ESOP Association Salutes Senators Cardin (D-MD) and Roberts (R-KS) For Introducing Pro-ESOP Bill

WASHINGTON, July 20, 2017 /PRNewswire-USNewswire/ -- Again bi-partisan support for more employees' owning our free enterprise economy is evidenced by introduction of S. 1588 by a Republican and a Democrat members of the Senate Committee on Finance, which has jurisdiction over tax laws.  Senators Pat Roberts (R-KS) and Ben Cardin's (D-MD) bill, S. 1588 is similar to a bi-partisan pro-ESOP bill introduced by 8 members of the House Committee on Ways and Means, four Republicans and four Democrats, led by Representatives Reichert (R-WA) and Ron Kind (D-WS)—HR 2092.  These two members of the Senate Finance Committee were joined by 20 other Senators, including 7 other  members of the Senate Finance Committee.

The continued bi-partisan support for employee stock ownership plans (ESOPs) reflects that more and more members of Congress are aware that broad-based employee stock ownership plans, such as ESOPs, are job preservers.  Data collected since 2002 through 2016, which included two recessions, evidence that companies with broad- based employee stock ownership plans were 4 to 8 times less likely to lay off employees than conventionally owned companies.

"Bottom line, elected officials, Federal , State, City, proclaim over and over, 'I am for jobs, creating jobs'", said ESOP Association President J. Michael Keeling. "But the best jobs policy is one that has a proven record of preserving jobs."

To be noted also, Colorado, Missouri, Iowa, to name three state, have enacted legislation to encourage ESOP creation, and several others are actively considering similar legislation, as is New York City.  Since ESOPs are most often implemented by an exiting shareholder of a private company, the company is most likely to stay in place, stay in operation, and provide local jobs.

S. 1588 and HR 2092 would

Increase tax incentives of current owners of S corporation stock to sale her/his stock to an ESOP; and

The ESOP Association, Immediate Release, July 20, 2017—Page 2

Preserve the preference for government contracts for a small business that qualifies for the preference (8) (a) when that business transfers over 50% of the business to the ESOP to benefit all employees of the company.  (Current SBA policy holds the company with an 8(a) preference loses that preference if majority owned by employees through an ESOP. )

SOURCE The ESOP Association

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http://www.esopassociation.org