{"database": "press", "table": "releases", "rows": [["https://www.portman.senate.gov/public/index.cfm/press-releases?ID=24138be1-d938-4dda-8577-3c3fe2f179d0", "Treasury Responds to Portman's Letter and Agrees to Ease Up on Regulation that Threatens the Retirement Security of American Workers", "2013-12-16", "2013", "2013-12", "Republican", "House", "OH", "Rob Portman", "P000449", "www.portman.senate.gov", null, null, "legacy", "Washington, D.C. \u2013 Responding to a letter sent by U.S. Senators Rob Portman (R-Ohio) and Ben Cardin (D-Md.) to U.S. Secretary of the Treasury Jacob Lew expressing concern with a regulation that could unintentionally weaken the retirement security of many American workers, the U.S. Department of Treasury has decided to ease up on these rules for now while seeking public suggestions on a permanent fix.\u00a0 This flaw undermines and runs counter to the original intent of the Treasury regulation\u2014strengthening retirement security. Fortunately, Secretary Lew has the power to prevent the unintended consequences of this regulation without new legislation.\r\nIn the letter, Portman and Cardin, both members of the Senate Finance Committee, warn that this technical glitch might inadvertently incentivize companies to hard-freeze the defined benefit pension plan of long-time employees and urge Lew to fix it, stating, \u201cThis is clearly not the intended effect of the nondiscrimination rules, which were written to strengthen retirement security, rather than to force many older employees into new pension plans that may not provide enough time to accumulate sufficient benefits before retirement.\u201d\r\nThe full text of the letter is below.\u00a0 Read a signed copy here.\r\nNovember 21, 2013\r\nThe Honorable Jacob J. Lew  Secretary of the Treasury  Main Treasury Building, Room 3330  1500 Pennsylvania Avenue, N.W.  Washington, D.C. 20220\r\nDear Secretary Lew:\r\nWe write to request action concerning a Treasury regulation that could unintentionally weaken the retirement security of many American workers. The regulation in question was created in order to strengthen retirement security, so repairing this flaw would support the Treasury\u2019s original intent. It\u2019s a regulation that can be improved without new legislation.\r\nOver the past several years, many companies have transitioned from defined benefit to defined contribution retirement plans. In doing so, many have elected to grandfather existing employees into the defined benefit plans in order to avoid disruptions and save them from having to build retirement savings in a new pension model mid-career. After \u201csoft freezing\u201d the existing pension plan, the company places new hires within a new defined contribution pension system.\r\nOver time, the existing employees grandfathered into the old system typically build seniority and become more highly-compensated than the younger, newer employees who also are more likely to have greater job turnover. This widens the income gap between the two pension groups.\r\nUnfortunately, soft freezes may cause plans to inadvertently violate a Treasury rule that requires qualified plans to meet certain nondiscrimination testing requirements.\u00a0 These requirements are intended to enforce a degree of pension benefit parity between higher- and lower-compensated employees. The split between having mostly higher-compensated employees in a defined benefit plan and mostly lower-paid employees in a defined contribution plan may trigger the nondiscrimination rules even if the level of pension benefits between the two groups is comparable. This is because current nondiscrimination rules do not adequately allow for the comparison between defined benefit and defined contribution benefits in these circumstances.\r\nCompanies failing their nondiscrimination tests risk losing their pensions\u2019 qualified status, resulting in immediate taxation of their employees\u2019 pension benefits. To avoid this expensive outcome, many companies feel compelled to instead implement a \u201chard freeze\u201d that completely closes the defined benefit plan and forces all employees into the new plan.\r\nThis is clearly not the intended effect of the nondiscrimination rules, which were written to strengthen retirement security, rather than to force many older employees into new pension plans that may not provide enough time to accumulate sufficient benefits before retirement.\r\nSome companies are already facing the prospect of triggering the nondiscrimination rules, and nearly every company that wishes to soft freeze its defined benefit plan will face this problem over the next several years. The sooner Treasury can implement a practical, non-regulatory solution to this issue, the sooner companies can avoid having to hard freeze their pensions when they would prefer a soft freeze.\r\nWe greatly appreciate your attention to this matter.", 1, "2026-03-30T12:14:52Z", "2026-03-30T12:14:52Z"]], "columns": ["url", "title", "date", "year", "month", "party", "chamber", "state", "member_name", "bioguide_id", "domain", "scraper", "source", "date_source", "text", "has_text", "collected_at", "updated_at"], "primary_keys": ["url"], "primary_key_values": ["https://www.portman.senate.gov/public/index.cfm/press-releases?ID=24138be1-d938-4dda-8577-3c3fe2f179d0"], "units": {}, "query_ms": 1.5419910196214914, "source": "dwillis/congress-press", "source_url": "https://github.com/dwillis/congress-press", "license": "MIT", "license_url": "https://github.com/dwillis/congress-press/blob/main/LICENSE"}