Bill Text: CT SB00249 | 2014 | General Assembly | Comm Sub

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Bill Title: An Act Promoting Retirement Savings.

Spectrum: Strong Partisan Bill (Democrat 16-1)

Status: (Introduced - Dead) 2014-04-29 - Favorable Report, Tabled for the Calendar, Senate [SB00249 Detail]

Download: Connecticut-2014-SB00249-Comm_Sub.html

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General Assembly		Raised Bill No. 249
February Session, 2014		LCO No. 1517
		*_____SB00249APP___042814____*
Referred to Committee on LABOR AND PUBLIC EMPLOYEES
Introduced by:
(LAB)

AN ACT PROMOTING RETIREMENT SAVINGS.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective July 1, 2014) As used in this section and sections 2 to 15, inclusive, of this act:

(1) "Connecticut Retirement Security Trust Fund" or "trust" means the trust fund established pursuant to section 2 of this act;

(2) "Connecticut Retirement Security Trust Fund Board" or "board" means the governing body of the Connecticut Retirement Security Trust Fund, established pursuant to section 2 of this act;

(3) "Eligible employee" means any individual who is employed by a qualified employer, except (A) any individual who is seventeen years of age or younger on January first of each year, and (B) any individual who is included in a unit of employees covered by a collective bargaining agreement between employee representatives and one or more employers, if there is evidence that retirement benefits were the subject of good faith bargaining between such employee representatives and such employer or employers;

(4) "Individual retirement account" means an individual retirement account or individual retirement annuity within the trust established in accordance with Section 408(a) or (b) of the Internal Revenue Code;

(5) "Individual retirement savings balance" means the sum of all assets deposited into a plan participant's individual retirement account, plus accumulated interest and minus any fees;

(6) "Internal Revenue Code" means the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time;

(7) "Plan participant" means any eligible employee who maintains an individual retirement account within the trust;

(8) "Public retirement plan" or "plan" means a retirement plan designed by the Connecticut Retirement Security Trust Fund Board and offered through the Connecticut Retirement Security Trust Fund to eligible employees and qualified employers in the state;

(9) "Qualified employer" means any person, corporation, limited liability company, firm, partnership, voluntary association, joint stock association or other entity that employs five or more persons in the state. "Qualified employer" does not include: (A) The federal government, (B) the state or any political subdivision thereof, or (C) any municipality, unit of a municipality or municipal housing authority; and

(10) "Vendor" means (A) a regulated investment company or an insurance company conducting business in the state, or (B) a company conducting business in the state to (i) provide payroll or recordkeeping services, and (ii) offer retirement plans or payroll deposit individual retirement account arrangements using products of regulated investment companies. "Vendor" does not include individual registered representatives, brokers, financial planners or agents.

Sec. 2. (NEW) (Effective July 1, 2014) (a) There is established a fund to be known as the "Connecticut Retirement Security Trust Fund" the purpose of which shall be to promote and enhance retirement savings for private sector employees in the state. The Connecticut Retirement Security Trust Fund shall be a nonlapsing fund held by the State Treasurer separate and apart from all other moneys, funds and accounts. Investment earnings credited to the fund shall become part of the trust.

(b) The trust shall constitute an instrumentality of the state and shall perform essential governmental functions, in accordance with the provisions of this section. The trust shall receive and hold all payments and deposits or contributions intended for the trust, as well as gifts, bequests, endowments or federal, state or local grants and any other funds from any public or private source and all earnings until disbursed in accordance with the provisions of this section.

(c) The amounts on deposit in the trust shall not constitute property of the state and the trust shall not be construed to be a department, institution or agency of the state. Amounts on deposit in the trust shall not be commingled with state funds and the state shall have no claim to or against, or interest in, such funds. Any contract entered into by or any obligation of the trust shall not constitute a debt or obligation of the state and the state shall have no obligation to any designated beneficiary or any other person on account of the trust and all amounts obligated to be paid from the trust shall be limited to amounts available for such obligation on deposit in the trust. The amounts on deposit in the trust may only be disbursed in accordance with the provisions of this section. The trust shall continue in existence as long as it holds any deposits or has any obligations and until its existence is terminated by law and upon termination any unclaimed assets shall return to the state. Property of the trust shall be governed by section 3-61a of the general statutes.

(d) The Treasurer shall be responsible for the receipt and investment of moneys held by the trust. The trust shall not receive deposits in any form other than cash, except in the case of a rollover contribution described in Section 402(c), 403(a)(4), 403(b)(8) or 457(e)(16) of the Internal Revenue Code. Rollover contributions to the trust shall be limited to plan participants who have contributed to the trust. No depositor or designated beneficiary may direct the investment of any contributions or amounts held in the trust other than the specific fund options provided for by the trust.

(e) The assets of the trust shall be used for the purpose of distributing individual retirement savings balances to the plan participants and paying the operational, administrative and investment costs of the trust.

Sec. 3. (NEW) (Effective July 1, 2014) (a) There is established the Connecticut Retirement Security Trust Fund Board that shall serve as the trustee of the Connecticut Retirement Security Trust Fund. The board is charged with the implementation and administration of the trust, including the design of the public retirement plan.

(b) Notwithstanding the provisions of section 4-9a of the general statutes, the board shall consist of the following trustees:

(1) One appointed by the president pro tempore of the Senate, who shall be an academic expert on retirement plan designs and who shall serve an initial term of four years;

(2) One appointed by the speaker of the House of Representatives, who shall represent an organization whose principle purpose is advocacy for seniors and who shall serve an initial term of four years;

(3) One appointed by the majority leader of the Senate, who shall be an organized labor representative and who shall serve an initial term of four years;

(4) One appointed by the majority leader of the House of Representatives, who shall be a representative of the business community who manages employee retirement plan options and who shall serve an initial term of four years;

(5) One appointed by the minority leader of the Senate, who shall be an expert in designing retirement plan options for businesses and who shall serve an initial term of three years;

(6) One appointed by the minority leader of the House of Representatives, who shall be a representative of the business community with expertise in consumer retirement planning and who shall serve an initial term of three years;

(7) One appointed by the Governor, who shall be an academic expert in the needs of an aging population and who shall serve an initial term of three years;

(8) The State Comptroller, or the Comptroller's designee;

(9) The State Treasurer, or the Treasurer's designee;

(10) The Labor Commissioner, or the commissioner's designee; and

(11) The Secretary of the Office of Policy and Management, or the secretary's designee.

(c) All appointments to the board shall be made not later than July 31, 2014. Following the expiration of their initial terms, subsequent trustees appointed by the Governor and members of the General Assembly shall serve three-year terms. Any vacancy shall be filled by the appointing authority not later than thirty calendar days after the office becomes vacant. Any trustee previously appointed to the board may be reappointed.

(d) The Comptroller and the Treasurer shall serve as chairpersons of the board. Said chairpersons shall schedule the first meeting of the board, which shall be held not later than forty calendar days after the effective date of this section. The board shall meet at least monthly.

(e) The trustees 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.

(f) Each trustee shall, not later than ten calendar days after appointment, take an oath of office that so far as it devolves upon the trustee, the trustee will diligently and honestly administer the affairs of the board, and will not knowingly violate or willingly permit to be violated any of the provisions of law applicable to the trust. Each trustee's term shall begin from the date the trustee takes such an oath. The oath shall be administered by a chairperson of the board.

(g) Each trustee shall be entitled to one vote on the board. A majority of the board shall constitute a quorum for the transaction of any business, the exercise of any power or the performance of any duty authorized or imposed by law.

(h) The board shall be within the Retirement Division of the office of the State Comptroller for administrative purposes only.

(i) The board, on behalf of the trust and for purposes of implementing the plan, shall:

(1) Establish consistent terms for each individual retirement account, including, but not limited to, (A) the method of payment into the trust by payroll deduction, rollover contribution described in Section 402(c), 403(a)(4), 403(b)(8) or 457(e)(16) of the Internal Revenue Code with the limitation described in subsection (d) of section 2 of this act, transfer from bank accounts or otherwise, (B) the termination, withdrawal or transfer of payments under the trust, including the purchase of an annuity product upon retirement, (C) changing of the identity of the designated beneficiary, (D) any charges or fees assessed in connection with the administration of the plan, and (E) interest allocated to individual retirement accounts for a given calendar year based upon the performance of the trust;

(2) Enter into one or more contractual agreements, as necessary, including contracts for legal, actuarial, accounting, custodial, advisory, management, administrative, advertising, marketing and consulting services for the plan and pay for such services from the trust;

(3) Adopt such regulations in accordance with the provisions of chapter 54 of the general statutes as are necessary to carry out the provisions of this section and may establish rules and regulations that the board deems necessary or desirable to facilitate the proper administration of the trust. Rules and regulations established by the board shall be binding upon all parties dealing with the board and all persons claiming any benefits from the trust;

(4) Hire staff, including a program administrator;

(5) Form working groups as necessary to solicit feedback from key stakeholders on the design of the plan, advocate for changes in federal retirement law to improve retirement security, assess the impact of the plan on reducing public assistance costs for the elderly in the state and determine if changes in federal or state tax law could help employees in the state save for retirement; and

(6) Develop alternative plan designs, if necessary, to help eligible employees in the state save for retirement.

(j) In conducting the business of the trust, including its oversight functions, the board 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 a like character and with like aims; (2) in accordance with strict fiduciary standards and responsibilities; and (3) in accordance with the provisions of the general statutes.

(k) The board shall ensure that the trust complies with all applicable requirements of federal and state laws, rules and regulations to the extent necessary for the trust to meet all criteria for federal tax-deferral or tax-exempt benefits under the Internal Revenue Code.

(l) Each year the Treasurer shall publish and forward to the board a consolidated report showing the fiscal transactions of the trust for the preceding fiscal year, including gain or loss by category of security, a reconciliation of assets showing the progression of the trust from one year to the next, the amount of the accumulated cash and securities of the system and the last balance sheet showing the financial condition of the system by means of an actuarial valuation of its assets and liabilities. Assets shall be shown at book and market value and by type or term of investment, gain or loss shall be reported by category of security type.

Sec. 4. (NEW) (Effective July 1, 2014) The public retirement plan shall include design features prescribed by the Connecticut Retirement Security Trust Fund Board. The board may amend such features from time to time to serve the interests of eligible employees, plan participants, qualified employers and other stakeholders. The plan shall:

(1) Assure portability through maintenance of individual retirement accounts for each plan participant. Each qualified employer participating in the plan shall allow eligible employees to contribute to the plan through a payroll deposit arrangement and through any other means prescribed by the board;

(2) Transition to an inflation-indexed annuity with options for spousal benefits and lump sum distribution upon the plan participant's retirement;

(3) Offer a guaranteed interest rate to plan participants upon the board analyzing expected rates of return on trust assets;

(4) Include a written quarterly report detailing: (A) The individual retirement savings balance of such plan participant's individual retirement account, (B) the estimated value of assets available upon such plan participant's retirement, (C) an estimate of such plan participant's expected monthly retirement income, and (D) the total assets in the trust including an accounting of contributions by plan participants and qualified employers and investment returns. This information shall be made available through a secure Internet web site. The report shall comply with all federal regulations regarding reporting;

(5) Encourage plan participants to preserve retirement savings by providing a written explanation of the consequences of failing to rollover distributions from individual retirement accounts to another eligible retirement plan. The contents of such an explanation shall meet similar requirements to those set forth in Section 402(f) of the Internal Revenue Code for qualified retirement plans;

(6) Require that all assets in the individual retirement account, whether contributed by a plan participant or a qualified employer or accrued through investments, shall vest immediately upon a plan participant's enrollment in the plan;

(7) Provide preretirement death benefits to enable a plan participant to bequeath assets to designated beneficiaries; and

(8) Ensure that all contributions to individual retirement accounts are tax qualified under the Internal Revenue Code and the state tax code.

Sec. 5. (NEW) (Effective July 1, 2014) The State Treasurer, on behalf of the Connecticut Retirement Security Trust Fund and for purposes of the trust, shall:

(1) Receive and invest moneys in the trust in any instruments, obligations, securities or property in accordance with section 6 of this act;

(2) Procure insurance as the Treasurer deems necessary to guarantee the stated rate of return and to protect the trust's property, assets, activities or deposits or contributions to the trust;

(3) Apply for, accept and expend gifts, grants or donations from public or private sources to enable the trust to carry out its objectives; and

(4) Establish one or more funds within the trust and maintain separate accounts for each individual retirement account.

Sec. 6. (NEW) (Effective July 1, 2014) The State Treasurer shall invest the amounts on deposit in the trust in a manner reasonable and appropriate to achieve the objectives of the trust, exercising the discretion and care of a prudent person in similar circumstances with similar objectives. The Treasurer shall give due consideration to rate of return, risk, term or maturity, diversification of the total portfolio within the trust, liquidity, the projected disbursements and expenditures and the expected payments, deposits, contributions and gifts to be received. The State Treasurer shall not require the trust to invest directly in obligations of the state or any political subdivision of the state or in any investment or other fund administered by the Treasurer. The assets of the trust shall be continuously invested and reinvested in a manner consistent with the objectives of the trust until disbursed upon order of the board or expended on expenses incurred by the operations of the trust.

Sec. 7. (NEW) (Effective July 1, 2014) The Connecticut Retirement Security Trust Fund Board shall establish and evaluate procedures necessary to implement the public retirement plan. The board shall:

(1) Design, establish and operate the plan to: (A) Increase access and enrollment in quality retirement plans that provide an annuitized benefit; (B) provide a guaranteed rate of return; (C) reduce the need for public assistance through a system of prefunded retirement income; (D) offer low administrative costs and streamlined enrollment; (E) minimize the need for financial sophistication for plan participants; and (F) ensure trust and transparency in the management of retirement funds through oversight and ethics review of plan fiduciaries;

(2) Explore and establish investment options that offer plan participants the conversion of individual retirement account balances to secure retirement income without incurring debts or liabilities to the state;

(3) Establish the process for plan participants to switch from the default of lifetime annuity to lump-sum payout upon retirement;

(4) Disseminate educational information concerning saving and planning for retirement;

(5) Disseminate information concerning the tax credits available to small business owners for establishing new retirement plans and the federal retirement savings contribution credit available to lower and moderate income households for qualified savings contributions;

(6) Determine the eligibility of an employer, employee or any other individual to participate in the plan;

(7) Evaluate and establish the process by which a plan participant shall contribute a portion of his or her salary or wages to his or her individual retirement account;

(8) Evaluate and establish the process by which a qualified employer shall credit the plan participant's contributions to his or her individual retirement account through payroll deposit;

(9) Evaluate and establish the process by which a qualified employer may contribute to a plan participant's individual retirement account, provided: (A) The contribution shall be allowed under the Internal Revenue Code, and (B) the contribution shall not cause the plan to be treated as an employee benefit plan under the federal Employee Retirement Income Security Act of 1974;

(10) Design and establish the process for the enrollment of eligible employees in the plan and design and establish the process by which an individual or employee eligible to participate in the plan under subdivisions (3) to (5), inclusive, of subsection (c) of section 10 of this act may enroll in and make contributions to the plan. This process shall include, but not be limited to, the creation of an information packet including the necessary paperwork for an eligible employee to opt out of the plan or adjust his or her level of contribution;

(11) Develop one or more payroll deposit savings arrangements through which qualified employers may make deposits into the trust;

(12) Establish and maintain a secure Internet web site that displays all public notices issued by the board and such other information as the board deems relevant pursuant to the education of the public regarding the plan;

(13) Submit, in accordance with the provisions of section 11-4a of the general statutes, a report to the General Assembly regarding any changes that are necessary for the implementation of the plan; and

(14) Set maximum investment levels in accordance with contribution limits set for individual retirement accounts by the Internal Revenue Code.

Sec. 8. (NEW) (Effective July 1, 2014) (a) Before opening the plan for enrollment the board shall:

(1) Establish and maintain a secure Internet web site to provide qualified employers with information about employer–sponsored retirement plans and payroll deduction individual retirement accounts, and to assist qualified employers in identifying vendors of retirement arrangements that may be set up by the qualified employers in lieu of participation in the plan;

(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 board may remove a vendor from the Internet web site if the vendor: (1) Submits materially inaccurate information to the board, (2) does not remit assessed fees within sixty days from the date of assessment, or (3) fails to submit to the board notice of any material change to the vendor's registered investment products. Any vendor found to have submitted materially inaccurate information to the board shall be allowed sixty calendar days to correct the information.

Sec. 9. (NEW) (Effective July 1, 2014) (a) Not later than August 1, 2015, or ninety days following the date on which the conditions required by sections 8 and 17 of this act have been met, whichever is later, the Connecticut Retirement Security Trust Fund Board shall open the public retirement plan to enrollment.

(b) Prior to the plan's opening, the board shall declare (1) the rate at which interest shall be allocated to individual retirement accounts, and (2) the default contribution rate from the date of the plan's opening until December thirty-first of the same year.

(c) On or before December first of the year in which the plan opens to enrollment, and annually thereafter, the board shall declare the rate at which interest shall be allocated to individual retirement accounts for the following calendar year commencing January first.

(d) Interest shall be allocated to individual retirement accounts and shall be computed at the stated interest rate on the balance of an eligible employee's account and shall be compounded daily.

(e) On or before December first of the year in which the plan opens to enrollment, and annually thereafter, the board shall notify all plan participants of any changes to the default contribution rate for the following calendar year.

(f) (1) Administrative fees shall be allocated to each individual retirement account on a pro rata basis.

(2) Annual administrative expenses shall not exceed one per cent of the total trust balance.

(g) All expenses, including employee costs, incurred to implement, maintain, advertise and administer the plan shall be paid from moneys collected by or for the trust.

Sec. 10. (NEW) (Effective July 1, 2014) (a) Not later than ninety calendar days after the Connecticut Retirement Security Trust Fund Board opens the plan for enrollment, qualified employers who do not offer another retirement savings arrangement as described in subdivision (1) of subsection (c) of this section shall offer eligible employees a payroll deposit option to facilitate participation in the plan.

(b) (1) Each qualified employer shall enroll each eligible employee in the plan at the default contribution rate unless such employee elects not to participate in the plan.

(2) An eligible employee may elect to opt out of the plan by providing written notice, on such form and in such manner as the board may prescribe, to the board and such eligible employee's employer.

(3) Following initial implementation of the plan in accordance with this section, and at least biennially thereafter, qualified employers shall designate an open enrollment period during which each eligible employee who previously opted out of the plan shall be enrolled in the plan unless the employee again elects to opt out.

(4) Any eligible employee not participating in the plan may enroll at any time by submitting written notice, on such form and in such manner as the board may prescribe, to the board and such eligible employee's employer.

(5) The board, in coordination with the Labor Commissioner, shall disseminate information to employers regarding the employers' obligations under this section.

(c) (1) A qualified employer shall retain the option at all times to set up an employer-sponsored retirement plan, such as a defined benefit plan, an employee retirement plan described in Section 401(k) of the Internal Revenue Code, a simplified employee pension plan or a savings incentive match plan for employees, or to offer an automatic enrollment payroll deduction individual retirement account instead of offering a payroll deposit retirement savings arrangement in the Connecticut Retirement Security Trust Fund.

(2) If a qualified employer has offered its eligible employees a payroll deposit retirement savings arrangement through the plan and chooses to terminate such payroll deposit retirement savings arrangement, such qualified employer shall notify each eligible employee and plan participant, within a reasonable amount of time and in a manner prescribed by the board, of such qualified employer's decision to terminate such payroll deposit retirement savings arrangement.

(3) Qualified employers that offer employees retirement savings arrangements described in subdivision (1) of subsection (c) of this section may elect to offer employees not eligible to participate in such arrangements the opportunity to make payroll deposit contributions to the trust.

(4) Any employer that does not satisfy the definition of a qualified employer pursuant to section 1 of this act by virtue of such employer employing fewer than five employees in the state, inclusive of independent contractors, may choose to participate in the plan.

(5) Any individual whose employer is not a qualified employer may choose to participate in the plan on an individual basis. However, any contributions made to the plan on behalf of such individual shall not be made as a payroll deposit contribution through such individual's employer's payroll system.

(d) (1) The board shall set a default contribution amount as a percentage of salary at not less than two per cent and not more than five per cent and may vary such amount according to the length of time that an eligible employee has contributed to the plan.

(2) Plan participants may, at any time, on a form and in a manner prescribed by the board, elect to change their level of contribution.

Sec. 11. (NEW) (Effective July 1, 2014) The Connecticut Retirement Security Trust Fund Board, from time to time, shall consider the opinions of eligible employees, plan participants, qualified employers and other stakeholders in making modifications to the public retirement plan by: (1) Holding public hearings to allow eligible employees, plan participants, qualified employers and other stakeholders to comment on the plan, including the default contribution amounts, guaranteed interest rates and fees charged; (2) surveying plan participants and qualified employers to assess their experience with the plan; and (3) assessing the marketplace of employer-sponsored retirement plan offerings to determine what is otherwise available to employees and residents in the state.

Sec. 12. (NEW) (Effective July 1, 2014) (a) Qualified employers shall not be liable for an eligible employee's decision to participate in or opt out of the public retirement plan, or for the investment performance of assets deposited in the trust.

(b) (1) A qualified employer shall not be a fiduciary or considered to be a fiduciary of the plan.

(2) A qualified employer shall not be responsible for the administration, investment or investment performance of the plan.

(3) A qualified employer shall not be liable with regard to investment returns, plan design or retirement income paid to plan participants.

(c) A qualified employer's voluntary contribution made in accordance with the process established under section 7 of this act may not contradict the provisions of this section or change the qualified employer's relationship to the plan or such qualified employer's obligations to its eligible employees.

Sec. 13. (NEW) (Effective July 1, 2014) (a) The state shall not be liable for the payment of the individual retirement account balance earned by plan participants.

(b) Any financial liability for the payment of retirement account balances in excess of funds available in the trust shall be borne by the entities with whom the Treasurer contracts to provide insurance to protect the value of the trust.

Sec. 14. (NEW) (Effective July 1, 2014) (a) No qualified employer shall, without good cause, fail to allow an eligible employee to participate in the plan.

(b) Qualified employers shall remit all moneys intended for the trust not later than fourteen days after the date such moneys were deducted from each plan participant's wages.

(c) Any eligible employee or plan participant aggrieved by a violation of the provisions of sections 2 to 15, inclusive, of this act may file a complaint with the Labor Commissioner. Upon receipt of any such complaint, the commissioner may hold a hearing concerning the violation of such provisions. Any party aggrieved by the decision of the commissioner may appeal the decision in accordance with the provisions of chapter 54 of the general statutes.

Sec. 15. (NEW) (Effective July 1, 2014) (a) Each trustee of the Connecticut Retirement Security Trust Fund Board shall file, with the board and the Office of State Ethics, a statement of financial interests, as described in section 1-83 of the general statutes. Such statement shall be a public record.

(b) Not later than August 1, 2015, or ninety days following the date on which the conditions required by sections 8 and 17 of this act have been met, whichever is later, and annually thereafter, the board shall submit to the General Assembly, in accordance with the provisions of section 11-4a of the general statutes, and to the Governor, president pro tempore of the Senate and speaker of the House of Representatives a report prepared by the board, which shall include, but not be limited to, a summary of the plan design and operation, the number of plan participants and the average contribution of said plan participants, and the rates of return and administrative costs as a percentage of total assets of the plan.

(c) Not later than the January first following the first full year that the trust and plan have been operative, the board shall submit to the General Assembly, in accordance with section 11-4a of the general statutes, and to the Governor, president pro tempore of the Senate and the speaker of the House of Representatives, an annual audit prepared in accordance with generally accepted accounting principles by an independent certified accountant, on the operations of the trust and plan.

Sec. 16. (Effective July 1, 2014) (a) The Connecticut Retirement Security Trust Fund Board shall conduct a market feasibility study to determine whether the necessary conditions for implementation of this act can be met, including: (1) Likely participation rates, (2) contribution levels, (3) rate of account closures and rollovers, (4) ability to provide employers with a payroll deposit system for remitting contributions from employees, (5) funding options for implementation of sections 2 to 17, inclusive, of this act until the trust has sufficient funds to be self-sustaining, and (6) likely insurance costs and whether such costs should be subject to the limit on annual administrative expenses pursuant to subsection (f) of section 9 of this act.

(b) Not later than December 15, 2014, the board shall submit, in accordance with the provisions of section 11-4a of the general statutes, a report on the findings of such study and any recommendations therefrom to the Governor and to the joint standing committee of the General Assembly having cognizance of matters relating to labor and public employees.

Sec. 17. (NEW) (Effective July 1, 2014) (a) Prior to the implementation of any plan, trust, administrative arrangement or investment offering under the provisions of sections 2 to 15, inclusive, of this act, the Connecticut Retirement Security Trust Fund Board shall determine that, based on the market feasibility study conducted in accordance with section 16 of this act, the provisions of sections 2 to 15, inclusive, of this act shall be self-sustaining, and funds are available through a nonprofit or other private entity, federal funding or appropriations by the General Assembly in amounts sufficient to allow the board to implement this act until the board has sufficient funds to be self-sustaining.

(b) Prior to the implementation of any plan, trust, administrative arrangement or investment offering under the provisions of sections 2 to 15, inclusive, of this act, the arrangements for individual retirement accounts shall qualify for the favorable federal income tax treatment ordinarily accorded to individual retirement accounts under the Internal Revenue Code, and the public retirement plan shall be determined not to be an employee benefit plan under the federal Employee Retirement Income Security Act.

Sec. 18. Section 3-13c of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):

Trust funds as used in sections 3-13 to 3-13e, inclusive, and 3-31b shall be construed to include Connecticut Municipal Employees' Retirement Fund A, Connecticut Municipal Employees' Retirement Fund B, Soldiers, Sailors and Marines Fund, the Connecticut Retirement Security Trust Fund, State's Attorneys' Retirement Fund, Teachers' Annuity Fund, Teachers' Pension Fund, Teachers' Survivorship and Dependency Fund, School Fund, State Employees Retirement Fund, the Hospital Insurance Fund, Policemen and Firemen Survivor's Benefit Fund and all other trust funds administered, held or invested by the Treasurer.

This act shall take effect as follows and shall amend the following sections:
Section 1	July 1, 2014	New section
Sec. 2	July 1, 2014	New section
Sec. 3	July 1, 2014	New section
Sec. 4	July 1, 2014	New section
Sec. 5	July 1, 2014	New section
Sec. 6	July 1, 2014	New section
Sec. 7	July 1, 2014	New section
Sec. 8	July 1, 2014	New section
Sec. 9	July 1, 2014	New section
Sec. 10	July 1, 2014	New section
Sec. 11	July 1, 2014	New section
Sec. 12	July 1, 2014	New section
Sec. 13	July 1, 2014	New section
Sec. 14	July 1, 2014	New section
Sec. 15	July 1, 2014	New section
Sec. 16	July 1, 2014	New section
Sec. 17	July 1, 2014	New section
Sec. 18	from passage	3-13c

LAB	Joint Favorable
APP	Joint Favorable