The American Society of Pension Professionals & Actuaries (ASPAA) reports that automatic enrollment through the Hawaii Retirement Savings Program has come closer to expansion with legislation aimed at doing so receiving recommendations from several committees.

Legislators have been considering the measures for two years, according to ASPAA. Multiple bills have been introduced during the current legislative session.

SB 855 would require a “covered employer” under the Hawaii Retirement Savings Act to automatically enroll covered employees into the Hawaii Retirement Savings Program unless they opt out and would repeal the limit on the total fees and expenses that can be spent for the program each year.

The bill has been passed by the Senate Labor and Technology Committee and Senate Ways and Means Committee. Its companion bill, HB 847, was amended and passed by the Committee on Labor and then referred to the Committee on Finance.

SB 1455 is similar to SB 855 in the “covered employer” requirements but lacks the other bill’s language concerning fees and expenses and appropriation of funds.

The Hawaii Retirement Savings Board strongly supports HB 847, according to written testimony from Ahlani K. Quiogue, the board’s executive director.

The requirement to automatically enroll employees is “critical to the feasibility of the program,” she wrote.

“There is an urgent need to provide a viable option for private sector workers to have access to a retirement savings plan,” Quiogue’s testimony states. “Automatically requiring enrollment but allowing workers to opt-out is not only beneficial to workers and considered a best practice in retirement savings programs but a feature most of the other state programs because of the recognition that without a critical mass of workers participating in these programs, they are not viable over the long-term.

“Moreover, aligning Hawaii’s law with most of the other states’ automatic enrollment provisions facilitates the potential for Hawaii to engage in an interstate compact agreement that will also aid in the viability of the program.”

Quiogue noted that as of Jan. 1 of this year, 13 out of 20 state programs offer an individual retirement account or auto-IRA, and two state programs are open to all other employers and workers through a voluntary marketplace or multiple employer plan.

Outside of state programs and specific to the collision repair industry, the Society of Collision Repair Specialists (SCRS) offers a 401(k) Multiple Employer Plan (MEP) to help participating businesses and employees save expenses relevant to their 401(k) balances and reduce administrative responsibilities for companies and provide fiduciary support.

Some of the plan highlights include:

• • Plan features customization
  • Administrative support to help with transition, onboarding, and employee education
  • Executive Committee within SCRS that conducts quarterly reviews of the plan and investments
  • Pre-negotiated declining fee schedule, meaning as the plan grows costs automatically go down
  • SCRS annual tax filing preparation
  • One audit for the entire plan, saving companies thousands of dollars by not having to do their own

For more information, reach out to Scott Broaddus by phone at (804) 327-0424 or by email at scott.broaddus@irongate-capital.com, or Coley Eckenrode at (804) 327-0425 or coley.eckenrode@vamllc.com. An information request web form is also available here.

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