What: All Issues : Labor Rights : Pension Protections : This vote was on final passage of a pension relief legislative conference report (HR 3108), the "Pension Funding Equity Act of 2004" amending the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code of 1986 to temporarily replace the 30-year Treasury rate with a rate based on long-term corporate bonds for certain pension plan funding requirements. (2004 senate Roll Call 68)
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[POW!]
 

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This vote was on final passage of a pension relief legislative conference report (HR 3108), the "Pension Funding Equity Act of 2004" amending the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code of 1986 to temporarily replace the 30-year Treasury rate with a rate based on long-term corporate bonds for certain pension plan funding requirements.
senate Roll Call 68     Apr 08, 2004
Progressive Position:
Nay
Progressive Result:
Loss

Saying the measure fails to shore up pensions for U.S. small business employers in the same way it does for Fortune 500 companies and other "single-employer" pension funds, Senate progressives cast their votes against a pension relief legislative conference report (HR 3108), which was the culmination of a joint House-Senate conference committee charged with reconciling differences between their chambers' bills. However, progressives failed to sway the majority of their colleagues, and the Senate agreed to conference report by a 78 - 19 vote on the conference report, which contained little in the way of Democrat-requested aid for underfunded "multi-employer" pension plans. Multiemployer plans allow workers to earn pensions under different employers, an arrangement that helps workers in lower-wage, short-term or seasonal to earn a pension, and are a critical source of pensions for employees of small businesses, progressives said. The President signed the conference report into law April 10. HR 3108, the "Pension Funding Equity Act of 2004" amends the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code of 1986 to temporarily replace the 30-year Treasury rate with a rate based on long-term corporate bonds for certain pension plan funding requirements. Traditionally, companies have been required to fund their defined benefit plans in relationship to the rate of return that is accounted for on a 30-year Treasury bond, which in turn affects how much money they must pay into these plans. Supporters of the legislative fix argued that this is no longer a viable benchmark, because the government is no longer issuing 30-year bonds. Conservatives argued that without the changes laid out in this bill, many companies would be forced to end their defined benefit plans. The Senate version of H.R. 3108, passed by an overwhelming margin (86-9) on Jan. 28, 2004 as members from both sides of the aisle voted to support businesses suffering from the recent economic downturn and help stabilize the defined benefit plan system. While the Senate-passed version of H.R. 3108 included 100 percent of multiemployer plans, as well as deficit reduction contribution relief for single-employer pension plans, the House-passed legislation only provided a pension interest rate fix. Progressives were committed to keeping the bipartisan Senate language on multi-employer plans in the bill through conference, but under the direction of conservatives who held sway over the conference committee, the negotiations took on what progressives charged was a partisan tone that they say came at the expense of thousands of small businesses who participate in multiemployer plans. Because of that, and what progressives charge was pressure from the White House, the conference agreement omits relief for all but four percent of multiemployer pension plans, to the detriment of thousands of union workers and small businesses that participate in multiemployer pension plans. Progressive conferees were willing to compromise to ensure passage of the legislation, but, after nearly two weeks of meetings and an agreement on a 20 percent compromise, House Republicans placed a completely new proposal on the table that covered less than 4 percent of multiemployer plans, saying that any additional relief would not be accepted by the White House. In its Statement of Administration Position (SAP) on the Senate bill, the Administration voiced its strong opposition to any "amendment that would substantially weaken funding requirements" for single-employer or multiemployer plans, and was adamant in its opposition to multiemployer plan provisions. Sen. Jon Corzine, D-N.J., who voted against the conference report, expressed dismay at the outcome. "Where is the sensibility, particularly from the administration and from my colleagues on the other side of the aisle who ... want to support small business. This is absolutely outside the context of reasonableness. We are turning our backs on them saying this is great. The bill that applies to the single-employer plan should give the same coverage to multiemployer plans." Corzine added, "All we are asking is fairness to both. This bill (HR 3108) does not provide it."

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