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PSCA Executive Reports

May 31, 2018

PBGC Nomination

On May 14, President Trump announced his intent to nominate Gordon Hartogensis to be Director of the Pension Benefit Guaranty Corporation (“PBGC”) for a five-year term. If confirmed, Mr. Hartogensis would replace Tom Reeder, who has served as Director since October 2015. Although there have been rumors of a possible nomination for over a year, the announcement caught many by surprise, including Republicans. The timing was particularly odd given that Mr. Reeder was scheduled to testify before the Joint Select Committee on Multiemployer Plans later in the week. 

Mr. Hartogensis is currently a trustee for his family’s trust and manages the trust’s assets. His prior experience is largely related to technology and start-ups. As reported by the Washington Post and other outlets, Mr. Hartogensis is also brother-in-law to Senate Majority Leader Mitch McConnell (R-KY) as he is married to the sister of Elaine Chao, current Transportation Secretary and former Secretary of Labor. 

After the announcement, Senator Patty Murray (D-WA), Ranking Member of the Senate Health, Education, Labor, and Pensions Committee, and Representative Bobby Scott (R-VA), Ranking Member of the House Education and Workforce Committee, both publicly expressed concern that the Administration would propose replacing Mr. Reeder at this time with someone who lacks any experience with pension plans. Then, on May 24, Senator Murray and Senate Finance Committee Ranking Member Ron Wyden (D-OR) sent a letter to President Trump demanding to know when and why the decision was made to replace Tom Reeder as Director of the PBGC. 

Senate Majority Leader McConnell reportedly wants to move Mr. Hartogensis’ nomination as quickly as possible, and we understand that Secretary Chao has been making personal calls to Republican Senators on his behalf. That said, it will likely be many months before the Senate takes up Mr. Hartogensis’ nomination. The Administration will first have to provide the Senate with the necessary paperwork, and the process may be even slower for Mr. Hartogensis because of his financial holdings. Moreover, the nomination falls under the jurisdiction of both the HELP and Finance Committees, which could take additional time to move the nomination. At this time, it appears that September is likely the earliest possible date for floor consideration.

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