Budget Amendment ID: FY2026-S3-858

JUD 858

SMART Plan

Ms. Lovely and Messrs. Mark, Cronin, Eldridge, Keenan and Oliveira moved that the proposed new text be amended by inserting after section __ the following sections:-

“SECTION XX. Section 64 of chapter 29 of the General Laws, as appearing in the 2022 Official Edition, is hereby amended by striking out, in line 31, the words "independent contractors" and inserting in place thereof the following words: contracted employees.

SECTION XX. Said section 64 of said chapter 29, as so appearing, is hereby further amended by adding the following paragraph:-

The state treasurer, on behalf of the commonwealth, may establish an automatic enrollment feature within the deferred compensation program. The automatic enrollment feature shall not require prior authorization by an employee. Automatic enrollment features shall be set forth in the deferred compensation plan document and shall include, but not be limited to, the following provisions:

(i) automatic enrollment shall apply only to employees hired on or after January 1, 2026; provided, however, that for any commonwealth agencies or departments that purchase or make payments to an individual or group annuity contract, custodial account, or any other investment authorized under section 403(b) of the Internal Revenue Code for its employees, automatic enrollment shall only apply at said agency's or department's discretion and affirmative election;

(ii) automatic enrollment shall apply only to new employees of a "governmental body", as defined in section 64B, if the governmental body elects to implement the automatic enrollment feature for its employees;

(iii) automatic enrollment shall not require new employees to defer any amount of their compensation;

(iv) an employee who is automatically enrolled shall have the option decline participation in the plan and shall have 90 days from the date of enrollment to discontinue participation in the plan;

(v) an automatically enrolled employee who discontinues participation in the plan within 90 days shall receive a refund of their account as soon as practicable after discontinuing participation;

(vi) a qualified default investment option to receive contributions by any automatically-enrolled employee who does not choose an investment alternative to receive the employee's contributions; and

(vii) notice requirements to automatically-enrolled participants in accordance with federal law.

SECTION XX. Section 64B of said chapter 29, as so appearing, is hereby amended by inserting after the third paragraph the following paragraph:-

The treasurer or, in the absence of the treasurer, the chief financial officer by whatever name that person is called, on behalf of a governmental body, may, at its own election, implement an automatic enrollment feature within its deferred compensation program established pursuant to this section. The automatic enrollment feature shall not require advance authorization by an employee. Subject to the election of each governmental body, any such automatic enrollment feature permitted as a part of a governmental body's deferred compensation program shall only apply to new employees of a governmental body hired on or after January 1, 2026 and such deferred compensation program will be required to include the specifications for auto enrollment detailed in subsections (b) through (h), inclusively, of section 64.”