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Senate Finance Takes Aim at Retirement System Challenges

 

The key Senate committee with jurisdiction over retirement tax policy issues is turning its attention to reviewing proposals that encourage and facilitate retirement savings. 

Sen. Charles Grassley (R-IA), Chairman of the Senate Finance Committee, has announced that the Committee will hold a hearing entitled “Challenges in the Retirement System” on Tuesday, May 14 at 10:15 a.m. ET. This will be the first retirement policy hearing held by the Finance Committee for the 116th Congress since Sen. Grassley reclaimed the chairmanship, after previously serving as chair during much of the last decade, including when the Pension Protection Act of 2006 was signed into law. 

Currently, a single panel of witnesses representing a cross-section of industry and stakeholder interests is scheduled to testify:

  • Joan Tibbetts, VP, Retirement, The Principal Financial Group
  • Tobias Read, Oregon State Treasurer
  • Joan Ruff, Board Chair, AARP
  • Lynn Dudley, SVP, Global Retirement & Compensation Policy, American Benefits Council

Grassley, along with the Committee’s ranking Democrat, Oregon Sen. Ron Wyden, reintroduced the Retirement Enhancement and Savings Act (RESA) on April 1. RESA will likely be the starting point for discussions when the Senate takes up retirement security legislation, which could be in the next couple of months. 

The Finance Committee hearing also comes as the House of Representatives is poised to approve the Setting Every Community Up for Retirement Enhancement (SECURE) Act (H.R. 1994), previously approved by the House Ways and Means Committee in early April. 

RESA tracks closely with the House’s SECURE Act. Since both bills have many things in common and are moving on bipartisan tracks so far, there is a strong possibility the two chambers will be able to reach an agreement and send a final legislative package to President Trump in the coming months. 

“Retirement security is an important topic that is already getting a great deal of attention this year. The House Ways and Means Committee considered a retirement-savings bill yesterday that is built on the provisions included in RESA, and I look forward to working with Chairman Neal to reconcile our bills and get a final package to the President’s desk,” Grassley stated April 3 on the Senate floor. 

Among other things, both RESA and the SECURE Act authorize open MEP arrangements, significantly increase the incentives for a small business owner to adopt a new plan by enhancing the small employer pension plan start-up tax credit and encourage small business owners to design a plan with an automatic enrollment feature. 

A livestream of the May 14 hearing can be viewed here.