Legislation introduced by Indiana Congresswoman Susan W. Brooks freeing charitable and cooperative associations from burdensome federal pension requirements was passed by the U.S. House of Representatives today. House Resolution 4275 – the Cooperative and Small Employer Charity Pension Flexibility Act – will benefit more than 1,500 Hoosier employees and will head directly to the President for signature.
The legislation ensures that charitable and cooperative associations are not swept into the Pension Protection Act of 2006 (PPA) funding rules, which require them to fund their pension plans at levels commonly associated with high risk plans. These groups received a temporary exemption from the rules in 2006 which is set to expire in 2017. The new legislation made the exemption permanent.
“The future of charitable organizations and our rural electric cooperatives is in jeopardy because of federal requirements that fail to recognize the unique structure of these groups,” Brooks said.
“They provide vital services to our communities and help so many people struggling to get by and build a better life for themselves and their families. This common sense bill prevents charities and cooperatives from being forced to overfund their pension plans, and thus will free up more resources for these groups to continue enhancing communities across America.”
“This finishes the job Congress started in 2006,” said Scott Bowers of Indiana Electric Cooperatives. “PPA didn’t make sense for rural co-op plans like ours then, and still doesn’t make sense now. Congresswoman Brooks understands our unique business model and pension plan design and we thank her.”