2 ESOP Bills Advance Out of HELP Committee in Unanimous Vote
A third ESOP bill was originally scheduled to be voted on during the hearing, but no vote was held
The vote allows the Retire Through Ownership Act and the Employee Ownership Representation Act of 2025 to advance out of committee and be considered by the full Senate. A third ESOP bill, the Employee Ownership Fairness Act of 2025, was originally scheduled to be voted on during the hearing, but no vote was held.
The advancement followed a committee hearing in each house of Congress last week, which featured testimony from Jim Bonham, CEO of the ESOP Association, and other witnesses. Bonham spoke in support of the bills, including the Retire Through Ownership Act, which he said would give fiduciaries legal certainty.
The Retire Through Ownership Act, introduced by Representative Roger Marshall, R-Kansas, addresses the question of valuation risk associated with ESOPs by aligning their valuation with IRS standards, offering a “safe harbor” for trustees who rely on certified appraisers using these guidelines.
The Employee Ownership Representation Act of 2025 would expand the ERISA Advisory Council by assigning two additional representatives. The council advises the Department of Labor on employee benefits policy.
Currently, the council has 15 members from business, labor and the general public, but none represent ESOP-related interests.
The Employee Ownership Fairness Act of 2025 was removed from consideration for a vote during the hearing. It is not clear if or when the committee might vote on that bill, which would exclude ESOP contributions from annual defined contribution savings limits, currently capped at $23,500 for 2025.
ESOPs have received support from Daniel Aronowitz, who awaits a full Senate vote to be confirmed as the next head of the Employee Benefits Security Administration. During a confirmation hearing in June, Aronowitz said he would “end the war on ESOPs.”
The ESOP Association, an ESOP advocacy organization, launched a paid campaign this week urging the Senate to confirm Aronowitz.