Bill Text: HI HB1189 | 2020 | Regular Session | Amended
Bill Title: Relating To Retirement Savings.
Spectrum: Partisan Bill (Democrat 9-0)
Status: (Introduced - Dead) 2019-12-01 - Carried over to 2020 Regular Session. [HB1189 Detail]
Download: Hawaii-2020-HB1189-Amended.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
1189 |
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THIRTIETH LEGISLATURE, 2019 |
H.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO RETIREMENT SAVINGS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION
1. The legislature finds that there is an imminent retirement
security crisis in the State, as many individuals do not have access to an
employer-sponsored retirement plan.
Individuals without a retirement plan are at significant risk of not having
enough retirement income to meet basic expenses during retirement. A retirement savings plan can help employees
achieve economic security, improve economic mobility, and reduce wealth
disparity.
In 2017, Oregon was the first state to
implement a retirement savings plan that covers private sector workers who do
not otherwise have access to a savings plan provided by their employer. With many small businesses operating in
Oregon, the state calculated that it had more than one million employers who did
not offer any form of retirement savings.
The plan was actually adopted earlier in 2015, as the Obama
administration tried to encourage states to promote retirement savings. Other states have similar programs including
California, Connecticut, Illinois, Maryland, Massachusetts, New Jersey, and
Vermont.
The legislature further finds that individuals need a lifelong savings system that provides them with the opportunity to build their assets and attain future financial stability. Access by private sector employees to employer-sponsored retirement plans provides a reliable way to accumulate savings needed for a secure retirement, but many small businesses are unable to provide a mechanism for their employees to invest.
The legislature further finds that approximately fifty per cent of the State's private sector employees work for an employer that does not offer a retirement plan or are not eligible for the plan offered. The lack of opportunity to participate in an employer-provided retirement plan spans all levels of education and earnings. Employees of Hawaii businesses with fewer than one hundred employees are much less likely to have access to a retirement plan than employees of larger businesses. Employees who are offered the opportunity to save through the employee's place of employment are significantly more likely to participate and make steady contributions to build retirement savings.
The purpose of this Act is to require the legislative reference bureau to study the feasibility of implementing a Hawaii retirement savings program for private sector employees utilizing information from other state experiences and educational institutions with expertise on existing programs; to report to the legislature with its findings and proposals, if any; and, if the results of the study support it, to propose a program to establish the Hawaii retirement savings program for private sector employees not currently covered by an existing program.
SECTION 2. (a) Prior to the establishment of the Hawaii retirement savings program for private sector employees, the legislative reference bureau shall conduct a study to establish the plan to set up an auto-individual retirement account program that would be cost-efficient and effective. In conducting its study, the legislative reference bureau may:
(1) Obtain legal advice regarding the applicability of the Employee Retirement Income Security Act of 1974, as amended, and the Internal Revenue Code of 1986, as amended, to the program;
(2) Investigate whether employers that are not required to participate in the program can make the program available to their employees;
(3) Investigate methods to allow individuals who are not automatically enrolled in the program to participate in the program and make contributions to an account, either through payroll contributions or another method of contribution;
(4) Conduct an analysis of the potential costs to employers, including administrative costs, and costs associated with providing automatic payroll deductions for participation in the program, as well as recommendations on how to eliminate or reduce those costs through incentives, tax credits, or other means;
(5) Investigate the feasibility and benefits of partnering with other similar programs established in other jurisdictions;
(6) Prepare a timeline for implementation of the Hawaii retirement savings program;
(7) Make recommendations to the legislature regarding ways to increase participation in the Hawaii retirement savings program; and
(8) Propose to the legislature the administrative body and implementation for the program, including any necessary authorizing legislation.
The legislative reference bureau may issue a request for proposals for a third party to conduct the analysis as described in paragraphs (1) through (7). The contracting services under this Act shall be exempt from chapter 103D, Hawaii Revised Statutes.
(b) The legislative reference bureau shall report to the legislature its findings and recommendations, including any proposed legislation, no later than twenty days prior to the convening of the regular session of 2020.
SECTION 3. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2019-2020 for the purposes of this Act.
The sum appropriated shall be expended by the legislative reference bureau for the purposes of this Act.
SECTION 4. This Act shall take effect on January 1, 2050.
Report Title:
Hawaii Retirement Savings Program; LRB; Study; Appropriation
Description:
Requires the Legislative Reference Bureau to conduct a study on establishing a plan to implement the Hawaii Retirement Savings Program and to submit a report prior to the 2020 Regular Session to the Legislature on its findings, recommendations, and proposed legislation. Appropriates funds. (HB1189 HD1)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
