Bipartisan, bicameral legislation cosponsored on May 16 by U.S. Reps. Blake Moore (R-UT) and Dusty Johnson (R-SD) would support America’s small business owners who choose to pursue an employee-owned business model by reducing cost barriers associated with ownership transfers.
“Utah boasts a flourishing ecosystem of employee-owned businesses that create value for both their customers and employees. We must ensure that our federal programs do not inadvertently hinder opportunities for companies to transition to an employee-ownership model, and the Employee Equity Investment Act is designed to accomplish this goal without imposing any additional burden on taxpayers,” said Rep. Moore.
Reps. Moore and Johnson introduced the Employee Equity Investment Act of 2023, H.R. 3383, with bill sponsor U.S. Rep. Dean Phillips (D-MN) and five other original cosponsors, including U.S. Rep. Brian Fitzpatrick (R-PA). U.S. Sens. Chris Van Hollen (D-MD), Marco Rubio (R-FL) and Todd Young (R-IN) introduced the same-named S. 1618 in the Senate.
“As the former vice president of an ESOP [Employee Stock Ownership Plan], I saw firsthand the benefits of employee-owned businesses,” Rep. Johnson said. “I am proud to support this effort to ensure more businesses have the flexibility and opportunity to transfer ownership to employees.”
Rep. Phillips pointed out that during the coming years, millions of small business owners will reach retirement age and sell to competitors or other buyers in the mergers and acquisitions market, a move that he said often results in jobs leaving the communities that rely on them.
“Expanding opportunities for employee ownership will help keep businesses and jobs in local communities, allow American workers to build wealth for their families, and result in more sustainable and resilient communities,” the congressman said. “Employee ownership is both good business and good for business.”
The measure has been endorsed by The ESOP Association, Ownership America, the National Cooperative Business Association, the Employee-Owned Contractors Roundtable, the Economic Innovation Group, the Small Business Majority, the U.S. Impact Investing Alliance, and others.