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<ns0:Id>20250AB__260799INT</ns0:Id>
<ns0:VersionNum>99</ns0:VersionNum>
<ns0:History>
<ns0:Action>
<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-20</ns0:ActionDate>
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<ns0:LegislativeInfo>
<ns0:SessionYear>2025</ns0:SessionYear>
<ns0:SessionNum>0</ns0:SessionNum>
<ns0:MeasureType>AB</ns0:MeasureType>
<ns0:MeasureNum>2607</ns0:MeasureNum>
<ns0:MeasureState>INT</ns0:MeasureState>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Assembly Member Nguyen</ns0:AuthorText>
<ns0:Authors>
<ns0:Legislator>
<ns0:Contribution>LEAD_AUTHOR</ns0:Contribution>
<ns0:House>ASSEMBLY</ns0:House>
<ns0:Name>Nguyen</ns0:Name>
</ns0:Legislator>
</ns0:Authors>
<ns0:Title> An act to amend Sections 100000, 100002, 100004, 100008, 100010, 100012, 100016, 100022, 100026, 100030, 100032, 100033, and 100046 of, and to repeal Sections 100018, 100020, 100024, and 100028 of, the Government Code, relating to retirement, and making an appropriation therefor. </ns0:Title>
<ns0:RelatingClause>retirement, and making an appropriation therefor</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>CalSavers: retirement savings.</ns0:Subject>
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<ns0:DigestText>
<html:p>Existing law, the CalSavers Retirement Savings Trust Act, administered by the CalSavers Retirement Savings Board (board), establishes the CalSavers Retirement Savings Program (program) and the CalSavers Retirement Savings Trust (trust). Under existing law, the trust consists of a program fund and an administrative fund with trust moneys that are continuously appropriated and administered by the CalSavers Retirement Savings Board for the purpose of promoting greater retirement savings for California private employees. Existing law requires eligible employers to offer a payroll deposit retirement savings arrangement so that eligible employees may contribute a portion of their salary or wages to a retirement savings program account in the program, as specified.</html:p>
<html:p>Existing law defines “eligible employer” as a person or entity engaged in a business,
industry, profession, trade, or other enterprise in the state, whether for profit or not for profit, excluding, among others, specified federal, state, and local governmental entities, with at least one eligible employee and that satisfies certain requirements to establish or participate in a payroll deposit retirement savings arrangement.</html:p>
<html:p>This bill would expand that definition of “eligible employer” to include household employers, defined as those who have hired or contracted someone to work in or around their home for the benefit of their personal household and who provide the employee a W-2 federal tax form to evidence tax deductions at the federal and state level. By expanding eligibility under these provisions, the bill would remove a restriction limiting expenditure of funds and authorize the expenditure of continuously appropriated moneys for a new purpose, thereby making an appropriation.</html:p>
<html:p>Existing law requires the
board, subject to its authority and fiduciary duty, to design and implement the program. Existing law authorizes the board to provide for investment in myRAs. Existing law requires the program to include, as determined by the board, one or more payroll deduction IRA arrangements. Existing law provides the board with the power and authority to, among other things, make and enter into contracts necessary for the administration of the trust and to disseminate information concerning tax credits available to small business owners for allowing their employees to participate in the program and the federal Retirement Savings Contribution Credit (Saver’s Credit).</html:p>
<html:p>This bill would eliminate the authority of the board to invest in myRAs and would make related conforming changes. The bill would require the program, with board approval, to establish an IRA on behalf of participants who are eligible to receive federal or state retirement benefits, as specified, establish a payroll
deposit emergency savings account on behalf of participants for the purpose of preserving retirement investments, and notify participants at least 30 days prior to the creation of the accounts.</html:p>
<html:p>This bill would additionally authorize the board to assess the feasibility of multi-state or regional agreements to administer the program and to disseminate information concerning tax credits available to small business owners for allowing their employees to participate in the successor to the Saver’s Credit, known as the Saver’s Match.</html:p>
<html:p>Existing law requires the board, prior to opening the program for enrollment, to establish a retirement investments clearinghouse on its internet website and a vendor registration process, if there is sufficient interest by vendors to participate and provide the necessary funding. Existing law requires vendors that would like to participate in the board’s retirement investments clearinghouse and be
listed on the board’s internet website as a registered vendor to provide specified information to the board.</html:p>
<html:p>This bill would eliminate the above-described requirement for the board to establish a retirement investments clearinghouse on its internet website and a vendor registration process, and would instead require vendors that would like to contract with the board to provide specified information to the board. The bill would make related conforming changes.</html:p>
<html:p>Existing law authorizes an employer to choose to have a payroll deposit retirement savings arrangement to allow employee participation in the program under the terms and conditions prescribed by the board. Existing law requires, by December 31, 2025, eligible employers with one or more eligible employees and do not offer a retirement savings program, as provided, to have a payroll deposit retirement savings arrangement to allow employee participation in the program.
Existing law provides the board the powers and duties necessary to administer the enforcement of employer compliance, as provided.</html:p>
<html:p>This bill would instead, beginning December 31, 2027 and by December 31 of each calendar year, require eligible employers with one or more eligible employees who do not offer a retirement savings program, as specified, to have a payroll deposit retirement savings arrangement to allow employee participation in the program.</html:p>
<html:p>Existing law requires the board to issue to each employer who fails to allow its eligible employees to participate in the program, as provided, a notice of penalty application. Existing law requires each eligible employer that, without good cause, fails to allow its employees to participate in the program, as specified, after the board serves a final notice of penalty application, to be subject to a penalty of $250 per eligible employee and an additional penalty of $500 per
eligible employee if noncompliance continues, as described. Existing law requires the Franchise Tax Board to issue a first notice of the imposition of a penalty to an eligible employer for failure to comply after the board informs the Franchise Tax Board of the eligible employer’s noncompliance. Existing law requires amounts collected by the Franchise Tax Board for these purposes to be transmitted to the board for deposit in the trust.</html:p>
<html:p>This bill would additionally subject each eligible employer that fails to allow its eligible employees to participate in the program after the above-described penalties have been assessed to a penalty of $500 per eligible employee. The bill would prohibit the penalties assessed from being imposed more than once every 180 days since the last violation. By depositing additional penalties into the trust, a continuously appropriated fund, the bill would make an appropriation.</html:p>
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<ns0:VoteRequired>TWO_THIRDS</ns0:VoteRequired>
<ns0:Appropriation>YES</ns0:Appropriation>
<ns0:FiscalCommittee>YES</ns0:FiscalCommittee>
<ns0:LocalProgram>NO</ns0:LocalProgram>
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<ns0:Election>NO</ns0:Election>
<ns0:UsualCurrentExpenses>NO</ns0:UsualCurrentExpenses>
<ns0:BudgetBill>NO</ns0:BudgetBill>
<ns0:Prop25TrailerBill>NO</ns0:Prop25TrailerBill>
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<ns0:Bill id="bill">
<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
<ns0:BillSection id="id_BA4B2C7C-30D0-404B-986A-3AC6176A9F54">
<ns0:Num>SECTION 1.</ns0:Num>
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Section 100000 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:LawSection id="id_F2D6C556-1158-41CB-B17B-4079F8E15A36">
<ns0:Num>100000.</ns0:Num>
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<ns0:Content>
<html:p>For purposes of this title, the following definitions apply:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
“Board” means the CalSavers Retirement Savings Board.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
“CalSavers Retirement Savings Program” or “program” means a retirement savings program offered pursuant to the CalSavers Retirement Savings Trust Act.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
“Eligible employee” means a person who is employed by an eligible employer.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
“Eligible employee” does not include:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
Any employee covered under the federal Railway Labor Act (45 U.S.C. Sec. 151), or any employee engaged in
interstate commerce so as not to be subject to the legislative powers of the state, except insofar as application of this title is authorized under the United States Constitution or laws of the United States.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
Any employee on whose behalf an employer makes contributions to a Taft-Hartley pension trust fund.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
“Eligible employer” means a person or entity engaged in a business, industry, profession, trade, or other enterprise in the state, whether for profit or not for profit, excluding sole proprietorships, self-employed individuals, or other business entities that do not employ any individuals other than the
owners of the business, the federal government, the state, any county, any municipal corporation, or any of the state’s units or instrumentalities, that has at least one eligible employee and that satisfies the requirements to establish or participate in a payroll deposit retirement savings arrangement.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
(i)
<html:span class="EnSpace"/>
“Eligible employer” also includes household employers.
</html:p>
<html:p>
(ii)
<html:span class="EnSpace"/>
“Household employers” includes those who have hired or contracted someone to work in or around their home for the benefit of their personal household and provide the employee a W-2 federal tax form to evidence tax deductions at the federal and state level.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Upon a positive determination pursuant to subdivision (a) of Section 100046, eligible employer means an employer of a provider of in-home supportive services, as regulated by Article 7 (commencing with Section 12300) of Chapter 3 of Part 3 of Division 9 of the Welfare and Institutions Code.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
“Eligible employer” does not include an employer that provides a retirement savings arrangement as described in Section 100032.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
“IRA” means an individual retirement account or individual retirement annuity under Section 408(a),
408(b), or 408A of Title 26 of the United States Code.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
“Participating employer” means an eligible employer that provides a payroll deposit retirement savings arrangement provided for by this title for eligible employees.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
“Payroll deposit retirement savings
arrangement” means an arrangement by which an employer allows employees to remit payroll deduction contributions to a retirement savings program, which may include an IRA, and in the case of a payroll deduction IRA arrangement, to remit specifically to an IRA.
</html:p>
<html:p>
(h)
<html:span class="EnSpace"/>
“Trust” means the CalSavers Retirement Savings Trust established by this title.
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
“Vendor” means a registered investment company or admitted life insurance company qualified to do business in California that provides retirement investment products. “Vendor” also includes a company that is registered to do business in California that provides payroll services or recordkeeping services and offers retirement plans or payroll deduction IRA arrangements using products of regulated investment companies and insurance companies qualified to do business in California. “Vendor” does not include individual registered representatives, brokers, financial planners, or agents.
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<ns0:BillSection id="id_A0621865-C0DD-4CA5-B86A-9174117F030F">
<ns0:Num>SEC. 2.</ns0:Num>
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Section 100002 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:LawSection id="id_0665D6E5-1107-4D77-BADE-B2837FABF3A0">
<ns0:Num>100002.</ns0:Num>
<ns0:LawSectionVersion id="id_85295BF8-D191-45E3-89CC-1CA799A5BCEE">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
There is hereby created within state government the CalSavers Retirement Savings Board, which shall consist of nine members, with the Treasurer serving as chair, as follows:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
The Treasurer.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The Director of Finance, or the director’s designee.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
The Controller.
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
An individual with retirement savings and investment expertise appointed by the Senate Committee on Rules.
</html:p>
<html:p>
(E)
<html:span class="EnSpace"/>
An employee representative appointed by the Speaker of the Assembly.
</html:p>
<html:p>
(F)
<html:span class="EnSpace"/>
A small business representative appointed by the Governor.
</html:p>
<html:p>
(G)
<html:span class="EnSpace"/>
A public member appointed by the Governor.
</html:p>
<html:p>
(H)
<html:span class="EnSpace"/>
Two additional members appointed by the Governor.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Members of the board appointed by the Governor, the Senate Committee on Rules, and the Speaker of the Assembly shall serve at the pleasure of the appointing authority.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
All members of the board shall serve without compensation. Members of the board shall be reimbursed for necessary travel expenses incurred in connection with their board duties.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
A board member, program administrator, and other staff of the board shall not do any of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Directly or indirectly have any interest in the making of any investment made for the program, or in the gains or profits accruing from any investment made for the program.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Borrow any funds or deposits of the trust, or use those funds or deposits in any manner, for themselves or as an agent or partner of others.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Become an endorser, surety, or obligor on investments by the board.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
The board and the program administrator and staff, including contracted administrators and consultants, shall discharge their duties as fiduciaries with respect to the trust solely in the interest of the program participants as follows:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
For the exclusive purposes of providing benefits to program
participants and defraying reasonable expenses of administering the program.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
By investing with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with those matters would use in the conduct of an enterprise of a like character and with like aims.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
The board, subject to its authority and fiduciary duty, shall design and implement the CalSavers Retirement Savings Program.
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The board shall maintain an investment policy statement that defines the program’s investment objectives and articulates policies and procedures enabling investment objectives to be met in a prudent manner. The board shall seek to minimize participant fees and strive to implement program features that provide maximum possible income replacement balanced with appropriate risk in an IRA-based environment. The investment policy statement shall describe the investment options available to holders of individual savings accounts established as part of the program. The investment policy statement shall include a risk management and oversight program. Investment options may encompass a range of risk and return opportunities and allow for a rate of return commensurate with an appropriate level of risk to meet the investment objectives stated in
the policy.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The board shall annually review the investment policy statement. The board shall review the investment policy statement and any changes in the investment policy statement at a public hearing.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The risk management and oversight program shall include an effective risk management system to monitor the risk levels of
the CalSavers Retirement Savings Program investment portfolio and ensure that the risks taken are prudent and properly managed. The program shall be managed to provide an integrated process for overall risk management on both a consolidated and disaggregated basis, and to monitor investment returns as well as risk to determine if the risks taken are adequately compensated compared to applicable performance benchmarks and standards.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
The board shall approve an investment management entity or entities, the costs of which shall be paid out of funds held in the trust and shall not be attributed to the administrative costs of the board in operating the trust. Not later than 30 days after the close of each month, the board shall place on file for public inspection during business hours a report with respect to investments made pursuant to this section and a report of deposits in financial institutions.
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<ns0:Num>SEC. 3.</ns0:Num>
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Section 100004 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:Num>100004.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
There is hereby established a retirement savings trust known as the CalSavers Retirement Savings Trust to be administered by the board for the purpose of promoting greater retirement savings for California private employees in a convenient, voluntary, low-cost, and portable manner. After sufficient funds are made available for this title to be operative, the trust, as a self-sustaining trust, shall pay all costs of administration only out of moneys on deposit therein.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The board shall segregate moneys received by the trust into two funds, which shall be identified as the program fund and the administrative fund. Notwithstanding Section 13340, moneys in the trust are hereby continuously appropriated, without regard to fiscal years, to the board for the
purposes of this title.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
Moneys in the program fund may be invested or reinvested by the Treasurer or may be invested in whole or in part under contract with the board of a California public retirement system, with private money managers, or a combination thereof, as determined by the board.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
Transfers may be made from the program fund to the administrative fund for the purpose of paying operating costs associated with administering the trust and as required by this title, including, but not limited to, board operations, program administrator and investment expenses, and enforcement and compliance costs. On and after six years from the date the program is implemented, on an annual basis, expenditures from the administrative fund shall not exceed more than 1 percent of the total
program fund. All costs of administration of the trust shall be paid out of the administrative fund.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
Any contributions paid by employees and employers into the trust shall be used exclusively for the purpose of paying benefits to the participants of the CalSavers Retirement Savings Program, for the cost of administration of the program, and for investments made for the benefit of the program.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
The trust is an instrumentality of the state. Any security issued, managed, or invested by the board within the trust on behalf of an individual participating within the CalSavers Retirement Savings Program shall be exempt from Sections 25110, 25120, and 25130 of the Corporations Code.
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<ns0:Num>SEC. 4.</ns0:Num>
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Section 100008 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:Num>100008.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
The CalSavers Retirement Savings Program shall include, as determined by the board, one or more payroll deduction IRA arrangements.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
The program shall, with board approval, establish an IRA on behalf of participants who are eligible to receive federal or state retirement benefits, such as tax credits or deposits from any unit of federal or state government, that require monetary deposits into specified IRA accounts.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
The program shall notify participants at least 30 days prior to the creation of the accounts described in paragraph (1).
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The notification shall include, at a minimum, all of the following:
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
The benefits and risks associated with the existence and operation of the IRA.
</html:p>
<html:p>
(ii)
<html:span class="EnSpace"/>
How to opt out of the IRA.
</html:p>
<html:p>
(iii)
<html:span class="EnSpace"/>
The mechanics for how to operate the IRA alongside other CalSavers accounts.
</html:p>
<html:p>
(iv)
<html:span class="EnSpace"/>
The process for withdrawal of retirement savings and any penalties or tax implications for early withdrawal.
</html:p>
<html:p>
(v)
<html:span class="EnSpace"/>
How to obtain additional information on the account.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
The program shall, with board approval, establish a payroll deposit emergency savings account on behalf of participants for the
purpose of preserving retirement investments.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The accounts shall not exceed a contribution of one thousand dollars ($1,000) at any given time or a lesser amount as determined by the board, and shall not have minimum balance requirements.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
Unless otherwise specified by the employee, a participating employee shall contribute 3 percent of the employee’s annual salary or wages to the payroll deposit emergency savings account described in this subdivision.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
By
regulation, the board may adjust the contribution amount to no less than 0.5 percent and no more than 3 percent and may vary that amount within that 0.5 percent to 3 percent range.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Participating employers may make contributions to their participating employees’ emergency savings accounts provided that the contributions would be permitted under the Internal Revenue Code and would not cause the program to be treated as an employee benefit plan under the federal Employee Retirement Income Security Act.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
The program shall notify participants at least 30 days prior to the creation of the payroll deposit emergency savings accounts described
in this subdivision.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The notification shall include, at a minimum, all of the following:
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
The benefits and risks associated with the existence and operation of the account.
</html:p>
<html:p>
(ii)
<html:span class="EnSpace"/>
How to opt out of the account.
</html:p>
<html:p>
(iii)
<html:span class="EnSpace"/>
The mechanics for how to operate the account alongside other CalSavers accounts.
</html:p>
<html:p>
(iv)
<html:span class="EnSpace"/>
The process for withdrawal of savings from the account.
</html:p>
<html:p>
(v)
<html:span class="EnSpace"/>
The purpose of the account.
</html:p>
<html:p>
(vi)
<html:span class="EnSpace"/>
How to obtain additional information on the account, including the current annual percentage yield.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_34466C99-8D50-41C6-8135-1ED8BE84C4F7">
<ns0:Num>SEC. 5.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100010.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100010 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_F4DEB69E-2614-4B98-AB41-88DFB07A374D">
<ns0:Num>100010.</ns0:Num>
<ns0:LawSectionVersion id="id_C73B71EE-CFF9-4965-8238-AA08A2D97785">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
The board shall have the power and authority to do all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Make and enter into contracts necessary for the administration of the trust.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Adopt a seal and change and amend it from time to time.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Cause moneys in the program fund to be held and invested and reinvested.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Accept any grants, gifts, legislative appropriation, and other moneys from the state, any unit of federal, state, or local government or any other person, firm, partnership, or corporation for deposit to the administrative fund or the program fund.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
Contract with a program administrator and determine the duties of the program administrator. The Treasurer shall, on behalf of the board, appoint an executive director, who shall not be a member of the board and who shall serve at the pleasure of the board. The Treasurer shall determine the duties of the executive director and other staff as appropriate and set their compensation. The board may authorize the executive director to enter into contracts on behalf of the board or conduct any business necessary for the efficient operation of the board.
</html:p>
<html:p>
(6)
<html:span class="EnSpace"/>
Make provisions for the payment of costs of administration and operation of the trust.
</html:p>
<html:p>
(7)
<html:span class="EnSpace"/>
Employ staff.
</html:p>
<html:p>
(8)
<html:span class="EnSpace"/>
Retain and contract with the board of a California public retirement system, private financial
institutions, other financial and service providers, consultants, actuaries, counsel, auditors, third-party administrators, and other professionals as necessary.
</html:p>
<html:p>
(9)
<html:span class="EnSpace"/>
Procure insurance against any loss in connection with the property, assets, or activities of the trust.
</html:p>
<html:p>
(10)
<html:span class="EnSpace"/>
Procure insurance indemnifying each member of the board from personal loss or liability resulting from a member’s action or inaction as a member of the board.
</html:p>
<html:p>
(11)
<html:span class="EnSpace"/>
Set minimum and maximum investment levels in accordance with contribution limits set for IRAs by the Internal Revenue Code.
</html:p>
<html:p>
(12)
<html:span class="EnSpace"/>
Collaborate and cooperate with the board of a California public retirement system, private financial institutions, service providers, and business, financial, trade, membership, and other
organizations to the extent necessary or desirable for the effective and efficient design, implementation, and administration of the program and to maximize outreach to eligible employers and eligible employees.
</html:p>
<html:p>
(13)
<html:span class="EnSpace"/>
Collaborate with, and evaluate the role of, licensed insurance agents and financial advisors in assisting and providing guidance for eligible employees.
</html:p>
<html:p>
(14)
<html:span class="EnSpace"/>
Cause expenses incurred to initiate, implement, maintain, and administer the program to be paid from contributions to, or investment returns or assets of, the program or arrangements established under the program, to the extent permitted under state and federal law.
</html:p>
<html:p>
(15)
<html:span class="EnSpace"/>
Facilitate compliance by the retirement savings program or arrangements established under the program with all applicable requirements for the program under the Internal Revenue
Code of 1986, including tax qualification requirements or any other applicable law and accounting requirements, including providing or arranging for assistance to program sponsors and individuals in complying with applicable law and tax qualification requirements in a cost-effective manner.
</html:p>
<html:p>
(16)
<html:span class="EnSpace"/>
Carry out the duties and obligations of the trust pursuant to this title and exercise any and all other powers as appropriate for the effectuation of the purposes, objectives, and provisions of this title pertaining to the trust.
</html:p>
<html:p>
(17)
<html:span class="EnSpace"/>
Assess the feasibility of multistate or regional agreements to administer the program through shared administrative resources and enter into those agreements if determined beneficial.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The board shall adopt regulations it deems necessary to implement this title consistent with the Internal Revenue Code and regulations issued pursuant to that code to ensure that the program meets all criteria for federal tax-deferral or tax-exempt benefits, or both. The board may delegate this rulemaking authority to the executive director by resolution.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_1CD12664-60FA-43AA-A7AC-693287F013C4">
<ns0:Num>SEC. 6.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100012.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100012 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_EE909036-EA85-4C65-96B1-9F9B805435E7">
<ns0:Num>100012.</ns0:Num>
<ns0:LawSectionVersion id="id_D485FA9D-5B6C-40D1-A249-EDE1BF5548E1">
<ns0:Content>
<html:p>In addition to the powers and authority granted to the board pursuant to Section 100010, the board shall have the power and authority to do the following:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
Cause the retirement savings program or arrangements established under the program to be designed, established, and operated, in a manner consistent with all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
In accordance with best practices for retirement savings vehicles.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
To encourage participation, saving, and sound investment practices, and appropriate selection of default investments.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
With simplicity, ease of administration for participating employers,
and portability of benefits.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
Arrange for collective, common, and pooled investment of assets of the retirement savings program or arrangements, including investments in conjunction with other funds with which those assets are permitted to be collectively invested, with a view to saving costs through efficiencies and economies of scale.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
Disseminate educational information designed to educate participants about the benefits of planning and saving for retirement and information to help them decide the level of CalSavers Retirement Savings Program participation and savings strategies that may be appropriate for them.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
Disseminate information concerning tax credits available to small business owners for allowing their employees to participate in the program, and the federal Retirement Savings Contribution
Credit (Saver’s Credit) and its successor the federal retirement savings incentive, known as the Saver’s Match,
available to lower and moderate-income households for qualified savings contributions.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
Submit progress and status reports to participating employers and eligible employees.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
If necessary, determine the eligibility of an employer, employee, or other individual to participate in the program.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
Evaluate and establish the process by which an eligible employee of an eligible employer is able to contribute a portion of their salary or wages to the program for automatic deposit of those contributions and the participating employer provides a payroll deposit retirement savings arrangement to forward the
employee contribution and related information to the program or its agents. This may include, but is not limited to, financial services companies and third-party administrators with the capability to receive and process employee information and contributions for payroll deposit retirement savings arrangements or other arrangements authorized by this title.
</html:p>
<html:p>
(h)
<html:span class="EnSpace"/>
Design and establish the process for the enrollment of program participants.
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
Allow participating employers to use the program to remit employees’ contributions to their IRAs on their employees’ behalf.
</html:p>
<html:p>
(j)
<html:span class="EnSpace"/>
Allow participating employers to make their own contributions to their employees’ IRAs, provided that the contributions would be permitted under the Internal Revenue Code and would not cause the program to be treated as an employee benefit plan under the
federal Employee Retirement Income Security Act.
</html:p>
<html:p>
(k)
<html:span class="EnSpace"/>
Evaluate and establish the process by which an individual or an employee of a nonparticipating employer may enroll in and make contributions to the program.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_F0374277-CC6C-456F-BD79-1AA889A61E48">
<ns0:Num>SEC. 7.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100016.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100016 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_90F2DDDD-55EE-492B-9F89-ADF73B873CFD">
<ns0:Num>100016.</ns0:Num>
<ns0:LawSectionVersion id="id_C9ABEBF9-9D36-41F4-A5CF-B732130A6CDF">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
Vendors that would like to contract with the board shall provide to the board, at a minimum, all of the following information:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
A statement of experience in California and in other states in providing employer-sponsored retirement plans, and payroll deduction IRAs.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
A description by the vendor of the types of retirement investment products offered.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
A disclosure of all expenses paid directly or indirectly by retirement plan participants, including, but not limited to, penalties for early withdrawals, declining or fixed withdrawal charges, surrender or deposit charges,
management fees, and annual fees, supported by documentation as required for prospectus disclosure by the National Association of Securities Dealers and the Securities and Exchange Commission. Vendors shall be required to provide information regarding the impact of product fees upon a hypothetical investment, as described in Section 100022.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
The types of products, product features, services offered to participants, and information about how to access product prospectuses or other relevant product information.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
A discussion of the ability, experience, and commitment of the vendor to provide retirement counseling and education services, including, but not limited to, access to group meetings and individual counseling by various means, including telephone and telecommunications devices for the deaf (TDD), Internet,
language access services, and face-to-face consultations by registered representatives.
</html:p>
<html:p>
(6)
<html:span class="EnSpace"/>
A statement of the financial strength of the vendor by identifying its ratings assigned by nationally recognized rating services that evaluate the financial strength of similar companies.
</html:p>
<html:p>
(7)
<html:span class="EnSpace"/>
The location of offices and counselors, individual registered representatives, brokers, financial planners, agents, or other methods of distribution, of the vendor that would serve employers and their employees in California.
</html:p>
<html:p>
(8)
<html:span class="EnSpace"/>
A description of the ability of the vendor to comply with all applicable provisions of federal and state law governing retirement plans, including minimum distribution requirements and contribution limits.
</html:p>
<html:p>
(9)
<html:span class="EnSpace"/>
To the extent applicable, the demonstrated ability of the vendor to offer an appropriate array of accumulation funding options, including, but not limited to, investment options that offer guaranteed returns on contributions and the conversion of retirement savings account balances to secure retirement income, a diversified mix of value, growth, growth and income, hybrid, and index funds or accounts across large, medium, and small capitalization asset classes, both domestic and international.
</html:p>
<html:p>
(10)
<html:span class="EnSpace"/>
A discussion of the range of administrative and customer services provided, including asset allocation, accounting and administration of benefits for individual participants, recordkeeping for individual participants, asset purchase, control, and safekeeping, execution of a participant’s instructions as to asset and contribution allocation, calculation of daily net asset values, direct access for participants to their account
information, periodic reporting that is not less than quarterly to active participants on their account balances and transactions, and compliance with the standard of care consistent with federal law and applicable to the provision of investment services.
</html:p>
<html:p>
(11)
<html:span class="EnSpace"/>
Certification by the vendor that the information provided to the board accurately reflects the provisions of the retirement investment products it registers.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
Vendors shall supply information and data in the format prescribed by the board.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_ECBA4433-DF0A-4448-8D86-D28C2C5707CF">
<ns0:Num>SEC. 8.</ns0:Num>
<ns0:ActionLine action="IS_REPEALED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100018.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100018 of the
<ns0:DocName>Government Code</ns0:DocName>
is repealed.
</ns0:ActionLine>
<ns0:Fragment/>
</ns0:BillSection>
<ns0:BillSection id="id_D1B26BCA-C8F0-4A0E-9A0B-E07002E790B5">
<ns0:Num>SEC. 9.</ns0:Num>
<ns0:ActionLine action="IS_REPEALED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100020.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100020 of the
<ns0:DocName>Government Code</ns0:DocName>
is repealed.
</ns0:ActionLine>
<ns0:Fragment/>
</ns0:BillSection>
<ns0:BillSection id="id_BBAD35BE-7CD2-4258-AE3B-A8D94475E395">
<ns0:Num>SEC. 10.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100022.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100022 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_7DF54BAC-852D-4580-B7D8-411B927468FA">
<ns0:Num>100022.</ns0:Num>
<ns0:LawSectionVersion id="id_E11EDC1C-518C-4C6C-865F-5B23E326FF57">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
The board shall maintain on its internet website the information required in Section 100016 about the retirement investment products offered by each contracted vendor and objective comparisons between the
types of products.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The board shall include on its internet website information on investment performance based upon the investment’s average annual total return as measured by a nationally recognized rating service selected by the board for standard periods of time of not less than one year.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
The board’s internet website shall include a table
showing, for each registered fund, the total fee cost in dollars incurred by a shareholder who initially invested five thousand dollars ($5,000), earned a 5 percent rate of return for one-, five-, 10-, 15-, and 20-year time periods. This table shall be accompanied by a disclaimer that the rate of return is for purposes of illustrating the respective impacts of different fee amounts on each investment, and is not to predict future investment returns.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_C6B3306C-83B8-424E-84CE-CA919CC5E41F">
<ns0:Num>SEC. 11.</ns0:Num>
<ns0:ActionLine action="IS_REPEALED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100024.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100024 of the
<ns0:DocName>Government Code</ns0:DocName>
is repealed.
</ns0:ActionLine>
<ns0:Fragment/>
</ns0:BillSection>
<ns0:BillSection id="id_321D6CA3-88C6-485D-88D1-92E7FDAE3A21">
<ns0:Num>SEC. 12.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100026.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100026 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_0569CB89-645C-42C8-9386-492A7D3025FD">
<ns0:Num>100026.</ns0:Num>
<ns0:LawSectionVersion id="id_9CDF0C9A-6A20-43BD-9ACE-C5B5205018DC">
<ns0:Content>
<html:p>A contracted vendor may not charge a fee associated with a registered product that is not disclosed.</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_53741658-E23E-401F-9C5E-34BB813A6A90">
<ns0:Num>SEC. 13.</ns0:Num>
<ns0:ActionLine action="IS_REPEALED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100028.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100028 of the
<ns0:DocName>Government Code</ns0:DocName>
is repealed.
</ns0:ActionLine>
<ns0:Fragment/>
</ns0:BillSection>
<ns0:BillSection id="id_D93ED0FF-822F-4D37-A3FF-857873EA5675">
<ns0:Num>SEC. 14.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100030.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100030 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_95359969-C783-4E64-8792-0BE92B542430">
<ns0:Num>100030.</ns0:Num>
<ns0:LawSectionVersion id="id_2C6B0128-EADC-4257-B426-75C7BCE6915B">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
The board and the program, and its officers and employees, are not responsible for, and shall not be held liable for, the adequacy of the information provided by contracted vendors and contained in the program’s internet website.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The board and the program shall not be held liable for the actions of contracted vendors.
</html:p>
</ns0:Content>
</ns0:LawSectionVersion>
</ns0:LawSection>
</ns0:Fragment>
</ns0:BillSection>
<ns0:BillSection id="id_1D71F104-D2D4-433B-AB6A-C0DBEC5C7844">
<ns0:Num>SEC. 15.</ns0:Num>
<ns0:ActionLine action="IS_AMENDED" ns3:type="locator" ns3:href="urn:caml:codes:GOV:caml#xpointer(%2Fcaml%3ALawDoc%2Fcaml%3ACode%2Fcaml%3ALawHeading%5B%40type%3D'TITLE'%20and%20caml%3ANum%3D'21.'%5D%2Fcaml%3ALawSection%5Bcaml%3ANum%3D'100032.'%5D)" ns3:label="fractionType: LAW_SECTION">
Section 100032 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
</ns0:ActionLine>
<ns0:Fragment>
<ns0:LawSection id="id_E2DF25C4-0DEF-48D2-95B6-91E1E5B87C9E">
<ns0:Num>100032.</ns0:Num>
<ns0:LawSectionVersion id="id_ABEC6B32-B286-494C-9E5F-C7103BC28750">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
Any employer may choose to have a payroll deposit retirement savings arrangement to allow employee participation in the program under the terms and conditions prescribed by the board.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
Beginning December 31, 2027, and by December 31 of each calendar year thereafter, eligible employers with one or more eligible employees that do not offer a retirement savings program pursuant to paragraph (1) of subdivision (d) shall have a payroll deposit retirement savings arrangement to allow employee participation in the program.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The board, in its discretion, may extend the dates in paragraph (1).
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
Each eligible employee shall be enrolled in the program unless the employee elects not to participate in the program. An eligible employee may elect to opt out of the program by making a notation on the opt-out form or by contacting the program by telephone.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Following initial implementation of the program pursuant to this section, at least once every two years, the board may designate an open enrollment period
during which eligible employees that previously opted out of the program shall be given the employee information packet with the disclosure and opt-out forms, for the employee to enroll in the program or opt out of the program by making a notation on the opt-out form.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
An employee who elects to opt out of the program who subsequently wants to participate through the employer’s payroll deposit retirement savings arrangement may enroll during the board’s designated open enrollment period or at any other time.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
An employer that provides an employer-sponsored retirement plan,
such as a defined benefit plan or a 401(k), Simplified Employee Pension (SEP) plan, or Savings Incentive Match Plan for Employees (SIMPLE) plan, or that offers an automatic enrollment payroll deduction IRA, shall be exempt from the requirements of the CalSavers Retirement Savings Program, if the plan or IRA qualifies for favorable federal income tax treatment under the federal Internal Revenue Code.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
An employer shall retain the option at all times to set up and offer a tax-qualified retirement plan, as described in paragraph (1), instead of having a payroll deposit retirement savings arrangement to allow employee participation in the CalSavers Retirement Savings Program.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
An eligible employee may also terminate their participation in the program at any time in a manner prescribed by the board and thereafter by making a notation on the opt-out form or by telephone.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
Unless otherwise specified by the employee, a participating employee shall contribute 3 percent of the employee’s annual salary or wages to the program.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
By regulation, the board may adjust the contribution amount set in subdivision
(f) to no less than 2 percent and no more than 5 percent and may vary that amount within that 2 percent to 5 percent range.
</html:p>
<html:p>
(h)
<html:span class="EnSpace"/>
The board may implement annual automatic escalation of employee contributions.
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Employee contributions subject to automatic escalation shall not exceed 8 percent of salary.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Automatic escalation shall result in no more than a 1-percent-of-salary increase in employee
contributions per calendar year.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
A participating employee may elect to opt out of automatic escalation and may set their contribution percentage rate at a level determined by the participating employee.
</html:p>
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<ns0:BillSection id="id_8D6A3886-35D3-48F0-A560-9040676B43CE">
<ns0:Num>SEC. 16.</ns0:Num>
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Section 100033 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:Num>100033.</ns0:Num>
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<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
The CalSavers Retirement Savings Board shall have the power and duties necessary to administer the enforcement of employer compliance with this title.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
The CalSavers Retirement Savings Board shall issue to each employer who fails to allow its eligible employees to participate in the CalSavers Retirement Program pursuant to this title a notice of penalty application.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Each eligible employer that, without good cause, fails to allow its eligible employees to participate in the CalSavers Retirement Savings Program pursuant to Sections 100014 and 100032, after the CalSavers Retirement Savings Board serves a final notice of penalty application, shall be subject to a
penalty of two hundred fifty dollars ($250) per eligible employee and an additional penalty of five hundred dollars ($500) per eligible employee if noncompliance continues as described in Section 19287 of the Revenue and Taxation Code.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
Each eligible employer that, without good cause, fails to allow its eligible employees to participate in the program after the penalties described in paragraph (2) have been assessed shall be subject to a penalty of five hundred dollars ($500) per eligible employee.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
Penalties assessed under this subdivision shall not be imposed more than once every 180 days since the last violation.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
The CalSavers Retirement Savings Board shall issue a final notice of penalty application to an eligible employer that fails to comply with this title. Pursuant to Section 19287 of the Revenue and Taxation Code, the Franchise Tax Board shall issue a first notice of the imposition of a penalty to an eligible employer for failure to comply after the CalSavers Retirement Savings Board informs the Franchise Tax Board of the eligible employer’s noncompliance.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
An eligible employer may appeal any penalty imposed under this section in writing to the Franchise Tax Board pursuant to Section 19288 of the Revenue and Taxation Code.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The CalSavers Retirement Savings Board shall reimburse the Franchise Tax Board for the costs incurred by the Franchise Tax Board in administering the program authorized
by this article.
</html:p>
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<ns0:Num>SEC. 17.</ns0:Num>
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Section 100046 of the
<ns0:DocName>Government Code</ns0:DocName>
is amended to read:
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<ns0:Num>100046.</ns0:Num>
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<ns0:Content>
<html:p>The CalSavers Retirement Savings Program is approved by the Legislature and implemented as of January 1, 2017. The board shall consider and utilize the following parameters in designing the program:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
The board shall include a provider of in-home supportive services, as regulated by Article 7 (commencing with Section 12300) of Chapter 3 of Part 3 of Division 9 of the Welfare and Institutions Code in the program if the board determines, and the Director of the State Department of Social Services and the Director of the Department of Finance certify, in writing, all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The inclusion meets all state and federal legal requirements.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The
appropriate employer of record has been identified for the purpose of satisfying all the program’s employer requirements.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The payroll deduction, described in Section 12302.2 of the Welfare and Institutions Code, can be implemented at reasonable costs.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
The inclusion does not create a financial liability for the state or employer of record.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The board shall structure the program so as to ensure the state is prohibited from incurring liabilities associated with administering the program and that the state has no liability for the program or its investments.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
The board shall determine necessary costs associated with outreach, customer service, enforcement, staffing and consultant costs, and all other costs necessary to administer the
program.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
The board shall consult with employer representatives to create an administrative structure that facilitates employee participation while addressing employer needs, including, but not limited to, clearly defining employers’ duties and liability exemption pursuant to Section 100034.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
The board shall include comprehensive worker education and outreach in the program, and the board may collaborate with state and local government agencies, community-based and nonprofit organizations, foundations, vendors, and other entities deemed appropriate to develop and secure ongoing resources for education and outreach that reflect the cultures and languages of the state’s diverse workforce population.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
The board shall include comprehensive employer education and outreach in the program, with an emphasis on
employers with fewer than 100 employees, developed in consultation with employer representatives, with the integration of the following components:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
A program internet website to assist the employers of participating employees.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
A toll-free help line for employers with live and automated assistance.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Online internet web training.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Presentations to business associations.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
Targeted outreach to small businesses with 10 or less
employees.
</html:p>
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