(Washington, DC) – U.S. Senator Jeanne Shaheen (D-NH), Chair of the U.S. Senate Committee on Small Business and Entrepreneurship (SBC), today convened a committee hearing on succession planning. The hearing examined the need for greater awareness in succession planning, the increasing number of small business owners close to retirement who do not have succession plans in place and the importance of succession planning to maintain vibrant local economies.
“Unfortunately, most small business owners are ill-prepared to exit their businesses. They’ve dedicated most of their time in business to building a successful company, and they don’t have the information or resources to think about next steps,” said Chair Shaheen. “This hearing is an opportunity to think about how we help those small business owners transition their businesses, how do we help them retain the legacy of those family businesses, how do we help them save for retirement and ensure that jobs remain in local communities.”
Supporting small business owners as they retire and pass on their livelihoods and legacies to the next generation is critical to our nation’s ongoing prosperity and success. About 10,000 Baby Boomers turn 65 every day, and over half of all private employer businesses are owned by individuals over the age of 55. Despite this, most small business owners do not have succession plans in place. More needs to be done to increase awareness of the importance of succession planning and provide greater access to the information and resources necessary to sustain the legacy of their businesses.
Full hearing remarks and testimony can be viewed here.
Witnesses for today’s hearing included:
- Mr. Scott Snider, President, Exit Planning Institute, Westlake, OH.
- Ms. Theresa Hildreth, Executive Director, Calhoun County Economic Development Corporation, Rockwell City, IA.
- Ms. Tabitha Croscut, Shareholder/Attorney, Devine-Millimet, Manchester, NH.
- Mr. Palmer Schoening, Chairman, Family Business Coalition, Washington, DC.
As a long-time member and current Chair of the Senate Committee on Small Business and Entrepreneurship, as well as a former small business owner, Chair Shaheen knows how important New Hampshire’s and America’s small businesses are to its communities. Shaheen recognizes the importance of their long-term survival and success—even beyond the first generation of their founders. Shaheen has made strides to ease the transition of businesses from generation to generation, especially concerning employee stock ownership plan (ESOP) transitions, which keeps businesses in their communities and creates resiliency by transitioning the company to the people that know it best—their employees. Shaheen was able to secure language in the FY 2022 National Defense Authorization Act (NDAA) creating a five-year pilot program incentivizing employee ownership in defense contracting by allowing ESOPs to receive follow-on contracts. In the FY 2024 NDAA signed into law in December, Shaheen extended and expanded the program. Shaheen was also a supporter of the Main Street Employee Ownership Act, which was signed into law. This bill removed barriers in SBA’s flagship lending program, the 7(a) loan program, for loans to ESOPs and directed the agency to engage in education and outreach on employee ownership. As a result of the legislation, lenders are actively making ESOP investments in New Hampshire.