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Collins proposes bill to protect tuition payments in bankruptcies

WASHINGTON – Bankruptcy trustees are increasingly forcing colleges to forfeit college tuition payments made by parents who have gone broke, and Rep. Chris Collins, R-Clarence, thinks that’s a troubling trend that ought to stop.

Collins and Rep. Blake Farenthold, R-Texas, Wednesday introduced the Protecting All College Tuition (PACT) Act, which would prevent bankruptcy trustees from targeting tuition payments in that way.

“Higher education is one of the best ways to guarantee a child’s future success,” Collins said. “The PACT Act will ensure that the financial sacrifices parents made to pay their children’s tuition are protected from seizure in bankruptcy proceedings.”

Collins and Farenthold developed the legislation after the Wall Street Journal reported earlier this month that bankruptcy trustees are increasingly targeting the tuition parents have paid as they try to pay off the parents’ bad debts.

The Journal article said that 25 colleges or universities have been targeted for tuition forfeiture since 2008, and that 12 of those universities have complied. None of the universities cited in the story was located in Western New York.