Partisan vote blocks bill to encourage profit-sharing through ESOPs
In a 5-5 vote along party lines, the Legislative Council on Thursday rejected a request by state Sen. Shenna Bellows, D-Manchester, to submit legislation that would create a new income tax credit for businesses that offer profit-sharing to their workers through Employee Stock Ownership Plans.
The Bangor Daily News reported that only a fraction of the 272 bills submitted by lawmakers for the second year of the 128th Legislature made it through the council, adding that there were relatively few bipartisan votes. The majority of the bills that failed did so in 5-5 votes, with all the Republicans on one side and the Democrats on the other.
Bellows and the other lawmakers whose proposed bills were rejected have the option of appealing the rejections at the Legislative Council’s Nov. 30 meeting.
“When a company is growing and prospering, the workers driving the success should reap some reward from that growth,” Bellows, the lead Senate Democrat on the Legislature’s Labor, Commerce, Research and Economic Development Committee, said in a news release prior to Thursday’s vote. “But too often, it’s only the CEOs and high-level management that prosper off growing profits. This legislation would give companies an incentive to share the wealth with their employees.”
ESOPs provide workers with ownership interest in the company that employs them. The businesses provides a predetermined number of shares to each eligible employee. Employee shares are held in trust until the worker retires, at which point they can sell their shares on the open market or back to the company.
Mainebiz has reported on a number of Maine businesses that have, in recent years, turned to ESOPs to give employs a greater sense of pride and investment in their jobs. Among them: Kennebec Technologies; Landry / French Consruction Co.; Wright-Ryan Construction Inc.; Warren Construction Group; The Via Agency; and Ethos, a branding and digital marketing agency in Westbrook.
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