Legislative Memo

Lev Ginsburg
T 518.465.7511


S.7505/A.9505 Part X



Creation of a Voluntary Retirement Savings Program for Private-Sector Employees



February 7, 2018


The Business Council opposes S.7505/A.9505 Part X, a provision that would establish in the form of an automatic enrollment payroll deduction IRA, for private sector employees.

There is growing concern in our nation about insufficient retirement savings, even though there are many retirement plans already available to employees outside the workplace. In a recent public opinion research project, the National Institute on Retirement Security (“NIRS”) conducted a survey and found that the top three reasons why saving for retirement is difficult for Americans are the rising cost of long-term care, salaries that don’t keep up with financial obligations, and increasing debt.

Additionally, data shows that where savings plans are available, employees are not taking advantage of current market place products – including the new federally administered retirement savings plan- myRA program established by the U.S. Department of Treasury) that offers access for individuals that do not have an employer-sponsored plan. The federal plan was so underutilized that it is being phased out of existence.

The top reasons found for lack of retirement savings simply have nothing to do with a lack of available work-sponsored savings programs. This is likely why not a single employer member of The Business Council has ever asked for the creation of this type of program.

In 2016 the Governor established the SMART Commission, which stands for “Saving More to Achieve Richer Tomorrows,” which was to partner with state agencies, financial services professionals, consumer advocates, and academics to study available options for the creation of a state-administered retirement savings program for workers whose employers do not offer a retirement plans. The SMART Commission seldom met and did not reach a consensus on its findings. Given the Commission’s make-up and the expertise available for critical thinking on the issues presented, it would be prudent to await not only a Commission decision, but one which is a consensus of its members, before the state takes any legislative or regulatory actions in this area.

In addition, our members have several other concerns with the proposal, including:

At minimum, The Business Council believes that the significant issues of employer compliance, start-up costs and market impact need to be addressed in earnest before any legislative action is taken.

For these reasons, The Business Council opposes S.7505/A.9505 Part X.