A bipartisan retirement reform package introduced June 7 by leaders of the Senate Health, Education, Labor and Pensions (HELP) Committee will likely form a key part of any final “SECURE 2.0” legislation Congress might pass this year. The Retirement Improvement and Savings Enhancement to Supplement Healthy Investments for the Nest Egg (RISE & SHINE) Act is the HELP Committee’s version of a new round of retirement reforms building on the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019 (Div. O of Pub. L No. 116-94). This GRIST highlights key provisions in the RISE & SHINE Act of interest to employers.
Led by Chair Patty Murray, D-WA, and ranking Republican member Richard Burr, R-NC, the HELP Committee oversees ERISA issues in the Senate. The committee plans to review, modify and vote on the RISE & SHINE bill on June 14.
The bill joins a list of similar SECURE 2.0 measures, including House-passed legislation (HR 2954) and another Senate bill (S 1770) set to see action this month at the Finance Committee, which has jurisdiction over tax issues. Those bills aim to expand retirement plan coverage, boost savings, increase lifetime income opportunities and ease plan administration. The Senate HELP and Finance committees are already working with each other and House lawmakers on a consensus SECURE 2.0 package, which could get a vote during the lame-duck congressional session later this year.
While the RISE & SHINE Act adopts several provisions found in other bills, it includes some relatively new proposals. Examples include provisions allowing employers to offer emergency savings accounts linked to defined contribution (DC) plans, expanding disclosures when defined benefit (DB) pension plan sponsors offer participants a lump sum option to replace their annuity payments, promoting automatic re-enrollment in DC plans, encouraging development of pooled employer plans (PEPs) and easing reporting for certain groups of small DC plans.
The bill includes several provisions substantially identical to portions of the recent House-passed bipartisan Securing a Strong Retirement Act of 2022 (SSRA) (HR 2954):
The HELP Committee’s bill contains a new proposal that would allow an employer to create emergency savings accounts linked to its defined contribution (DC) plans. First offered in stand-alone legislation (S 4310) from Sens. Cory Booker, D-NJ, and Todd Young, R-IN, the proposal’s details include the following:
The bill includes several provisions addressing required participant disclosures:
The bill includes a number of provisions aimed at enhancing and simplifying the administration of DC plans:
Several provisions will be of interest to DB plan sponsors: