Co-sponsor PROSPERS Act to ensure states can continue to establish retirement savings programs, make it easier for middle-class families to save for retirement
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WASHINGTON – Following a vote by Senate Republicans to undo rules meant to help workers at small businesses save for retirement, U.S. Senators Dick Durbin (D-IL) and Tammy Duckworth (D-IL) joined their Senate colleagues Chris Murphy (D-CT) and Martin Heinrich (D-NM) in introducing 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, led by Illinois, 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. In 2015, Illinois created the Secure Choice program, which is poised to help the 1.5 million Illinoisans who lack a retirement plan through their employer save for retirement. It is set to take effect next year. However, the recent vote by Congressional Republicans would add unnecessary regulatory burdens for businesses participating in the program, if it is signed into law.
“Already, tens of millions of Americans have very little savings for retirement—this vote by Senate Republicans will only make this situation worse,” said Senator Durbin. “Congress should be making it easier for more Americans to retire with dignity and security, and this legislation allows states to explore innovative policy solutions to America’s retirement crisis.
“Millions of hardworking Americans are facing retirement without the savings they’ll need yet Senate Republicans are rushing to make it harder for Illinoisans to save for retirement while creating an unnecessary regulatory burden for businesses," said Senator Duckworth. “By interfering with the ability of States like Illinois to help the 55 million Americans who don’t have retirement plans at work, Senate Republicans helped out the Wall Street lobbyists who want to take away a competing option for people to plan for retirement themselves.”
In addition to Durbin and Duckworth, the PROSPERS Act was cosponsored by Senators Patty Murray (D-WA), Ron Wyden (D-OR), Dianne Feinstein (D-CA), Tom Carper (D-DE), Richard Blumenthal (D-CT), Sheldon Whitehouse (D-RI), Jeff Merkley (D-OR), Jeanne Shaheen (D-NH), Michael Bennet (D-CO), Chris Van Hollen (D-MD), Kamala Harris (D-CA), Maggie Hassan (D-NH), Cory Booker (D-NJ), 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, including Illinois State Treasurer Michael Frerichs, opposed the 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.
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