Ready for more Enron fallout? Prompted by public outcry over the many company executives who will keep their multimillion-dollar Texas homes after declaring bankruptcy, Congress is pushing for an end to state homestead exemptions that shield primary residences from bankruptcy proceedings. States like Texas and Florida, where there aren't any limits on the value of the home are primary targets of legislation that seeks to set a national maximum exemption of $125,000.
The bill, which passed the Senate and is now before the House, also calls for debtors to meet a 40-month residency requirement to qualify for an exemption-a provision that could prove onerous to anyone running into financial difficulties after relocating. "And even if the debtor satisfies the 40-month residency requirement, he may still be unable to take advantage of the exemption if he has committed one of a number of enumerated bad acts," says Sen. Herb Kohl (D-WI), who proposed the legislation.
Now that's shutting the barn door and padlocking it-too bad those Enron cows are long gone.
Play Your Cards Right
Likely to spark a new class of plastic, Cleveland-based Charter One Financial's new delayed-debit card offers what may be the best of two worlds: the float of a credit card and the interest-free aspect of a debit card. Instead of deducting debits on a pay-as-you-spend basis, Charter One debits monthly or semimonthly. "It gives business owners a quasi-cash-management tool," says David Bowen, senior vice president of retail product management at Charter One, noting that the SmartBusiness OneCard was designed for small businesses.
"It allows you to keep the bulk of your money earning interest in a savings account while you accumulate debits throughout the month knowing that they will hit on a particular date," he explains. "Then you transfer the money over and everything goes through." Charter One account holders can also monitor spending and debit clearing dates online at the company's Web site, where customers can view what their account balances would be if charges were applied daily. There is a $50 annual fee-waived for the first year-and the card is available in Illinois, Ohio, Massachusetts, Michigan, New York and Vermont.
Bring on the Competition
Tired of vying for attention at VC forums? Competing in a venture capital contest can be a good alternative, often offering both cash prizes and services to help you gain entrée to the VC community. What's more, recent years have seen contests targeting virtually every entrepreneurial segment, from national student competitions sponsored by MBA Jungle and Garage.com to the Oxygen.com Build Your Own Business grant for women entrepreneurs.
While you may have to hunt for the one that's right for you, entering can jump-start your venture, says MBA student Onne Ganel (above left), one of four partners who won the Wharton Business Plan Competition. "Along with the prize, we also received spots in a few area venture fairs and a space in an incubator where we will have access to helpful legal and financial seminars," says Ganel, who plans to use the facilities and the funds to move forward with his Envisia venture, which markets magnetic resonance imaging technology.
"Contests are something you can leverage," he adds. "I can call any VC in the U.S. right now and say, 'Hello, I'm the winner of the Wharton Business Plan Competition. Would you give me two minutes?' And they will."
If that sounds like a winning proposition, the following contests are worth a look:
- Oxygen's Build Your Own Business
- MBA Jungle Business Plan Contest
- OPEN Business Plan Contest
- Palo Alto Software's Business Plan
- Garage.com's PLANedu Contest
- Wharton Business Plan Competition
- Sen. Herb Kohl
(202) 224-5653, senator_Kohl@kohl.senate.gov
Jennifer Pellet is a freelance writer in New York City specializing in business and finance.