Toward stemming the foreign acquisition of American companies, U.S. Reps. Blake Moore (R-UT) and Dusty Johnson (R-SD) on May 7 proposed the bipartisan American Ownership and Resilience Act, which would bridge a financing gap by activating private investment to support employee ownership.
“We will soon witness the greatest transfer of assets in American history as over two million U.S. business owners near retirement in the next decade,” said Rep. Moore, who sponsored H.R. 3248. “The American Ownership and Resilience Act will empower and support business owners and workers who want to transition to employee ownership, building substantial livelihoods for new employee owners and protecting our domestic supply chain from hostile foreign competitors.”
If enacted, H.R. 3248 would expand employee ownership through Employee Stock Ownership Plans (ESOPs) and provide the financing needed to keep companies U.S.-owned, according to a bill summary provided by the lawmakers.
Rep. Moore introduced the bill alongside three original cosponsors, including Rep. Johnson and U.S. Rep. Lori Trahan (D-MA), to enable the private sector to finance U.S. business sales to American workers through ESOPs without relying on taxpayer funds.
H.R. 3248 also would equip the U.S. Department of Commerce with a zero-subsidy investment facility to facilitate these transactions, and support Ownership Investment Companies — licensed private investment funds — to help overcome the capital access barrier currently impeding ESOP sales, the summary says.
“American businesses are the backbone of our economy, but many are at risk of dissolving or being sold to foreign competitors like China,” Rep. Johnson said, noting that the U.S. faces an economic shift as nearly half of all privately held businesses with employees are owned by individuals nearing retirement.
These firms employ more than 32 million Americans, and with more than half of owners expected to retire within the next decade, the nation risks a wave of business closures or sales, many to foreign buyers.
“The American Ownership and Resilience Act will keep these companies local, strong, and American-owned,” said Rep. Johnson. “Employee ownership is a pro-worker, pro-America solution.”
Paralign Capital Partners, JDS Industries, and the Lafayette Square Institute endorsed the measure, which is the companion bill to the same-named S. 1462, introduced on April 10 by U.S. Sens. John Curtis (R-UT) and John Hickenlooper (D-CO).