Church Plan Investment Clarification Act

Mr. Speaker, I move to suspend the rules and pass the bill

(H.R. 33) to amend the Securities Act of 1933 to specify when certain securities issued in connection with church plans are treated as exempted securities for purposes of that Act, as amended.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and to add extraneous material on this bill.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise in support of H.R. 33, the Church Plan Investment Clarification Act. I would like to thank my colleagues on the Financial Services Committee for their support of this legislation. I would also like to thank Mr. Carson of Indiana for managing the bill for the other side of the aisle.

H.R. 33, the Church Plan Investment Clarification Act, is a technical corrections bill to amend Public Law 108-359, the Church Pension Fairness Act. It clarifies an exemption in current law to allow church pension plans, like secular pension plans, to invest in collective trusts.

Due to a technical error included in the 2004 law, the necessary exemption from the Securities Act of 1933 was not provided to give church pension plans access to collective trusts. Collective trusts allow pension plans to pool their assets, diversify their investments, and share risk and transaction costs with other pension plans, thereby reaping the benefits of collective buying power. Again, H.R. 33 clarifies that church pension plans, like secular plans, may invest in collective trusts.

On June 22, 2011, the House Committee on Financial Services by voice vote unanimously approved H.R. 33. This bill is similar to the original Church Pension Fairness Act bill, H.R. 1533, which the House passed in 2003 by a vote of 397-0.

Finally, the bill is supported by a number of organizations, including the Church Alliance; the General Board of Pension and Health Benefits of the United Methodist Church; the YMCA Retirement Fund; Everence Financial on behalf of the Mennonite Retirement Trust, the retirement plan for the Mennonite Church USA; the Seventh-Day Adventist Church in North America; Church Pension Group, on behalf of the Church Pension Fund, an independent agency of the Episcopal Church; the Ministers and Missionaries Benefit Board of the American Baptist Churches in the USA; the Board of Pensions of the Evangelical Lutheran Church in America; and the Pensions Board of the United Church of Christ.

With that, I urge my colleagues to support the bill.

I reserve the balance of my time.

Mr. Speaker, I have no further requests for time, and I yield back the balance of my time.

Mr. Speaker, on that I demand the yeas and nays.

Mr. Speaker, I rise today in support of H.R. 33, ``The Church Plan Investment Clarification Act.'' This legislation will allow church pension plans to participate in collective trusts.

Collective trusts allow pension plans to combine assets to invest in various stock and non stock options. This provides pension plans an opportunity to diversify investment portfolios, while sharing risks and transaction costs with other pension plans.

Under current law, thousands of church pension plans are denied participation in collective trusts, rendering them unable to pool their assets and reap the benefits of collective buying power. Many churches, as a result, experience difficulties and incur expenses when diversifying pension plan investments.

I support the Church Plan Investment Clarifications Act to amend the Securities Act of 1933. Amending current securities legislation will broaden the existing exemption to collective trusts to include church pension plans. This bill will clarify that clergy and lay workers are able to invest in collective trusts, despite their unique tax status. The Act affords church pension plans the same securities law treatment that is extended to governmental plans.

Churches provide invaluable services to our communities. Across the Nation, church pension plans will benefit from this bipartisan bill, including churches in Houston, Texas, where I represent the 18th Congressional District. Churches such as the Bellfort Seventh Day Adventist Church, New Light Christian Church and the Community of Faith Church. This legislation will be of great significance to the Wheeler Avenue Baptist Church, the St. John Missionary Baptist Church on Dowling, the Brooks Hollow Baptist Church, and Houses of worship throughout our community and Nation.

These faith institutions in Houston, as well as throughout the country, will no longer have to individually bear the burden of high fees on investment transactions for their retirement plans. The clergy and lay workers that will benefit from this legislation have spent their entire careers serving others. The least we can offer in return is the opportunity for these pension plans to pool their resources in order to decrease costs associated with funding their retirement plans.

This bill is also supported by The Church Alliance, the Seventh Day Adventist Church, the YMCA Retirement Fund, the Church Pension Group, and others. I thank my friend from Illinois for sponsoring this important legislation, and urge my colleagues to work together to pass the Church Plan Investment Clarification Act.

Mr. Speaker, due to the celebration of my daughter's wedding, I was unable to be in Washington, DC for votes during the week of July 18. Had I been present for the votes that week, I would have voted as follows:

Rollcall vote 602: I would have voted in favor of H.R. 33, legislation amending the Securities Act of 1933 to specify when certain securities issued in connection with church plans are treated as exempted securities for purposes of that Act.

Rollcall vote 606: I would have voted against H.R. 2560, legislation submitting a constitutional amendment to the States that would irresponsibly limited the government's ability to respond to wars, disasters, or other challenges as well as changing Congressional voting procedures that would end majority rule.

Rollcall vote 611: I would have voted against H.R. 2553, legislation that, while extending the operations of the Federal Aviation Authority, would undermine labor relations.

Rollcall vote 621: I would have voted against H.R. 1315, legislation undermining consumer protections implemented as part of the Dodd-Frank Act.

Rollcall vote 629: I would have voted against H.R. 2551, ideologically driven legislation that cuts funding for House and joint operations by $227 million (6.4 percent) from FY11 enacted levels, which is $472 million (12.4 percent) below the requested amount. These cuts risk possible layoffs and pay-cuts for legislative branch staff, which will damage Congress' ability to fulfill its Constitutional duties and responsibilities to the public. For example, the Library of Congress, which is the nation's oldest federal cultural institution and provides critical resources to Members of Congress, was severely cut to 13.7 percent below the request. I was also dismayed by the cuts to related agencies such as Congressional Research Service, Government Accountability Office and Congressional Budget Office, which provide crucial assistance and oversight to Congress. These cuts will make the Legislative Branch less effective, not more efficient.

Madam Speaker, flying in today, our plane was delayed. I didn't have the opportunity to advance my support for H.R. 33, the Church Plan Investment Clarification Act of 2011. I want to acknowledge the sponsorship of Congresswoman Biggert and indicate that under current law thousands of church pension plans are denied participation in collective trusts, rendering them unable to pull their assets or reap the benefits of collective buying power. Many churches, as a result, experience difficulties and incur expenses when diversifying pension plans.

Our churches, our houses of worship provide invaluable service, and many of those in my own community--the Bellfort Seventh Day Adventist Church, the New Life Christian Church, Wheeler Avenue Baptist Church, St. John Missionary Baptist Church on Dowling, Brookhollow, and many others, work throughout our community. We are blessed to have Lakewood Church in our community, as well, that works very hard, a church leadership that I've known for many, many years.

So this bill has been supported by the Church Alliance, the Seventh Day Adventist Church, the YMCA Retirement Fund, the Church Pension Group, and others. And I thank my friend from Illinois, as I said. Churches do missionary work. Their workers need to have the ability to have their pensions.

And I close by saying there are those suffering in Kenya, they are dying, the Somalians who left because of the devastation of the drought, and I know our faith community wants us to do something about it.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, this bill would permit church pension plans to invest in collective trusts by correcting a technical error that resulted from the interaction of the securities laws and the Tax Code. In 2003, Mr. Speaker, Congress passed legislation that was intended to accomplish this goal, but the final law did not make the necessary corrections to the Securities Act of 1933. As such, IRS regulations currently prevent collective trusts from allowing investments by church plans.

This bill will make it more cost-efficient for a religious organization to manage its pension plans by allowing the plan to manage its assets through a collective trust mechanism alongside the assets of other pension plans. Church pension plans will no longer have to be managed separately, which creates greater costs to the plan and its participants. The bill, Mr. Speaker, effectively provides another option for church pension plans and allows them to be managed much more like other kinds of pension plans, and will minimize costs.

This bill is supported by the Church Alliance, a coalition of 37 denominational benefit programs that provide pensions and health benefits to more than 1 million clergy across this country, lay workers, and their family members.

Mr. Speaker, I urge adoption of this bill.

I yield back the balance of my time.