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Employee Ownership Blog

Timothy Garbinsky

Apis & Heritage Releases First Annual Impact Report

Apis & Heritage Capital Partners (A&H), a middle-market mezzanine debt firm with the mission of closing the racial wealth gap using employee ownership, has released its first annual impact report, highlighting some of the successes of its initial Legacy Fund I. A&H saw its first fund oversubscribed by investors and foundations, exceeding its initial $50 million cap by over $8 million. This fund will help A&H further its mission of converting businesses that primarily employ workers of color to employee ownership.

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Scott Rodrick

Ex-House Members Propose ESOPs as Solution to Retirement Crisis

Ron Kind (D-Wis.) and Erik Paulsen (R-Minn.), both former U.S. representatives who served on the House Ways and Means Committee, authored an editorial in The Hill, Employee ownership could be the key to solving our retirement security crisis, pointing out that "At a time when retirement seems out of reach for many Americans, there is clear and convincing evidence that people who work for private businesses with Employee Stock Ownership Plans . . . have far greater retirement security than the average American." Citing recent research from Ernst & Young on S corporation ESOP participants and NCEO research on ESOPs and retirement security, Kind and Paulsen note how ESOPs help workers; at the same time, they cite a report from Matrix Global Advisors and an NCEO analysis of ESOP litigation to criticize regulatory uncertainty around ESOPs that makes it more difficult to establish an ESOP. They express hope that the project at the U.S. Department of Labor (DOL) to establish clearer guidance for ESOPs will "finally put to bed the regulatory uncertainty that has cast a shadow over employee ownership for decades," stating that the ESOP community is ready to work with the DOL and the administration "to usher in a new era of employee ownership."

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Timothy Garbinsky

Clarification on the Recent IRS Press Release

Our friends at the Employee-Owned S Corporations of America (or ESCA) have reported that they've had constructive dialogue with the IRS regarding their recent press release on ESOPs. Our understanding is that the press release was intended as just that-- a press release and not an official notice of any sort. This press release was meant to alert interested parties generally and the employee ownership community more specifically that they've identified what they've termed a "questionable transaction."

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Emalie Martzall

PaCEO Launches Multi-Channel Outreach Campaign

On September 5, the Pennsylvania Center for Employee Ownership (PaCEO), in conjunction with the Pittsburgh City Council and the Heinz Endowments, launched the U.S.’s first citywide task force on employee ownership. The Pittsburgh Citywide Task Force on Employee Ownership is now in the process of reaching out to roughly 30,000 businesses in the Pittsburgh region with the message of employee ownership through a variety of channels. The channels include email, direct mail, social media, radio ads, podcast ads, television, and a podcast episode on CityCast Pittsburgh on September 20. The last phase of the task force is a series of in-person informational sessions co-hosted by the Pennsylvania Center at various community groups around the city. These informational sessions will begin next month and will continue through the remainder of 2023 and into 2024. 

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Corey Rosen

Missouri Makes 50% Capital Gains Exclusion on ESOP Sales Permanent

On September 6, Missouri Governor Mike Parsons signed S.B. 20 (also see the PDF of the bill text), one of whose provisions makes permanent a law enacted in 2016 that provides a 50% reduction in state capital gains taxes for business owners selling to an ESOP as long as the ESOP owns at least 30% of the company after the sale. The law was originally set to sunset in 2023, but this new law removes the sunset provision, making it permanent. Iowa passed a very similar law in 2012

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Grace Dawson

The NCEO Holiday Gift Guide is Back—Add Your Products and Let Us Support You This Season

Although we may not feel it in the air , the holiday season is quickly approaching. Before the rush of preparation overcomes us, I’d like to take a moment to look back at the year so far and thank our members and supporters for making it a great one. There were 1,973 of you at our Annual Conference in April, and we’re approaching the 330 mark for our Fall Forum registration. Helping employee ownership thrive is our mission and expertise, and this year, we’re improving our holiday benefit offerings in the form of our Holiday Gift Guide.

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Madelyn Hammack

Reflections on the 2023 National Employee-Owner Summit

Last week, I had the opportunity to attend the first day of the 2023 National Employee-Owner Summit in Downers Grove, Illinois. The two-day event, which is a collaboration between the NCEO and the OEOC (Ohio Employee Ownership Center), is moderated by the OEOC and offers non-managerial employee-owners the opportunity to learn from and interact with their peers from other ESOP companies through informational sessions, structured exercises, small group discussions, and even games.

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