Oklahoma state lawmakers have introduced bills in both chambers of the state legislature that would create a state-run retirement program for employers that do not offer a retirement plan.
Called the Oklahoma Prosperity Act Program, it would begin enrolling participants two years after the bill is passed in automatic-enrollment, payroll-deduction individual retirement accounts (IRAs). It would require employers that have at least 10 workers and that have been in business for two years or longer to make the state-run plan available to their workers.
Employees who are 18 or older would be automatically enrolled at a 3% deferral, unless they choose a higher amount, and have the right to opt out of the program. They would also have the ability to choose which investments they want to place their money in. Employers would not be able to contribute to the plan.
A six-member board, the Oklahoma Sooner Choice Trust Board, would administer the program, function as the plan’s fiduciary by acting prudently and in the best interest of participants, review the investments at least twice a year, seek ways to maximize participation and savings through a communications program, and issue audited financial reports to the governor and legislature within two years after the program is established and annually thereafter.
The board would determine how long an employee must have worked at an employer before they are eligible to participate in the savings program. The board would also be charged with adopting an investment policy statement (IPS) every year. Assets in the fund would be held separately from state assets. Employers that failed to enroll employees who have not specifically indicated that they want to opt out of the program would be penalized.
The legislation, introduced in the Oklahoma Legislature, was backed by state Representative Dustin Roberts, R-Durant, in the House, and state Senator John Montgomery, R-Lawton, in the Senate.
Twelve states already have such programs in place.