Wyden: House Trust Fund Fix ‘Goes Too Far’ on Pension Smoothing
Victor J. Blue/Bloomberg News
The chairman of the tax-writing Senate Finance Committee on July 28 criticized the primary source of funding for a House bill that would shore up the Highway Trust Fund, a day before the Senate is expected to vote on the legislation.
“I do think the other body goes too far on the issue of pension smoothing. And given that position, the country is likely to have two big challenges in the future. One, how do you fund transportation. And second, what do you do about the hopes and aspirations of all those workers relying on pensions,” said Sen. Ron Wyden (D-Ore.), the Finance panel’s chairman.
UPDATE: Senate passes amended bill.
The House GOP bill relies mostly on pension smoothing to approve nearly $11 billion to keep the Highway Trust Fund solvent through May. Pension smoothing allows companies to reduce required contributions to their retirement plans as a way of inflating their taxable income temporarily.
Wyden’s opposition to the key provision in the House-passed legislation could prompt other Democrats to oppose the bill, hurting the bill’s chances of passing in the Senate. The Transportation Department has indicated that without a short-term fix, it would have to scale back reimbursements to states due to low funds in the highway account beginning Aug. 1.
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|By Eugene Mulero|
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