Bill to Create State DC Plan Passes CT Senate

A Hartford Courant news story said the bill would allow the state comptroller to create the program that would also apply to self-employed individuals and tax-exempt nonprofit organizations, which could get payroll deduction IRAs and other offerings in a voluntary program with no mandatory employer contribution. According to the newspaper, while Democrats say there would be no cost to the state, opponents argue that a similar idea in Maryland would have had start-up costs of $625,000 and an annual state subsidy of $400,000 over the next four years.

The measure, backed by Senate Democrats including Senate President Pro Tem Donald Williams, passed the chamber on a party line vote of 22 to 11. The news report said Williams and the Connecticut chapter of the AARP, were jubilant at the vote.

“By pooling together small-business employees from across Connecticut, we will help people save for retirement and instantly give our small businesses a real advantage over out-of-state competitors,” Williams said in the news account (See CT 401(k) Plan Backers Kick off PR Push ).

Despite the Senate vote, however, the Courant said the bill faces a decidedly uncertain future with an “army” of opponents working against it in the state House including the Connecticut Business and Industry Association (CBIA), the Connecticut Bankers Association, the Insurance Association of Connecticut, and others.

“It’s unnecessary at this point,” said Jesmin Basanti, an attorney for CBIA, told the newspaper. “The role of government is to steer, not row” the boat.