Knowing that now, more than ever, Americans need retirement options that are accessible, reasonable and efficient, several committee members of the House Ways and Means Committee questioned witnesses today about how to not only uphold current retirement savings initiatives, but also how to improve a system that currently does not seem to be providing enough savings for aging Americans looking to retire at a comfortable age.
At ESCA, we pay close attention to these discussions. If Congress wants long-term, successful policy proposals to help Americans retire, S ESOPs and employee-ownership are an important, positive part of the dialogue.
As Congressman Erik Paulsen (R-MN-3rd) stated during the hearing, S ESOPs enable workers to accumulate substantial amounts of retirement savings as compared to other defined contribution retirement plans. With several thriving employee-owners in his district, including Lifetouch and SCICOM, Rep. Paulson knows that S ESOPS are “successful retirement savings vehicles” and must be a part of our economy’s future.
Bill Sweetnam, formerly of the Treasury Department, agreed with Rep. Paulsen’s assessment of the benefits of S ESOPs, and spoke to his time in the Bush Administration when the Treasury Department considered some of the same issues the committee was grappling with – namely, whether to eliminate some of the many forms of work-based retirement savings programs through a ‘simplification’ effort. Mr. Sweetnam stated that the values of S ESOPs made it clear: they should not be restructured or lumped in with other plans, but rather left untouched.
Later in the same hearing, Congressman Earl Blumenauer (D-OR-3rd) noted that he considers promoting S ESOPs to be an important way to providing retirement security to U.S. workers. Rep. Blumenauer’s home state of Oregon is also home to other S ESOP companies, including Woodfold, Inc. and n-Link.
Both Rep. Paulsen and Rep. Blumenauer are sponsors of the Promotion and Expansion of Private Employee Ownership Act (H.R. 1244), which encourages employee-ownership of S corporations. The bill eliminates barriers that currently exist for companies that want to become employee-owned or expand the employee-ownership stake in their S corporation. We encourage all members of Congress to support employee ownership in their communities by joining this bill and making S ESOPs a part of the future retirement debate.