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SENATE DOCKET, NO. 256 FILED ON: 1/12/2023
SENATE . . . . . . . . . . . . . . No. 1698
The Commonwealth of Massachusetts
_________________
PRESENTED BY:
Joan B. Lovely
_________________
To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:
The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
An Act relative to the SMART plan.
_______________
PETITION OF:
NAME:DISTRICT/ADDRESS :Joan B. LovelySecond EssexDeborah B. Goldberg, Treasurer
and Receiver General
Treasurer1/20/2023 1 of 4
SENATE DOCKET, NO. 256 FILED ON: 1/12/2023
SENATE . . . . . . . . . . . . . . No. 1698
By Ms. Lovely, a petition (accompanied by bill, Senate, No. 1698) of Joan B. Lovely and
Deborah B. Goldberg, Treasurer and Receiver General for legislation relative to the SMART
plan. Public Service.
[SIMILAR MATTER FILED IN PREVIOUS SESSION
SEE SENATE, NO. 1746 OF 2021-2022.]
The Commonwealth of Massachusetts
_______________
In the One Hundred and Ninety-Third General Court
(2023-2024)
_______________
An Act relative to the SMART plan.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
of the same, as follows:
1 SECTION 1. Section 64 of chapter 29 of the General Laws, as appearing in the 2020
2Official Edition, is hereby amended by striking, in line 31, the words “independent contractors”
3and inserting in place thereof the following words:-
4 contracted employees
5 SECTION 2. Said section 64 of said chapter 29 of the General Laws, as so appearing, is
6hereby further amended by inserting at the end thereof the following paragraphs:-
7 The state treasurer, on behalf of the deferred compensation program, may adopt annual
8budgets and supplemental budgets as necessary. Said budgets may include salaries for treasury
9employees tasked with working on and/or administering the deferred compensation program, and 2 of 4
10said budgets may be funded from the administrative expense account of the deferred
11compensation program. Any such treasury employee whose compensation is sourced from the
12deferred compensation program shall be an “employee” as that term is defined in section 1 of
13chapter 32 and shall be a member of the Massachusetts state employees’ retirement system.
14 The state treasurer, on behalf of the commonwealth, may establish an automatic
15enrollment feature within the deferred compensation program. The automatic enrollment feature
16does not require advance authorization by an employee, and is hereby deemed to be an exception
17to the provisions of the Massachusetts Wage Act or any other state law requiring employee
18authorization for a payroll deduction or any similar ordinance of a governmental body. The
19details of the automatic enrollment feature shall be set forth in the deferred compensation plan
20document and shall include:
21 (a) A provision that automatic enrollment shall apply only to new employees of the
22commonwealth, meaning employees hired on or after June 1, 2022; but that for any
23commonwealth agencies or departments that have Code section 403(b) eligible employees,
24automatic enrollment shall only apply at the commonwealth agency’s or department’s discretion
25and affirmative election;
26 (b) A provision that automatic enrollment shall apply only to new employees of a
27“governmental body”, as defined in section 64B of chapter 29 of these general laws, if the
28governmental body elects to implement the automatic enrollment feature for its employees;
29 (c) A provision that automatic enrollment may not require more than the IRS safe harbor
30maximum deferral percentage; 3 of 4
31 (d) A provision that the amount of compensation deferred by an automatically-enrolled
32employee shall automatically increase by a specified amount each year unless the participating
33employee elects not to participate in auto escalation or elects to defer a different amount than
34specified;
35 (e) A provision that an employee who is automatically enrolled shall have as long as
36ninety days to discontinue participation in the plan;
37 (f) A provision that an automatically-enrolled employee who discontinues participation in
38the plan within ninety days shall receive a refund of their account as soon as practicable after
39discontinuing participation;
40 (g) A provision that the plan shall specify a qualified default investment option to receive
41contributions by any automatically-enrolled employee who does not choose an investment
42alternative to receive the employee’s contributions; and
43 (h) A provision that the plan shall adhere to notice requirements to automatically-enrolled
44participants in accordance with the Internal Revenue Code and applicable IRS Rulings.
45 SECTION 3. Section 64B of chapter 29 of the General Laws, as appearing in the 2020
46Edition, is hereby amended by inserting between the third and fourth paragraphs the following
47paragraph:-
48 The treasurer or, if there is no treasurer, the chief financial officer by whatever name that
49person is called, on behalf of a governmental body, may, at its own election, implement an
50automatic enrollment feature within its deferred compensation program established pursuant to
51this section 64B, chapter 29. The automatic enrollment feature does not require advance 4 of 4
52authorization by an employee and is hereby deemed to be an exception to the provisions of the
53Massachusetts Wage Act or any other state law requiring employee authorization for a payroll
54deduction or any similar ordinance of a governmental body. Subject to the election of each
55governmental body, any such auto enrollment feature permitted as a part of a governmental
56body’s deferred compensation program shall only apply to new employees of a governmental
57body hired on or after June 1, 2024 and such deferred compensation program will be required to
58include the specifications for auto enrollment detailed in subsections (b)-(h) of section 64 of
59chapter 29 of the General Laws.