Additional Senators Cosponsor S. 742

June 11, 2013

Home News Additional Senators Cosponsor S. 742

Over the past few weeks S. 742, The Promotion and Expansion of Private Employee Ownership Act of 2013, received more support in the Senate. Senators Susan Collins (R-ME), Tim Johnson (R-SD), Bernie Sanders (I-VT), Patrick Leahy (D-VT) and Jon Tester (D-MT) all announced that they are signing on to cosponsor the bill.

It is a critical time for legislation aimed at increasing retirement savings and security, like The Promotion and Expansion of Private Employee Ownership Act of 2013, because, according to a recent survey by the Employee Benefit Research Institute, approximately 28% of Americans do not believe they will have enough money to retire comfortably.

The bill, introduced by Senators Ben Cardin (D-MD) and Pat Roberts (R-KS), intends to encourage owners of S corporations to sell their stock to an ESOP, provide needed technical assistance for companies that may be interested in forming an S ESOP, ensure small ESOP-owned businesses retain their SBA eligibility when employee ownership of the company expands, and affirm the importance of preserving the S ESOP structure in the Internal Revenue Code.

A recent study by Alex Brill, a fellow at the American Enterprise Institute, found that S ESOPs are vital economic players in their communities and across the country. The study points out that, “The S ESOP structure in particular has been shown to lead to greater firm longevity and higher wages, wage growth, job stability, retirement plan contributions, employment, and sales than would otherwise have been anticipated.” S ESOPs incentivize employee-owners because they are invested both personally and financially in the company.

The employee ownership community applauds these Senators’ efforts to promote and expand their business model. As Jeff Millhollin, President and CEO of Pacific Steel & Recycling, an employee-owned company, says, “We applaud this legislation that creates jobs and encourages long-term retirement savings for hardworking Montanans and Americans.”

The current list of co-sponsors include Sen. Ben Cardin (D-MD), Sen. Mary Landrieu (D-LA), Sen. Debbie Stabenow (D-MI), Sen. Amy Klobuchar (D-MN), Sen. Sherrod Brown (D-OH), Sen. Jon Tester (D-MT), Sen. Tim Johnson (D-SD), Sen. Patrick Leahy (D-VT), Sen. Bernie Sanders (D-VT), Sen. Pat Roberts (R-KS), Sen. John Thune (R-SD), Sen. Roy Blunt (R-MO), Sen. Mike Crapo (R-ID), and Sen. Susan Collins (R-ME)

ESCA thanks all of the Senators who have decided to cosponsor this important piece of legislation.

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