Pro-ESOP Provisions Included in FY27 Funding Package for Commerce Department
Language Directs the Commerce Dept. to Address Financing, Access to Capital for ESOPs
The House Appropriations Committee has approved a fiscal year 2027 funding measure for the departments of Commerce, Justice, Science and Related Agencies with pro-ESOP language that helps set the stage for advancing ESOPs at the U.S. Department of Commerce.
The language is included in the Committee report on the bill, which directs federal agencies on how appropriated funds should be spent. The ESOP language specifically references ESOPs as a business succession tool and directs the Commerce Department to look at the financing gap for ESOP formation.
The ESOP Association has been working to promote greater access to capital for both existing ESOPs and those considering forming an ESOP, specifically via the bipartisan American Ownership and Resilience Act (AORA, S. 1645/H.R. 3248). The AORA bill was a major focus of The ESOP Association’s advocacy efforts last week during its ESOP Advocacy Day, with hundreds of employee owners and professional service providers meeting with their elected representatives and staff on Capitol Hill to promote pro-ESOP legislation.
Commonly referred to as the CJS Appropriations bill, this legislation is part of the annual federal appropriations process that funds federal departments and agencies. The bill has been approved by the full House Appropriations Committee and is expected to advance to the House floor for consideration.
The language included in the FY27 CJS Appropriations bill specifically states:
“Employee Stock Ownership Plans (ESOPs). – The Committee recognizes that ESOPs can be an effective tool for retaining and American companies, especially those undergoing business succession. The Committee notes the private financing gap may impede the growth of ESOPs among small- and medium-sized businesses, especially those in industries critical to economic and national security. The Committee encourages the Department to assess opportunities to address this financing gap.”
For more information on access to capital issues for ESOPs, please see The ESOP Association’s policy paper.
For more information on the American Ownership and Resilience Act (AORA) specifically, please see TEA’s legislative brief.
