States Moving to Fill Private-Sector Retirement Plan Void
According to the Pension Rights Center, 17 states have initiated some action to do so.
In California, the California Secure Choice Retirement Savings Program, approved by Governor Jerry Brown in 2012, provides a voluntary, low-risk, automatic-enrollment retirement savings plan for workers who currently lack access to retirement savings plans through their jobs. The California Secure Choice Retirement Savings Investment Board (SCIB) has been established and has begun receiving advice and input about how to structure and administer the program.
In another example, Connecticut legislators introduced bills that would mandate a study about whether the state government should offer a retirement plan to employees without an employer-sponsored plan. Under the proposed legislation, an 11-member task force would study the availability of retirement plans and trends in retirement savings, as well as the projected needs of future retirees.
In Massachusetts, a plan allowing nonprofit entities, which represent about 14% of the state’s workforce, to access retirement savings plans managed by the state treasury is awaiting approval by the Internal Revenue Service (IRS).
According to the Pension Rights Center, proposals for a similar actions are pending in Illinois, Maryland, Minnesota, and Ohio. Colorado, Nebraska, Oregon, Vermont and Wisconsin have either established committees or have proposed establishing committees to study retirement options for private employees.
In Arizona, legislation to establish a trust program providing payroll deposit retirement savings arrangements to private employers that have five or more employees has been assigned to the House Appropriations and Rules Committees. Legislation for government-run plans for private-sector employees have also been introduced in Indiana, Maine, Washington and West Virginia.
More explanation about the proposals in each of the 17 states is on the Pension Rights Center’s website.