By David Espo ASSOCIATED PRESS 3:07 p.m. March 3, 2005 WASHINGTON – The Republican-controlled Senate refused to limit consumer interest rates at 30 percent Thursday as it moved methodically toward passage of legislation making it harder to shed personal debts in bankruptcy. The vote was a bipartisan 74-24 to scuttle an amendment by Sen. Mark Dayton, D-Minn., who said consumers must pay interest rates as high as 1,059 percent when they borrow money. "That goes way beyond what we call predatory lending. That is 'terroristic' lending," he said. But Sen. Orrin Hatch, R-Utah, said Dayton's proposal would pre-empt state laws, including those that fix an interest rate ceiling below 30 percent. "There's no reason to touch the state usury laws," he said. Dayton's proposal was the latest in a string of unsuccessful Democratic attempts to soften the impact of the measure on consumers. Supporters have been struggling for eight years to enact a bankruptcy bill, and a four-seat Senate gain in last November's elections gives them a strong chance at success. Several Republicans suggested during the day that, barring unexpected changes, the GOP-controlled House may be willing to approve the same bill that is moving through the Senate, eliminating the need for time-consuming congressional negotiations and allowing the measure to reach President Bush's desk quickly. Republicans operated along the same lines recently on legislation to rein in multimillion-dollar class action lawsuits, the first substantive bill to clear Congress since elections in which Bush won a new term and Republicans strengthened their majorities in both houses of Congress. Senate passage of the bankruptcy bill is expected next week, but Democrats moved Thursday to force a showdown first over the minimum wage. Sen. Edward M. Kennedy, D-Mass., proposed raising the federal wage floor from $5.15 to $7.25 in three steps in a little over two years. "Amending the bankruptcy bill to increase the minimum wage will help many of the people this so-called bankruptcy 'reform' is likely to hurt – low-income families, minorities and women," Kennedy said. The last time the minimum wage rose was 1997. Republicans generally oppose increases in the minimum wage, arguing they are a barrier to job creation, and even Democratic aides conceded Kennedy's effort was likely to fail when the roll is called next week. Even so, the GOP was crafting an alternative designed to give Republicans a minimum wage provision they can vote for – rather than merely opposing the Democratic plan. Republican aides, speaking on condition of anonymity, said it would raise the minimum wage by $1.10 over 18 months, although it was not clear what type of exemptions, if any, might be included. Sen. Rick Santorum, R-Pa., said he also intended to propose tax breaks for businesses that create jobs as part of the GOP alternative. Democratic aides said Dayton's amendment was aimed principally at payday loan companies, firms that lend money based on anticipated tax refunds and similar short-term lenders. Sen. Richard Shelby, R-Ala., said Dayton's amendment amounted to a form of price controls, which he said "often hurt people they are intended to help." The chairman of the Senate Banking Committee, Shelby said he intends to hold hearings later this year on the issues raised by Dayton's proposal. Sen. Paul Sarbanes of Maryland, the senior Democrat on the committee, said he, too, would oppose "a very major legislative step" without consideration by the panel. All 55 of the Senate's Republicans voted against the amendment. Democrats were divided, 24 in favor and 18 against.