FOR IMMEDIATE RELEASE

May 7, 2015

CONTACT: Sue Walitsky 202-224-4524

CARDIN, ROBERTS INTRODUCE BIPARTISAN BILL TO
ENCOURAGE RETIREMENT SAVINGS THROUGH EMPLOYEE-OWNED COMPANIES

Washington, DC – U.S. Senators Ben Cardin (D-Md.) and Pat Roberts (R-Kan.) introduced legislation to encourage retirement savings by fostering the growth of S-corporations that are owned by Employee Stock Ownership Plans (“S-ESOPs”).

Through changes to the tax code and educational outreach to companies, the bipartisan Promotion and Expansion of Private Employee Ownership Act would eliminate barriers that businesses and their owners currently face in establishing a new S corporation ESOP or expanding the employee-ownership stake in an S corporation.

“Americans deserve the opportunity to build secure retirement savings. S-ESOPs have proven resilient even in tough times while providing an effective means of retirement savings for their workers,” said Senator Cardin. “We need to preserve and expand this structure to enable more businesses to grow and to allow their employees to accrue these valuable benefits.”

“The legislation will encourage employees to save for future needs, including retirement,” Senator Roberts said. “The more we do to help people save, the more resources are freed to make critical investments, particularly in investments that grow jobs and help the economy.”

The Promotion and Expansion of Private Employee Ownership Act also provides an important protection for small businesses by ensuring that they continue to qualify for Small Business Administration loans, contracting assistance, or business development programs after they are converted to ESOPs. The technical change in the law allows the business to maintain its status as minority-owned, woman-owned, veteran-owned, or otherwise qualify for specific programs within SBA that are dependent on the nature of the ownership.

A similar bipartisan bill, H.R. 2096 was introduced by House Ways and Means Committee members Dave Reichert (R-Wash.) and Ron Kind (D-Wis.).

Original cosponsors of the bill include Senators: John Thune (R-S.D.), Sheldon Whitehouse (D-R.I.), Mike Crapo (R-Idaho), Roy Blunt (R-Mo.), Al Franken (D-Minn.), Debbie Stabenow (D-Mich.), Heidi Heitkamp (D-N.D.), Pat Leahy (D-Vt.), and James Risch (R-Idaho).

Senator Cardin and Senator Roberts are members of the Senate Committee on Finance.