SECURE Act passage hopes fade as Congress hesitates

While broad bipartisan support remains strong on Capitol Hill for the SECURE Act with resolute encouragement from the retirement industry, the chances of passing a sweeping retirement security package this Congress are dwindling.

Industry proponents are hoping the Setting Every Community up for Retirement Enhancement Act of 2019, referred to as the SECURE Act, will pass before the holiday recess at the end of December because Congress rarely passes legislation in a presidential election year that does more than keep the government funded and other must-do responsibilities.

The latest attempt to get the measure passed via unanimous consent failed Nov. 7 in the Senate, with lawmakers unable to reach an agreement on potentially adding amendments to the bill.

And with a presidential impeachment trial expected to soon dominate Washington, senators will likely be singularly concentrated on the high-stakes event.

"Even though people want to walk and chew gum at the same time, there's only so many hours they can devote to other things if they are completely focused on an impeachment trial," said Melissa Kahn, Washington-based managing director of retirement policy for State Street Global Advisors' defined contribution team.

The impeachment process, which ramped up Oct. 31 when the House voted to formalize the inquiry, will have an effect on just about every legislative effort, said Kent Mason, a partner with law firm Davis & Harman LLP in Washington.

"There will be a great effort on the Hill to say, 'We can do this and we can still legislate at the same time,'" Mr. Mason said. "I know they're conscious of that, but the impeachment process takes up a lot of time, and it obviously does not improve bipartisanship, so I think it will have an effect on SECURE like it has an effect on many, many things in terms of both time available and political will to work together."

Christopher Spence, senior director of federal government relations for TIAA-CREF in Washington, is still optimistic about the chances of the measure passing but added that a potential Senate trial is a concern.

"The reality is that impeachment could only really hinder things moving forward in the legislative process, but I think the legislative process still has to continue and that means that there's still going to be opportunities for things like the SECURE Act to get done before the end of this year," he said.

Though an impeachment trial could upend the legislative calendar, there are three potential avenues forward for the SECURE Act, proponents said: using floor time to debate and amend the bill; unanimous consent, which would require no objections from senators; or getting it attached to a larger bill.

The one avenue many in the retirement industry are eyeing is attachment to a piece of must-pass legislation, like a spending bill. Congress has a Nov. 21 deadline to pass the next spending bill and avert a government shutdown, though now it's not clear if the SECURE Act or other smaller bills will be attached.

Congress in September passed a "clean" continuing resolution that prohibited attachment of other legislation to the spending bill when it was considered then. It could pass a similar resolution in November and push a spending bill vote back as far as the end of the fiscal year in September, sources speculated.

"Whenever the bigger budget deal comes together I think we have a good chance of SECURE happening, but we've seen these must-pass legislation vehicles come and go over a long period of time and something has happened each time to preclude (SECURE) from being attached," Mr. Mason said.

Paul Richman, chief government and political affairs officer for the Insured Retirement Institute in Washington, said if a continuing resolution passes that funds the government into early next year or beyond, "there's a good chance of seeing some non-controversial provisions like the SECURE Act attached."

But the retirement industry isn't alone in pushing senators to attach their bills to must-pass legislation, noted Paul Beddoe, the National Association of Government Defined Contribution Administrators' government affairs director based in Washington.

"As the calendar rolls along, every industry has priorities that they want to see jump on that last moving train out of the station and it just becomes a bigger and bigger challenge for things (to get attached) even with broad bipartisan support," he said.

Mr. Spence said getting the SECURE Act attached to a larger bill is the most likely way it could be passed. "But I remain encouraged that members continue to think about getting this done on its own rather than waiting for a larger bill to come about," he said.

In recent weeks, sources said that Senate Majority Leader Mitch McConnell, R-Ky., has made attempts to get the bill on the unanimous consent calendar but has been unsuccessful because at least one senator dissented behind the scenes, sources said. The latest attempt concluded on the Senate floor and failed Nov. 7.

Sen. Pat Toomey, R-Pa., proposed that the Senate consider the bill via unanimous consent along with five amendments apiece from Republicans and Democrats.

Mr. Toomey was one of three Republican senators who placed a hold on the bill in May, preventing its passage via unanimous consent. If no senator were to object to the unanimous consent offering, the bill would have simply passed as is. Sens. Ted Cruz of Texas and Mike Lee of Utah also placed holds on the bill.

The amendments the Republicans put forth included fixing a drafting error in the Tax Cuts and Jobs Act to ensure that the full cost of store, office or building improvements can be immediately expensed, as was originally intended (offered by Mr. Toomey); expanding 529 college savings plans to cover expenses of K-12 students and educational costs for home-schooled students (offered by Mr. Cruz); and removing a SECURE Act provision that would provide pension funding relief for community newspapers (offered by Mr. Lee).

"I think we should have a debate, I think we should have a series of votes," Mr. Toomey said on the Senate floor Nov. 7. "I think we could bang this out in a day, at the end of which we would pass the SECURE Act, preferably after considering amendments from both sides."

Sen. Patty Murray, D-Wash., objected, saying the amendments offered are "not in the interest of working families and will kill any chance this bill has of becoming law." Democrats did not put forth any amendments of their own.

With no agreement on moving the measure via unanimous consent, a sense of frustration was evident on the Senate floor.

"For the past five-and-a-half months some of us have been trying to get this legislation done, and there have been concerns on both sides of the aisle," said Sen. Rob Portman, R-Ohio.

"But we're at a point now where we know... that we continue to have this stalemate and after five-and-a-half months I think it's time for us to move forward with these reforms."