BWM C.S.S.B. 1098 75(R)BILL ANALYSIS FINANCIAL INSTITUTIONS C.S.S.B. 1098 By: Wentworth (Goodman) 5-12-97 Committee Report (Substituted) BACKGROUND Currently, Texas exemption laws do not presently contain a provision that protects the right to receive alimony, maintenance, and support payments. A couple going through a divorce are likely to have joint obligation debts. After divorce, a spouse needing maintenance is still obligated to creditors even if the divorce decree provides that the other spouse is primarily liable for these debts. Without an amendment to the exemption statute, when the receiving spouse files for bankruptcy, the receiving spouse may not be able to seek bankruptcy protection because of the threat of a trustee objection. This bill will exempt certain support payments from seizure. PURPOSE As proposed, S.B. 1098 exempts alimony, support, or separate maintenance payments from seizure. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 42.001(b), Property Code, to provide that alimony, support, or separate maintenance received by the debtor for the support of the debtor and any dependent of the debtor is exempt from seizure and is not included in the aggregate limitations prescribed by Subsection (a). SECTION 2. Effective date: September 1, 1997. Makes application of this Act prospective. SECTION 3. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE The Committee Substitute to S.B. 1098 qualifies the exempted support payments by adding provisions that the payments have been receieved by the debtor.