The Senate nullified state-run retirement plans by a razor-thin 50-49 vote late Wednesday via a resolution of disapproval under the Congressional Review Act.
Groups who had fought the plans applauded Senate passage of H.J. Res. 66, which invalidated the Department of Labor’s “safe harbor” regulations on savings arrangements established by states for non-governmental employees.
The House passed the legislation, introduced by Rep. Tim Walberg, R-Mich., on Feb. 15.
Sen. Orrin Hatch, R-Utah, introduced companion legislation S.J. Res. 32. A similar resolution signed into law by President Donald Trump in April revoked city-run plans.
Cathy Weatherford, president and CEO of the Insured Retirement Institute, said in a statement that IRI has “continually advocated for common-sense, bipartisan policies which would expand access to retirement savings accounts and automatic saving features.” However, DOL’s rule “would not have achieved this objective. The Senate has preserved the high level of ERISA protections workers receive when they participate in workplace retirement savings plans and will not exempt those participating in state-mandated savings plans.”
The U.S. Chamber of Commerce stated that it was “pleased to see the Senate take action to overturn DOL’s misguided rule exempting state government-sponsored retirement plans from basic investor protections.”
The rule “was sold as a way to expand small-business retirement plan options – but it would have instead trapped employees of small businesses into a bad option. We urge the president to sign this legislation swiftly so we can all get to work on pending bipartisan proposals to expand retirement options for small businesses,” stated Neil Bradley, senior vice president and chief policy officer for the Chamber.