Introduce PROSPERS Act to ensure states can continue to establish retirement savings programs, make it easier for middle-class families to save for retirement
WASHINGTON, D.C. – Following a vote today by Senate Republicans to undo rules meant to help workers at small businesses save for retirement, U.S. Senators Martin Heinrich (D-N.M.) and Chris Murphy (D-Conn.) introduced the Preserve Rights of States and Political Subdivisions to Encourage Retirement Savings (PROSPERS) Act to ensure states and cities can continue to create retirement savings programs for workers in the private sector. Several states are already instituting programs like this across the country, and dozens more are exploring it. These programs help lower the cost of entry for middle-class families to save for retirement, as well as reduce the cost of providing retirement benefits for small businesses.
“After a lifetime of hard work, Americans deserve to retire with dignity. Yet too many families are unprepared for retirement,” said Heinrich. “Instead of fighting for the financial security that is the cornerstone of a thriving middle class, Republicans voted today to take away opportunities for Americans to save their own money for retirement. Our legislation will make saving for retirement easier by providing workers with a simple way to put money away each month and easing the burden of participation and compliance on small businesses.”
“Planning for retirement is hard. And the constant, nagging worry that you’re not saving enough is really scary. There is a crisis in this country, and Republicans are ripping away states’ ability to try to do something about it,” said Murphy. “55 million people in this country don’t have access to retirement savings plans through their employers. I’m proud to introduce this commonsense bill to simply allow states like Connecticut to offer workers the option to set aside a small portion of their earnings in a privately run plan.”
Cosponsoring the bill are U.S. Senators Patty Murray (D-Wash.), Ron Wyden (D-Ore.), Dick Durbin (D-Ill.), Dianne Feinstein (D-Calif.), Tom Carper (D-Del.), Richard Blumenthal (D-Conn.), Sheldon Whitehouse (D-R.I.), Jeff Merkley (D-Ore.), Jeanne Shaheen (D-N.H.), Michael Bennet (D-Colo.), Chris Van Hollen (D-Md.), Kamala Harris (D-Calif.), Tammy Duckworth (D-Ill.), Maggie Hassan (D-N.H.), Cory Booker (D-N.J.), and Ben Cardin (D-Md.).
When workers have access to a retirement savings plan through their employer and are enrolled in that plan, they are more likely to save for retirement and build financial security later in life. However, according to the AARP, nearly 55 million workers across the country lack access to employer-sponsored retirement programs–nearly half of all private-sector workers aged 18 to 64. A Joint Economic Committee report on the state of retirement demonstrates that as incomes stagnate, workers face tough choices that leave American families vulnerable to future financial insecurity.
In 2016, the Department of Labor published two final rules that clarified existing safe harbors making it easier for states and cities to establish retirement savings programs for private sector employees and provided guidance for those already in existence. These rules were overturned by Republicans’ passage of two Congressional Review Act (CRA) resolutions that deny more than 14 million Americans the ability to save for retirement through state and city programs.
Republican and Democratic state treasurers from across the country oppose today’s vote by Republicans in Congress to overturn Department of Labor rules because they want Congress to preserve the rights of states and cities to establish retirement savings options for their citizens.
The PROSPERS Act is supported by AFL-CIO, SEIU, National Council of La Raza, and the National Conference of State Legislatures.
A copy of the PROSPERS Act is available here.