An amendment to help Delphi salaried retirees who saw their pensions cut during the 2008-2009 auto bailout passed a key hurdle Thursday after Ohio’s two senators successfully tucked the measure into a tax bill that now moves to the Senate floor.
Sens. Sherrod Brown, D-Ohio and Rob Portman, R-Ohio, successfully fought to extend the Health Coverage Tax Credit – a tax credit for retirees who lost their health care coverage when their companies entered into bankruptcy or moved overseas. Both senators are members of the Senate Finance committee, which sent the bill and amendment to the full Senate.
Brown said the amendment will help the more than 20,000 Delphi salaried retirees who lost between 30 and 70 percent of their pensions in the aftermath of the federal government’s 2009 bailout of GM.
Of that 20,000, about 5,000 live in Ohio, Brown said, including 2,000 in the Dayton area, 1,500 near Youngstown and 1,500 split between Columbus and Sandusky.
“This amendment means that hardworking families who lost their health care coverage, pension, and other benefits will receive the assistance they need to help pay their health care bills,” Brown said.
The tax credit, which expired Jan. 1, was used heavily by the Delphi salaried retirees who saw their pensions cut in the aftermath of the federal government’s $50 billion bailout of GM. Delphi, a key parts supplier spun off by GM as an independent company in 1999, was pulled into the GM restructuring, and as part of its restructuring, GM agreed to restore, or “top up,” the pensions of Delphi’s union retirees.
The tax credit makes health insurance more affordable by providing a 72.5 percent tax credit to eligible workers, allowing these workers to pay only a portion of their qualified health insurance. The credit is often used for retirees who are too young for Medicare.
The amendment passed Thursday would extend the tax credit at its current rate of 72.5 percent for an additional two years.
“Thousands of Delphi salaried retirees and their families depend on the Health Coverage Tax Credit,” said Portman, who said the government “should make it a top priority to help these hard-working families regain the financial security that our government took from them.”
The tax bill also included a Portman measure to make long-term unemployed Americans eligible for the Work Opportunity Tax Credit, which gives employers a tax credit of between $1,200 and $9,600 per employee for hiring and retaining veterans, ex-felons, the disabled and summer youth employees. And it included the extension of a tax deduction for energy efficient commercial and multifamily buildings.
Brown authored two tax credits that made it into the bill. One is aimed at spurring businesses to create manufacturing jobs in communities that have seen significant manufacturing job loss, and another one is designed to relieve homeowners of the requirement to pay taxes on mortgage debt forgiveness resulting from mortgage modifications, or short sales.