Nevada is the most recent state to pass a state-run retirement savings program for private sector employees. The Nevada legislature passed bill SB305 on Sunday by a vote of 35 to 7. Now it’s up to Nevada Governor Joe Lombardo to sign the bill.
The proposal, put forward by Senate Majority Leader Dallas Harris (D-Las Vegas) on March 16, would establish a Nevada Employee Savings Trust.
In April, the American Retired Association (ARA) sent a letter supporting the bill. It partly states:
“The ARA believes that Senate Bill 305 strikes the right balance of closing as many retirement coverage gaps in the private sector workforce as possible while minimizing the burden on Nevada employers. Senate Bill 305 requires all private sector employers in Nevada that have an electronic payroll system to provide a retirement plan for their employees. Senate Bill 305 ensures that all types of retirement plans, including 401(k) plans, meet the requirements.In addition, Senate Bill 305 provides exemptions from the Employee Retirement Income Security Act (ERISA). We are creating a state-led, IRA-based retirement program designed to help the state, which does not force the state to compete with the many existing retirement plan products on the market.”
Regarding the Senate vote on May 29, ARA’s Federal and State Legal Director Andrew Remo said, “The American Retired Association is encouraged to continue the process before the end of this session.” States have many legislative actions to address the application of retirement plans, and we welcome Nevada.”
what this bill does
This measure would create a board of trustees for the Nevada Employees’ Savings Trust and provide for its membership, powers, duties, and board limits. It also created the Nevada Employees’ Savings Trust Administration Fund, whose funds will be used only to pay the administration and expenses of the board and the program.
board. The bill would give the board the power to:
1. Design, establish and operate the Nevada Employee Savings Trust Program.and
2. Adopt regulations, rules and procedures for the establishment and operation of the Program and take other measures necessary or desirable for the establishment and operation of the Program.
SB305 also requires the Board to prepare program information materials, disclosure statements, forms, and instructions for distribution by covered employers to covered employees.
The law provides that members of the board of directors, trustees, and certain other persons involved in the administration of trusts are trustees with respect to participants in the program.
employer. SB305 stipulates that eligible employers must automatically enroll all eligible employees in the program or similar programs offered by trade associations and chambers of commerce. Through this program, funds are deducted from the compensation of eligible employees and contributed to the IRA at a contribution rate set by the Board of Directors.
employee. Eligible employees are automatically enrolled in the program. You can also:
- opt out;
- Change the contribution rate.and
- Withdraw your donation to deal with financial or other emergencies.
funds. The measure would allocate the assets of all IRAs established through the program by covered employees to trusts to invest, invest, and invest solely for the purpose of providing benefits to covered employees and to cover the reasonable expenses of the board of directors and the program. required to manage and operate. , and trust. SB305 also establishes specific investment guidelines and practices.