Compensation & Benefits Library™ gives you accurate answers and practical guidance to help you design, analyze, compare, administer, and communicate compensation and benefits...
By Sean Forbes
May 11 — Maryland Gov. Larry Hogan (R) signed into law a bill creating a state-run IRA program for private sector workers who don't have access to a retirement plan at work.
The legislation requires employers that don't offer plans to automatically enroll their employees into payroll-deduction individual retirement accounts. Hogan signed the law May 10.
“This is a necessary expansion of retirement security for Marylanders,” Kathleen Kennedy Townsend, former lieutenant governor of Maryland, told Bloomberg BNA on May 11.
“It’s the most important expansion since Social Security. And I hope it will be the first of strides for better security for senior citizens and their families,” said Townsend, who chaired a task force established in 2014 by then-Gov. Martin O'Malley (D) to devise a program for the state.
Maryland now joins several other states that have laws in place setting up private sector programs, including California, Illinois, New Jersey, Oregon and Washington. In all, about half of the states are investigating such efforts.
The Maryland law is effective July 1.
Unlike in states such as California and Illinois, the law doesn't specify the size of employer required to participate in the program.
However, covered employers don't include government agencies, whether federal, state, county or municipal; those that currently offer, or established within the past two years, savings programs separately from the S.B. 1007 requirements; and those that haven't been continually in business during the current and preceding calendar years.
The law also doesn't set a mandatory contribution rate. Instead, the Maryland Small Business Retirement Savings Board, also established by the law, will determine contribution rates.
Employers that participate in the program, or otherwise offer a retirement savings arrangement to their employees as specified in the bill, are exempt from the state’s $300 annual filing fee for corporations and business entities after the program becomes operational.
To contact the reporter on this story: Sean Forbes in Washington at email@example.com
To contact the editor responsible for this story: Jo-el J. Meyer at firstname.lastname@example.org
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)