In Detail: Inside the House Education-Workforce Vote

April 27, 2001 ( - The House Education and the Workforce Committee unanimously approved the Portman-Cardin pension reform bill (H.R. 10).

The House Ways and Means Committee reported its portion of the bill yesterday by a bipartisan vote of 35-6, clearing the way for a vote on the bill by the full House next week.  That vote is expected to take place on either May 2 or May 3, according to the Bureau of National Affairs (BNA).

Amendment Approved

An amendment, offered by Representative John Tierney (D-Massachusetts), was approved unanimously by the commitee.  It requires the Secretary of Labor to submit a report to the committee, within five years of the bill’s enactment, detailing the effect of the provisions of the bill including:

  • pension plan coverage for low and middle-income workers
  • the general levels and quality of pension plans
  • access to and participation in pension plans

Tierney also noted “Studies seem to indicate that the trickle-down effect adopted as the foundation of this bill, by giving more financial incentives to business in the hopes that employers will spread the wealth to employees, appears to be good in theory but generally has been bad in practice.”  In support of that position, Tierney cited a report by the Center on Budget and Policy Priorities  issued April 2.

That report noted that about 70% of the tax subsidies in the bill would benefit workers who make $67,000 or more annually.

Amendments Opposed, Withdrawn

Tax credit amendments for low-income and small businesses proposed by Representative Robert Andrews (D-New Jersey) were withdrawn after Committee Chair John Boehner (R-Ohio) suggested that most of the provisions are within the jurisdiction of the House Ways and Means Committee, and said he would not support the action.  Under those amendments:

  • low-income workers would be eligible for a tax credit for up to half of up to $2,000 in contributions made to a qualified retirement plan
  • small employers would be eligible for tax credits for contributions to a qualified retirement plan small employers would be also be eligible for tax credits for startup costs incurred within three years of establishing a retirement plan

The proposed amendments were similar to those offered by Rep. Richard Neal (D-Massachusetts) in the Ways and Means Committee review earlier in the week, which rejected the amendments.

In addition, Andrews’ amendment addressed other ERISA-related issues according to the BNA, including a proposal that the Treasury Department prescribe one or more model pension plans to “provide simplicity and minimal administrative responsibilities to employers.”

Cash Balance Concerns
Also included were other amendments offered by Tierney and Representative Dennis Kucinich (D-Ohio).  Kuchinich’s amendment would enhance disclosure provisions and ensure employees the freedom to choose to participate in either the cash balance plan or remain in the traditional pension plan. 

Chairman Boehner noted that employers would likely choose to eliminate their defined benefit program altogether, rather than offer that choice.  The amendment was defeated by voice vote.

Kucinich offered a second amendment to increase the guarantee for pension benefit improvements covered under the Pension Benefit Guaranty Corporation (PBGC).

However, that amendment was withdrawn after Boehner noted that it had not been presented until the morning of the hearing, and would require additional hearings since it would potentially increase benefits guaranteed by PBGC.

– Nevin Adams      &nbs