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General Assembly Substitute Bill No. 1221
January Session, 2025
AN ACT MAKING CHANGES TO THE CONNECTICUT RETIREMENT
SECURITY PROGRAM.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 31-416 of the general statutes is repealed and the 1
following is substituted in lieu thereof (Effective July 1, 2025): 2
As used in this section, section 31-71e [,] and sections 31-417 to 31-3
427, inclusive: 4
(1) "Board" means the Connecticut Retirement Security Advisory 5
Board established pursuant to section 31-417; 6
(2) "Consumer" has the same meaning as provided in section 17b-706; 7
[(2)] (3) "Contribution level" means (A) the contribution rate selected 8
by the participant that may be expressed as (i) a percentage of the 9
participant's taxable wages as is required to be reported under Sections 10
6041 and 6051 of the Internal Revenue Code of 1986, or any subsequent 11
corresponding internal revenue code of the United States, as amended 12
from time to time, or (ii) a dollar amount up to the maximum deductible 13
amount for the participant's taxable year under Section 219(b)(1) of the 14
Internal Revenue Code of 1986, or any subsequent corresponding 15
internal revenue code of the United States, as amended from time to 16
time; or (B) in the absence of an affirmative election by the participant, 17
three per cent of the participant's taxable wages as is required to be 18 Substitute Bill No. 1221
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reported under Sections 6041 and 6051 of the Internal Revenue Code of 19
1986, or any subsequent corresponding internal revenue code of the 20
United States, as amended from time to time. For participants enrolled 21
on and after July 1, 2025, the contribution level in the absence of an 22
affirmative election by the participant shall follow the provisions of 23
Section 414A(b)(3)(A) of the Internal Revenue Code of 1986, or any 24
subsequent corresponding internal revenue code of the United States, 25
as amended from time to time. The contribution level of a participant 26
who customarily and regularly receives gratuities in conjunction with 27
his or her employment shall be a percentage of such participant's wages 28
as is required to be reported under Sections 6041 and 6051 of the Internal 29
Revenue Code of 1986, or any subsequent corresponding internal 30
revenue code of the United States, as amended from time to time; 31
[(3)] (4) "Covered employee" means (A) an individual [(A)] (i) who 32
has been employed by a qualified employer for a period of not less than 33
one hundred twenty days, [(B)] (ii) who is nineteen years of age or older, 34
[(C)] (iii) who performs services within the state for purposes of section 35
31-222, and [(D)] (iv) whose service or employment is not excluded 36
under the provisions of subdivision (5) of subsection (a) of section 31-37
222, and (B) on and after July 1, 2026, a personal care attendant (i) who 38
has been employed by a qualified employer for a period of not less than 39
thirty days, (ii) who is nineteen years of age or older, and (iii) who 40
performs services within the state for purposes of section 31-222; 41
[(4)] (5) "Participant" means any individual participating in the 42
program; 43
(6) "Personal care attendant" has the same meaning as provided in 44
section 17b-706; 45
[(5)] (7) "Program" means the Connecticut Retirement Security 46
Program established pursuant to section 31-418, as amended by this act; 47
[(6)] (8) (A) "Qualified employer" means (i) any person, corporation, 48
limited liability company, firm, partnership, voluntary association, joint 49
stock association or other entity doing business in the state during the 50 Substitute Bill No. 1221
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calendar year, whether for profit or not for profit, that employed on 51
October first of the preceding calendar year five or more individuals in 52
the state and has paid not less than five of such individuals taxable 53
wages of not less than five thousand dollars in the preceding calendar 54
year, [.] or (ii) on and after July 1, 2026, a consumer that receives services 55
from a personal care attendant under a state-funded program. (B) 56
"Qualified employer" does not include: [(A)] (i) The federal government, 57
[(B)] (ii) the state or any political subdivision thereof, [(C)] (iii) any 58
municipality, unit of a municipality or municipal housing authority, 59
[(D)] (iv) an employer employing only individuals whose services are 60
excluded under subdivision (5) of subsection (a) of section 31-222, other 61
than a consumer that receives services from a personal care attendant 62
under a state-funded program, or [(E)] (v) an employer that was not in 63
existence at all times during the current calendar year and the preceding 64
calendar year, other than a consumer that receives services from a 65
personal care attendant under a state-funded program; 66
[(7)] (9) "Individual retirement account" means a Roth IRA; 67
[(8)] (10) "Roth IRA" means an account described in Section 408A of 68
the Internal Revenue Code of 1986, or any subsequent corresponding 69
internal revenue code of the United States, as amended from time to 70
time; 71
[(9)] (11) "Normal retirement age" means the age specified in Section 72
408A of the Internal Revenue Code of 1986, or any subsequent 73
corresponding internal revenue code of the United States, as amended 74
from time to time, when an individual may withdraw all funds without 75
penalty; 76
[(10)] (12) "Vendor" means (A) a federally regulated retirement plan 77
sponsor conducting business in the state, including, but not limited to, 78
a federally regulated investment company or an insurance company, or 79
(B) a company conducting business in the state to (i) provide ancillary 80
services, including, but not limited to, technological, payroll or 81
recordkeeping services, and (ii) offer retirement plans or payroll deposit 82 Substitute Bill No. 1221
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individual retirement account arrangements using products of 83
regulated retirement plan sponsors. "Vendor" does not include 84
individual registered representatives, brokers, financial planners or 85
agents; and 86
[(11)] (13) "Fee" means investment management charges, 87
administrative charges, investment advice charges, trading fees, 88
marketing and sales fees, revenue sharing, broker fees and other costs 89
necessary to administer the program. 90
Sec. 2. Subsection (a) of section 31-418 of the general statutes is 91
repealed and the following is substituted in lieu thereof (Effective July 1, 92
2025): 93
(a) There is established the Connecticut Retirement Security Program, 94
the purpose of which shall be to promote and enhance retirement 95
savings for private sector employees in the state, to be administered by 96
the Comptroller. The office of the Comptroller shall constitute a 97
successor agency to the Connecticut Retirement Security Authority for 98
the purposes of administering the Connecticut Retirement Security 99
Program, in accordance with subsections (a), (b), (c), (d) and (f) of 100
sections 4-38d and 4-38e. The Comptroller in consultation with the 101
board, may: 102
(1) Establish criteria and guidelines for the program to offer qualified 103
retirement investment choices. Such criteria and guidelines shall 104
establish a cap on total annual fees and shall provide participants with 105
information regarding each retirement investment choice's historical 106
investment performance; 107
(2) Receive and invest moneys in the program in any instruments, 108
obligations, securities or property in accordance with section 31-423, as 109
amended by this act; 110
(3) Contract with financial institutions or other organizations offering 111
or servicing retirement programs. The Comptroller may require that 112
each participant be charged a fee to defray the costs of the program. The 113 Substitute Bill No. 1221
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amount and method of collection of such fee shall be determined by the 114
Comptroller. No employer shall be required to fund or be responsible 115
for collecting fees from plan participants; 116
(4) Charge and equitably apportion among participants the 117
administrative costs and expenses incurred in the exercise of the 118
Comptroller's powers and duties as granted by this section; 119
(5) Borrow working capital funds and other funds as may be 120
necessary for the start-up and continuing operation of the program, 121
provided such funds are borrowed in the name of the program only. 122
Such borrowings shall be payable solely from revenues of the program; 123
(6) Do all things necessary or convenient to carry out the provisions 124
of section 31-71e, and sections 31-417 to 31-427, inclusive; [and] 125
(7) Establish an administrative process by which participants, 126
potential participants and employees may submit grievances, 127
complaints and appeals to the Comptroller and have such grievances, 128
complaints and appeals heard and addressed by the Comptroller; and 129
(8) Implement the provisions of Section 414A(b)(3)(A) of the Internal 130
Revenue Code of 1986, or any subsequent corresponding internal 131
revenue code of the United States, as amended from time to time. 132
Sec. 3. Section 31-423 of the general statutes is repealed and the 133
following is substituted in lieu thereof (Effective July 1, 2025): 134
(a) The Comptroller shall provide for each participant's account to be 135
invested in (1) an age-appropriate target date fund, or (2) other 136
investment vehicles the Comptroller may prescribe if affirmatively 137
selected by the participant. 138
(b) For each participant who receives a federal Saver's Match 139
contribution pursuant to 26 USC 6433, as amended from time to time, 140
the Comptroller shall provide an applicable retirement savings vehicle 141
able to receive such contribution. 142 Substitute Bill No. 1221
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Sec. 4. Subsection (c) of section 31-425 of the general statutes is 143
repealed and the following is substituted in lieu thereof (Effective July 1, 144
2025): 145
(c) If a qualified employer fails to (1) enroll [a covered employee] such 146
qualified employer's covered employees as required under subsection 147
(a) of section 31-422, [such covered employee, the Labor Commissioner 148
or the Comptroller, may bring a civil action to require the qualified 149
employer to enroll the covered employee and shall recover such costs 150
and reasonable attorney's fees as may be allowed by the court.] or (2) 151
transmit contributions to the program, as required under subsection (e) 152
of section 31-422, the Comptroller shall send a notice of noncompliance 153
to such qualified employer. The Comptroller shall send at least two 154
notices of noncompliance followed by a final notice of noncompliance. 155
Each year a qualified employer is found to be noncompliant for a period 156
of ninety calendar days or longer after service of such final notice of 157
noncompliance, such employer may be assessed a civil penalty by the 158
Comptroller of (A) not more than five hundred dollars for a qualified 159
employer that employs not less than five and not more than twenty-four 160
employees, (B) not more than one thousand dollars for a qualified 161
employer that employs not less than twenty-five and not more than 162
ninety-nine employees, and (C) not more than one thousand five 163
hundred dollars for a qualified employer that employs one hundred or 164
more employees. 165
(d) The Comptroller may adopt regulations in accordance with the 166
provisions of chapter 54 to implement the provisions of this section. 167
This act shall take effect as follows and shall amend the following
sections:
Section 1 July 1, 2025 31-416
Sec. 2 July 1, 2025 31-418(a)
Sec. 3 July 1, 2025 31-423
Sec. 4 July 1, 2025 31-425(c)
Substitute Bill No. 1221
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Statement of Legislative Commissioners:
In Section 4, Subsec. (c)(2) "not less than ninety calendar days" was
changed to "a period of ninety calendar days or longer", for accuracy
and clarity.
LAB Joint Favorable Subst. -LCO