The Washington outlook for 2019 depends on whether you are an optimist or a pessimist.
As the year starts with a new balance of power in Congress split between Republicans in the Senate and Democrats in the House, it will take bipartisanship to get anything passed. Some Washington observers see that as a good omen, at least when it comes to ideas for improving retirement security.
"I am pretty bullish about retirement security being high on the agenda next year. It's important in terms of solving a public policy challenge that's affecting millions of Americans," said Shai Akabas, director of economic policy at the Bipartisan Policy Center in Washington.
"There's real interest in moving forward," agreed Geoff Manville, principal, government relations, at Mercer LLC in Washington. "It would be a complementary effort on the House and Senate side, not a competition."
A likely vehicle is some combination of the Senate's proposed Retirement Enhancement and Savings Act, and the House-passed Family Savings Act. Both proposals would make it easier for smaller employers to join open multiple employer plans, ease non-discrimination rules for frozen defined benefit plans and add a safe harbor for selecting lifetime income providers in defined contribution plans.
Another bipartisan contender is a proposal by Sens. Ben Cardin, D-Md., and Rob Portman, R-Ohio, that would let plan sponsors contribute to 401(k) plans while employees pay down student debt. It also calls for giving sponsors of frozen defined benefit plans relief from strict non-discrimination testing, a bipartisan fix floated in many bills.
The 116th Congress could also work on other ways to improve retirement security for millennials, including more health savings account incentives and making accounts more portable.
The biggest game changer will be when Rep. Richard Neal, D-Mass., takes over as chairman of the House Ways and Means Committee, which has jurisdiction over tax-related retirement measures. Mr. Neal is a longtime proponent of increasing retirement savings and sponsor of several proposals, including one that would require many employers to offer retirement plans.
Robert Melia, executive director of the Iselin, N.J.-based Institutional Retirement Income Council, expects some combination of those ideas to gain traction in 2019, with an emphasis on guaranteed lifetime income options. "There's a whole conglomeration of trends pointing toward that," he said.
Sen. Charles Grassley, R-Iowa, is on deck to be the next chairman of the Senate Finance Committee, which also oversees tax-related retirement issues. Mr. Grassley's previous stints as chairman, including presiding over passage of the Pension Protection Act of 2006, has retirement advocates encouraged.
"I think he will be a terrific bipartisan broker of all the ideas that are going to be floated," said Mercer's Mr. Manville.