11/14/2017

Urge Senators to Support Portman Amendment on Deferred Compensation

Portman's amendment will safeguard nonprofits from damaging new regulations

The Ohio Society of Association Executives (OSAE) and the American Society of Association Executives (ASAE) are pleased to share the news that Senator Rob Portman (R–OH) will offer an amendment during the Senate Finance Committee markup to repeal the nonqualified deferred compensation provision that would negatively impact many associations. Our organizations are asking you to thank Portman for his support on this important issue. 

Additionally, our organizations are asking association professionals and industry partners to call or email members of the Senate Finance Committee and to ask them to support Portman's amendment during the markup of the legislation.

The chairman's mark proposes to eliminate nonqualified deferred compensation arrangements for nonprofit employers like associations. The legislation eliminates 457 plans outright, without grandfathering existing arrangements. For employees who have 457 arrangements, they would be faced with their existing balances being taxed by 2026, disrupting their personal financial planning and retirement outlook. This provision hurts nonprofit employees who in good faith entered into contractual agreements with their employers, and are counting on this benefit as part of their retirement planning.
 
This provision also hurts nonprofit employers in attracting and retaining top talent. Large nonprofits are complex organizations that demand a high level of executive leadership. Nonprofit employers can't offer performance stock options, but 457 plans are an alternative benefit, allowing nonprofits to offer key employees a limited amount of nonqualified vested deferred compensation to supplement the retirement benefits.
 
Because of the potential impact of this provision on retirement planning and executive recruitment and retention, OSAE and ASAE are urging the Senate to consider grandfathering existing deferred compensation plans past the current pay-out year of 2026.

Our ask: 
We are encouraging association professionals to call or email members of the Senate Finance Committee and ask them to vote in favor of the Portman Amendment on deferred compensation. To see a list of members of the Finance Committee, please select this link. Republican members of the Senate Finance Committee will drive this issue, so members in the majority will be the most helpful at this time. However, members on both sides of the aisle will have an important vote, so if you'd like to reach out to the Democratic members, you can do that, too. 

We thank you for your support on this important issue. To read more about this matter, visit ASAE's Power of A website here. If you have any questions, please call (202) 626-2703 or email publicpolicy@asaecenter.org.