Bill Text: IA HF80 | 2017-2018 | 87th General Assembly | Introduced
Bill Title: A bill for an act establishing a retirement savings plan trust, and including implementation and effective date provisions.
Sponsorship: Partisan Bill (Democrat 6)
Status: (Introduced - Dead) 2017-01-26 - Subcommittee: Koester, Highfill and Hunter. H.J. 130. [HF80 Detail]
Download: Iowa-2017-HF80-Introduced.html
House File 80 - Introduced HOUSE FILE BY HUNTER, KEARNS, McCONKEY, STAED, BENNETT, and MASCHER A BILL FOR 1 An Act establishing a retirement savings plan trust, and 2 including implementation and effective date provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: TLSB 1801YH (3) 87 ec/sc PAG LIN 1 1 Section 1. NEW SECTION. 12K.1 Purpose and definitions. 1 2 1. The general assembly finds that the general welfare and 1 3 well=being of the state are directly related to the ability 1 4 of the citizens of the state to save for their retirement 1 5 years, and that a vital and valid public purpose is served by 1 6 the creation and implementation of programs which encourage 1 7 and make possible the attainment of financial security by 1 8 the greatest number of citizens of the state. In order to 1 9 make available to the citizens of the state an opportunity to 1 10 fund future retirement savings needs, it is necessary that a 1 11 public trust be established in which moneys may be invested for 1 12 retirement. 1 13 2. As used in this chapter, unless the context otherwise 1 14 requires: 1 15 a. "Administrative fund" means the administrative fund 1 16 established under section 12K.4. 1 17 b. "Employer" means a person or entity engaged in a 1 18 business, industry, profession, trade, or other enterprise in 1 19 Iowa. 1 20 c. "Internal Revenue Code" means the same as defined in 1 21 section 422.3. 1 22 d. "Iowa retirement savings plan trust" or "trust" means the 1 23 trust created under section 12K.2. 1 24 e. "Participant" means an individual that has entered into a 1 25 participation agreement under this chapter to contribute to an 1 26 Iowa retirement savings plan. 1 27 f. "Participation agreement" means an agreement between a 1 28 participant and the trust entered into under this chapter. 1 29 g. "Program fund" means the program fund established under 1 30 section 12K.4. 1 31 Sec. 2. NEW SECTION. 12K.2 Creation of the Iowa retirement 1 32 savings plan trust. 1 33 An Iowa retirement savings plan trust as allowed by the 1 34 Internal Revenue Code is created for the purpose of helping 1 35 Iowans save for retirement. The treasurer of state is the 2 1 trustee of the trust, and has all powers necessary to carry out 2 2 and effectuate the purposes, objectives, and provisions of this 2 3 chapter pertaining to the trust, including the power to do all 2 4 of the following: 2 5 1. Make and enter into contracts necessary for the 2 6 administration of the trust. 2 7 2. Enter into agreements with any financial institution, 2 8 the state, or any federal or other state agency, or other 2 9 entity as required to implement this chapter. 2 10 3. Carry out the duties and obligations of the trust 2 11 pursuant to this chapter. 2 12 4. Accept any grants, gifts, legislative appropriations, 2 13 and other moneys from the state, any unit of federal, state, or 2 14 local government, or any other person, firm, partnership, or 2 15 corporation which the treasurer of state shall deposit into the 2 16 administrative fund or the program fund. 2 17 5. Carry out studies and projections so the treasurer of 2 18 state may advise participants regarding present and estimated 2 19 future retirement needs and levels of financial participation 2 20 in the trust required in order to enable participants to 2 21 achieve their retirement funding objectives. 2 22 6. Participate in any federal, state, or local governmental 2 23 program for the benefit of the trust. 2 24 7. Procure insurance against any loss in connection with the 2 25 property, assets, or activities of the trust. 2 26 8. Enter into agreements with participants and employers. 2 27 9. Make distributions and refunds to participants pursuant 2 28 to participation agreements as prescribed by the Internal 2 29 Revenue Code. 2 30 10. Invest moneys from the program fund in any investments 2 31 which are determined by the treasurer of state to be 2 32 appropriate. 2 33 11. Engage investment advisors, if necessary, to assist in 2 34 the investment of trust assets. 2 35 12. Contract for goods and services and engage personnel 3 1 as necessary, including consultants, actuaries, managers, 3 2 legal counsel, and auditors, for the purpose of rendering 3 3 professional, managerial, and technical assistance and advice 3 4 to the treasurer of state regarding trust administration and 3 5 operation. 3 6 13. Establish, impose, and collect administrative fees 3 7 and charges in connection with transactions of the trust, and 3 8 provide for reasonable service charges, including penalties for 3 9 cancellations and late payments with respect to participation 3 10 agreements. 3 11 14. Administer the funds of the trust. 3 12 15. Adopt rules pursuant to chapter 17A for the 3 13 administration of the trust. 3 14 Sec. 3. NEW SECTION. 12K.3 Limitation of liability. 3 15 The trust, the treasurer of state, and the state of Iowa may 3 16 not guarantee any rate of return or any interest rate on any 3 17 contribution to the trust. The trust, treasurer of state, and 3 18 the state of Iowa are not liable for any loss incurred by any 3 19 person as a result of participating in the trust. 3 20 Sec. 4. NEW SECTION. 12K.4 Program and administrative funds 3 21 ==== investment and payments. 3 22 1. The treasurer of state shall segregate moneys received 3 23 by the trust into two funds: the program fund and the 3 24 administrative fund. 3 25 2. All moneys paid by participants in connection with 3 26 participation agreements shall be deposited as received into 3 27 separate accounts within the program fund. 3 28 3. Contributions to the trust made by participants may only 3 29 be made in the form of cash. 3 30 Sec. 5. NEW SECTION. 12K.5 Cancellation of agreements. 3 31 A participant may cancel a participation agreement at will. 3 32 Upon cancellation of a participation agreement, a participant 3 33 shall be entitled to the return of the participant's account 3 34 balance subject to penalties prescribed by the Internal Revenue 3 35 Code. 4 1 Sec. 6. NEW SECTION. 12K.6 Annual audited financial report. 4 2 1. The treasurer of state shall submit an annual audited 4 3 financial report, prepared in accordance with generally 4 4 accepted accounting principles, on the operations of the trust 4 5 by January 1 to the governor and the general assembly. 4 6 2. The annual audit shall be made either by the auditor 4 7 of state or by an independent certified public accountant 4 8 designated by the auditor of state and shall include direct and 4 9 indirect costs attributable to the use of outside consultants, 4 10 independent contractors, and any other persons who are not 4 11 state employees. 4 12 3. The annual audit shall be supplemented by all of the 4 13 following information prepared by the treasurer of state: 4 14 a. Any related studies or evaluations prepared in the 4 15 preceding year. 4 16 b. A summary of the benefits provided by the trust, 4 17 including the number of participants in the trust. 4 18 c. Any other information which is relevant in order to make 4 19 a full, fair, and effective disclosure of the operations of the 4 20 trust. 4 21 Sec. 7. NEW SECTION. 12K.7 Tax considerations. 4 22 For federal tax purposes, the Iowa retirement savings plan 4 23 trust shall conform to the requirements established by the 4 24 Internal Revenue Code to be able to operate as a retirement 4 25 plan. The plan may conform to the requirements under section 4 26 401(a), section 408, or another section of the Internal Revenue 4 27 Code which allows Iowans the best retirement option under the 4 28 trust as determined by the treasurer of state. 4 29 Sec. 8. NEW SECTION. 12K.8 Property rights to assets in 4 30 trust. 4 31 1. The assets of the trust shall at all times be preserved, 4 32 invested, and expended solely and only for the purposes of the 4 33 trust and shall be held in trust for the participants. 4 34 2. No property rights in the trust shall exist in favor of 4 35 the state. 5 1 3. The assets of the trust shall not be transferred or used 5 2 by the state for any purposes other than the purposes of the 5 3 trust. 5 4 Sec. 9. NEW SECTION. 12K.9 Construction. 5 5 This chapter shall be construed liberally in order to 5 6 effectuate its purpose. 5 7 Sec. 10. IMPLEMENTATION PROVISION. The treasurer of state 5 8 shall provide that when the requirements of chapter 12K are 5 9 enacted, individuals may begin making contributions to the Iowa 5 10 retirement savings plan trust, as created by section 12K.2, as 5 11 enacted in this Act, no earlier than July 1, 2019. 5 12 Sec. 11. EFFECTIVE DATE. This Act takes effect on July 1, 5 13 2018. 5 14 EXPLANATION 5 15 The inclusion of this explanation does not constitute agreement with 5 16 the explanation's substance by the members of the general assembly. 5 17 This bill creates the Iowa retirement savings plan trust 5 18 under the office of treasurer of state for the purpose of 5 19 helping Iowans save for retirement. The bill provides that 5 20 the trust be operated so that, for federal tax purposes, it 5 21 meets the requirements of a retirement plan as provided by the 5 22 Internal Revenue Code. 5 23 The state treasurer is the trustee of the trust and has 5 24 numerous powers, as specified in the bill, for the purpose of 5 25 carrying out the purpose of the trust. Powers granted the 5 26 treasurer of state to effectuate the purpose of the trust 5 27 include entering into agreements with trust participants and 5 28 employers, investing moneys in the trust, and entering into any 5 29 agreements or contracts necessary to carry out the purposes of 5 30 the trust. 5 31 The bill provides that the state, the treasurer of state, 5 32 and the trust may not guarantee any rate of return on any 5 33 contributions to the trust and are not liable for any loss 5 34 incurred by any person as a result of participating in the 5 35 trust. The bill requires the treasurer to submit an annual 6 1 audited financial report on the operations of the trust. 6 2 The bill provides that when the requirements of the bill 6 3 are enacted, the treasurer shall not allow individuals to make 6 4 contributions to the trust earlier than July 1, 2019. 6 5 The bill takes effect July 1, 2018. LSB 1801YH (3) 87 ec/sc
