Pro-Employee Ownership Proposals Pending on Senate Floor announces that Sen. Bernard Sanders [I-VT], Patrick Leahy [D-VT], and Sherrod Brown [D-OH] have filed "pro-employee" amendments to H.R. 5297: Small Business Lending Fund Act of 2010:
One amendment would establish an initiative to promote employee ownership at the Department of Labor; the other amendment would establish a loan guarantee program at the Department of Treasury to help finance certain ESOP transactions. To read the amendments, please click on the following amendment numbers: S. AMDT 4439 and S. AMDT 4440....H.R. 5297 will be considered by the full Senate sometime after July 13th.
Here is a link to the relevant amendments:
SA 4439. Mr. SANDERS (for himself, Mr. Brown of Ohio, and Mr. Leahy) submitted an amendment intended to be proposed to amendment SA 4402 proposed by Mr. Reid (for Mr. Baucus (for himself, Ms. Landrieu, and Mr. Reid)) to the bill H.R. 5297, to create the Small Business Lending Fund Program to direct the Secretary of the Treasury to make capital investments in eligible institutions in order to increase the availability of credit for small businesses, to amend the Internal Revenue Code of 1986 to provide tax incentives for small business job creation, and for other purposes; which was ordered to lie on the table; as follows:
At the appropriate place, insert the following:
TITLE X--WORKER OWNERSHIP, READINESS, AND KNOWLEDGE
SEC. X01. SHORT TITLE.
This title may be cited as the ``Worker Ownership, Readiness and Knowledge Act'' or the ``WORK Act''.
SEC. X02. DEFINITIONS.
In this title:
(1) EXISTING PROGRAM.--The term ``existing program'' means a program, designed to promote employee ownership and employee participation in business decisionmaking, that exists on the date the Secretary is carrying out a responsibility authorized by this title.
(2) INITIATIVE.--The term ``Initiative'' means the Employee Ownership and Participation Initiative established under section X03.
(3) NEW PROGRAM.--The term ``new program'' means a program, designed to promote employee ownership and employee participation in business decisionmaking, that does not exist on the date the Secretary is carrying out a responsibility authorized by this title.
(4) SECRETARY.--The term ``Secretary'' means the Secretary of Labor.
(5) STATE.--The term ``State'' means any of the 50 States within the United States of America.
SEC. X03. EMPLOYEE OWNERSHIP AND PARTICIPATION INITIATIVE.
(a) Establishment.--The Secretary of Labor shall establish an Employee Ownership and Participation Initiative to promote employee ownership and employee participation in business decisionmaking.
(b) Functions.--In carrying out the Initiative, the Secretary shall--
(1) support within the States existing programs designed to promote employee ownership and employee participation in business decisionmaking; and
(2) facilitate within the States the formation of new programs designed to promote employee ownership and employee participation in business decisionmaking.
(c) Duties.--To carry out the functions enumerated in subsection (b), the Secretary shall--
(1) support new programs and existing programs by--
(A) making Federal grants authorized under section X5; and
(B)(i) acting as a clearinghouse on techniques employed by new programs and existing programs within the States, and disseminating information relating to those techniques to the programs; or
(ii) funding projects for information gathering on those techniques, and dissemination of that information to the programs, by groups outside the Department of Labor; and
(2) facilitate the formation of new programs, in ways that include holding or funding an annual conference of representatives from States with existing programs, representatives from States developing new programs, and representatives from States without existing programs.
SEC. X04. PROGRAMS REGARDING EMPLOYEE OWNERSHIP AND PARTICIPATION.
(a) Establishment of Program.--Not later than 180 days after the date of enactment of this Act, the Secretary shall establish a program to encourage new and existing programs within the States, designed to foster employee ownership and employee participation in business decisionmaking throughout the United States.
(b) Purpose of Program.--The purpose of the program established under subsection (a) is to encourage new and existing programs within the States that focus on--
(1) providing education and outreach to inform employees and employers about the
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possibilities and benefits of employee ownership, business ownership succession planning, and employee participation in business decisionmaking, including providing information about financial education, employee teams, open-book management, and other tools that enable employees to share ideas and information about how their businesses can succeed;
(2) providing technical assistance to assist employee efforts to become business owners, to enable employers and employees to explore and assess the feasibility of transferring full or partial ownership to employees, and to encourage employees and employers to start new employee-owned businesses;
(3) training employees and employers with respect to methods of employee participation in open-book management, work teams, committees, and other approaches for seeking greater employee input; and
(4) training other entities to apply for funding under this section, to establish new programs, and to carry out program activities.
(c) Program Details.--The Secretary may include, in the program established under subsection (a), provisions that--
(1) in the case of activities under subsection (b)(1)--
(A) target key groups such as retiring business owners, senior managers, unions, trade associations, community organizations, and economic development organizations;
(B) encourage cooperation in the organization of workshops and conferences; and
(C) prepare and distribute materials concerning employee ownership and participation, and business ownership succession planning;
(2) in the case of activities under subsection (b)(2)--
(A) provide preliminary technical assistance to employee groups, managers, and retiring owners exploring the possibility of employee ownership;
(B) provide for the performance of preliminary feasibility assessments;
(C) assist in the funding of objective third-party feasibility studies and preliminary business valuations, and in selecting and monitoring professionals qualified to conduct such studies; and
(D) provide a data bank to help employees find legal, financial, and technical advice in connection with business ownership;
(3) in the case of activities under subsection (b)(3)--
(A) provide for courses on employee participation; and
(B) provide for the development and fostering of networks of employee-owned companies to spread the use of successful participation techniques; and
(4) in the case of training under subsection (b)(4)--
(A) provide for visits to existing programs by staff from new programs receiving funding under this title; and
(B) provide materials to be used for such training.
(d) Guidance.--The Secretary shall issue formal guidance, for recipients of grants awarded under section X5 and one-stop partners affiliated with the statewide workforce investment systems described in section 106 of the Workforce Investment Act of 1998 (29 U.S.C. 2881), proposing that programs and other activities funded under this title be--
(1) proactive in encouraging actions and activities that promote employee ownership of, and participation in, businesses; and
(2) comprehensive in emphasizing both employee ownership of, and participation in, businesses so as to increase productivity and broaden capital ownership.
SEC. X05. GRANTS.
(a) In General.--In carrying out the program established under section X4, the Secretary may make grants for use in connection with new programs and existing programs within a State for any of the following activities:
(1) Education and outreach as provided in section X4(b)(1).
(2) Technical assistance as provided in section X4(b)(2).
(3) Training activities for employees and employers as provided in section X4(b)(3).
(4) Activities facilitating cooperation among employee-owned firms.
(5) Training as provided in section X4(b)(4) for new programs provided by participants in existing programs dedicated to the objectives of this title, except that, for each fiscal year, the amount of the grants made for such training shall not exceed 10 percent of the total amount of the grants made under this title.
(b) Amounts and Conditions.--The Secretary shall determine the amount and any conditions for a grant made under this section. The amount of the grant shall be subject to subsection (f), and shall reflect the capacity of the applicant for the grant.
(c) Applications.--Each entity desiring a grant under this section shall submit an application to the Secretary at such time, in such manner, and accompanied by such information as the Secretary may reasonably require.
(d) State Applications.--Each State may sponsor and submit an application under subsection (c) on behalf of any local entity consisting of a unit of State or local government, State-supported institution of higher education, or nonprofit organization, meeting the requirements of this title.
(e) Applications by Entities.--
(1) ENTITY APPLICATIONS.--If a State fails to support or establish a program pursuant to this title during any fiscal year, the Secretary shall, in the subsequent fiscal years, allow local entities described in subsection (d) from that State to make applications for grants under subsection (c) on their own initiative.
(2) APPLICATION SCREENING.--Any State failing to support or establish a program pursuant to this title during any fiscal year may submit applications under subsection (c) in the subsequent fiscal years but may not screen applications by local entities described in subsection (d) before submitting the applications to the Secretary.
(f) Limitations.--A recipient of a grant made under this section shall not receive, during a fiscal year, in the aggregate, more than the following amounts:
(1) For fiscal year 2011, $300,000.
(2) For fiscal year 2012, $330,000.
(3) For fiscal year 2013, $363,000.
(4) For fiscal year 2014, $399,300.
(5) For fiscal year 2015, $439,200.
(g) Annual Report.--For each year, each recipient of a grant under this section shall submit to the Secretary a report describing how grant funds allocated pursuant to this section were expended during the 12-month period preceding the date of the submission of the report.
SEC. X06. EVALUATIONS.
The Secretary is authorized to reserve not more than 10 percent of the funds appropriated for a fiscal year to carry out this title, for the purposes of conducting evaluations of the grant programs identified in section X05 and to provide related technical assistance.
SEC. X07. REPORTING.
Not later than the expiration of the 36-month period following the date of enactment of this Act, the Secretary shall prepare and submit to Congress a report--
(1) on progress related to employee ownership and participation in businesses in the United States; and
(2) containing an analysis of critical costs and benefits of activities carried out under this title.
SEC. X08. AUTHORIZATIONS OF APPROPRIATIONS.
(a) In General.--There are authorized to be appropriated for the purpose of making grants pursuant to section X5 the following:
(1) For fiscal year 2011, $3,850,000.
(2) For fiscal year 2012, $6,050,000.
(3) For fiscal year 2013, $8,800,000.
(4) For fiscal year 2014, $11,550,000.
(5) For fiscal year 2015, $14,850,000.
(b) Administrative Expenses.--There are authorized to be appropriated for the purpose of funding the administrative expenses related to the Initiative, for each of fiscal years 2011 through 2015, an amount not in excess of--
(1) $350,000; or
(2) 5.0 percent of the maximum amount available under subsection (a) for that fiscal year.-
SA 4440. Mr. SANDERS (for himself, Mr. Brown of Ohio, and Mr. Leahy) submitted an amendment intended to be proposed to amendment SA 4402 proposed by Mr. Reid (for Mr. Baucus (for himself, Ms. Landrieu, and Mr. Reid)) to the bill H.R. 5297, to create the Small Business Lending Fund Program to direct the Secretary of the Treasury to make capital investments in eligible institutions in order to increase the availability of credit for small businesses, to amend the Internal Revenue Code of 1986 to provide tax incentives for small business job creation, and for other purposes; which was ordered to lie on the table; as follows:
At the appropriate place, insert the following:
SEC. __X. ESTABLISHMENT OF THE EMPLOYEE OWNERSHIP BANK.
(a) Findings.--Congress finds that--
(1) between December 2007 and May 2010, payroll employment in the United States fell by 7,381,000;
(2) between January 2000 and May 2010, the manufacturing sector lost 5,632,000 jobs;
(3) as of May 2010, fewer than 12,000,000 workers in the United States were employed in the manufacturing sector, the fewest number of factory jobs since March 1941;
(4) at the end of 2009, the United States had a trade deficit of more than $374,908,000,000, including a $226,877,200,000 trade deficit with China;
(5) preserving and increasing decent paying jobs must be a top priority of Congress;
(6) providing loan guarantees, direct loans, and technical assistance to employees to buy their own companies will preserve and increase employment in the United States; and
(7) just as the United States Export-Import Bank was created in 1934, in the midst of the Great Depression, as a way to increase United States jobs through exports, the time has come to establish the United States Employee Ownership Bank within the Department of the Treasury to preserve and expand jobs in the United States.
(b) Definitions.--In this section--
(1) the term ``Bank'' means the Unites States Employee Ownership Bank, established under section 4;
(2) the term ``eligible worker-owned cooperative'' has the same meaning as in section 1042(c)(2) of the Internal Revenue Code of 1986;
(3) the term ``employee stock ownership plan'' has the same meaning as in section
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4975(e)(7) of the Internal Revenue Code of 1986; and
(4) the term ``Secretary'' means the Secretary of the Treasury.
(c) Establishment of United States Employee Ownership Bank Within the Department of the Treasury.--
(1) IN GENERAL.--Before the end of the 90-day period beginning on the date of enactment of this Act, the Secretary shall establish the United States Employee Ownership Bank, to foster increased employee ownership of United States companies and greater employee participation in company decision making throughout the United States.
(2) ORGANIZATION OF THE BANK.--
(A) MANAGEMENT.--The Secretary shall appoint a Director to serve as the head of the Bank, who shall serve at the pleasure of the Secretary.
(B) STAFF.--The Director may select, appoint, employ, and fix the compensation of such employees as are necessary to carry out the functions of the Bank.
(d) Duties of Bank.--The Bank is authorized to provide loans, on a direct or guaranteed basis, which may be subordinated to the interests of all other creditors--
(1) to purchase a company through an employee stock ownership plan or an eligible worker-owned cooperative, which shall be at least 51 percent employee owned, or will become at least 51 percent employee owned as a result of financial assistance from the Bank;
(2) to allow a company that is less than 51 percent employee owned to become at least 51 percent employee owned;
(3) to allow a company that is already at least 51 percent employee owned to increase the level of employee ownership at the company; and
(4) to allow a company that is already at least 51 percent employee owned to expand operations and increase or preserve employment.
(e) Preconditions.--Before the Bank makes any subordinated loan or guarantees a loan under subsection (d)(1), a business plan shall be submitted to the bank that--
(1) shows that--
(A) not less than 51 percent of all interests in the company is or will be owned or controlled by an employee stock ownership plan or eligible worker-owned cooperative;
(B) the board of directors of the company is or will be elected by shareholders on a one share to one vote basis or by members of the eligible worker-owned cooperative on a one member to one vote basis, except that shares held by the employee stock ownership plan will be voted according to section 409(e) of the Internal Revenue Code of 1986, with participants providing voting instructions to the trustee of the employee stock ownership plan in accordance with the terms of the employee stock ownership plan and the requirements of that section 409(e); and
(C) all employees will receive basic information about company progress and have the opportunity to participate in day-to-day operations; and
(2) includes a feasibility study from an objective third party with a positive determination that the employee stock ownership plan or eligible worker-owned cooperative will generate enough of a margin to pay back any loan, subordinated loan, or loan guarantee that was made possible through the Bank.
(f) Terms and Conditions for Loans and Loan Guarantees.--Notwithstanding any other provision of law, a loan that is provided or guaranteed under this section shall--
(1) bear interest at an annual rate, as determined by the Secretary--
(A) in the case of a direct loan under this Act--
(i) sufficient to cover the cost of borrowing to the Department of the Treasury for obligations of comparable maturity; or
(ii) of 4 percent; and
(B) in the case of a loan guaranteed under this section, in an amount that is equal to the current applicable market rate for a loan of comparable maturity; and
(2) have a term not to exceed 12 years.
(g) Employee Right of First Refusal Before Plant or Facility Closing.--Section 3 of the Worker Adjustment and Retraining Notification Act (29 U.S.C. 2102) is amended--
(1) in the section heading, by adding at the end the following: ``
; employee stock ownership plans or eligible worker owned cooperatives''; and
(2) by adding at the end the following:
``(e) Employee Stock Ownership Plans and Eligible Worker-Owned Cooperatives.--
``(1) GENERAL RULE.--If an employer orders a plant or facility closing in connection with the termination of its operations at such plant or facility, the employer shall offer its employees an opportunity to purchase such plant or facility through an employee stock ownership plan (as that term is defined in section 4975(e)(7) of the Internal Revenue Code of 1986) or an eligible worker-owned cooperative (as that term is defined in section 1042(c)(2) of the Internal Revenue Code of 1986) that is at least 51 percent employee owned. The value of the company which is to be the subject of such plan or cooperative shall be the fair market value of the plant or facility, as determined by an appraisal by an independent third party jointly selected by the employer and the employees. The cost of the appraisal may be shared evenly between the employer and the employees.
``(2) EXEMPTIONS.--Paragraph (1) shall not apply--
``(A) if an employer orders a plant closing, but will retain the assets of such plant to continue or begin a business within the United States; or
``(B) if an employer orders a plant closing and such employer intends to continue the business conducted at such plant at another plant within the United States.''.
(h) Regulations on Safety and Soundness and Preventing Competition With Commercial Institutions.--Before the end of the 90-day period beginning on the date of enactment of this Act, the Secretary of the Treasury shall prescribe such regulations as are necessary to implement this section and the amendments made by this section, including--
(1) regulations to ensure the safety and soundness of the Bank; and
(2) regulations to ensure that the Bank will not compete with commercial financial institutions.
(i) Community Reinvestment Credit.--Section 804 of the Community Reinvestment Act of 1977 (12 U.S.C. 2903) is amended by adding at the end the following new subsection:
``(l) Establishment of Employee Stock Ownership Plans and Eligible Worker-Owned Cooperatives.--In assessing and taking into account, under subsection (a), the record of a financial institution, the appropriate Federal financial supervisory agency may consider as a factor capital investments, loans, loan participation, technical assistance, financial advice, grants, and other ventures undertaken by the institution to support or enable employees to establish employee stock ownership plans or eligible worker-owned cooperatives (as those terms are defined in sections 4975(e)(7) and 1042(c)(2) of the Internal Revenue Code of 1986, respectively), that are at least 51 percent employee-owned plans or cooperatives.''.
(j) Authorization of Appropriations.--There are authorized to be appropriated to the Secretary to carry out this section, $500,000,000 for fiscal year 2010, and such sums as may be necessary thereafter. -