WASHINGTON – The Senate may not take up a pension overhaul bill when it returns from a one-week recess, leaders said Friday, suggesting the legislation could be dead for the year.
A memo that congressional aides said came from the office of Majority Leader Bill Frist (search) said that when the Senate reconvenes on Oct. 17 it will focus on spending bills, Katrina-related items and the nomination of Harriet Miers (search) to the Supreme Court.
"Thanks to everyone for all of their hard work on this. We got very close, but were ultimately unable to get it over the finish line," the memo said.
With Social Security reform making little headway, the bill to shore up the financially shaky pension system was to have been the main retirement legislation this year.
The measure, the outcome of negotiations between the Finance and the Health, Education, Labor and Pensions committees, would take steps to prevent companies from underfunding their employee pension plans and to assure the financial solvency of the Pension Benefit Guaranty Corporation, the federal agency that insures plans and takes over bankrupt plans.
The sponsors had intended to pass the bill this week after a quick debate, but were thwarted when several senators delayed action in protest over a provision linking credit ratings with pension funding obligations.
Sen. Barbara Mikulski (search), D-Md., who joined with Sen. Mike DeWine (search), R-Ohio, in seeking to amend the credit rating provision, urged Frist to bring the bill to the floor. "We owe it to American workers and American companies to get this right," Mikulski said in a statement.
She argued that the current bill, which requires companies with poor credit ratings to increase contributions to their pension funds, could have the "unintended consequence of encouraging businesses to drop their pension plans."
Senate Finance Committee Chairman Charles Grassley, R-Iowa, an architect of the bill, did not comment directly on its possible demise but he did have harsh words for the DeWine-Mikulski amendment: "Corporate pension plans are in a $500 billion deficit, and the DeWine-Mikulski amendment would dig that hole deeper and put more workers' pensions at risk."
"I don't want to pass a bill that masks the real cost of benefits," said Sen. Max Baucus of Montana, the Finance Committee's top Democrat. "That leads to broken promises."