Title: Temporary Federal ESOP Grant Program Act of 2020
Policy area: Labor and Employment

Summary:
Temporary Federal ESOP Grant Program Act of 2020
This bill establishes a grant program for businesses that establish or expand an employee stock ownership plan that meets the applicable federal requirements for such plans.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 4236 Introduced in Senate (IS)]

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116th CONGRESS
  2d Session
                                S. 4236

To establish a grant program to encourage the creation and expansion of 
                    employee stock ownership plans.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 21, 2020

  Mr. Johnson (for himself and Ms. Baldwin) introduced the following 
  bill; which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To establish a grant program to encourage the creation and expansion of 
                    employee stock ownership plans.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Temporary Federal ESOP Grant Program 
Act of 2020''.

SEC. 2. GRANT PROGRAM.

    (a) Establishment.--Not later than 30 days after the date of the 
enactment of this Act, the Secretary of the Treasury shall establish 
the Temporary Federal Employee Stock Ownership Plan Program, or the 
``Temporary Federal ESOP Program'', to provide grants to eligible 
business concerns for purposes of--
            (1) establishing; or
            (2) increasing the percentage of the eligible business 
        concern owned by;
an employee stock ownership plan (as defined in section 4975(e)(7) of 
the Internal Revenue Code of 1986).
    (b) Eligible Business Concern.--For purposes of this section, the 
term ``eligible business concern'' means a business concern that 
submits with the grant application--
            (1) a completed agreement signed by the business concern 
        and an employee stock ownership trust--
                    (A) establishing an employee stock ownership plan 
                (as defined in section 4975(e)(7) of the Internal 
                Revenue Code of 1986) which is a tax credit employee 
                stock ownership plan meeting the requirements of 
                section 409 of the Internal Revenue Code of 1986; or
                    (B) increasing the percentage of the business 
                concern owned by such a plan, if such plan is already 
                in existence;
            (2) supporting documentation for the valuation of the 
        business concern as determined for purposes of such agreement 
        by an independent valuation expert utilizing generally accepted 
        valuation approaches (as determined by the Secretary of the 
        Treasury), or by the trustee of the employee stock ownership 
        trust if such valuation is certified by such an independent 
        valuation expert, including filings to the Internal Revenue 
        Service or the Securities and Exchange Commission, as 
        applicable; and
            (3) a certification that the grant funds will be used 
        toward the purchase of employer securities, and that the 
        reduction in cost to the business concern attributable to the 
        grant funds will be used for capital investment in or 
        replacement and maintenance of fixed assets, including 
        manufacturing equipment and tools, computers, land, buildings, 
        facilities, health and safety equipment, and other similar 
        investments.
    (c) Grant Awards.--Based on a determination made within 15 business 
days from the date of submission of an application meeting the 
requirements of subsection (b), the Secretary of the Treasury shall 
award a grant under the Temporary Federal ESOP Program to a business 
concern in an amount not to exceed the sum of--
            (1) $20,000 per employee--
                    (A) who is a participant in the employee stock 
                ownership trust established by such business concern; 
                or
                    (B) whose ownership share in such business concern 
                by reason of an existing employee stock ownership trust 
                is increased;
            (2) $50,000 for any costs incurred by the business concern 
        and employee stock ownership trust, and documented in the grant 
        application, in developing the agreement required under 
        subsection (b)(1).
    (d) Termination.--No grant shall be awarded under the Temporary 
Federal ESOP Program after September 30, 2022.
    (e) Authorized Transfer of Appropriations.--The Secretary of the 
Treasury may transfer any unobligated amount of the appropriation under 
section 4027 of the Coronavirus Economic Stabilization Act of 2020 for 
the purposes of carrying out the Temporary Federal ESOP Program.
    (f) Secretary of the Treasury.--For purposes of this section, any 
reference to the Secretary of the Treasury includes a reference to any 
delegate of such Secretary.
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