ENTITLED, An Act to provide for automatic increases in the accounts of automatically-enrolled participants of the deferred compensation plan of the South Dakota Retirement System.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:
Section 1. That § 3-13-56 be amended to read as follows:
3-13-56. The board may establish an automatic enrollment feature within the plan by rules promulgated pursuant to chapter 1-26 and § 3-13-54. Any automatic enrollment feature established by the board shall include:
(1) A provision that automatic enrollment shall apply only to newly-employed members hired after a specified future date;
(2) A provision that automatic enrollment shall apply only to the employees of those participating units that choose the automatic enrollment feature for the unit's employees;
(3) A provision that automatic enrollment may not require more than an established maximum contribution per month per automatically-enrolled participant;
(4) A provision that a participant who is automatically enrolled shall have as long as ninety days after the start of employment to discontinue participation in the plan;
(5) A provision that an automatically-enrolled participant who discontinues participation in the plan within ninety days of enrollment shall receive a refund of the participant's account within thirty days after discontinuing participation;
(6) A provision that the state investment officer shall select a default investment fund to receive contributions by any automatically-enrolled participant who does not choose an investment alternative to receive the participant's contributions;
(7) A provision authorizing participating units and the system to make contributions to the plan for the benefit of participants;
(8) A provision that the plan shall adhere to notice requirements to automatically-enrolled participants in accord with Internal Revenue Service Rulings 98-30 and 2000-8;
(9) A provision that automatic enrollment does not require advance authorization by a participant, which is hereby deemed to be an exception to the provisions of any state law requiring employee authorization for a payroll deduction or any similar ordinance of a local participating unit; and
(10) A provision that the amount of compensation deferred by an automatically-enrolled participant shall automatically increase by a specified amount each year unless the participant elects not to participate in automatic escalation or elects to defer a different amount than specified.
If a participant discontinues participation pursuant to subdivision (4), that act is a permissive withdrawal pursuant to § 414(w) of the Internal Revenue Code.
An Act to provide for automatic increases in the accounts of automatically-enrolled participants of the deferred compensation plan of the South Dakota Retirement System.
I certify that the attached Act originated in the
HOUSE as Bill No. 1011
Speaker of the House
President of the Senate
Secretary of the Senate
House Bill No. 1011
File No. ____
Chapter No. ______
Received at this Executive Office this _____ day of _____________ ,
20____ at ____________ M.
for the Governor
The attached Act is hereby approved this ________ day of ______________ , A.D., 20___
STATE OF SOUTH DAKOTA,
Office of the Secretary of State
Filed ____________ , 20___
at _________ o'clock __ M.
Secretary of State
Asst. Secretary of State