When it comes to Congress, the old saying is true: It’s a marathon, not a sprint.
But as we enter the final five months of the 119th Congress, the marathon is quickly becoming a sprint.
There is a lot at stake for ESOPs between now and the end of the year. Congress is entering the final stretch of its legislative calendar, with the midterm elections looming and the possibility of changes in party control, the leadership on our committees of jurisdiction, oversight priorities, and legislative agendas.
In other words, there are many things outside of our control. That is why ESOP advocacy requires both persistence and preparation. It requires putting in the time and effort to build strong relationships across the political spectrum. And it requires being ready to pursue every possible legislative avenue when an opportunity arises.
Between now and the end of the year, our top legislative priority is the Retire Through Ownership Act, which would codify the appropriate measures an ESOP Trustee can follow to establish fair market value for ESOP shares. This essential guidance has been sought for over 50 years and would make it easier for business owners to form new ESOPs and existing ESOPs to rely on the professional valuations of appraisal firms. The Retire Through Ownership Act passed the Senate unanimously last October, and was also voted unanimously out of the House Education & Workforce Committee. We have been working with House leadership on strategies to bring the bill for a vote in the full House, and we remain hopeful the bill can be passed this year.
We are also working to advance other important legislation, including the bipartisan American Ownership and Resilience Act, which would unlock new access to capital for ESOPs, and the Balance the Scales Act, which would curtail the practice of common interest agreements at the Department of Labor. Each of these efforts represents an opportunity to strengthen the ESOP model and make employee ownership more accessible and sustainable.
But the clock is ticking.
The House is already adjourned until the end of August, and the Senate is scheduled to recess on August 7 and return in mid-September. When Congress returns, lawmakers will tackle the urgent business of reaching an agreement to fund the federal government beyond September 30, when the current fiscal year ends, or risk a government shutdown just weeks before the midterm elections.
Then Congress will recess again as members return to their districts to campaign. After the November elections, lawmakers will return to Washington for what could be a very short and unpredictable post-election session.
That is the reality of legislating in an election year. The calendar compresses. Priorities shift. And legislation that appears stalled can move quickly. That is why we have worked so hard to build relationships with Congressional leaders, so we are ready when the opportunity arises.
This fall, we will be looking at every legislative avenue available to advance our agenda, including opportunities to move our priorities through larger pieces of legislation that Congress must pass before the end of the year.
It’s something we’ve done before, with great success.
At the end of 2022, TEA worked with lawmakers in both the House and Senate to help ensure important employee ownership provisions were part of the year-end omnibus legislation that included the SECURE 2.0 Act. That effort included the WORK Act, which created the Employee Ownership Initiative at the U.S. Department of Labor, as well as a mandate for the Department of Labor to produce a regulation addressing adequate consideration in ESOP transactions.
We also have to recognize that if our legislation does not cross the finish line by the end of this year, we will have to start again when the 120th Congress convenes in January. That possibility makes the work we are doing right now even more important. Between now and December, we will undoubtedly call upon our Public Policy Council, Employee Ownership Action Network (EOAN) and our ESOP Ambassadors to help in these efforts.
The midterm elections could bring new party leadership, new committee chairs, and new priorities in both the House and Senate. We cannot predict exactly what Washington will look like in January. But we can make sure that the cause of ESOPs and employee ownership will be part of the conversation, regardless of who is in charge.
That is why The ESOP Association’s bipartisan advocacy is so important, and why our members’ voices matter. The strength of the ESOP community in Washington is directly connected to our willingness to speak up, build relationships, and make the case for employee ownership. Every conversation with a lawmaker, every Hill visit, every letter and email from an ESOP company, and every member who engages in advocacy helps demonstrate that employee ownership is not a niche issue. It is a powerful model for strengthening businesses, building wealth, and creating more resilient communities.
The next five months will be busy, unpredictable, and critically important. We will continue working with policymakers on both sides of the aisle, pursuing every opportunity to advance our legislative priorities and doing everything we can to make sure the voice of America’s ESOP companies and employee owners is heard.
