National Worker Cooperative Development and Support Act
- Bill Number
- H.R. 5958
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Commerce
- Status
- Introduced
- Latest Action
- 2025-11-07: Referred to the Committee on Small Business, and in addition to the Committees on Financial Services, and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- Last Updated
- 2025-11-19T12:28:08Z
AI-Generated Summary
Purpose
The National Worker Cooperative Development and Support Act aims to promote the growth and sustainability of worker-owned cooperative businesses—entities where employees majority own and control the company—by directing federal agencies to provide support, remove barriers, and coordinate efforts. This legislation seeks to use these cooperatives as a tool for national economic development, focusing on job creation, equitable ownership, and community benefits.
Key Provisions
- Agency Responsibilities (Section 2): Heads of specified federal agencies must:
- Launch programs to support and expand worker-owned cooperatives.
- Review and revise regulations to eliminate obstacles to their formation and growth.
- Improve access to funding through innovative options and existing programs.
- Coordinate with a new federal council, contribute to a national strategy, and conduct research on economic impacts, barriers, and program effectiveness.
- Offer education, outreach, technical assistance for businesses transitioning to cooperatives, and training for federal employees to integrate cooperatives into government systems.
- Education and Outreach (Section 3): The Small Business Administration (SBA) must create accessible educational materials on worker-owned cooperatives (available online, in print, and in multiple languages) and run outreach programs in communities where English is not the primary language.
- Establishment of the U.S. Council on Worker Cooperatives (Section 4):
- Created within 180 days by the Secretary of Labor, chaired by the Secretary or a designee.
- Includes representatives from SBA, IRS, Treasury, Commerce, Agriculture, National Economic Council, Domestic Policy Council, and others as needed.
- Duties include developing a federal strategy for economic development via cooperatives, identifying and proposing solutions to regulatory barriers, coordinating data/research/education, and avoiding program overlaps.
- Requires annual reports to Congress on progress, recommendations, successes, and challenges; the council sunsets (ends) after 10 years.
- Pilot Lending Program (Section 5): Expands the SBA's intermediary lending pilot to include cooperatives as eligible intermediaries.
- Community Development Financial Institutions (CDFI) Support (Section 6): Requires CDFIs—non-profit lenders focused on underserved communities—to provide education and services for establishing and managing worker-owned cooperatives.
Significant Changes to Existing Law
- Small Business Act Amendment (Section 5): Redefines "eligible intermediary" to explicitly include cooperatives; extends the pilot program's authorization from 2011–2013 to 2026–2036; increases annual funding from $20 million to $60 million.
- Riegle Community Development and Regulatory Improvement Act Amendment (Section 6): Adds worker-owned cooperatives to the list of priorities for CDFI education and services, alongside affordable housing and community facilities.
These changes build on existing small business and community development frameworks by prioritizing cooperatives, which were previously underserved.
Potential Impacts
- On Government Agencies: Increases workload for agencies like SBA, Labor, and Treasury through new programs, research, and coordination; fosters interagency collaboration via the council, potentially streamlining federal support for economic initiatives.
- On Citizens: Workers and entrepreneurs gain easier access to funding, education, and technical help, enabling more transitions to employee-owned models; benefits low-income or non-English-speaking communities through targeted outreach, potentially boosting job stability and wealth-building.
- On International Relations: No direct impacts mentioned; the focus is domestic economic development.
Main Stakeholders Affected
- Federal Agencies: SBA, Department of Labor, Treasury, Commerce, Agriculture, and IRS—required to implement new duties and revise policies.
- Worker-Owned Cooperatives and Businesses: Existing and aspiring cooperatives benefit from funding, barrier removal, and support for growth and transitions.
- Communities and Workers: Especially in underserved or multilingual areas, through education and outreach; employees gain ownership opportunities.
- Non-Profits and Academic Institutions: Involved in best practices, research, and technical assistance.
- Congress: Receives annual reports for oversight.
Notable Legal, Constitutional, or Political Implications
- Legal: Mandates regulatory reviews could lead to broader changes in federal rules affecting business formation, without overriding state laws on cooperatives. Definitions align with existing tax code (e.g., Internal Revenue Code Section 1042 for eligible cooperatives), ensuring compatibility.
- Constitutional: No apparent conflicts; promotes economic policy under Congress's commerce clause authority, emphasizing voluntary support rather than mandates on private entities.
- Political: Encourages a shift toward democratic business models, potentially influencing debates on economic inequality and worker rights; the 10-year sunset provides a trial period, allowing evaluation without permanent commitment. Annual reporting enhances transparency and accountability to lawmakers.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Recent Actions
- 2025-11-07: Referred to the Committee on Small Business, and in addition to the Committees on Financial Services, and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-11-07: Referred to the Committee on Small Business, and in addition to the Committees on Financial Services, and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-11-07: Referred to the Committee on Small Business, and in addition to the Committees on Financial Services, and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-11-07: Introduced in House
- 2025-11-07: Introduced in House
Bill Versions
- National Worker Cooperative Development and Support Act — issued 2025-11-07 — PDF (9 pages)