Railway Retirement Bill Steams Ahead

December 4, 2001 (PLANSPONSOR.com) - The railway retirement bill, which would let the federally administered railroad pension system redirect some of its assets from Treasury bonds to equities, has taken a few steps forward in the US Senate, Reuters reports.

The bill, which was passed by the House of Representatives in July, is at the center of a debate that has seen lawmakers argue over what legislation should take precedence in the final days of the 2001 session.

The bill, which is backed by the unions and the private sector, aims to cut railroads’ payroll taxes while boosting retirees’ benefits.

While attracting broad bi-partisan support, the bill does have its share of opposition. Senator Phil Gramm (R – Texas) plans to add amendments that would:

  • postpone the tax and benefit changes until the new private investments actually begin to earn income, and
  • link the railway retirement age, which the bill proposes to lower to 60 in some cases, to the Social Security retirement age, which is moving from 65 to 67

Senator Orrin Hatch (R – Utah) defended the measure, saying it had a clause that would help safeguard against a possible taxpayer bailout if things go wrong, according to Reuters.

– Camilla Klein                           editors@plansponsor.com

See also: Republicans Derail Rail Pension Bill