September/October 2001
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Bankruptcy
Rates Reviewed
Take a look into anyone's wallet and chances are you'll see at
least one credit card stuffed between other plastic or paper necessities.
Whether for business needs or personal use, most everyone today
has used a credit card or obtained a loan to purchase goods or
services.
There
are times, however, when borrowers become overextended or when
unforeseen events occur, and borrowers are unable to meet their
debt obligations. To account for these times, the U.S. adopted
bankruptcy laws years ago that are intended to achieve some type
of balance between the debtor's and creditor's rights.
To take
a closer look at bankruptcy filings and rates across the U.S.
and compare them to those filed in Pennsylvania, researchers from
Indiana University of Pennsylvania, through a grant from the Center
for Rural Pennsylvania, collected and analyzed bankruptcy data.
The Center's Board of Directors has approved the release of that
research, and the report, Rural Bankruptcy Rates in Pennsylvania,
is now available.
Collecting
the data
To complete the analysis and the report, researchers Dr. Martha
Troxell, Dr. Robert Boldin, and Dr. Mohamed Albohali, obtained
bankruptcy data from the U.S. Courts Statistical Division for
the 20-year period from 1980 to 1999. The researchers compared
bankruptcy information according to the type of bankruptcy (business
and non-business), the chapter of bankruptcy (7, 11, 12 and 13),
and by whether the bankruptcy was in a rural or an urban area.
Per capita personal income and unemployment rates for the same
period were used to provide a broader perspective of rural and
urban differences. Finally, bankruptcies filed were correlated
by the various categories of chapters, business and non-business,
and rural and urban.
Bankruptcies
filed were also correlated with unemployment rates and per capita
income over the period to determine if any relationships exist.
Review
of the findings
- Findings from
the 20-year period indicate that of the total bankruptcies
filed in Pennsylvania an average of 90 percent are non-business
and 10 percent are business.
- Of the total bankruptcies
filed, an average of 16 percent are rural and 84 percent are
urban.
- For business bankruptcies,
an average of 77 percent are urban and 23 percent are rural.
- For non-business
filings, an average of 84.5 percent are urban and 15.5 percent
are rural.
- For all filings,
an average of 69.5 percent are Chapter 7 (liquidation), 26.5
percent are Chapter 13 (consumer debt adjustment), and 4 percent
are Chapter 11 (reorganization). Similar patterns emerge whether
the bankruptcies are rural or urban.
- Since 1980, a
clear pattern emerges regarding total business bankruptcies
in that there is a steady decline in the percent of filings
in Pennsylvania that are by businesses. In 1980, 16.6 percent
of bankruptcy filings are classified as business and in 1999,
3.3 percent are so classified.
- Non-business bankruptcies
became an increasingly larger percentage of total filings.
In 1980, 83.4 percent of bankruptcies filed are classified
as non-business and by 1999 this increases to 96.7 percent.
- On average, Chapter
7 bankruptcy filings occur more frequently in urban as compared
to rural areas by a factor of 3.92 to 1. For Chapter 11, the
ratio increases to 5.45 to 1 and for Chapter 13 the ratio
is even higher at 17.5 to 1.
- A comparison of
national bankruptcy rates with Pennsylvania's bankruptcy rates
show that Pennsylvania stays consistently below the national
rate.
Want
more info?
For a copy of the report, Rural Bankruptcies in Pennsylvania,
call the Center for Rural Pennsylvania at (717) 787-9555 or email
info@ruralpa.org.
Chairman's
Message
Have you ever known someone who has had trouble managing his or
her money? Most of us have heard horror stories about people who
have brought financial hardships to themselves and their families
because they can't control their spending. With the availability
of relatively easy credit today, a disturbing trend shows bankruptcies
on the increase. This troubling statistic has prompted us to take
a closer look to see what kind of bankruptcies are occurring and
where they occur most frequently. I know you will find the results
of our cover story most interesting.
I am also
certain you will find another Center-sponsored endeavor to be
of interest, and that's our upcoming "Rural Summit in the
City." The Center for Rural Pennsylvania, with the assistance
of its board, staff, steering committee and supporters, is ready
to welcome you to the Harrisburg Hilton & Towers on November
13 and 14 to participate in an exciting "meeting of rural
minds."
The Rural
Summit in the City will feature a variety of sessions, an informational
breakfast, luncheons with featured speakers, and an evening reception
and dinner with our keynote speaker.
I look
forward to hearing our featured speakers, Mark Drabenstott of
the Center for the Study of Rural America and Rick Smyre of Communities
of the Future, who will provide insights on the present status
of and future opportunities for rural America.
Our keynote
speaker, Congresswoman Jo Ann Emerson of Missouri, will comment
on the agenda of the Congressional Rural Caucus, which she co-chairs.
Congresswoman
Emerson is the first woman to be elected to the U.S. House of
Representatives by Missouri's rural Eighth Congressional District.
As a member of Congress, she is dedicated to preserving and promoting
the rural way of life by raising the voice of rural America in
Washington, which means fighting for America's farmers and ranchers
during the tough times, securing the reauthorization of the Economic
Development Administration (EDA) in the 105th Congress, serving
as an active outreach coordinator of the Rural Health Care Coalition
(RHCC) for three years, and taking the lead on establishing the
Congressional Rural Caucus. As co-chair, she remains active in
ensuring that the ideas and issues of southern Missouri, and that
of rural America in general, are heard loud and clear on Capitol
Hill.
Please
join me in welcoming these exciting speakers to the Commonwealth
to share their perspectives on issues of importance to Pennsylvania.
I'm also pleased to welcome our lineup of expert panelists, hailing
from our home state and from states in the Midwest, Northeast
and South. These panelists are sure to provide you with information
that you can use back home after the Rural Summit.
The registration
brochure on pages 3 to 6 will help you learn more about the Rural
Summit in the City's full and exciting agenda. Please return your
registration form to the Center for Rural Pennsylvania as soon
as possible. If you have any questions about the Rural Summit,
call or email the Center for Rural Pennsylvania. I look forward
to seeing you in November.
Representative
Sheila Miller
(Note:
Visit the Center for Rural Pennsylvania's homepage for a copy
of the Rural Summit in the City conference brochure)
Just
the Facts: Public Lands in PA
In 2000, one in seven acres of land in Pennsylvania was publicly
owned. The stewards of these 4.2 million acres are the Pennsylvania
State Game Commission, the Pennsylvania Fish and Boat Commission,
the Bureaus of Forestry and State Parks, the U.S. Park Service,
and the U.S. Forest Service.
The vast
majority of these public lands are in rural Pennsylvania, so together,
state and federal governments own almost 18 percent of rural Pennsylvania.
Seven counties, including Cameron, Clinton, Elk, Forest, Potter,
Sullivan, and Union, have more than one-third of their total acreage
under government control.
The largest
owner of public land in Pennsylvania is the state Bureau of Forestry.
A bureau within the Department of Conservation and Natural Resources,
it manages more than 1.9 million acres. The next largest landholder
is the Pennsylvania Game Commission with nearly 1.4 million acres.
Together these two agencies own nearly 80 percent of the public
land in Pennsylvania.
Data from
the U.S. Department of Agriculture's (USDA) report, Major Uses
of Land in the United States, shows that nationally, Pennsylvania
ranks 17th in the number of publicly owned acres. These lands
include federal and state parks, wilderness areas, and wildlife
refuges. Alaska, California, and Arizona have the most publicly
owned lands, while Kansas, Delaware, and Rhode Island have the
least. In 1997, it was estimated that there were 237 million acres
of public land in the United States, or 10 percent of the total
land area.
Between
1959 and 1997, USDA estimated that the number of acres of public
land in the United States has tripled. During this period, USDA
reports that Pennsylvania gained about 530,000 acres of publicly
owned parkland.
Did
You Know . . .
- According to 1999
estimates, people born between 1977 and 1994 made up 25 percent
of Pennsylvania's rural population.
- If all of the
books in rural libraries were stacked end to end, they would
stretch two and one-half times from Stroudsburg, Monroe County,
in eastern Pennsylvania to Sharon, Mercer County, in western
Pennsylvania.
- In 1999, the average
rural library book was checked out 1.6 times.
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