Azusa Bankruptcy Attorney, Bankruptcy Lawyer, Bankruptcy Code 11 USC Section 903

TITLE 11 - BANKRUPTCY
CHAPTER 9 - ADJUSTMENT OF DEBTS OF A MUNICIPALITY
    SUBCHAPTER I - GENERAL PROVISIONS

-HEAD-
    Sec. 903. Reservation of State power to control municipalities

-STATUTE-
      This chapter does not limit or impair the power of a State to
    control, by legislation or otherwise, a municipality of or in such
    State in the exercise of the political or governmental powers of
    such municipality, including expenditures for such exercise, but - 
        (1) a State law prescribing a method of composition of
      indebtedness of such municipality may not bind any creditor that
      does not consent to such composition; and
        (2) a judgment entered under such a law may not bind a creditor
      that does not consent to such composition.

-SOURCE-
    (Pub. L. 95-598, Nov. 6, 1978, 92 Stat. 2622; Pub. L. 98-353, title
    III, Sec. 492, July 10, 1984, 98 Stat. 383.)


                       HISTORICAL AND REVISION NOTES                   

                          LEGISLATIVE STATEMENTS                      
      Section 903 of the House amendment represents a stylistic
    revision of section 903 of the Senate amendment. To the extent
    section 903 of the House bill would have changed present law, such
    section is rejected.

                         SENATE REPORT NO. 95-989                     
      Section 903 is derived, with stylistic changes, from section 83
    of current Chapter IX [section 403 of former title 11]. It sets
    forth the primary authority of a State, through its constitution,
    laws, and other powers, over its municipalities. The proviso in
    section 83, prohibiting State composition procedures for
    municipalities, is retained. Deletion of the provision would
    "permit all States to enact their own versions of Chapter IX
    [chapter 9 of former title 11]", Municipal Insolvency, 50
    Am.Bankr.L.J. 55, 65, which would frustrate the constitutional
    mandate of uniform bankruptcy laws. Constitution of the United
    States, Art. I, Sec. 8.
      This section provides that the municipality can consent to the
    court's orders in regard to use of its income or property. It is
    contemplated that such consent will be required by the court for
    the issuance of certificates of indebtedness under section 364(c).
    Such consent could extend to enforcement of the conditions attached
    to the certificates or the municipal services to be provided during
    the proceedings.

                                AMENDMENTS                            
      1984 - Par. (2). Pub. L. 98-353 struck out "to" before "that does
    not consent".

                     EFFECTIVE DATE OF 1984 AMENDMENT                 
      Amendment by Pub. L. 98-353 effective with respect to cases filed
    90 days after July 10, 1984, see section 552(a) of Pub. L. 98-353,
    set out as a note under section 101 of this title.

-End-
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