a) The goal of the Affordable Retirement Savings Act is to ensure that all [STATE] residents can use an individual retirement savings account.

b) Interstate Partnerships For Retirement Savings

i) Within ninety days of enactment of this Act, the [STATE TREASURER] shall submit a preliminary report to the Governor and the majority and minority leaders of both chambers of the Legislature that assesses the feasibility of entering an existing interstate partnership for retirement savings or establishing its own interstate partnership for the purpose of enhancing returns for workers, reducing costs, and lowering investment risks. 

ii) Should the [STATE TREASURER] determine interstate partnership is not immediately feasible, it shall reevaluate such feasibility annually and submit a report to the Governor and the majority and minority leaders of both chambers of the Legislature.

iii) The [STATE TREASURER] may enter into an interstate partnership with other state-run retirement programs, in consultation with other departments as necessary, to enhance investment returns for workers, reduce costs, and lower investment risks.

c) Establishment of the [STATE] Secure Savings Plan and Fund

i) A retirement savings plan in the form of an automatic enrollment payroll deduction Individual Retirement Account (IRA), known as the [STATE] Secure Savings Plan (“Plan”), is established. 

ii) The [State] Secure Savings Plan Fund (“Fund”) is established as a trust outside of the state treasury and shall include the IRAs of enrollees in the Plan. The Fund consists of money received from Plan enrollees and participating employers pursuant to automatic payroll deductions.

iii) Employer requirements

1) Covered employers shall participate and non-covered employers may participate in the Plan by: 

(a) Registering their business with the Plan. 

(b) Enrolling all employees who have not opted out of the Plan and providing a payroll deduction for retirement savings for such employees and depositing the money deducted into the Plan.

2) For purposes of this section:

(a) “Covered employer” (“employer”) means a person or entity engaged in a business, industry, profession, trade, or other enterprise in [STATE] for at least two years, whether for profit or not for profit, that employs ten or more employees and does not offer a qualified retirement plan benefit. 

(b) “Employee” means any individual who is employed by an employer for at least sixty days and who earns wages subject to state income tax.

iv) Enrollment and enrollee contributions

1) Any individual in [STATE] not employed by a covered employer may voluntarily enroll in the Plan, including gig, alternative, or independent workers, and the self-employed. 

2) Enrollees may select a contribution level expressed as a percentage of wages or a dollar amount up to the maximum yearly contribution set by the Internal Revenue Code. If an enrollee does not select a contribution amount, the default shall be set by the Board but shall not exceed five percent of wages. Enrollees may change their contribution level or opt out of the program at any time, subject to Board regulations. Enrollees will have investment options to choose from as determined by the Board.  Enrollees will have a choice between traditional or Roth IRA options. The Board shall determine the default option absent an enrollee election.

3) For purposes of this section:

(a) “Enrollee” means any employee of a covered or non-covered employer or self-employed or other independent worker who is enrolled in the Plan. 

(b) Individual retirement account (“IRA”) means a Roth or traditional individual retirement account under §408 of the Internal Revenue Code.

d) Creation of Secure Savings Plan Board of Trustees

i) The [STATE] Secure Savings Plan Board of Trustees (“Board”) is established in the [OFFICE OF THE STATE TREASURER] with a fiduciary duty to the plan’s enrollees and beneficiaries. 

ii) The Board shall consist of nine trustees to include the State [TREASURER], the director of the Governor’s [Office of Budget], five additional trustees who are appointed by the Governor and confirmed by the Senate, one trustee appointed by the Senate, and one trustee appointed by the House. The Governor’s additional trustees shall include two public representatives with expertise in investment or retirement savings plan administration, including the day-to-day operations of plans, maintaining individual accounts, and keeping track of transactions and assets at the individual participant account level; one representative of participating employers (or anticipated employers at inception); one representative of enrollees (or anticipated enrollees at inception); and one retired [STATE] resident.

iii) Appointments shall be for four years, except for the two Legislative appointments which shall be two year terms. A Trustee shall be eligible for removal with a majority vote of the Senate and concurrence from the Governor. A vacancy in the term of an appointed Board trustee shall be filled for the balance of the unexpired term in the same manner as the original appointment.

iv) Trustees of the Board serve without compensation but may be reimbursed for reasonable necessary travel expenses incurred in connection with their Board duties from money in the Fund. Trustees shall be subject to [STATE] conflict of interest and ethics rules and shall not engage in any activities that might result in a conflict of interest with their duties as members of the Board.

v) The Board shall have the following powers and duties:

1) To design, establish, and operate the Plan in a manner that is in accordance with best practices for retirement savings vehicles and implements administrative processes to ensure program sustainability; maximizes participation, savings, and sound investment practices; maximizes simplicity, including ease of administration and integration with payroll systems for participating employers and enrollees; and ensures the portability of benefits and considers the type of IRA offered as a way of increasing the portability of benefits.

2) To make and enter into contracts and hire staff as necessary to administer the Plan and manage participation in or creation of an interstate partnership in collaboration with the [STATE TREASURER]. Engage an investment manager to invest Plan assets and establish investment options offering returns without incurring state liabilities. The board may also pursue options for bank loans or a line of credit to cover the start-up costs of the Plan.

3) To design and establish the process for enrollment, including the process by which an employee can opt not to participate in the Plan, select a contribution level, select an investment option, and terminate participation in the plan; and establish the process by which an individual not employed by a covered employer may voluntarily enroll in and make contributions to the Plan.

4) To develop an employer and employee information packet, including background information, enrollment procedures, and contribution options.

5) To determine a penalty structure for employers who fail, without reasonable cause, to enroll employees in the Plan and what constitutes a qualified employer-sponsored retirement plan that would exempt employers from participation in the [STATE] Secure Savings Plan.

6) To ensure that the Plan is fully implemented and that Plan enrollment begins within twenty-four months of the date of enactment. 

7) Report annually to the Governor and the majority and minority leadership of both chambers on program implementation.

8) To assess the feasibility of multi-state or regional agreements to administer the program through shared administrative resources and enter into those agreements if determined beneficial.

9) To undertake the above duties and responsibilities through rule-making and/or agreements or directions to other agencies.

10) To direct the [STATE TREASURER] to hire staff to support the oversight and administration of the program.

e) Administrative costs

i) For the first five years of operation, the Board may use up to one percent of the money in the Fund for administrative costs, including startup expenses. From the sixth year onward, the Board may use up to three-quarters of one percent of the money in the Fund for administrative purposes.

f) Enforcement

i) Covered employers failing to enroll employees in the Plan, without reasonable cause, shall be subject to penalties. 

ii) An initial offense shall result in a warning and a sixty day compliance period. Penalties shall increase over time based on the number and nature of violations. No employer shall be fined more than $250 per employee per year for failure to enroll employees.

g) [STATE] has a compelling interest in protecting privacy and the protection of personal information. In administering this Act, state and local agencies, businesses, and any other entity, shall only request data necessary to administer this Act and retain it only as required to administer and achieve the purposes of the Act. Any personal information or data collected or obtained in the course of administering this Act shall be shared only in a manner that has been deidentified and aggregated to the greatest extent allowable while still in compliance with federal eligibility requirements and every allowable effort shall be made to revoke access to such data should programs be eliminated or should there be an ineligibility determination. Personal information or data collected or obtained in the course of administering this Act shall not be otherwise disclosed without the informed consent of the individual, a warrant signed by a [STATE] judge or federal judge, lawful court order administered within [STATE] or a lawful federal court order, or subpoena administered within [STATE] or federal subpoena, or unless otherwise required by federal or state statute. Personal information or data may be considered deidentified if it cannot reasonably be used to infer information about, or otherwise be linked to, a particular individual or household.

h) The provisions of this Act are severable. If any provision of this Act or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.