Contact Derrick White (202) 224-9851
April 4, 2001
HATCH ANNOUNCES INTRODUCTION OF RAILROAD RETIREMENT BILL
WASHINGTON–Sen. Orrin G. Hatch (R-Utah) today introduced a bill to modernize and improve certain benefits under the Railroad Retirement system, the government-administered pension plan for railroad workers.
"Railroad Retirement is unique in that it is the only private industry pension plan established in statute and administered by the federal government," Hatch said. "The railroads and rail workers have joined together to develop these improvements, which in turn must now be approved by Congress in order to become effective."
The bill, entitled the Railroad Retirement and Survivors” Improvement Act of 2001, would allow assets in the railroad pension to be – for the first time in its more than 60-year history – invested like other industry pensions in a mix of public and private securities. In addition, increased investment returns would allow for benefit increases for retirees as well as payroll tax reductions for the railroad industry.
"There are more than 8,000 rail employees and retirement program beneficiaries in Utah, and more than 900,000 nationwide," said Hatch. "The bill offers increased benefits for widows and cuts in half the time needed to vest in the program, from 10 to five years. At the same time, the bill reduces the very high pensions costs shared by both railroad employees and employers, which constitute a major disincentive for employers to hire new employees under Railroad Retirement."
Hatch, a senior member of the Senate Finance Committee, is joined by fellow Finance Committee member Max Baucus (D-MT) and a bipartisan group of other senators as cosponsors. Hatch anticipates the bill will receive strong bipartisan support in both the Senate and the House. Last year, the House passed an almost identical bill by an overwhelming bipartisan margin of 391 to 25. The Senate Finance Committee approved the bill last year but the Senate did not act on final passage before the end of the Congress.
"This is an important bill for both railroad retirement participants and for the future of the railroad industry," said Hatch. "I expect, based on the strong bipartisan support we have, to see this bill signed into law this year.