May 2023 Issue:
NAIFA To Send 500+ Members to Capitol Hill to Protect NAIFA Interests
NAIFA’s Congressional Conference is set for May 22-23 in Washington, D.C. It’s not too late to register to participate in this program that establishes and grows the constituent-lawmaker relationships that protect the rules that allow middle America to safeguard their families’ and business’ financial futures.
A key goal of the Congressional Conference is to build and nurture relationships between NAIFA members and their Senators and Members of the House of Representatives. These relationships are at the heart of NAIFA’s amazingly effective advocacy program. The 500+ NAIFA members/Congressional Conference participants who will visit their Members of the House of Representatives and their Senators on May 23 are at the forefront of this all-important effort.
On tap on the afternoon of May 22 will be presentations from two key Members of the House of Representatives, Reps. Brad Schneider (D-IL) and Rep. Monica De La Cruz (R-TX). Both will describe how important relationships with their constituents are to them and to their decision-making. They will also comment on the challenges and opportunities now in front of the 118th Congress.
Also on the May 22 agenda are issues briefings with NAIFA staff and lobbyists, “how-to” lobbying tips, and networking with colleagues and friends. Then, on May 23, Conference participants will fan out all over Capitol Hill to educate lawmakers and their staffs on emerging and active issues that matter to the long-term financial security of their clients and themselves.
Timing is key this year. Currently, government officials are projecting the need to raise the statutory debt limit by early June to avoid an economy-wrecking default by the U.S. This is now and almost certainly will still be all-consuming. Ways to address the country’s fiscal issues—including whether to raise revenue via tax increases as well as substantial spending cuts—are on the top of every lawmaker’s mind. NAIFA’s messages, via constituents, couldn’t come at a better time.
It's not too late to register to participate in the Congressional Conference if you haven’t already. More information and registration for the Congressional Conference on May 22-23 here in Washington, DC. can be found at https://conference.naifa.org/2023.
NAIFA Staff Contacts: Diane Boyle – Senior Vice President – Government Relations, at dboyle@naifa.org; Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org; or Michael Hedge – Senior Director – Government Relations, at mhedge@naifa.org.
House Passes Debt Limit/Spending Cuts Bill
On April 26, the House of Representatives passed a partisan bill (H.R.2811) that would raise the debt limit “in exchange” for deep spending cuts. The bill is the GOP’s opening offer—in response to the FY 2024 Biden budget proposal—for use in what Republicans hope will be negotiations to approve spending cuts in return for their support for raising the debt limit.
The bill—commonly referred to as “the McCarthy plan,” named after Speaker of the House Rep. Kevin McCarthy (R-CA), who is leading the GOP’s spending cuts/debt limit effort—passed narrowly, by a 217 to 215 vote. Four Republicans and all voting Democrats opposed the bill, which was approved by only GOP votes.
The “Limit, Save, Growth” Act now awaits Senate action. However, Senate Democrats are united in opposition to it, and Senate action on it is unlikely (except, perhaps, as a “message vote” to prove that it cannot pass the Senate).
H.R.2811 would impact NAIFA members and their clients, as it would virtually every American, particularly with respect to its provisions raising the debt limit. However, the bill does not contain any provisions of specific concern to NAIFA. The Congressional Budget Office (CBO) projects the bill, if enacted, would reduce U.S. spending by $4.8 trillion over ten years. The bill would:
- Increase in the debt limit to March 31, 2024, or by $1.5 trillion, whichever comes first.
- Cap the FY 2024 topline spending limit at the FY 2022 level, or less.
- Limit spending increases to no more than one percent for each of the next ten years.
- Repeal many of the “green energy” tax provisions enacted in last year’s Inflation Reduction Act.
- Cancel the President’s student loan forgiveness proposal.
- Expand work requirements to qualify for Medicaid, SNAP (Supplemental Nutrition Assistance Program), and TANF (Temporary Assistance to Needy Families).
- Rescind unspent/unobligated COVID relief funds.
- Reform of energy regulation process (permitting program).
- Repeal most ($80 billion) of the new funds allocated last year to the Internal Revenue Service (IRS).
- Require Congressional approval of major regulatory proposals.
House Republicans were and are upfront about the bill’s goal: to trigger negotiations on a package that will raise the statutory debt ceiling (and thus prevent default by the U.S. on its existing obligations), and a spending cuts plan. It is unclear at this point whether the bill will do that.
On May 10, President Biden met with Congressional leaders – the so-called “Four Corners” comprised of Senate Majority Leader Sen. Chuck Schumer (D-NY), Senate GOP Leader Sen. Mitch McConnell (R-KY), Speaker of the House Rep. Kevin McCarthy (R-CA), and House Democratic Leader Rep. Hakeem Jeffries (D-NY). While they all reported no movement after the hour-long meeting, they did agree to meet again. Staff is now meeting to try to hammer out a way forward ahead of the next principals’ meeting on May 12.
Senate Democrats roundly criticized the bill, and President Biden continues to repeat his vow to not negotiate on the debt limit issue. However, there are signs that the Republicans and Democrats could open talks about spending cuts/deficit reduction. There is at least talk among rank-and-file lawmakers about potential areas of common ground: e.g., creation of a commission to address the burgeoning federal deficit, work requirements for social welfare programs, a topline spending cap for the upcoming fiscal year, etc.
Whether these talks can take root seemingly depends on getting past the basic area of disagreement: whether spending cuts can be negotiated without tying those cuts to the debt limit. Republicans say “no.” Democrats insist on such separation. So far, there’s no sign of a resolution to this basic question. However, virtually all lawmakers agree that the U.S. cannot be allowed to default in any way on existing debt.
NAIFA Staff Contacts: Diane Boyle – Senior Vice President – Government Relations, at dboyle@naifa.org; Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org; or Michael Hedge – Senior Director – Government Relations, at mhedge@naifa.org.
Debt Limit Dominates Congressional Agenda
The nation’s debt limit—the amount above which Treasury is precluded by statute from borrowing—could kick in as soon as June 1, according to Treasury Department projections. If it does, the U.S. could default on some of its obligations, putting at risk the full faith and credit of the United States. Economists say this would be catastrophic, resulting in substantial interest rate increases, massive jobs losses, and huge investment losses. Preventing this is at the top of the Congressional agenda this month.
The “X Date” (the date on which Treasury would be unable to borrow the money (due to the debt limit) it needs to pay all its bills on a timely basis—is still uncertain. But both government and private sector economists are projecting it could come as soon as early June (due to smaller-than-anticipated tax payments in April). As a result, most lawmakers are anxious to head off the economic consequences of default, or even getting close to default.
There is a lot of talk about what to do. Republicans say they will not support a debt limit increase without significant spending cuts. Democrats counter that the debt limit impacts preexisting obligations and therefore should not be tied to new spending cuts. At this juncture, potential compromises are no more than speculation. The possibilities being discussed currently are:
- A short-term debt limit increase to buy time for an agreement to be negotiated.
- Votes in the Senate that make clear that the House-passed H.R.2811 (the McCarthy debt limit/spending cuts plan) cannot pass, possibly along with a vote on a two-year clean debt limit increase bill (no other provisions in the bill) that also cannot pass the Senate.
- An agreement that includes an enforceable promise to negotiate a budget plan (or, if not an actual budget, at least a spending cuts plan (that may include new revenue in the form of tax increases) at the same time the debt limit is raised or suspended.
- Reform of the debt limit itself, to avoid a continuation of the weaponization of the debt limit (that has been used by both parties, dozens of times, over the past few decades)—one reform proposal that seems to have piqued interest among lawmakers is a proposal to allow the President to raise the debt limit, when necessary, subject to a Congressional vote to block any such increase.
Other possibilities include the minting of a $1 trillion coin to be deposited with the Federal Reserve (which might or might not accept it), or having Treasury simply continue necessary borrowing in defiance of the debt limit—setting up a conflict (to be resolved in the courts) between the debt limit’s statutory authority and the Constitution’s provision (the 14th amendment) that bans Congress from “questioning…the validity of the public debt.” And there’s always the possibility that an as-yet-not-considered alternative could emerge.
Taxes: So far, Congressional Republicans are united in their opposition to any new taxes (and indeed, want to enact new revenue-losing rules or extend existing tax rules (e.g., the 2017 tax cuts that are due to expire in 2025). But Democrats, who are equally opposed to the size and scope of the spending cuts contemplated by the GOP, are likely to insist on at least some new tax revenue before they will agree, however reluctantly, to painful spending cuts. So, most Washington insiders believe that a final fiscal agreement will include at least some new taxes.
Among the possibilities for new tax revenue are changes to trust rules, estate (and gift and generation-skipping transfer) tax rules, and—if Democrats prevail—some kind of “tax-the-rich” proposal. (One that is particularly troublesome is the proposal that would force the wealthy to pay tax annually on the gains in their investments, even when those gains have not been realized, i.e., the assets sold). There is also some talk about changes to nonqualified deferred compensation rules, and rules governing private placement life insurance (PPLI). Note that the McCarthy debt limit package itself included one set of tax increases--repeal of many of the green energy incentives enacted in the Inflation Reduction Act.
None of these tax proposals is as yet seriously in play. But they are likely prospects if and when lawmakers turn to the tax code for new revenue. NAIFA is watching developments in this area very closely.
Prospects: Virtually every lawmaker—from both parties and in both chambers of Congress—vow there will not be a default. But the path forward to raising or suspending the debt limit remains unclear. It is white-knuckle time on this issue this month.
NAIFA Staff Contacts: Diane Boyle – Senior Vice President – Government Relations, at dboyle@naifa.org; or Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org.
Ways & Means Chair Says a Tax Bill Is Coming by June
House Ways & Means Committee Chair Rep. Jason Smith (R-MO) says his committee will propose a tax package by late May or in June. The package will reflect priorities discussed at the committee’s field hearings (so far, four have been held outside of Washington), and will prioritize “working families and small businesses.” Currently, this effort appears to be entirely Republican-generated and supported.
The emerging tax package—which is at the moment an initiative separate from the ongoing budget and debt limit debates—will focus on economic growth, Rep. Smith says. Among the issues he says the committee is examining are:
- Expiring 2017 tax cuts, including the section 199A 20 percent deduction for non-corporate business income.
- Estate tax (repeal or modification).
- Research & development.
- Business expensing rules.
- The deductibility of business interest paid.
- Child tax credit, with work requirements.
- Bonus depreciation.
- Repealing or amending the already-enacted $600 reporting threshold for third-party settlement organizations (for example, e-Bay, Venmo, Etsy, and Airbnb).
- International tax rules, with special focus on the global minimum tax.
So far not discussed (at least publicly) are issues related to making the package revenue-neutral (i.e., revenue-raising offsets). There is some consideration being given privately to limiting, but not entirely repealing, the green energy incentives included in the Inflation Reduction Act.
Prospects: It’s early days yet on this initiative. Chairman Smith shares the GOP Conference’s aversion to tax increases, but there are real issues with proposing a tax package that loses revenue. This is another initiative that NAIFA is watching very closely.
NAIFA Staff Contact: Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org.
Secure Notarization Bill Reintroduced
The Secure Notarization Act of 2023, S.1212, was introduced on April 19 in the Senate. It joins the House bill, H.R.1059, which the House approved by voice vote this past February. NAIFA supports this legislation.
S.1212, authored by Sens. Kevin Cramer (R-ND) and Mark Warner (D-VA), would permit the use of Remote Online Notarizations (RONs) anywhere in the country. The bill would authorize every notary in the country to perform RONs. It would also require the use of fraud prevention mechanisms like tamper-evident technologies and multi-factor authentication.
Prospects: The Secure Notarization Act is strongly supported by NAIFA as well as by a wide-ranging coalition of allied interests. While the bill may run into obstacles due to competing priorities and limited floor time in the Senate, its supporters are optimistic that it will be enacted into law before year-end.
NAIFA Staff Contact: Michael Hedge – Senior Director – Government Relations, at mhedge@naifa.org.
DOL Appeals Florida Court Ruling that Overturns Fiduciary Rule Guidance
On April 14, the U.S. Department of Labor (DOL) filed a notice of appeal to the 11th Circuit Court of Appeals on a Florida District Court ruling (American Securities Association v. United States Department of Labor) that struck down parts of the agency’s sub-regulatory guidance on the applicability of the fiduciary standard to advice on rolling over ERISA plan retirement funds into IRAs.
The U.S. District Court for the Middle District of Florida ruled in February that DOL had “exceeded its regulatory authority when it applied strict fiduciary standards of conduct to financial advisers recommending IRAs.” At issue was whether combining a recommendation to take a rollover from a retirement plan with post-rollover advice meant that advice is being provided on a “regular basis” under DOL’s five-part regulatory test for fiduciary investment advice status. Per the Florida court opinion, recommendations to employee benefit plans must be analyzed separately from recommendations to IRAs to determine whether the regular basis prong of the five-part test has been met. In this situation, DOL’s ability to regulate advisors’ standards of conduct ends when the money leaves the plan established under ERISA.
Prospects: It is unlikely that DOL will give up on its effort to impose stricter standards of conduct in retirement fund rollover and other situations—at least for as long as there is a Democrat in the White House. If the agency loses in the 11th Circuit, it is possible DOL will push the issue all the way up to the Supreme Court. In addition, DOL has included a new fiduciary rulemaking project in its most recent regulatory agenda. Hence, resolution of this issue is still some time away.
NAIFA Staff Contact: Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org.
Key Tax Writer Introduces Bill to Expand Use of HSAs to Cover In-Home Long-Term Care
Rep. Adrian Smith (R-NE) has introduced bipartisan legislation that would allow use of health savings account (HSA) funds to pay for in-home long-term care. The bill has 11 bipartisan cosponsors.
H.R.1795, the Homecare for Seniors Act, would explicitly permit HSA funds to be used to pay for qualified home care. Qualified home care is defined as a contract that obligates the service provider to provide care for three or more ADLs (activities of daily living), including assistance with eating, toileting, transferring, bathing, dressing, continence and/or medication adherence. The bill also would require the Department of Health and Human Services (HHS) to run a public education/awareness campaign to make it more widely known that in-home service expenses would be eligible for tax-free distributions from HSAs.
Under current law, HSA money can be used, tax-free, only for qualified medical expenses. H.R.1795 would expand the definition of qualified medical expenses to include in-home non-medical care involving assistance with activities of daily living.
Prospects: There will be a revenue cost to this bill (it has not yet been scored by the Joint Committee on Taxation, the official “scorekeeper” of all tax provisions). And the size of that score will have a significant impact on the bill’s chances. Currently, tax writers are looking at ways to make the 2017 tax cuts permanent—a costly process but are not looking at any new tax increases. Getting a new revenue-losing tax benefit enacted into law, no matter how widely supported, will be a heavy lift if Congressional scorekeepers project it would cause a significant revenue loss.
NAIFA Staff Contact: Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org.
“Tax-the-Rich” Legislation Resurfaces
On April 18, Sen. Bernie Sanders (I-VT) reintroduced his “tax-the-rich” bill, the “For the 99.5 Percent Act,” in the Senate. The bill was reintroduced in the House by Rep. Jimmy Gomez (D-CA). The bill would impose higher estate tax rates on those who inherit more than $3.5 million.
The bill would:
- Exempt the first $3.5 million of an individual’s estate from the estate tax
- Establish a new set of rates for estates valued at more than $3.5 million, as follows:
- 45 percent on the value of an estate between $3.5 million and $10 million
- 50 percent on the value of an estate between $10 million and $50 million
- 55 percent on the value of an estate between $50 million and $1 billion
- 65 percent on the value of an estate in excess of $1 billion
- End “dynasty trusts” by
- Strengthening the generation-skipping tax by applying it with no exclusion to any trust set up to last more than 50 years
- Bar donors to grantor-retained annuity trusts (GRATs) from taking assets back from these trusts within two years to avoid gift taxes
- Impose income tax liability on earnings generated by assets in grantor trusts
- Limit the gift tax exclusion for gifts made to trusts
The legislation would also change the rules on valuation discounts. It also includes special rules for family farms.
Prospects: While the GOP controls the House, this legislation has little to no chance of being considered, much less enacted. However, Republicans on the Ways & Means Committee are interested in estate tax rules, and so elements of this bill—especially the grantor trust proposals—may find their way into the discussion as the House GOP tax package moves forward. NAIFA will watch this issue carefully.
NAIFA Staff Contact: Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org.
CMS Rule Sets Medicare Advantage, Part D Marketing Rules
On April 12, the Centers for Medicare, and Medicaid Services (CMS) finalized rules governing practices involving advising/selling Medicare Advantage (MA) and Part D (prescription drug) plans. The rules cover practices applicable to plan sponsors, agents, brokers, and third-party marketing associations. The final rules reflect changes sought by NAIFA.
Among the most notable requirements impacting agents and brokers are:
- Obligations on MA organizations and Part D sponsors to establish and maintain an oversight plan that monitors agent/broker activities and reports non-compliance to CMS.
- Restrictions on agent and broker marketing activity at educational events.
- Requirements governing the timing and scope of marketing meetings with beneficiaries.
- Requirement that agents and brokers ask beneficiaries certain questions and cover certain topics regarding their health plan needs prior to enrollment.
- Limiting the existing beneficiary call recording obligation to sales, marketing, and enrollment calls and clarifying that the recording requirement also applies to web-based.
Notably, while the final rule distinguishes between requirements for agents/brokers, and those governing TPMOs (third-party marketing organizations), CMS notes that TPMOs include agents and brokers performing certain activities. This is consistent with the regulatory definition of TPMO which covers “organizations and individuals, including independent agents and brokers, who are compensated to perform lead generation, marketing, sales, and enrolment-related functions…”
Regarding the requirement that agents record calls when dealing with beneficiaries, the final rule clarifies that the recording requirements do not apply to all calls with beneficiaries, only to sales, marketing, and enrollment calls. Unfortunately, CMS did not address NAIFA’s request to allow beneficiaries to opt out of being recorded when speaking with their agent of record.
Another revision NAIFA asked to alter, which CMS took into consideration before issuing the final rule, saw CMS attempting to limit the distribution and collection of scope-of-appointment forms and business-reply cards to six months after an educational event; the final version extends this timeframe to 12 months.
The marketing and communications regulations will become effective September 30, 2023, in time for the 2024 Annual Enrollment Period and will apply to all activity related to CY 2024 and beyond.
Obligations Specific to Agents and Brokers:
- Requires MA organizations and Part D sponsors to establish and maintain an oversight plan that monitors agent/broker activities and reports agent/broker non-compliance to CMS.
- Requires agents and brokers to ask beneficiaries certain questions and cover certain topics prior to health plan enrollment, including adding the effect of an enrollee’s enrollment choice on their current coverage to the Pre-Enrollment Checklist.
- Prohibits agents and brokers from contacting a beneficiary at the individual’s home as unsolicited door-to-door contact unless an appointment at the beneficiary’s home at the applicable date and time as previously scheduled.
- Reinstates the prohibition on agents and brokers accepting Scope of Appointment (SOA) forms at educational events.
- Prohibits marketing events from taking place within 12 hours of an educational event in the same building or an adjacent building.
- Requires the plan, or agents and brokers as applicable, to agree upon and record the Scope of Appointment with the beneficiary at least 48 hours prior to the start of the personal marketing appointment. Provides exceptions for:
- SOAs completed in the last four days of a valid election period for the beneficiary.
- Unscheduled walk-in meetings initiated by the beneficiary.
- Limits the time period when SOAs and BRCs are valid up to 12 months from the beneficiary’s date or initial request for more information.
Obligations Specific to TPMOs:
- Requires TPMOs to submit marketing materials developed for multiple MA organizations and Part D sponsors directly into the health plan management system (HPMS) for CMS review, rather than submitting to the MA organization or Part D sponsor as was previously the case. CMS states that this change will allow them to know exactly which organizations the piece is being used to market, enabling them to hold only those MA organizations and Part D sponsors accountable for inappropriate marketing.
- Limits the requirement on TPMOs to record calls between themselves and beneficiaries to sales, marketing, and enrollment. There is no requirement to record when the agent is merely setting an appointment or checking in after a sale.
- Clarifies that call recording applies to all web-based calls, though only the audio portion needs to be recorded.
- Modifies the TPMO disclaimer to add state health insurance programs (SHIPs) as an option for beneficiaries to obtain additional help and list the number of organizations with which they contract in the service area as well as the number of plans.
Note: CMS does not address its proposal to prohibit TPMOs from distributing beneficiary contact information in this final rule, though they may address it in a future regulation.
Additional Commercial and Marketing Requirements and Restrictions
• Requires each MA organization and Part D sponsor to provide a written annual notification from plans that an enrollee may opt out of future plan business contacts regardless of the plan’s intention to contact. The rule defers to plans on how best to communicate this. • Explicitly prohibits any use of the Medicare name, CMS logo, or products or information issued by the federal government (i.e., Medicare card) in a misleading manner. MA organizations and Part D sponsors will be responsible for any misleading actions by their first tier, downstream, and related entities.
Prohibits the use of any superlatives (including logos and taglines), unless sources of documentation and/or data supportive of the superlative are also referenced in the material and have been published in either the current contract year or the prior contract year.
Prohibits MA organizations or Part D sponsors from marketing any products or plans unless the names or marketing names of the entities offering the benefits being advertised are clearly displayed.
Prohibits MA organizations and Part D sponsors from including information about savings available to potential enrollees that are based on a comparison of typical expenses borne by uninsured individuals, unpaid costs of dually eligible beneficiaries, or other unrealized costs of a Medicare beneficiary.
Codifies existing guidance that prohibits Medicare organizations and Part D sponsors from marketing benefits in a service area where those benefits are not available unless doing so is unavoidable because of the use of local or regional media that covers the service area(s).
Establishes that the non-renewal notice is a “standardized communication material” that must be used without modification except where noted. • Requires the summary of benefits (SB) to list medical benefits in the top half of the first page.
Requires that certain new information, such as language capabilities, be added to the organization’s searchable provider directory.
Prospects: NAIFA will continue working diligently with CMS to address any items which are not ideal for the working relationships between agents and brokers and their clients.
NAIFA Staff Contact: Michael Hedge – Senior Director – Government Relations, at mhedge@naifa.org.
DOL Issues Advice Memo on Cafeteria Plan Substantiation Rules
On May 3, the Internal Revenue Service (IRS) released an advice memo (Memorandum Number 202317020) making clear that expenses to be paid from cafeteria plan funds must be documented. If they are not, the memo states, the funds used to pay unsubstantiated expenses will not be shielded from income or employment taxes.
The general rule, per the memo, is that if a cafeteria plan does not require an independent third party to fully substantiate health flexible spending arrangement (FSA) reimbursements for medical expenses, then the “plan fails to operate in accordance with the substantiation requirements and is not a cafeteria plan within the meaning of IRC Section 125.” That means employee deferrals into the FSA would have to be included in the employee’s gross income. Further, such FSA contributions would be characterized as wages subject to FICA and FUTA taxes.
The memo provides six examples—five of which illustrate situations where the substantiation (if any) is insufficient—of adequate substantiation (documentation). The first example involves a medical FSA and requires that to be reimbursable from a tax-free FSA, a medical expense must be substantiated by a third party independent of the employee. The substantiation must include a description of the service or product to be reimbursed, the date of service or sale, and the amount of the employee’s expenses.
The remaining five examples describe practices that fail the substantiation requirement—situations involving submission of a claim without any documentation other than the employee’s own information; situations where substantiation is required only on a random basis; failure to substantiate de minimis expenses, failure to require substantiation from certain “preferred” providers, and the rules regarding payment from a cafeteria plan’s dependent care FSA.
Prospects: Some experts question whether this advice memo—which states that it cannot be used or cited as precedent—will be enforced. It is based on a never-finalized regulation proposed more than 15 years ago. Still, it would likely take litigation—a costly and time-consuming endeavor—to clarify whether these substantiation rules are in fact enforceable law, and thus NAIFA members advising clients on cafeteria plan FSAs (medical and dependent care) should be aware of this advice memo and encourage their clients to proceed accordingly.
NAIFA Staff Contact: Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org.
Su Nomination as DOL Secretary Heads to Senate Floor
By a party-line vote, the nomination of Julie Su to be Secretary of the Department of Labor (DOL) has cleared committee and is now awaiting action by the full Senate. The Senate vote has not yet been scheduled. Several Democrats remain undecided, so Su’s nomination is by no means assured.
The 11 to 10 committee vote pitted all the Senate Health, Education, Labor, and Pensions (HELP) Committee’s Republicans against Su, while all the Committee’s Democrats voted to support her nomination. However, there are at least three Democratic Senators who do not serve on the HELP Committee whose positions on her nomination have not yet been announced.
The DOL Secretary will have significant influence over DOL’s regulatory agenda. That agenda includes a number of issues of considerable importance to NAIFA members. Among them are the conflict of interest (fiduciary rule) regulation, and regulations defining who can work as an independent contractor as opposed to an employee (worker classification).
Prospects: Most Washington insiders believe that Su’s nomination is in trouble. It is possible that all three Democratic Senators (Joe Manchin from West Virginia, Kyrsten Sinema from Arizona, and Jon Tester from Montana) who have not yet committed to vote to confirm her will ultimately vote “aye” on her nomination. But these Senators have expressed concern about Su’s record, particularly with respect to worker classification and unionization issues. And there are many in the business community that are lobbying hard against her.
It is likely that the Administration (or Su herself) will withdraw her nomination rather than letting it go to a losing vote. However, Su will remain at the helm of the DOL in an acting capacity, until a replacement nominee is named and confirmed, or until she herself is confirmed.
NAIFA Staff Contacts: Jayne Fitzgerald – Director – Government Relations, at jfitzgerald@naifa.org; or Michael Hedge – Senior Director – Government Relations, at mhedge@naifa.org.
