If a pair of Congressional Democrats have their way, active managers may gain access to the largest defined contribution plan in the country. But don't bet your year-end bonus on it.

On December 11, Representative Gregory Meeks (D-New York) introduced H.R. 5877, with Representative Maxine Waters (D-California) cosponsoring. Emile Hallez of Ignites reported on the proposed legislation, which would require the Federal Thrift Savings Plan to include actively managed funds in its lineup. The bill has been referred to both the House Oversight and Government Reform Committee and the House Education and the Workforce Committee.

And that's not all. The trade publication reports that the bill would also require 401(k) plan sponsor to consider using funds from asset managers backed by minorities, veterans or women. (The bill would amend the Employee Retirement Income Security Act (ERISA) accordingly.)

Currently, the TSP's nearly $400 billion in assets are in passive options powered mainly by BlackRock [profile]. Ignites notes that a 2009 law already allows the TSP board to include active funds, but they haven't done so; the new bill would require them to do so.

It's unclear what motivated the Queens Congressman, whose district is not known as an asset management stronghold, to introduce the legislation. The trade publication notes that Meeks has received donations from a number of asset managers' parents, including Credit Suisse, Goldman Sachs (his second-biggest donor last time around), MassMutual, New York Life and UBS.

Don't go counting your hypothetical TSP inflows just yet, though. Meeks is a Democrat, after all, in a House controlled by Republicans (and next to a Senate soon-to-be controlled by Republicans, too.) Govtrack.us estimates that Meeks' bill has a two percent chance of getting out of committee and a one percent chance of actually becoming law. 

Edited by: Neil Anderson, Managing Editor


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