1 See Institute Memorandum to Pension Members No. 21-96, dated May 24, 1996.
VIA FAX
June 4, 1996
TO: PENSION COMMITTEE No. 22-96
RE: ADMINISTRATION ISSUES POSITION ON H.R. 3448
______________________________________________________________________________
The Clinton Administration has issued the attached statement of its position on H.R.
3448, the Small Business Job Protection Act. As previously reported1, H.R. 3448 includes small
employer plan and pension simplification legislation, as well as a proposed increase in the
minimum wage. H.R. 3448, which was passed by the House, is currently being considered by
the Senate.
With regard to the pension legislation included in the bill, the Administration indicates
its general support, but suggests that pension proposals should be enacted in legislation
separate from a bill to increase the minimum wage. The Administration also states its concern
with some of the details of the pension proposals including the need to require "more
meaningful employer contributions" in any simplified small employer pension plan, the desire
for "a more appropriate" definition of highly compensated employee and concern that the bills
three-year waiver of the excise tax on excess distributions would add complexity to the law and
encourage plan terminations. (The waiver is included in the bill as part of the repeal of the
section 415(e) combined plan limit, the effective date of which is delayed in the bill to January,
1999.)
The Administration also states its strong opposition to certain tax proposals in H.R. 3448
that are unrelated to the pension provisions.
We will keep you informed of developments.
Russell G. Galer
Assistant Counsel - Pension
Attachment