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Introduced Version Senate Bill 159 History

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Key: Green = existing Code. Red = new code to be enacted
Senate Bill No. 159

(By Senators Foster, McCabe and Plymale)

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[Introduced January 10, 2008; referred to the Committee on Pensions; and then to the Committee on Finance.]

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A BILL to amend the Code of West Virginia, 1931, as amended, by adding thereto a new article, designated §5-10E-1, §5-10E-2, §5-10E-3, §5-10E-4, §5-10E-5, §5-10E-6 and §5-10E-7, all relating to establishing the West Virginia Voluntary Accounts Program; defining certain terms; requiring private employers to provide employees savings opportunities; permitting certain other savings plans; providing that the principal account is created in the State Treasury; and providing procedures for implementing a voluntary savings account program for employees and employers in the private sector.

Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended by adding thereto a new article, designated §5-10E-1, §5-10E-2, §5-10E-3, §5-10E-4, §5-10E-5, §5-10E-6 and §5-10E-7, all to read as follows:
ARTICLE 10E. CONSOLIDATED PUBLIC RETIREMENT BOARD VOLUNTARY ACCOUNTS.

§5-10E-1. Findings.
The Legislature finds that many workers do not have access to an employment-based retirement plan. Workers who are unable to build up pensions and savings risk living on low incomes in their old age and are more likely to become dependent on state services. The voluntary accounts program will provide a simple and inexpensive way for workers to save for retirement and employers to offer an employee benefit:
§5-10E-2. Definitions.
Unless the context in which used clearly requires a different definition, the following definitions in this section apply throughout this article:
(1) "Director" means the executive secretary of the Public Employees Retirement System;
(2) "Participating employee" means any worker in this state who chooses to participate in the program; and
(3) "Participating employer" means any private employer, with a place of business in this state with employees that choose to participate in the program.
(4) "Program" means the voluntary accounts program created under section three of this article;
§5-10E-3. Voluntary accounts program created.
The voluntary accounts program is created. The director may propose rules for legislative approval in accordance with the provisions of article three, chapter twenty-nine-a of this code as necessary to implement the provisions of this article. The provisions of sections four and five of this article may not be implemented until any approvals from federal agencies that may be required, including a favorable tax treatment ruling of the plan, have been granted, and appropriate funds for start-up costs of the program have been identified and appropriated by the Legislature.
Any start up funds appropriated by the Legislature shall be reimbursed to the state from fees charged for the participation of private employers and employees in the voluntary accounts program.
Private employers shall, in cooperation with the trustees of the Consolidated Public Retirement Board, provide employees with the opportunity to participate in the voluntary accounts program, including payroll deductions for those employees who elect to contribute to individual retirement accounts. Each participating employer is authorized to contract with a participating employee to defer or otherwise contribute a portion of that employee's compensation, in accordance with the Internal Revenue Code or other applicable federal laws.
§5-10E-4. Voluntary accounts program participant investments.
Participating employees may self-direct the investment of their account balances through selection among investment options to the extent provided in this section.
The director may provide the individual retirement account plans as the Consolidated Public Retirement Board
determines to be advisable. The Board of Treasury Investments, with respect to the voluntary accounts program, shall invest the contributions of participating employees, in accordance with federal law, and to the extent permissible under federal law, in accordance with the provisions of article six-c, chapter twelve of this code and pursuant to investment policy established by the Board of Treasury Investments for the voluntary accounts program. The Board of Treasury Investments shall provide investment options for participants to choose from, and may establish an investment plan for participants who choose not to self-direct their investments.
The director may also provide plans, including 401(k) plans and savings incentive match plans for employees, individual retirement account plans, that employers may elect to adopt for the benefit of their employees. However, this article does not require employers to provide plans for their employees. Those employers that elect to adopt plans are responsible for complying with any applicable federal and state laws, rules or regulations.
§5-10E-5. Principal account.
The voluntary accounts program principal account is created in the State Treasury and shall be administered in compliance with applicable federal law and as set forth in this section. The Board of Treasury Investments shall make arrangements with financial institutions to serve as trustees or custodians of the voluntary accounts as may be required or advisable to comply with applicable federal law and to provide for the efficient implementation and administration of the program.
The contributions elected by participating employees in accordance with section four and this section of this article shall be paid into the voluntary accounts program principal account and shall be sufficient to cover costs of repayment of start up funding, administration and staffing in addition to other amounts as may be determined by the director. The account shall be used to carry out the purposes of this chapter.
§5-10E-6. Accounts held in trust.
All moneys in the voluntary accounts program principal account and the voluntary accounts program administrative account, all property and rights purchased with the moneys, and all income attributable to the moneys, shall be held in trust by the Board of Treasury Investments for the exclusive benefit of the voluntary accounts program participants and their beneficiaries, and, notwithstanding any other provision of this or related articles, shall be held separate from other types of funds to the extent required by federal law. Neither the participating employee, nor the participant's beneficiary or beneficiaries, nor any other designee, has any right to commute, sell, assign, transfer, or otherwise convey the right to receive any payments under the program. These payments and rights are nonassignable and nontransferable. Account balances are not subject to attachment, garnishment, or execution and are not transferable by operation of law in the event of bankruptcy or insolvency, except to the extent otherwise required by law.
§5-10E-7. Authority, powers, duties and responsibilities of the
Board of Treasury Investments, director and Consolidated Public Retirement Board .

The Board of Treasury Investments has the full power to invest moneys in the voluntary accounts program principal account and the voluntary accounts program administrative account in accordance with cumulative investment directions provided by this article.
All investment and operating costs of the Board of Treasury Investments associated with the investment of the program assets shall be paid to the state. With the exception of these expenses, one hundred percent of all earnings from these investments shall accrue directly to the voluntary accounts program principal account.
No state board, commission, or agency or any officer, employee, or member is liable for any loss or deficiency resulting from participant investments selected under this article.
Neither the Board of Treasury Investments nor any officer, employee, or member are liable for any loss or deficiency resulting from reasonable efforts to implement investment directions under the provisions of this article. The voluntary accounts program administrative account is created in the State Treasury.
All expenses of the Consolidated Public Retirement Board pertaining to the voluntary accounts program including staffing and administrative expenses shall be paid out of the voluntary accounts program administrative account. Any excess balances credited to this account over administrative expenses disbursed from this account shall be transferred to the voluntary accounts program principal account at the time and in the amounts as may be determined by the director. Any deficiency in the voluntary accounts program administrative account caused by an excess of administrative expenses disbursed from this account shall be transferred to this account from the voluntary accounts program principal account.
The director shall keep or cause to be kept full and adequate accounts and records of the assets of each individual participant, obligations, transactions, and affairs of the program. The Consolidated Public Retirement Board shall account for and report on the investment of program assets or may enter into an agreement with the Board of Treasury Investments for accounting and reporting. The director's duties related to individual participant accounts include conducting the activities of trade instruction, settlement activities, and direction of cash movement and related wire transfers with the custodian bank and outside investment firms.
The director has sole responsibility for contracting with any record keepers for individual participant accounts and shall manage the performance of record keepers under those contracts.
The director's duties under this section do not limit the authority of the Board of Treasury Investments to conduct its responsibilities for asset management and balancing of program funds.
The Board of Treasury Investments has sole responsibility for contracting with outside investment firms to provide investment management for program funds and shall manage the performance of investment managers under those contracts.
The State Treasurer shall designate and define the terms of engagement for the custodial banks.
No member of the Board of Treasury Investments is liable for the negligence, default, or failure of any other person or other member of the board to perform the duties of the member's office and no member of the board may be considered or held to be an insurer of the funds or assets of the voluntary accounts program, nor is any nonvoting member liable for actions performed with the exercise of reasonable diligence within the scope of the member's authorized activities as a member of the board.


NOTE: The purpose of this bill is to provide every worker in the state with access to a voluntary retirement savings account through the state.

This article is new, therefore, strike throughs and underscoring have been omitted.

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