr. RUBIO, Mr. CARDIN, Mrs. BLACK-

BURN, and Mr. CARPER) introduced the following bill; which was read

twice, considered, read the third time, and passed

A BILL To ensure funding of the United States trustees, extend

temporary bankruptcy judgeships, and for other purposes.

Be it enacted by the Senate and House of Representa-1

tives of the United States of America in Congress assembled, 2

SECTION 1. SHORT TITLE. 3

This Act may be cited as the ‘‘Bankruptcy Adminis-4

tration Improvement Act of 2020’’. 5

SEC. 2. FINDINGS AND PURPOSE. 6

(a) FINDINGS.—Congress finds the following: 7

(1) Because of the importance of the goal that 8

the bankruptcy system is self-funded, at no cost to 9

the taxpayer, Congress has closely monitored the 10

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funding needs of the bankruptcy system, including 1

by requiring periodic reporting by the Attorney Gen-2

eral regarding the United States Trustee System 3

Fund. 4

(2) Congress has amended the various bank-5

ruptcy fees as necessary to ensure that the bank-6

ruptcy system remains self-supporting, while also 7

fairly allocating the costs of the system among those 8

who use the system. 9

(3) Because the bankruptcy system is inter-10

connected, the result has been a system of fees, in-11

cluding filing fees, quarterly fees in chapter 11 12

cases, and other fees, that together fund the courts, 13

judges, United States trustees, and chapter 7 case 14

trustees necessary for the bankruptcy system to 15

function. 16

(4) This Act and the amendments made by this 17

Act— 18

(A) ensure adequate funding of the United 19

States trustees, supports the preservation of ex-20

isting bankruptcy judgeships that are urgently 21

needed to handle existing and anticipated in-22

creases in business and consumer caseloads, 23

and provides long-overdue additional compensa-24

tion for chapter 7 case trustees whose caseloads 25


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include chapter 11 reorganization cases that 1

were converted to chapter 7 liquidation cases; 2

and 3

(B) confirm the longstanding intention of 4

Congress that quarterly fee requirements re-5

main consistent across all Federal judicial dis-6

tricts. 7

(b) PURPOSE.—The purpose of this Act and the 8

amendments made by this Act is to further the long-stand-9

ing goal of Congress of ensuring that the bankruptcy sys-10

tem is self-funded, at no cost to the taxpayer. 11

SEC. 3. UNITED STATES TRUSTEE SYSTEM FUND; BANK-12

RUPTCY FEES. 13

(a) DEPOSITS OF CERTAIN FEES FOR FISCAL YEARS 14

2021 THROUGH 2026.—Notwithstanding section 589a(b) 15

of title 28, United States Code, for each of fiscal years 16

2021 through 2026— 17

(1) the fees collected under section 1930(a)(6) 18

of such title, less the amount specified in subpara-19

graph (2), shall be deposited as specified in sub-20

section (b); and 21

(2) $5,400,000 of the fees collected under sec-22

tion 1930(a)(6) of such title shall be deposited in 23

the general fund of the Treasury. 24


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(b) UNITED STATES TRUSTEE SYSTEM FUND.—Sec-1

tion 589a of title 28, United States Code, is amended by 2

adding at the end the following: 3

‘‘(f)(1) During each of fiscal years 2021 through 4

2026 and notwithstanding subsections (b) and (c), the fees 5

collected under section 1930(a)(6), less the amount speci-6

fied in paragraph (2), shall be deposited as follows, in the 7

following order: 8

‘‘(A) First, the amounts specified in the De-9

partment of Justice appropriations for that fiscal 10

year, shall be deposited as discretionary offsetting 11

collections to the ‘‘United States Trustee System 12

Fund’’, pursuant to subsection (a), to remain avail-13

able until expended. 14

‘‘(B) Second, the amounts determined annually 15

by the Director of the Administrative Office of the 16

United States Courts that are necessary to reim-17

burse the judiciary for the costs of administering 18

payments under section 330(e) of title 11, shall be 19

deposited as mandatory offsetting collections to the 20

‘United States Trustee System Fund’, and trans-21

ferred and deposited into the special fund estab-22

lished under section 1931(a), and notwithstanding 23

subsection (a), shall be available for expenditure 24

without further appropriation. 25


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‘‘(C) Third, the amounts determined annually 1

by the Director of the Administrative Office of the 2

United States Courts that are necessary to pay 3

trustee compensation authorized by section 4

330(e)(2) of title 11, shall be deposited as manda-5

tory offsetting collections to the ‘United States 6

Trustee System Fund’, and transferred and depos-7

ited into the Chapter 7 Trustee Fund established 8

under section 330(e) of title 11 for payment to 9

trustees serving in cases under chapter 7 of title 11 10

(in addition to the amounts paid under section 11

330(b) of title 11), in accordance with that section, 12

and notwithstanding subsection (a), shall be avail-13

able for expenditure without further appropriation. 14

‘‘(D) Fourth, any remaining amounts shall be 15

deposited as discretionary offsetting collections to 16

the ‘United States Trustee System Fund’, to remain 17

available until expended. 18

‘‘(2) Notwithstanding subsection (b), for each of fis-19

cal years 2021 through 2026, $5,400,000 of the fees col-20

lected under section 1930(a)(6) shall be deposited in the 21

general fund of the Treasury.’’. 22

(c) COMPENSATION OF OFFICERS.—Section 330 of 23

title 11, United States Code, is amended by adding at the 24

end the following: 25


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‘‘(e)(1) There is established a fund in the Treasury 1

of the United States, to be known as the ‘Chapter 7 Trust-2

ee Fund’, which shall be administered by the Director of 3

the Administrative Office of the United States Courts. 4

‘‘(2) Deposits into the Chapter 7 Trustee Fund under 5

section 589a(f)(1)(C) of title 28 shall be available until 6

expended for the purposes described in paragraph (3). 7

‘‘(3) For fiscal years 2021 through 2026, the Chapter 8

7 Trustee Fund shall be available to pay the trustee serv-9

ing in a case that is filed under chapter 7 or a case that 10

is converted to a chapter 7 case in the most recent fiscal 11

year (referred to in this subsection as a ‘chapter 7 case’) 12

the amount described in paragraph (4) for the chapter 7 13

case in which the trustee has rendered services in that fis-14

cal year. 15

‘‘(4) The amount described in this paragraph shall 16

be the lesser of— 17

‘‘(A) $60; or 18

‘‘(B) a pro rata share, for each chapter 7 case, 19

of the fees collected under section 1930(a)(6) of title 20

28 and deposited to the United States Trustee Sys-21

tem Fund under section 589a(f)(1) of title 28, less 22

the amounts specified in section 589a(f)(1)(A) and 23

(B) of title 28. 24


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‘‘(5) The payment received by a trustee under para-1

graph (3) shall be paid in addition to the amount paid 2

under subsection (b). 3

‘‘(6) Not later than September 30, 2021, the Director 4

of the Administrative Office of the United States Courts 5

shall promulgate regulations for the administration of this 6

subsection.’’. 7

(d) BANKRUPTCY FEES.—Section 1930(a) of title 28, 8

United States Code, is amended— 9

(1) by striking paragraph (6)(B) and inserting 10

the following: 11

‘‘(B)(i) During the 5-year period beginning 12

on January 1, 2021, in addition to the filing fee 13

paid to the clerk, a quarterly fee shall be paid 14

to the United States trustee, for deposit in the 15

Treasury, in each open and reopened case 16

under chapter 11 of title 11, other than under 17

subchapter V, for each quarter (including any 18

fraction thereof) until the case is closed, con-19

verted, or dismissed, whichever occurs first. 20

‘‘(ii) The fee shall be the greater of— 21

‘‘(I) 0.4 percent of disbursements or 22

$250 for each quarter in which disburse-23

ments total less than $1,000,000; and 24


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‘‘(II) 0.8 percent of disbursements but 1

not more than $250,000 for each quarter 2

in which disbursements total at least 3

$1,000,000. 4

‘‘(iii) The fee shall be payable on the last 5

day of the calendar month following the cal-6

endar quarter for which the fee is owed.’’; and 7

(2) in paragraph (7), in the first sentence, by 8

striking ‘‘may’’ and inserting ‘‘shall’’. 9

(e) APPLICABILITY.— 10

(1) IN GENERAL.—Except as provided in para-11

graph (2), the amendments made by this section 12

shall take effect on the date of enactment of this 13

Act. 14

(2) EXCEPTIONS.— 15

(A) COMPENSATION OF OFFICERS.—The 16

amendments made by subsection (c) shall apply 17

to any case filed on or after the date of enact-18

ment of this Act— 19

(i) under chapter 7 of title 11, United 20

States Code; or 21

(ii)(I) under chapter 11, 12, or 13 of 22

that title; and 23

(II) converted to a chapter 7 case 24

under that title. 25


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(B) BANKRUPTCY FEES.—The amend-1

ments made by subsection (d) shall apply to— 2

(i) any case pending under chapter 11 3

of title 11, United States Code, on or after 4

the date of enactment of this Act; and 5

(ii) quarterly fees payable under sec-6

tion 1930(a)(6) of title 28, United States 7

Code, as amended by subsection (d), for 8

disbursements made in any calendar quar-9

ter that begins on or after the date of en-10

actment of this Act. 11

SEC. 4. EXTENSION OF TEMPORARY OFFICE OF BANK-12

RUPTCY JUDGES IN CERTAIN JUDICIAL DIS-13

TRICTS. 14

(a) TEMPORARY OFFICE OF BANKRUPTCY JUDGES 15

AUTHORIZED BY THE BANKRUPTCY JUDGESHIP ACT OF 16

2017.— 17

(1) EXTENSIONS.—The temporary office of 18

bankruptcy judges authorized by section 1003(a) of 19

the Bankruptcy Judgeship Act of 2017 (28 U.S.C. 20

152 note) for the district of Delaware and the east-21

ern district of Michigan are extended until the appli-22

cable vacancy specified in paragraph (2) in the office 23

of a bankruptcy judge for the respective district oc-24

curs. 25


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(2) VACANCIES.— 1

(A) DISTRICT OF DELAWARE.—The 1st 2

and 2d vacancies in the office of a bankruptcy 3

judge for the district of Delaware— 4

(i) occurring 5 years or more after the 5

date established by section 1003(b)(1) of 6

the Bankruptcy Judgeship Act of 2017 (28 7

U.S.C. 152 note), and 8

(ii) resulting from the death, retire-9

ment, resignation, or removal of a bank-10

ruptcy judge, 11

shall not be filled. 12

(B) EASTERN DISTRICT OF MICHIGAN.— 13

The 1st vacancy in the office of a bankruptcy 14

judge for the eastern district of Michigan— 15







ruptcy judge, 22


(3) APPLICABILITY OF OTHER PROVISIONS.— 24

Except as provided in paragraphs (1) and (2), all 25


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other provisions of section 1003 of the Bankruptcy 1

Judgeship Act of 2017 (28 U.S.C. 152 note) remain 2

applicable to the temporary office of bankruptcy 3

judges referred to in paragraph (1). 4

(b) TEMPORARY OFFICE OF BANKRUPTCY JUDGES 5


2005 AND EXTENDED BY THE TEMPORARY BANKRUPTCY 7

JUDGESHIPS EXTENSION ACT OF 2012 AND THE BANK-8

RUPTCY JUDGESHIP ACT OF 2017.— 9


bankruptcy judges authorized for the following dis-11

tricts by section 1223(b) of the Bankruptcy Judge-12

ship Act of 2005 (28 U.S.C. 152 note), extended by 13

section 2(a) of the Temporary Bankruptcy Judge-14

ships Extension Act of 2012 (28 U.S.C. 152 note), 15

and further extended by section 1002(a) of the 16

Bankruptcy Judgeship Act of 2017 (28 U.S.C. 152 17

note) are extended until the applicable vacancy spec-18

ified in paragraph (2) in the office of a bankruptcy 19

judge for the respective district occurs: 20

(A) The district of Delaware. 21

(B) The southern district of Florida. 22

(C) The district of Maryland. 23

(D) The eastern district of Michigan. 24

(E) The district of Nevada. 25


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(F) The eastern district of North Carolina. 1

(G) The district of Puerto Rico. 2

(H) The eastern district of Virginia. 3

(2) VACANCIES.— 4

(A) SINGLE VACANCIES.—Except as pro-5

vided in subparagraphs (B), (C), (D), (E), and 6

(F), the 1st vacancy in the office of a bank-7

ruptcy judge for each district specified in para-8

graph (1)— 9


date established by section 1002(a)(2) of 11





ruptcy judge, 16


(B) DISTRICT OF DELAWARE.—The 3d, 18

4th, 5th, and 6th vacancies in the office of a 19

bankruptcy judge for the district of Delaware— 20



Bankruptcy Judgeship Act of 2017 (28 23



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ruptcy judge, 3


(C) SOUTHERN DISTRICT OF FLORIDA.— 5

The 1st and 2d vacancies in the office of a 6

bankruptcy judge for the southern district of 7

Florida— 8







ruptcy judge, 15


(D) DISTRICT OF MARYLAND.—The 1st 17

vacancy in the office of a bankruptcy judge for 18

the district of Maryland— 19






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ruptcy judge, 3


(E) EASTERN DISTRICT OF MICHIGAN.— 5

The 2d vacancy in the office of a bankruptcy 6

judge for the eastern district of Michigan— 7







ruptcy judge, 14


(F) DISTRICT OF PUERTO RICO.—The 1st 16


the district of Puerto Rico— 18







ruptcy judge, 25


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Judgeship Act of 2005 (28 U.S.C. 152 note), section 5

2 of the Temporary Bankruptcy Judgeships Exten-6

sion Act of 2012 (28 U.S.C. 152 note), and section 7

1002 of the Bankruptcy Judgeship Act of 2017 (28 8

U.S.C. 152 note) remain applicable to the temporary 9

office of bankruptcy judges referred to in paragraph 10

(1). 11

(c) TEMPORARY OFFICE OF BANKRUPTCY JUDGES 12



JUDGESHIPS EXTENSION ACT OF 2012.— 15


bankruptcy judges authorized for the following dis-17

tricts by section 1223(b) of the Bankruptcy Judge-18

ship Act of 2005 (28 U.S.C. 152 note) and extended 19

by section 2(a) of the Temporary Bankruptcy 20

Judgeships Extension Act of 2012 (28 U.S.C. 152 21

note) are extended until the applicable vacancy spec-22

ified in paragraph (2) in the office of a bankruptcy 23

judge for the respective district occurs: 24

(A) The southern district of Georgia. 25


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(B) The district of Maryland. 1

(C) The district of New Jersey. 2

(D) The northern district of New York. 3

(E) The district of South Carolina. 4

(2) VACANCIES.— 5

(A) SINGLE VACANCIES.—Except as pro-6

vided in subparagraph (B), the 1st vacancy in 7

the office of a bankruptcy judge for each dis-8

trict specified in paragraph (1)— 9


date of the enactment of this Act, and 11



ruptcy judge, 14


(B) DISTRICT OF MARYLAND.—The 2d 16

and 3d vacancies in the office of a bankruptcy 17

judge for the district of Maryland— 18





ruptcy judge, 23



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Judgeship Act of 2005 (28 U.S.C. 152 note) and 4

section 2 of the Temporary Bankruptcy Judgeships 5

Extension Act of 2012 (28 U.S.C. 152 note) remain 6

applicable to the temporary office of bankruptcy 7

judges referred to in paragraph (1). 8

(d) TEMPORARY OFFICE OF BANKRUPTCY JUDGES 9


1992 AND EXTENDED BY THE BANKRUPTCY JUDGESHIP 11

ACT OF 2005, THE TEMPORARY BANKRUPTCY JUDGE-12

SHIPS EXTENSION ACT OF 2012, AND THE BANKRUPTCY 13

JUDGESHIP ACT OF 2017.— 14


bankruptcy judges authorized by section 3(a) of the 16


note), extended by section 1223(c) of Bankruptcy 18

Judgeship Act of 2005 (28 U.S.C. 152 note), ex-19

tended by section 2(b) of the Temporary Bankruptcy 20

Judgeships Extension Act of 2012 (28 U.S.C. 152 21

note), and further extended by section 1002(b) of 22

the Bankruptcy Judgeship Act of 2017 (28 U.S.C. 23

152 note) for the district of Delaware and the dis-24

trict of Puerto Rico are extended until the applicable 25


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vacancy specified in paragraph (2) in the office of a 1

bankruptcy judge for the respective district occurs. 2

(2) VACANCIES.— 3

(A) DISTRICT OF DELAWARE.—The 7th 4


the district of Delaware— 6







ruptcy judge, 13


(B) DISTRICT OF PUERTO RICO.—The 2d 15


the district of Puerto Rico— 17







ruptcy judge, 24



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1223 of Bankruptcy Judgeship Act of 2005 (28 5

U.S.C. 152 note), section 2 of the Temporary Bank-6

ruptcy Judgeships Extension Act of 2012 (28 7

U.S.C. 152 note), and section 1002 of the Bank-8

ruptcy Judgeship Act of 2017 (28 U.S.C. 152 note) 9

remain applicable to the temporary office of bank-10

ruptcy judges referred to in paragraph (1). 11

(e) TEMPORARY OFFICE OF BANKRUPTCY JUDGE 12


1992 AND EXTENDED BY THE BANKRUPTCY JUDGESHIP 14

ACT OF 2005 AND THE TEMPORARY BANKRUPTCY 15



bankruptcy judge authorized by section 3(a) of the 18


note), extended by section 1223(c) of the Bank-20

ruptcy Judgeship Act of 2005 (28 U.S.C. 152 note), 21

and further extended by section 2(b) of the Tem-22

porary Bankruptcy Judgeships Extension Act of 23

2012 (28 U.S.C. 152 note) for the eastern district 24

of Tennessee is extended until the applicable vacancy 25


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specified in paragraph (2) in the office of a bank-1

ruptcy judge for the district occurs. 2

(2) VACANCY.—The 1st vacancy in the office of 3

a bankruptcy judge for the eastern district of Ten-4

nessee— 5

(A) occurring 5 years or more after the 6


(B) resulting from the death, retirement, 8

resignation, or removal of a bankruptcy judge, 9






1223 of the Bankruptcy Judgeship Act of 2005 (28 15

U.S.C. 152 note), and section 2 of the Temporary 16

Bankruptcy Judgeships Extension Act of 2012 (28 17


office of bankruptcy judge referred to in paragraph 19

(1). 20

(f) TEMPORARY OFFICE OF BANKRUPTCY JUDGE 21





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bankruptcy judge authorized by section 3(a) of the 2


note) and extended by section 2(c) of the Temporary 4

Bankruptcy Judgeships Extension Act of 2012 (28 5

U.S.C. 152 note) for the middle district of North 6

Carolina is extended until the applicable vacancy 7

specified in paragraph (2) in the office of a bank-8

ruptcy judge for the district occurs. 9

(2) VACANCY.—The 1st vacancy in the office of 10

a bankruptcy judge for the middle district of North 11

Carolina— 12

(A) occurring 5 years or more after the 13


(B) resulting from the death, retirement, 15

resignation, or removal of a bankruptcy judge, 16





Judgeship Act of 1992 (28 U.S.C. 152 note) and 21

section 2 of the Temporary Bankruptcy Judgeships 22

Extension Act of 2012 (28 U.S.C. 152 note) (28 23



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office of bankruptcy judge referred to in paragraph 1

(1). 2

SEC. 5. REGULATIONS. 3

Section 375(h) of title 28, United States Code, is 4

amended by striking ‘‘may’’ and inserting ‘‘shall’’. 5

Æ


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Documents

TH D CONGRESS SESSION S. 4996...13 cases, and other fees, that together fund the courts, 14 judges, United States trustees, and chapter 7 case 15 trustees necessary for the bankruptcy