BUT, Game Not Over!
Since late October 2010, The ESOP Association, and the ESOP community, has protested vigorously against the Department of Labor’s (DOL) proposed regulation to make all appraisers of private ESOP company stock ERISA fiduciaries. Today, the DOL issued a press release announcing that it would issue a new version of the regulation revising the definition of ERISA fiduciaries in January 2012, and begin the comment period, in essence, all over again.
This news is a good trend line for pro-ESOP voices. On October 22, 2010, to use an analogy, when the “game” started, the ESOP community was already down two touchdowns. Today, we can say we’re at half time, and we’re tied going into the locker room.
But, there is still plenty of play in the months leading up to 2012 and beyond. For example, the DOL press release hints at leaving in the provision making ESOP appraisers ERISA fiduciaries when they value stock being acquired by a private company. Read the release here.
Such an outcome would dry up ESOP transactions in our view, and soon the number of ESOPs would dwindle, our voice in DC would be weaker, and ESOP benefits would be devastated.
So, do not back off; continue to bring concerns about this proposed regulation to the attention of members of Congress.
Clearly our message will be precise when the new proposed regulation is issued in early 2012. We will post suggested messages — for letter, telephone call, or if you have email green light from a staff member of your Senators and Congress person’s offices, for an email — on our website, blog, and social media sites, as well as in our Advocacy and Congressional Visit Kits.
PS: Just a note of some pride from this corner. The DOL press release cites the Department’s desire to comply with a White House directive issued in January 2011. The ESOP Association, to our knowledge, was the first to develop a point by point analysis why the October 22, 2010, DOL proposed regulation did not conform to the President’s Executive Order, in a communication to the Office of Management and Budget. Click here to read our June 6, 2011 post – Is the DOL Ignoring the Obama Administration?