Assembly passes Wieckowski bill to rein in debt collectors

September 10, 2019

SACRAMENTO – The state Assembly today approved a critical anti-poverty bill to ensure debt collectors leave at least $1,724 in a bank account, rather than taking the entire amount and leaving people with insufficient funds to cover day-to-day expenses.  The bill, SB 616, authored by Senator Bob Wieckowski (D-Fremont) is supported by a large coalition of legal aid providers, advocates for low-income consumers and many progressive statewide organizations.  The bill goes to the Senate for a concurrence vote.

“There are millions of Californians living paycheck-to-paycheck and this bill gives them added financial security when debt collectors come after them,” said Wieckowski, a member of the Senate Judiciary Committee.  “We live in a high-poverty state and people need the security of knowing they will have enough in their account to buy groceries, pay rent and cover other expenses.  Debt collectors are notorious for seeking to collect from the wrong individuals.  Those mistakes can be devastating for the families affected.  SB 616 does not eliminate the responsibility to pay a legitimate debt, but it will help low-income Californians from falling deeper into debt.”

SB 616 allows for the $1,724 protection per individual. The state Department of Social Services (DSS) has determined that amount is the lowest possible for a family of four to survive in urban California.  The amount will be updated annually by DSS.

“Today’s vote sends a strong message to the multi-million-dollar debt collection industry that California won’t stand for the use of abusive debt collection practices,” said Jessica Bartholow, legislative advocate with the Western Center on Law and Poverty and chair of the California Asset Building Coalition Steering Committee.  “At a time when the Consumer Financial Protection Bureau is weakening the federal Fair Debt Collection Practices Act, Californians need this protection now more than ever.”

SB 616 is necessary because the claim of exemption process that individuals can use is cumbersome, time-consuming, and only protects funds after the money has been levied, when people might already be evicted, missed payments, or incurred late charges. Sixteen other states have levy protection measures, ranging from $300 to $10,000. 

"SB 616 will offer peace of mind to the tens of thousands of Californians every year who go through financial shock when debt collectors seize every penny in their bank account,” said Ted Mermin, director of the California Low-Income Consumer Coalition (CLICC). “This bill says that our state cares about preventing homelessness and maintaining stable communities. We offer thanks to the 45 members of the Assembly who sided with low-income Californians rather than debt collectors. And we salute the incredibly hard work over the past three years of our co-sponsor, the Western Center on Law & Poverty, and the staffs of Senator Wieckowski and co-authors Senator Bob Hertzberg, and Assemblymember Luz Rivas. This is a good day for the tens of millions of California consumers who are struggling with debt. And it is a good day for California."

In addition to the Western Center on Law & Poverty and CLICC, the bill is supported by the California Democratic Party, California Asset Building Coalition, Building the California Dream Alliance and many others.

Senator Wieckowski represents the 10th District, which includes parts of Alameda County and Santa Clara County.