Sec. 31-417. Connecticut Retirement Security Advisory Board.
Sec. 31-418. Connecticut Retirement Security Program.
Sec. 31-418a. Request for advance.
Sec. 31-419. Informational materials. Individual retirement account statement. Notification of fees.
Sec. 31-421. Comptroller standard of care.
Sec. 31-423. Investment vehicles. Vendor selection.
Sec. 31-424. Establishment of rules and procedures. Design features.
Sec. 31-425. Violations. Permissible civil actions.
Sec. 31-426. Annual report. Audit. Memoranda of understanding.
Sec. 31-427. Internet web site for qualified employers and vendors. Vendor participation procedures.
Sec. 31-428. Comptroller to establish and maintain Internet web site for participants.
Secs. 31-410 to 31-415. Definitions. Connecticut Retirement Security Board. Statement of financial interests. Acceptance of bequest, devise or gift; application for grants or financial assistance; account. Market feasibility study. Comprehensive proposal for implementation of plan. Sections 31-410 to 31-415, inclusive, are repealed, effective January 1, 2017.
(P.A. 14-217, S. 180–185; P.A. 16-29, S. 21; May Sp. Sess. P.A. 16-3, S. 207.)
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Sec. 31-416. Definitions. As used in this section, section 31-71e, and sections 31-417 to 31-427, inclusive:
(1) “Board” means the Connecticut Retirement Security Advisory Board established pursuant to section 31-417;
(2) “Contribution level” means (A) the contribution rate selected by the participant that may be expressed as (i) a percentage of the participant's taxable wages as is required to be reported under Sections 6041 and 6051 of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, or (ii) a dollar amount up to the maximum deductible amount for the participant's taxable year under Section 219(b)(1) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time; or (B) in the absence of an affirmative election by the participant, three per cent of the participant's taxable wages as is required to be reported under Sections 6041 and 6051 of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time. The contribution level of a participant who customarily and regularly receives gratuities in conjunction with his or her employment shall be a percentage of such participant's wages as is required to be reported under Sections 6041 and 6051 of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time;
(3) “Covered employee” means an individual (A) who has been employed by a qualified employer for a period of not less than one hundred twenty days, (B) who is nineteen years of age or older, (C) who performs services within the state for purposes of section 31-222, and (D) whose service or employment is not excluded under the provisions of subdivision (5) of subsection (a) of section 31-222;
(4) “Participant” means any individual participating in the program;
(5) “Program” means the Connecticut Retirement Security Program established pursuant to section 31-418;
(6) “Qualified employer” means any person, corporation, limited liability company, firm, partnership, voluntary association, joint stock association or other entity doing business in the state during the calendar year, whether for profit or not for profit, that employed on October first of the preceding calendar year five or more individuals in the state and has paid not less than five of such individuals taxable wages of not less than five thousand dollars in the preceding calendar year. “Qualified employer” does not include: (A) The federal government, (B) the state or any political subdivision thereof, (C) any municipality, unit of a municipality or municipal housing authority, (D) an employer employing only individuals whose services are excluded under subdivision (5) of subsection (a) of section 31-222, or (E) an employer that was not in existence at all times during the current calendar year and the preceding calendar year;
(7) “Individual retirement account” means a Roth IRA;
(8) “Roth IRA” means an account described in Section 408A of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time;
(9) “Normal retirement age” means the age specified in Section 408A of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, when an individual may withdraw all funds without penalty;
(10) “Vendor” means (A) a federally regulated retirement plan sponsor conducting business in the state, including, but not limited to, a federally regulated investment company or an insurance company, or (B) a company conducting business in the state to (i) provide ancillary services, including, but not limited to, technological, payroll or recordkeeping services, and (ii) offer retirement plans or payroll deposit individual retirement account arrangements using products of regulated retirement plan sponsors. “Vendor” does not include individual registered representatives, brokers, financial planners or agents; and
(11) “Fee” means investment management charges, administrative charges, investment advice charges, trading fees, marketing and sales fees, revenue sharing, broker fees and other costs necessary to administer the program.
(P.A. 16-29, S. 1; May Sp. Sess. P.A. 16-3, S. 95; P.A. 22-118, S. 96.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 amended Subdiv. (3)(B) by deleting provision re amount determined by authority not to exceed 6 per cent, amended Subdiv. (6) by replacing “Connecticut Retirement Security Program” with “Connecticut Retirement Security Exchange”, amended Subdiv. (11) by redefining “vendor”, added Subdiv. (12) defining “fee” and made technical changes, effective June 2, 2016; P.A. 22-118 deleted Subdiv. (1) and redesignated remaining Subdivs., amended redesignated Subdiv. (1) by replacing “Connecticut Retirement Security Authority board of directors” with “Connecticut Retirement Security Advisory Board,” and amended redesignated Subdiv. (5) by replacing “Connecticut Retirement Security Exchange” with “Connecticut Retirement Security Program,” effective July 1, 2022.
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Sec. 31-417. Connecticut Retirement Security Advisory Board. (a) There is created the Connecticut Retirement Security Advisory Board which shall consist of the following fifteen voting members, each a resident of the state: (1) The State Treasurer; (2) the State Comptroller; (3) the Secretary of the Office of Policy and Management; (4) the Banking Commissioner; (5) the Labor Commissioner; (6) one appointed by the speaker of the House of Representatives, who has a favorable reputation for skill, knowledge and experience in the interests of the needs of aging population; (7) one appointed by the majority leader of the House of Representatives, who has a favorable reputation for skill, knowledge and experience in the interests of small employers in retirement savings; (8) one appointed by the minority leader of the House of Representatives, who has a favorable reputation for skill, knowledge and experience in the interests of retirement investment products; (9) one appointed by the president pro tempore of the Senate, who has a favorable reputation for skill, knowledge and experience in the interests of employees in retirement savings; (10) one appointed by the majority leader of the Senate, who has a favorable reputation for skill, knowledge and experience in retirement plan designs; (11) one appointed by the minority leader of the Senate, who has a favorable reputation for skill, knowledge and experience in the interests of retirement plan brokers; and (12) four appointed by the Governor, one who has a favorable reputation for skill, knowledge and experience in matters regarding the federal Employment Retirement Income Security Act of 1974, as amended from time to time, or the Internal Revenue Code of 1986 or any subsequent corresponding internal revenue code of the United States, as amended from time to time, one who has a favorable reputation for skill, knowledge and experience in annuity products, one who has a favorable reputation for skill, knowledge and experience in retirement investment products, and one who shall have a favorable reputation for skill, knowledge and experience in actuarial science. Each member appointed pursuant to subdivisions (6) to (12), inclusive, of this subsection shall serve an initial term of four years. Thereafter, said members of the General Assembly and the Governor shall appoint members of the board to succeed such appointees whose terms expire and each member so appointed shall hold office for a term of six years from July first in the year of his or her appointment.
(b) All appointments to the board shall be made not later than January 1, 2017. Any vacancy shall be filled by the appointing authority not later than thirty calendar days after the office becomes vacant. Any member appointed to the board of directors of the former Connecticut Retirement Security Authority and serving on July 1, 2022, may continue to serve as a member of the Connecticut Retirement Security Advisory Board until the expiration of such member's term. Any member previously appointed to the board may be reappointed.
(c) Notwithstanding the provisions of section 4-9a, the Comptroller shall be the chairperson of the board. The board shall annually elect a vice-chairperson and such other officers as it deems necessary from among its members.
(d) The members of the board shall serve without compensation but shall, within available appropriations, be reimbursed in accordance with the standard travel regulations for all necessary expenses that they may incur through service on the board.
(e) Each member of the board shall, not later than ten calendar days after his or her appointment, take and subscribe the oath of affirmation required by article XI, section 1, of the State Constitution. Each member's term shall begin from the date the member takes such oath. The oath shall be filed in the office of the Secretary of the State.
(f) Eight members of the board shall constitute a quorum. Each member shall be entitled to one vote on the board.
(g) (1) No member of the board or any officer, agent or employee of the Comptroller administering the program shall, directly or indirectly, have any financial interest in any corporation, business trust, estate, trust, partnership or association, two or more persons having a joint or common interest, or any other legal or commercial entity contracting with the program.
(2) Notwithstanding the provisions of subdivision (1) of this subsection or any other section of the general statutes, it shall not be a conflict of interest or a violation of the provisions of said subdivision or any other section of the general statutes for a trustee, director, officer or employee of a bank, investment advisor, investment company or investment banking firm, or a person having the required favorable reputation for skill, knowledge and experience in retirement savings, to serve as a member of the board, provided, in each case to which the provisions of this subdivision are applicable, such trustee, director, officer or employee of such a firm abstains from discussion, deliberation, action and vote by the board in specific respect to any undertaking pursuant to this section, section 31-71e, sections 31-418 to 31-427, inclusive, in which such firm has a direct interest separate from the interests of all similar firms generally.
(h) The board, on behalf of the authority, and for the purpose of implementing the Connecticut Retirement Security Program established pursuant to section 31-418, shall advise the Comptroller on matters including:
(1) Using surplus funds to the extent authorized under sections 31-71e, 31-71j, 31-416 to 31-427, inclusive, and 31-429, or other provisions of the general statutes; and
(2) Making modifications to the program that the board deems necessary to implement the provisions of section 31-71e, sections 31-417 to 31-427, inclusive, consistent with federal rules and regulations in order to ensure that the program meets all criteria for federal tax-deferral or tax-exempt benefits, and to prevent the program from being treated as an employee benefit plan under the federal Employee Retirement Income Security Act of 1974, as amended from time to time.
(i) Any money expended from the General Fund for the purpose of administering the Connecticut Retirement Security Program shall be reimbursed to the General Fund according to a plan established and agreed upon by both the Secretary of the Office of Policy and Management and the Comptroller. Such plan shall (1) include a schedule for reimbursement of any money expended from the General Fund to the program, and (2) incorporate any previously agreed upon terms between the Comptroller and the Treasurer to pay back the General Fund for any request for an advance made pursuant to section 31-418a of the general statutes, revision of 1958, revised to January 1, 2021. Payments to reimburse the General Fund shall continue according to the terms of such plan until all money expended from the General Fund to the program is reimbursed. The program may pay any unpaid amounts earlier than the established repayment plan requires.
(P.A. 16-29, S. 2; May Sp. Sess. P.A. 16-3, S. 96; P.A. 22-118, S. 97; P.A. 23-204, S. 112.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 amended Subsec. (b) by increasing number of voting members from 9 to 15, adding new Subdivs. (3) to (6) re Secretary of the Office of Policy and Management, Banking Commissioner and Labor Commissioner, respectively, redesignating existing Subdivs. (3) to (9) as Subdivs. (6) to (12), further amending redesignated Subdiv. (7) to replace “employers” with “small employers” and further amending redesignated Subdiv. (12) to add provisions re members who have favorable reputations for skill, knowledge and experience in annuity products, retirement investment products and actuarial science, amended Subsec. (c) by replacing “July 31, 2016” with “January 1, 2017” re appointments, amended Subsec. (d) by deleting “, with the advice and consent of both houses of the General Assembly,” and deleting references to assistant executive director, amended Subsec. (f)(1) by deleting provision re Secretary of the State to administer oath, amended Subsec. (h) by increasing number of members constituting quorum from 4 to 8, amended Subsec. (j) by replacing “Connecticut Retirement Security Program” with “Connecticut Retirement Security Exchange”, and made technical and conforming changes, effective June 2, 2016; P.A. 22-118 deleted Subsec. (a) and redesignated Subsecs. (b) and (c) as Subsecs. (a) and (b), added in redesignated Subsec. (b) reference to Connecticut Retirement Security Advisory Board and revised board's membership terms, redesignated Subsec. (d) as Subsec. (c) and in same deleted reference to Governor selecting chairperson and added reference to provisions of Sec. 4-9a, redesignated existing Subsecs. (e) and (f) as Subsecs. (d) and (e) and in redesignated Subsec. (e) deleted Subdiv. (2), deleted Subsec. (g), redesignated Subsecs. (h) to (j) as Subsecs. (f) to (h) and in redesignated Subsec. (h) deleted Subdivs. (1) to (4) and (7) and redesignated remaining Subdivs. as Subdivs. (1) and (2), deleted Subsecs. (k) and (l) and added new Subsec. (i) re General Fund reimbursement, effective July 1, 2022; P.A. 23-204 substantially revised Subsec. (i) by establishing a plan for reimbursement to the General Fund, effective June 12, 2023 (Revisor's note: In codifying section 112 of public act 23-204, a reference to “section 6 of public act 18-169”, which appeared in the engrossed bill, was changed editorially by the Revisors to “section 31-418a of the general statutes, revision of 1958, revised to January 1, 2021,” for accuracy).
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Sec. 31-418. Connecticut Retirement Security Program. (a) There is established the Connecticut Retirement Security Program, the purpose of which shall be to promote and enhance retirement savings for private sector employees in the state, to be administered by the Comptroller. The office of the Comptroller shall constitute a successor agency to the Connecticut Retirement Security Authority for the purposes of administering the Connecticut Retirement Security Program, in accordance with subsections (a), (b), (c), (d) and (f) of sections 4-38d and 4-38e. The Comptroller in consultation with the board, may:
(1) Establish criteria and guidelines for the program to offer qualified retirement investment choices. Such criteria and guidelines shall establish a cap on total annual fees and shall provide participants with information regarding each retirement investment choice's historical investment performance;
(2) Receive and invest moneys in the program in any instruments, obligations, securities or property in accordance with section 31-423;
(3) Contract with financial institutions or other organizations offering or servicing retirement programs. The Comptroller may require that each participant be charged a fee to defray the costs of the program. The amount and method of collection of such fee shall be determined by the Comptroller. No employer shall be required to fund or be responsible for collecting fees from plan participants;
(4) Charge and equitably apportion among participants the administrative costs and expenses incurred in the exercise of the Comptroller's powers and duties as granted by this section;
(5) Borrow working capital funds and other funds as may be necessary for the start-up and continuing operation of the program, provided such funds are borrowed in the name of the program only. Such borrowings shall be payable solely from revenues of the program;
(6) Do all things necessary or convenient to carry out the provisions of section 31-71e, and sections 31-417 to 31-427, inclusive; and
(7) Establish an administrative process by which participants, potential participants and employees may submit grievances, complaints and appeals to the Comptroller and have such grievances, complaints and appeals heard and addressed by the Comptroller.
(b) The Comptroller shall enter into memoranda of understanding with the Labor Department and other state agencies regarding (1) the gathering or dissemination of information necessary for the operations of the program, subject to such obligations of confidentiality as may be agreed or required by law, (2) the sharing of costs incurred pursuant to the gathering and dissemination of such information, and (3) the reimbursement of costs for any enforcement activities conducted pursuant to section 31-425. Each state agency may also enter into such memoranda of understanding.
(c) The Comptroller may adopt regulations in accordance with the provisions of chapter 54 to implement the provisions of this chapter, including, but not limited to, regulations concerning the protection of program participants' personal and confidential information.
(P.A. 16-29, S. 3; May Sp. Sess. P.A. 16-3, S. 97, 207; P.A. 19-117, S. 99; P.A. 22-118, S. 98.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 3, from May 27, 2016, to January 1, 2017, effective June 2, 2016, and amended Subsec. (a) by replacing “Connecticut Retirement Security Program” with “Connecticut Retirement Security Exchange”, amended Subsec. (a)(5) by replacing provision re retirement programs to be offered with provisions re program to offer qualified retirement investment choices, cap on annual fees and information to be provided to participants, amended Subsec. (a)(8) by replacing “attorneys, accountants, consultants, financial experts, loan processors, banks, managers and such other employees and agents” with “such employees”, amended Subsec. (a)(11) by adding “the state and any instrumentalities thereof”, and made a technical change, effective January 1, 2017; P.A. 19-117 amended Subsec. (a)(5) by deleting provision re offer by multiple vendors as selected by authority, effective July 1, 2019; P.A. 22-118 amended Subsec. (a) to change “Connecticut Retirement Security Exchange” to “Connecticut Retirement Security Program”, add provision re administered by the Comptroller, delete Subdivs. (1) to (4), (8), (11) and (12) and add references to comptroller in redesignated Subdivs. and add new Subdiv. (7) re administrative process, amended Subsec. (b) to replace reference to board of directors with Comptroller, and added Subsec. (c) re adoption of regulations, effective July 1, 2022.
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Sec. 31-418a. Request for advance. Section 31-418a is repealed, effective May 7, 2022.
(P.A. 18-169, S. 6; P.A. 22-118, S. 513.)
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Sec. 31-419. Informational materials. Individual retirement account statement. Notification of fees. (a) The Comptroller shall prepare informational materials regarding the Connecticut Retirement Security Program for distribution by qualified employers to plan participants and prospective plan participants pursuant to section 31-422. Such informational materials shall include, but need not be limited to:
(1) The benefits and risks associated with making contributions to or making withdrawals from the program;
(2) The process for making contributions to the program, including a contribution election form;
(3) Clear and conspicuous notice regarding the default contribution level;
(4) The process by which a participant may opt out of the program by electing a contribution level of zero;
(5) A description of applicable federal and state regulations, including income and contribution limits for participating in the program;
(6) The process for withdrawing retirement savings from the program, including an explanation of the tax treatment of withdrawals;
(7) The process by which a participant may obtain additional information on the program, including information regarding investment options available under the program; and
(8) Such other information as the Comptroller may deem necessary or advisable to provide to participants, potential participants and qualified employers in the state.
(b) Not less than quarterly, the Comptroller shall provide a statement to each participant that shall include, but need not be limited to, the following information:
(1) The account balance in a participant's individual retirement account, including the value of the participant's investment in each investment option selected by the participant;
(2) The investment options available to each participant and the process by which a participant may select investment options for his or her contributions in accordance with subsection (b) of section 31-71j or as prescribed by the Comptroller;
(3) The amount of fees charged to each participant's individual retirement account and a description of the services to which such charges relate; and
(4) An estimate of the amount of income the account is projected to generate for a participant's retirement based on reasonable assumptions.
(c) Not less than annually, the Comptroller shall provide each participant with notification regarding fees that may be imposed through the program and information regarding the various investment options that may be available to participants. The Comptroller may provide such notification and information in the form of a prospectus or similar document.
(d) The Comptroller may adopt regulations in accordance with the provisions of chapter 54 for the electronic dissemination of any notices or information required to be provided to participants, potential participants and qualified employers pursuant to the provisions of this section.
(P.A. 16-29, S. 4; May Sp. Sess. P.A. 16-3, S. 98, 207; P.A. 19-117, S. 100; P.A. 22-118, S. 99.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 4, from May 27, 2016, to January 1, 2017, effective June 2, 2016, and replaced “Connecticut Retirement Security Program” with “Connecticut Retirement Security Exchange” in Subsec. (a) and made technical changes, effective January 1, 2017; P.A. 19-117 deleted “various vendors'” in Subsec. (b)(2), effective July 1, 2019; P.A. 22-118 amended Subsec. (a) to change “Connecticut Retirement Security Authority board of directors” with “Comptroller”, change “Connecticut Retirement Security Authority” to “Connecticut Retirement Security Program”, Subsec. (d) to replace reference to Sec. 1-121 with reference to Ch. 54 and replaced references to the board and the authority with references to the Comptroller throughout, effective July 1, 2022.
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Sec. 31-420. Establishment and maintenance of individual retirement accounts. Unclaimed funds. Total annual fees. (a) The Comptroller shall provide for the establishment and maintenance of an individual retirement account for each program participant. Such individual retirement account shall be established and maintained through the program. Program assets shall be held in trust or custodial accounts meeting the requirements of Section 408(a) or (c) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, or any other applicable federal law requirements.
(b) Interest, investment earnings and investment losses shall be allocated to each participant's individual retirement account. A participant's benefit under the program shall be equal to the balance in such participant's individual retirement account as of any applicable measurement date prescribed by the program.
(c) The Comptroller shall establish, or cause to be established, processes to prevent a participant's contributions to the program from exceeding the maximum amount of deduction under 26 USC 219(b)(1) for the participant's tax year.
(d) The Comptroller shall not be liable for the payment of any benefit to any participant or beneficiary of any participant, except with respect to any individual retirement accounts established and maintained by the Comptroller.
(e) Any unclaimed funds in a participant's individual retirement account shall be governed by section 3-57a.
(f) The Comptroller shall minimize total annual fees associated with the program, except on and after the completion of the fourth calendar year following the first date on which the program becomes effective pursuant to section 31-422, the total annual fees associated with the program shall not exceed three-quarters of one per cent of the total value of the program assets.
(P.A. 16-29, S. 5; May Sp. Sess. P.A. 16-3, S. 99, 207; P.A. 22-118, S. 100.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 5, from May 27, 2016, to January 1, 2017, effective June 2, 2016, and amended Subsec. (a) by replacing “Connecticut Retirement Security Program” with “Connecticut Retirement Security Authority” and deleting provision re third-party entity and added Subsec. (f) re total annual fees associated with program, effective January 1, 2017; P.A. 22-118 replaced references to Connecticut Retirement Security Authority with references to the Comptroller, effective July 1, 2022.
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Sec. 31-421. Comptroller standard of care. (a) The Comptroller, in conducting the business of the program shall act: (1) With the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of like character and with like aims; (2) solely in the interests of the program's participants and beneficiaries; (3) for the exclusive purposes of providing benefits to participants and beneficiaries and defraying reasonable expenses of administering the program; and (4) in accordance with the provisions of section 31-71e, and sections 31-417 to 31-427, inclusive, and any other applicable sections of the general statutes.
(b) The Comptroller shall, to the extent reasonable and practicable, require any vendors engaged or appointed by the Comptroller to abide by the standard of care described in subsection (a) of this section.
(P.A. 16-29, S. 6; May Sp. Sess. P.A. 16-3, S. 100, 207; P.A. 22-118, S. 101.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 6, from May 27, 2016, to January 1, 2017, effective June 2, 2016, and amended Subsec. (b) by replacing “agents” with “vendors”, effective January 1, 2017; P.A. 22-118 replaced references to Connecticut Retirement Security Authority board of directors with the Comptroller, effective July 1, 2022.
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Sec. 31-422. Qualified employers to provide informational materials to covered employees. Enrollment of participants. Fund rollover. Withholding of compensation. (a)(1) Not later than January 1, 2018, and annually thereafter, each qualified employer shall provide each of its covered employees with the informational materials prepared by the Comptroller pursuant to section 31-419. For any employee of a qualified employer who (A) is hired on or after January 1, 2018, or (B) does not meet the definition of covered employee pursuant to section 31-416, such qualified employer shall provide such informational materials to such employee not later than thirty days, or such other time period as prescribed by the Comptroller, after (i) the date of such employee's hiring, or (ii) the date such employee meets the definition of covered employee pursuant to section 31-416.
(2) Not later than sixty days after a qualified employer provides informational materials to a covered employee in accordance with subsection (a) of this section, or such other time period as prescribed by the Comptroller, and subject to the provisions of subdivision (3) of this subsection, such qualified employer shall automatically enroll each of its covered employees in the program at the participant's contribution level in accordance with the provisions of section 31-71j.
(3) A covered employee may opt out of the program by electing a contribution level of zero.
(4) (A) A qualified employer that (i) maintains a retirement plan or retirement arrangement described under Section 219(g)(5) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, or (ii) any other retirement arrangement approved by the Comptroller, shall be exempt from the requirements of subdivisions (1) and (2) of this subsection.
(B) A qualified employer shall not be considered to maintain a retirement plan or retirement arrangement described under said Section 219(g)(5) or any other retirement arrangement approved by the Comptroller pursuant to subparagraph (A) of this subdivision, if the Comptroller determines that (i) as of the first day of the previous calendar year, no new participant was eligible to be enrolled in a retirement plan or retirement arrangement maintained by such qualified employer, and (ii) on and after the first day of the previous calendar year, no contributions were made to such retirement plan or retirement arrangement by or on behalf of a participant in such plan or arrangement.
(5) The Comptroller may defer the effective date of the program, in whole or in part, and for particular categories of employers, as the Comptroller deems necessary to effectuate the purposes of section 31-71e, and sections 31-417 to 31-427, inclusive, in a manner that minimizes the disruption and burdens that may exist for any qualified employer. The Comptroller shall provide notice of any deferment of the effective date of the program to the chairpersons and ranking members of the joint standing committee of the General Assembly having cognizance of matters relating to labor not later than seven days after the Comptroller has deemed such deferment necessary. Such notice shall include the categories of employers affected, the purpose for which the deferment was granted and the new effective date of the program.
(b) A private employer with four employees or fewer may make the program available to its employees subject to such regulations as may be adopted by the Comptroller, in accordance with the provisions of chapter 54. No such employer shall require any employee to enroll in the program.
(c) Any individual who is not enrolled in the program pursuant to subsection (a) of this section may participate in the program at any time subject to such regulations as the Comptroller may adopt, in accordance with the provisions of chapter 54. The Comptroller shall provide the informational materials described in section 31-419 to any such individual at or before the time of such individual's enrollment in the program.
(d) To the extent permitted under the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, the Comptroller shall allow any individual to establish or contribute to an individual retirement account maintained for such individual under the program by rolling over funds from an existing retirement savings account of the individual.
(e) A qualified employer that withholds a contribution from a covered employee's compensation in connection with the program shall transmit such contribution on the earliest date the amount withheld from the covered employee's compensation can be transmitted, but not later than ten business days following the date upon which the covered employee's contribution amounts were withheld from his or her paycheck.
(f) No employer shall be permitted to make a contribution to the program.
(g) The Comptroller shall disseminate information concerning the tax credits that may be available to small business owners for establishing new retirement plans.
(P.A. 16-29, S. 7; May Sp. Sess. P.A. 16-3, S. 101, 207; P.A. 22-118, S. 102.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 7, from May 27, 2016, to January 1, 2017, effective June 2, 2016, and amended Subsec. (b) by replacing “An employer that does not otherwise meet the definition of a qualified employer” with “A private employer with four employees or fewer” and amended Subsec. (e) by replacing provision re time for transmission of contribution from covered employee's compensation with new provision re same, effective January 1, 2017; P.A. 22-118 replaced references to the Connecticut Retirement Security Authority board of directors with the Comptroller and made technical changes, effective July 1, 2022.
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Sec. 31-423. Investment vehicles. Vendor selection. The Comptroller shall provide for each participant's account to be invested in (1) an age-appropriate target date fund, or (2) other investment vehicles the Comptroller may prescribe if affirmatively selected by the participant.
(P.A. 16-29, S. 8; May Sp. Sess. P.A. 16-3, S. 102, 207; P.A. 19-117, S. 101; P.A. 22-118, S. 103.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 8, from May 27, 2016, to January 1, 2017, effective June 2, 2016, and designated existing provisions re investment of participant's account as Subsec. (a) and amended same to add provision re participant to select vendor and added Subsec. (b) re investment of contribution if participant does not select specific vendor or investment option, effective January 1, 2017; P.A. 19-117 deleted Subsec. (b) re participant not selecting specific vendor or investment option, deleted Subsec. (a) designator, added “if affirmatively selected by the participant” in Subdiv. (2) and made technical and conforming changes, effective July 1, 2019; P.A. 22-118 replaced references to the Connecticut Retirement Security Authority with the Comptroller, effective July 1, 2022.
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Sec. 31-424. Establishment of rules and procedures. Design features. (a) The Comptroller shall adopt regulations, in accordance with the provisions of chapter 54 governing the distribution of funds from the program. Such regulations shall allow for such distributions as may be permitted or required by the program and any applicable provisions of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time.
(b) The program shall include the following design features prescribed by the Comptroller, provided the Comptroller determines such features to be feasible and cost effective:
(1) A lifetime income investment option intended to provide participants with a source of retirement income for life. Any lifetime income investment for the program shall include spousal rights;
(2) Provide to each participant, one year in advance of the participant's normal retirement age, a disclosure explaining (A) the rights and features of the lifetime income investment; (B) that once the participant reaches normal retirement age, fifty per cent of the participant's account will be invested in the lifetime income investment; and (C) that the participant may elect to invest a higher percentage of his or her account balance in the lifetime income option;
(3) On the date a participant reaches his or her normal retirement age, invest fifty per cent of the participant's account balance, or such higher amount as specified by the participant, in the lifetime income investment;
(4) Permit each participant to elect a date not earlier than his or her normal retirement age on which to begin receiving distributions, provided, in the absence of an election, such distributions shall commence not later than ninety days after the participant reaches his or her normal retirement age; and
(5) Adopt regulations, in accordance with the provisions of chapter 54 whereby each participant may elect to invest a higher percentage of his or her account balance in the lifetime income investment.
(c) The Comptroller shall inform participants about their rights to withdraw funds from the program in accordance with the provisions of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time. For participants who elect to withdraw their assets prior to their normal retirement age, the Comptroller shall notify such participants of the potential for tax penalties associated with such withdrawal and the effect of such withdrawal on such participant's expected retirement income.
(P.A. 16-29, S. 9; May Sp. Sess. P.A. 16-3, S. 103, 207; P.A. 22-118, S. 104.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 9, from May 27, 2016, to January 1, 2017, effective June 2, 2016, and made technical changes in Subsecs. (b)(1) and (c), effective January 1, 2017; P.A. 22-118 replaced references to the Connecticut Retirement Security Authority with the Comptroller, replaced “establish rules and procedures” and “establish procedures” with “adopt regulations” and added references to Ch. 54, effective July 1, 2022.
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Sec. 31-425. Violations. Permissible civil actions. (a) The Attorney General may investigate any violation of section 31-421. If the Attorney General finds that any member of the Connecticut Retirement Security Advisory Board, or any agent engaged or appointed by the Comptroller or the board has violated or is violating any provision of said section, the Attorney General may bring a civil action in the superior court for the judicial district of Hartford under this section in the name of the state against such member or agent. The remedies available to a court in any such action shall be limited to injunctive relief. Nothing in this section shall be construed to create a private right of action.
(b) If a qualified employer fails to remit contributions to the program in the time period specified in subsection (e) of section 31-422, such failure to remit such contributions shall be a violation of section 31-71e.
(c) If a qualified employer fails to enroll a covered employee as required under subsection (a) of section 31-422, such covered employee, the Labor Commissioner or the Comptroller, may bring a civil action to require the qualified employer to enroll the covered employee and shall recover such costs and reasonable attorney's fees as may be allowed by the court.
(P.A. 16-29, S. 10; May Sp. Sess. P.A. 16-3, S. 207; P.A. 22-118, S. 105.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 10, from May 27, 2016, to January 1, 2017, effective June 2, 2016; P.A. 22-118 amended Subsec. (a) to replace reference to “Authority board of directors” with “Advisory Board” and “Comptroller or the board”, and amended Subsec. (c) to add “or the Comptroller”, effective July 1, 2022.
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Sec. 31-426. Annual report. Audit. Memoranda of understanding. (a) The Comptroller shall keep an accurate account of all its activities, receipts and expenditures of the Connecticut Retirement Security Program and shall submit, in accordance with the provisions of section 11-4a, a report detailing such activities, receipts and expenditures to the Connecticut Retirement Security Advisory Board, the Governor, the Office of Auditors of Public Accounts and the joint standing committees of the General Assembly having cognizance of matters relating to labor and finance, revenue and bonding on or before December thirty-first annually. Such report shall be in a form prescribed by the board and shall include projected activities of the Comptroller for the next fiscal year.
(b) The Auditors of Public Accounts may conduct a full audit of the books and accounts of the program pertaining to such activities, receipts and expenditures, personnel, services or facilities, in accordance with the provisions of section 2-90. For the purposes of such audit, the Auditors of Public Accounts shall have access to the properties and records of the program.
(P.A. 16-29, S. 11; May Sp. Sess. P.A. 16-3, S. 104, 207; P.A. 21-145, S. 7; P.A. 22-118, S. 106.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 11, from May 27, 2016, to January 1, 2017, effective June 2, 2016, and amended Subsec. (c) by changing “shall” to “may” re State Comptroller entering into memoranda of understanding, effective January 1, 2017; P.A. 21-145 amended Subsec. (a) by deleting requirement that report be subject to approval by the auditors and amended Subsec. (b) by adding reference to Ch. 12 and deleting authorization for auditors to prescribe methods of accounting and rendering of reports; P.A. 22-118 amended Subsec. (a) to replace “Connecticut Retirement Security Authority” with “Comptroller” and add reference to the Connecticut Retirement Security Program, to replace “Authority board of directors” with “Advisory Board” and to replace “authority” with “Comptroller”, amended Subsec. (b) to replace “authority” with “program” and delete reference to Ch. 12, and deleted Subsec. (c), effective July 1, 2022.
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Sec. 31-427. Internet web site for qualified employers and vendors. Vendor participation procedures. (a) The Comptroller shall:
(1) Establish and maintain a secure Internet web site to (A) provide qualified employers with information regarding employer-sponsored retirement plans and payroll deduction individual retirement accounts, and (B) assist qualified employers in identifying vendors of retirement arrangements that may be implemented by the qualified employers in lieu of participation in the program;
(2) Include the Internet web site address on any posting to the Internet web site or in other materials offered to the public regarding the program;
(3) Prior to implementing the Internet web site, and at least annually thereafter, provide notice to vendors (A) that such Internet web site is active, (B) that such vendors may register for inclusion on the Internet web site, and (C) regarding the process for inclusion on the Internet web site; and
(4) Establish an appeals process for vendors that are denied registration or removed from the Internet web site pursuant to subsection (d) of this section.
(b) Each vendor that registers to be listed on the Internet web site shall provide: (1) A statement of such vendor's experience providing employer-sponsored retirement plans and payroll deduction individual retirement accounts in this state and in other states, if applicable, (2) a description of the types of retirement investment products offered by such vendor, and (3) a disclosure of all expenses paid directly or indirectly by retirement plan participants, including, but not limited to, penalties for early withdrawals, declining or fixed withdrawal charges, surrender or deposit charges, management fees and annual fees.
(c) The cost of establishing and maintaining the registration system and the Internet web site shall be borne solely and equally by registered vendors, based upon the total number of registered vendors.
(d) The Comptroller may remove a vendor from the Internet web site if the vendor: (1) Submits materially inaccurate information to the Comptroller, (2) does not remit assessed fees within sixty days from the date of assessment, or (3) fails to submit to the Comptroller notice of any material change to the vendor's registered investment products. Any vendor found to have submitted materially inaccurate information to the Comptroller shall be allowed sixty calendar days to correct the information.
(P.A. 16-29, S. 13; P.A. 22-118, S. 107.)
History: P.A. 16-29 effective January 1, 2018; P.A. 22-118 replaced references to the Connecticut Retirement Authority board of directors with the Comptroller, effective July 1, 2022.
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Sec. 31-428. Comptroller to establish and maintain Internet web site for participants. The Comptroller shall establish and maintain a secure Internet web site to provide Connecticut Retirement Security Program participants with information regarding the various investment options offered through the program, including the historical investment performance of such options.
(May Sp. Sess. P.A. 16-3, S. 106; P.A. 19-117, S. 102; P.A. 22-118, S. 108.)
History: May Sp. Sess. P.A. 16-3 effective January 1, 2018; P.A. 19-117 deleted provision re approved vendors, added provision re various investment options offered through the program and made a conforming change, effective July 1, 2019; P.A. 22-118 replaced “Connecticut Retirement Security Authority board of directors” with “Comptroller” and replaced “Connecticut Retirement Security Exchange” with “Connecticut Retirement Security Program”, effective July 1, 2022.
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Sec. 31-429. Prohibition against contributions to exploratory, candidate, political or party committees. (a) No member of the Connecticut Retirement Security Advisory Board, except the State Comptroller or State Treasurer, or any executive director, assistant executive director or authorized officer appointed by said board or the principal of an entity with a contract with the Comptroller to administer the Connecticut Retirement Security Program, shall make a contribution to, or knowingly solicit contributions from the board on behalf of (1) an exploratory committee or candidate committee established by a candidate for nomination or election to the office of Governor, Lieutenant Governor, Attorney General, State Comptroller, Secretary of the State or State Treasurer, (2) a political committee authorized to make contributions or expenditures to or for the benefit of such candidates, or (3) a party committee.
(b) No member of the Connecticut Retirement Security Advisory Board, except the State Comptroller or State Treasurer, or the principal of any entity with a contract with the Comptroller to administer the program shall make a contribution to, or knowingly solicit contributions from the board on behalf of (1) an exploratory committee or candidate committee established by a candidate for nomination or election to the office of state senator or state representative, (2) a political committee authorized to make contributions or expenditures to or for the benefit of such candidates, or (3) a party committee.
(c) The provisions of this section, and sections 31-71e, 31-71j and 31-416 to 31-427, inclusive, shall be severable, and, if any of their provisions are held to be unconstitutional or invalid, the validity of the remaining provisions of said sections will not be affected.
(P.A. 16-29, S. 20; May Sp. Sess. P.A. 16-3, S. 207; P.A. 22-118, S. 109.)
History: P.A. 16-29 effective May 27, 2016; May Sp. Sess. P.A. 16-3 changed effective date of P.A. 16-29, S. 20, from May 27, 2016, to January 1, 2017, effective June 2, 2016; P.A. 22-118 amended Subsecs. (a) and (b) to replace “Authority board of directors” with “Advisory Board”, “authority” with “Comptroller” and “board's or the executive director's or assistant executive director's employees” with “board”, further amended Subsec. (b) to delete “or any executive director, assistant executive director or authorized officer appointed by said board”, and amended Subsec. (c) to make technical corrections, effective July 1, 2022.
Note: Chapters 575 and 576 are reserved for future use.
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