EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0270*
SENATE BILL 270
P6 5lr2091
By: Senator Jackson (By Request – State Treasurer)
Introduced and read first time: January 9, 2025
Assigned to: Budget and Taxation
A BILL ENTITLED
AN ACT concerning 1
Board of Trustees of the Maryland Teachers and State Employees Supplemental 2
Retirement Plans – Automatic Enrollment 3
FOR the purpose of requiring the State Board of Trustees of the Maryland Teachers and 4
State Employees Supplemental Retirement Plans to implement an automatic 5
enrollment arrangement for certain State employees; requiring an eligible employer 6
to deduct wages of an employee for contribution to a supplemental retirement plan 7
in accordance with an automatic enrollment arrangement, unless the employee has 8
elected to withdraw from or cease to contribute to the supplemental retirement plan; 9
and generally relating to the automatic enrollment of State employees into 10
supplemental retirement plans. 11
BY repealing and reenacting, with amendments, 12
Article – State Personnel and Pensions 13
Section 35–101 14
Annotated Code of Maryland 15
(2024 Replacement Volume and 2024 Supplement) 16
BY adding to 17
Article – State Personnel and Pensions 18
Section 35–206 19
Annotated Code of Maryland 20
(2024 Replacement Volume and 2024 Supplement) 21
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 22
That the Laws of Maryland read as follows: 23
Article – State Personnel and Pensions 24
35–101. 25
2 SENATE BILL 270
(a) In this title the following words have the meanings indicated. 1
(B) “AUTOMATIC ENROLLMENT ARRANGEMENT ” MEANS A SUPPLEMENTAL 2
PLAN PROVISION THAT REQUIRES AN ELIGIBLE EMPLOYER TO DEDUCT E LECTIVE 3
DEFERRALS FROM AN EM PLOYEE’S WAGES FOR CONTRIBU TION TO A 4
SUPPLEMENTAL RETIREM ENT PLAN UNLESS THE EMPLOYEE MAKES A N ELECTION 5
NOT TO CONTRIBUTE OR TO CONTRIBUTE A DIFF ERENT AMOUNT . 6
[(b)] (C) “Board” means the State Board of Trustees of the Maryland Teachers 7
and State Employees Supplemental Retirement Plans. 8
(D) “ELIGIBLE EMPLOYER ” MEANS THE EMPLOYER OF AN INDIV IDUAL 9
ELIGIBLE TO PARTICIP ATE IN A SUPPLEMENTA L RETIREMENT PLAN . 10
[(c)] (E) “Supplemental retirement plans” means the deferred compensation, 11
tax sheltered annuity, salary reduction savings plans, and any other plans authorized by 12
this title. 13
35–206. 14
(A) THE BOARD SHALL IMPLEMENT AN AUTOMATIC ENROLLM ENT 15
ARRANGEMENT TO AUTOM ATICALLY ENROLL ALL STATE EMPLOYEES HIRED ON OR 16
AFTER JANUARY 1, 2026, IN A SUPPLEMENTAL RE TIREMENT PLAN . 17
(B) (1) NOTWITHSTANDING ANY O THER PROVISION OF LA W, AN ELIGIBLE 18
EMPLOYER SHALL DEDUC T AN AMOUNT FROM THE WAGES OF AN EMPLOYEE FOR 19
CONTRIBUTION TO A SU PPLEMENTAL RETIREMEN T PLAN AS PART OF AN 20
AUTOMATIC ENROLLMENT ARRANGEMENT , UNLESS THE EMPLOYEE HAS ELECTED 21
TO WITHDRAW FROM THE SUPPLEMENTAL RETIREM ENT PLAN OR CE ASE MAKING 22
CONTRIBUTIONS TO THE SUPPLEMENTAL RETIREM ENT PLAN. 23
(2) THE AMOUNT DEDUCTED F ROM THE WAGES OF AN EMPLOYEE 24
EACH PAY PERIOD SHAL L BE THE MINIMUM AMO UNT SET BY THE BOARD, UNLESS 25
THE EMPLOYEE ELECTS TO: 26
(I) HAVE A DIFFERENT AMO UNT DEDUCTED ; 27
(II) CEASE MAKING CONTRIB UTIONS TO THE SUPPLE MENTAL 28
RETIREMENT PLAN ; OR 29
(III) WITHDRAW FROM THE SU PPLEMENTAL RETIREMEN T PLAN. 30
(C) AN EMPLOYEE ENROLLED IN A SUPPLEMENTAL RE TIREMENT PLAN 31
UNDER AN AUTOMATIC E NROLLMENT ARRANGEMEN T SHALL BE: 32 SENATE BILL 270 3
(1) PROVIDED A NOTICE WITH A N EXPLANATION OF : 1
(I) THE TERMS OF THE EMP LOYEE’S ENROLLMENT IN THE 2
SUPPLEMENTAL RETIREM ENT PLAN, INCLUDING THE CURREN T CONTRIBUTION 3
AMOUNT PROVIDED FOR UNDER THE AUTOMATIC ENROLLMENT ARRANGEME NT; 4
(II) THE EMPLOYEE ’S RIGHT TO IN CREASE, DECREASE, OR 5
CEASE CONTRIBUTIONS TO THE SUPPLEMENTAL RETIREMENT PLAN ; 6
(III) THE EMPLOYEE ’S RIGHT TO DISCONTIN UE PARTICIPATION 7
IN THE SUPPLEMENTAL RETIREMENT PLAN WITH IN 90 DAYS AFTER THE FIRST 8
AUTOMATIC DEDUCTION OF THE EMPLOYEE ’S CONTRIBUTION FROM WAGES ; 9
(IV) THE EMPLOYEE ’S RIGHT TO RECEIVE A REFUND OF THE 10
EMPLOYEE’S ACCOUNT CONTRIBUTI ONS AS SOON AS PRACT ICABLE AFTER 11
DISCONTINUING PARTIC IPATION WITHIN 90 DAYS AFTER THE FIRST AUTOMATIC 12
DEDUCTION OF THE EMP LOYEE’S CONTRIBUTION FROM WAGES; AND 13
(V) THE EMPLOYEE ’S RIGHTS REGARDING T HE INVESTMENT OF 14
THE EMPLOYEE ’S ACCOUNT AND THE IN VESTMENT OPTIONS AVA ILABLE UNDER THE 15
SUPPLEMENTAL RETIREM ENT PLAN; AND 16
(2) TREATED AS EXERCISIN G CONTROL OF THE ASS ETS IN THE 17
SUPPLEMENTAL RETIREM ENT PLAN ACCOUN T REGARDING THE AMOU NT OF 18
CONTRIBUTIONS AND EA RNINGS. 19
(D) IF A PARTICIPANT IS E NROLLED IN A SUPPLEM ENTAL RETIREMENT 20
PLAN UNDER AN AUTOMA TIC ENROLLMENT ARRAN GEMENT, THE BOARD SHALL 21
INVEST THE PARTICIPA NT’S CONTRIBUTIONS IN A DESIGNATED DEFAULT 22
INVESTMENT OPTION IN ACCORDANCE WITH EACH APPLICABLE SUPPLEMENTAL 23
RETIREMENT PLAN . 24
(E) EACH UNIT THAT HIRES AN ELIGIBLE EMPLOYEE WHO IS NOT ALREADY 25
ENROLLED IN A SUPPLE MENTAL RETIREMENT PL AN SHALL PROVIDE THE BOARD 26
WITH THE INFORMATION NECESSARY TO COMPLET E THE ENR OLLMENT OF THE 27
EMPLOYEE UNDER THE A UTOMATIC ENROLLMENT ARRANGEMENT . 28
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall apply only to 29
individuals eligible to participate in a supplemental retirement plan who commence 30
employment or who are reinstated on or after January 1, 2026. 31
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 32
October 1, 2025. 33 4 SENATE BILL 270