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2021 SPECIAL SESSION I

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HB 2174 State-Facilitated IRA Savings Program; established, membership, report.

Introduced by: Luke E. Torian | all patrons    ...    notes | add to my profiles

SUMMARY AS PASSED: (all summaries)

State-facilitated IRA savings program; establishment. Directs the governing board of the Virginia College Savings Plan (the Board) to establish a state-facilitated individual retirement account (IRA) savings program (the Program). The Board shall administer the Program and develop requirements, procedures, and guidelines for the Program, including default contribution rates, procedures for enrollment and withdrawal, and procedures for noncompliance. Moneys in the Program shall be invested in a manner deemed appropriate by the Board.

Eligible employers shall enroll their eligible employees in the Program. Eligible employers are defined in the bill as any nongovernmental employer that employs 25 or more eligible employees and does not offer a qualified retirement plan to their employees. Eligible employees are limited to individuals who are employed at least 30 hours per week. Each eligible employee shall be enrolled in the Program unless the employee elects not to participate in the Program.

Any employer that is not an eligible employer may facilitate the participation of its eligible employees in the program. Self-employed individuals and eligible employees whose employers do not enroll in the program may participate in the program in accordance with terms and conditions prescribed by the Board.

The bill contains provisions limiting the liability of the Board, the Plan, and the Commonwealth or any of its political subdivisions for obligations associated with the Program. The Commonwealth shall have no duty or liability to any party for the payment of any retirement savings benefits accrued by any individual under the Program. Participating employers shall not (i) have any liability for an employee's decision to participate in or opt out of the Plan, (ii) be a fiduciary over the Program, or (iii) have any liability or responsibility related to the operation of the Program. The bill also adds a requirement that at least one member of the Board have expertise in the management and administration of private defined contribution retirement plans.

The Program shall be established, and enrollment shall begin, on July 1, 2023, or as soon thereafter as practicable. Finally, the bill directs the Board to establish a group of stakeholders to identify and make recommendations as to other amendments necessary and prudent to effectuate the provisions of the bill.


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