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The Employee Ownership Update

Loren Rodgers

May 1, 2012

(Loren Rodgers)

Defined Contribution Plans in Congress

The House Ways and Means Committee heard testimony on April 17 about the current system of retirement tax incentives. The five witnesses all suggested that eliminating the current tax incentives would weaken the state of retirement security. Chairman Dave Camp (R-Mich.) described three criteria the committee would consider: simplification; increasing participation, especially by those with lower incomes; and effectively targeting benefits. Judy Miller of the American Society of Pension Professionals and Actuaries, argued that the actual cost of the tax incentives is 54% less than projected by the Joint Committee on Taxation and the Treasury's Department's Office of Tax Analysis: "Every dollar that is excluded from income this year will be included in income in a future year. Unfortunately, that is not reflected in the cash basis measurement of the retirement savings tax expenditure."

Separately, Senators Rob Portman (R-Ohio) and Ben Cardin (D-Md.) announced that they would continue working together on legislation to promote retirement security, specifically mentioning their opposition to the Department of Labor's proposed changes to the definition of a plan fiduciary. Many members of ESOP companies worry that the regulation would result in appraisers being fiduciaries and increase the cost and complexity of establishing plans.

Annual Conference Breaks Records

Over a thousand people attended the 2012 Employee Ownership Conference sponsored by the NCEO and the Beyster Institute last week in Minneapolis. The number of attendees was almost 20% higher than the conference's previous record, set last year in Denver, and undercounts the increase in interest, since the conference sold out one month in advance. Our unscientific guess is that 1,250 would have attended if we had room for them. The 2013 conference will be April 23 to 26 in Seattle.

Innovations in Employee Ownership

Employee ownership brings out the innovative spirit, and at our annual conference last week, four companies that embody that creativity in dramatic new ways received the 2012 Innovations Award. The four companies are Environmental Science Associates, n-Link Corporation, Torch Technologies, and Vigilent. Their innovations include systematic, survey-driven approaches to engage employees in strategic planning, a bottom-up charitable giving program, and a wellness initiative that directly links people to the company with stock options. Learn more about these companies and their ideas at the NCEO's Innovations Award Winners page.

We the Owners: Trailer

Attendees at our annual conference saw the unveiling of the 4:30-minute trailer of the new film We the Owners: Employees Expanding the American Dream. The trailer is now available to the public at

Other Employee Ownership Conferences

The Vermont Employee Ownership Center's 10th annual conference will be June 8 in Burlington. Highlights include 19 breakout sessions and a keynote address by Gar Alperovitz.

The U.S. Federation of Worker Cooperatives will hold its annual conference June 22 to 24 in Boston. Sessions cover governance, start-up, international cooperatives, financing, and more. Registration ends June 1.

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