The Connecticut legislature is wasting no time in considering a measure that would require disclosures by 403(b) plans political subdivisions in the Nutmeg State. The scope of the bill, however, is narrower than originally drafted.
HB 7161, which would require service providers under 403(b) retirement plans to disclose conflicts of interest, was introduced into the Connecticut House of Representatives on Feb. 23; the House passed it unanimously on May 2. The measure is now before the Senate.
Compared to the original version that the House Banking Committee approved in March, the amended bill has a narrower scope, requiring only that “any company that administers” a 403(b) plan offered by a political subdivision (and not administered by the state itself) must disclose in writing, upon enrollment, and annually thereafter:
The previous version apparently would have affected any kind of service provider, required descriptions of services and conflicts of interest, and empowered the State Treasurer to adopt disclosure regulations “guided by” the DOL’s 408(b)(2) regulations. The new version removes the need for bureaucratic rulemaking, with the accompanying fiscal note asserting simply that “disclosure requirements can be accommodated in annual plan documents provided by plan administrators.”
Ray Harmon is Government Affairs Counsel for the American Retirement Association.
HB 7161, which would require service providers under 403(b) retirement plans to disclose conflicts of interest, was introduced into the Connecticut House of Representatives on Feb. 23; the House passed it unanimously on May 2. The measure is now before the Senate.
Compared to the original version that the House Banking Committee approved in March, the amended bill has a narrower scope, requiring only that “any company that administers” a 403(b) plan offered by a political subdivision (and not administered by the state itself) must disclose in writing, upon enrollment, and annually thereafter:
- the fee ratio and return, net of fees, for each investment under the retirement plan; and
- the fees paid to any person who, for compensation, engages in the business of providing investment advice to participants in the retirement plan either directly or through publications or writings.
The previous version apparently would have affected any kind of service provider, required descriptions of services and conflicts of interest, and empowered the State Treasurer to adopt disclosure regulations “guided by” the DOL’s 408(b)(2) regulations. The new version removes the need for bureaucratic rulemaking, with the accompanying fiscal note asserting simply that “disclosure requirements can be accommodated in annual plan documents provided by plan administrators.”
Ray Harmon is Government Affairs Counsel for the American Retirement Association.
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