A retirement plan marketplace, granting rule-making authority, and making an appropriation. (FE)
Impact
The implementation of AB1138 is expected to lower barriers for small employers in providing retirement options, thereby increasing participation in retirement savings plans. This initiative is crucial as it targets those small businesses that may not currently offer retirement benefits due to high costs or complexity. By establishing a regulated marketplace, the state aims to ensure that retirement plans available through this system are compliant with federal laws, specifically the Employee Retirement Income Security Act (ERISA), while also maintaining reasonable administrative fees for participants.
Summary
Assembly Bill 1138 establishes a retirement plan marketplace aimed at facilitating access to retirement plans for small employers and individuals residing in the state. The Department of Financial Institutions (DFI) is tasked with managing this marketplace, which connects eligible employers—those with fewer than 100 employees—and eligible individuals to qualified financial services firms that provide compliant retirement plans. The intent is to enhance retirement savings and income options while also advocating for the needs of small employers, who often face barriers in offering such benefits to their employees.
Contention
Notable points of contention surrounding AB1138 include concerns from various stakeholders regarding the oversight and regulation of participating financial firms. Ensuring that retirement plans not only adhere to legal standards but also offer favorable terms for both employers and employees is paramount. Critics may point to potential limitations in the types of plans offered and the level of support for various employer sizes, particularly as the marketplace is designed to cater to a broad range of employers and risk tolerances. The effectiveness of the marketing strategies employed by DFI to promote this marketplace will also be a critical element in its success.
Relating to a study by the attorney general of the online resale of consumer goods obtained illegally and the online sale or distribution of counterfeit goods.