May 01, 2009

A bill that will protect Oregon’s vulnerable veterans is expected to land on the Senate floor early next week. SB 731A will protect exempt funds from garnishment. The bill implements the policy and principle behind state and federal exemption laws by ensuring that protection is offered up front, at the bank account level, rather than requiring an expensive and delayed court hearing.

“Veterans’ benefits, disability benefits, social security benefits – these are crucial programs that are designed to create a safety net for vulnerable people. That’s why state and federal laws declare these benefits exempt from collection,” said Sybil Hebb, an attorney at the Oregon Law Center. “Often, these benefits are our clients’ only source of income. Losing that money to a garnishment means missing rent and utility payments, not being able to pay for food or medication – these garnishments are shredding our safety nets.”

Last month, Oregon War Veterans Association (OWVA) was called by a VA veteran service officer in Portland, who had a veteran in ICU for two weeks. During that time, a creditor garnished every single dime from his bank account, and nearly made the disabled veteran homeless because the disability pension funds in his account were just enough for his rent payment. He could do nothing on his own to remedy the situation. OWVA contacted his landlord made arrangements to pay three months rent, so he wouldn't have to worry about losing his house while in the hospital and treatment center. There were no other (veteran or otherwise) resources available to him, and without OWVA's help, he would be on the street today. SB 731A would have stopped the illegal garnishment from ever happening.

“This bill simply implements the policy and principle behind state and federal exemption laws by ensuring that protection is offered up front, at the bank account level, rather than requiring an expensive and delayed court hearing,” said Greg Warnock, the Executive Director of Oregon War Veterans Association. “Current law already provides that creditors are not entitled to exempt funds, so banks and collection companies should not be fighting this legislation, if they already comply with the law.”

The Oregon War Veterans Association urges the Senate to support SB 731A to protect our veterans from further economic vulnerability without attacking creditors.