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Bankruptcy exemption bill status: Mayor Bloomberg's concerns satisfied

As reported two weeks ago, the bankruptcy exemption bill, S. 7034, was passed by both houses of the legislature, but was being held up pending passage of a new bill, S. 8451, which exempts New York State and its municipalities from the new $4,000 judgment debtor car exemption.

Why the new bill? New York City Mayor Michael Bloomberg blasted the bankruptcy exemption bill in late July, fearing that parking scofflaws will no longer be worried that their car might be towed. The mayor estimated that New York would lose $50 million in revenue and enforcement of parking scofflaws would come to a halt (see this New York Daily News article on the mayor's reaction, July 26, 2010.)

Political considerations may have had a part as well. The New York State Senate sponsor of the bankruptcy exemption bill, Senator Eric Schneiderman, is a Democratic candidate for Attorney General, and Mayor Bloomberg is supporting a republican rival.

Apparently the issue was resolved quickly. According to a Vos Iz Neias blog, the mayor blasted the bill at a news conference on the morning of July 26, hours after the Daily News article was posted. The Daily News then reported that, by that afternoon, the Mayor and Senator Schneiderman had settled their differences and issued this statement:

"We are pleased to report that we have reached agreement on a chapter amendment to the legislation that ensures the City's successful scofflaw towing program will remain intact. The chapter amendment will be introduced today and taken up by the Senate when it next considers legislative items. The underlying bill will not be sent to the Governor until this issue has been resolved."

Since then the Senate passed the new bill limiting the vehicle exemption (S. 8451, introduced July 26 and passed Aug. 3) and Assemblywoman Helene Weinstein, the long-time Assembly sponsor of the bill to update bankruptcy exemptions, has introduced the measure in the Assembly (A.11677.) The Assembly must meet before the bill can be passed, and, as of today, nobody knows when the Assembly will meet next in this, an election year. I understand that the Assembly is now, as a legal matter, 'at the call of the Speaker', and it is quite possible it may be called back into session before the election.

Assuming the new bill regarding the car exemption is passed by the Assembly, both bills will be sent to the Governor for action, either for passage or veto. The position of the Governor on the issue is unknown. Supporters of the bankruptcy exemption bill are encouraged to write to the Governor's office and submit their comments.

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