Speeches & Testimony

Mr. Speaker, I rise today to introduce legislation to ensure that the U.S. Small Business Administration (SBA) fully supports our small businesses establish and maintain employee stock ownership plans (ESOPs).

ESOPs offer a powerful way to ensure employees become stakeholders and help run the business they've built. This wealth-generating and retirement plan approach creates a more engaged and productive workforce by aligning employee interests with a company's success. This model promotes a stronger sense of ownership and community and keeps investment and wealth in local economies, benefiting workers and their families.

In Hawaii, we've seen firsthand the benefits of ESOPs. Hawaii is home to the second-oldest ESOP chapter in the Nation, underscoring the success and importance of employee-owned businesses in our state. From that humble beginning, the Hawaii Chapter of the ESOP Association now represents over 45 ESOP companies and professional service providers in the state, which is a significant number considering our state's size. These businesses, with the help of ESOPs, have continued to thrive, contributing to the local economy in ways that benefit families and the broader community.

Despite this strong record of ESOPs in Hawaii and throughout the United States, many small businesses face challenges in navigating the complex process of establishing and maintaining an ESOP. They often lack expertise in tax considerations, regulatory compliance, stock valuation, and securing the necessary funding.

There is also a growing concern with the "Silver Tsunami"—the impending wave of baby boomer business owners looking for ways to transfer ownership. As these owners retire, many are considering ESOPs, but the complexity of setting them up may discourage some from pursuing this option.

To help overcome these challenges, my ESOP Funding for SBA Position Act of 2025 will create a position within the SBA to guide small businesses through the process of setting up ESOPs, providing essential support on tax considerations, compliance, stock valuation and securing funding. This new SBA position will provide businesses with the resources they need to navigate the complexities of employee ownership.

This bipartisan bill, which I have introduced with my colleague Congressman Robert Bresnahan, will help empower small businesses nationwide. I urge my colleagues to support this important initiative that will make employee ownership more accessible, foster stronger communities and keep business wealth where it belongs—locally.

Mahalo.