To ensure workers have the highest quality choice when it comes to retirement savings, the Office of State Treasurer will explore an interstate collaboration for the Delaware Expanding Access for Retirement and Necessary Savings (EARNS) Program.

The EARNS Program board, voting unanimously at its July 13 public meeting, authorized the Treasurer’s office to evaluate entry into an interstate partnership or multistate consortium to support the launch and future success of the retirement savings program.

“We’re thrilled with the strong support of the EARNS Program Board as we seek interstate cooperation to support this innovative retirement savings program for Delaware,” Treasurer Colleen Davis said. “Partnering with other programs would allow for collaborative decision making with industry leaders and benefit the program as it moves towards its launch.”

Signed into law by Governor Carney in 2022, Delaware EARNS will provide a convenient way for private-sector workers to save for retirement. Nearly 150,000 Delaware workers, many of them low- and middle-income, currently lack access to a workplace retirement savings plan. The EARNS program, which is expected to launch in 2025, will also help small businesses that lack the resources to offer a 401(k) or similar retirement plan.

Treasurer Davis has consistently championed retirement savings for all Delawareans and was an outspoken advocate for passage of the legislation that created the EARNS program.

“Since coming into office, my priorities have been clear: bolster retirement security, create pathways to economic empowerment, and provide a culture of financial excellence,” Treasurer Davis said. “Delaware EARNS fits perfectly with those priorities.”

The Treasurer’s office, working with the firm AKF Consulting Group, determined that potential interstate cooperation could offer a range of benefits to Delaware:

• Lower start-up costs for the State
• Faster time to launch
• Lower initial fees for participant
• Potential for accelerated fee decreases

“Delaware has proven success with such partnerships,” Davis said. “DEPENDABLE, Delaware’s ABLE Plan—a savings vehicle for people with disabilities—operates through a multistate consortium called the National ABLE Alliance.”

To keep the public informed about the potential interstate cooperation and the EARNS program’s overall progress, the Treasurer’s office will hold public meetings and make updates on its website. Additionally, anyone can register to receive updates on developments about DE EARNS.

States interested in partnering with Delaware can write to EARNS@delaware.gov attention Ted Griffith, EARNS program director. Members of the public can use the same e-mail address for any questions or comments about the program.

After a successful launch in 2022, State Treasurer Colleen Davis, with the endorsement of the Delaware Plans Management Board, extended the ASPIRE529 pilot program and will once again offer financial assistance to youth in or aging out of the foster care system seeking higher education.

Awarded on a first-come first-served basis to qualified individuals, ASPIRE529 funds may be used towards costs associated with higher education including books and supplies, materials required for skills training, transportation, and child care.

“Individuals aging out of the foster care system face a number of obstacles as they begin their ‘adult lives,’ and furthering education shouldn’t be one of them,” Treasurer Davis said. “I am proud to offer ASPIRE529 awards in order to help these people take their next steps towards success.”

A total of up to 20 qualified applicants will be eligible to receive an award of $529. To be eligible for an award, a student must:

• Be under age 26, and:
  • At least 14 years old and currently in Department of Services for Children, Youth, & Their Families (DSCYF) Custody (foster care); or
  • Exited DSCYF Custody to adoption or guardianship at the age of 16 years or older; or
  • Aged out of foster care in Delaware at age 18.
• Complete a current-year Delaware Aspire529 application prior to the deadline. (June 30th)
• Be a Delaware resident.
• Be a U.S. citizen, permanent resident, or approved refugee.
• Be an undergraduate student.
• Show proof of enrollment or attendance at an institution of higher learning or trade school, AND if already attending, must be making satisfactory academic or vocational progress toward completion of that program. Proof of enrollment or attendance can be requested through your school’s registrar or administrative offices.

The application period runs from June 1, 2023, until June 30, 2023. Winners will be notified by September 1, 2023. The online application can be found at de.gov/aspire529.

“The Aspire529 helps youth transitioning out of foster care in Delaware overcome financial barriers while achieving their education goals,” said Tamara Myles, Transitional & Independent Living Program Manager with DSCYF’s Division of Family Services. “This award will help many pay for education expenses and will afford them the opportunity to acquire less debt during their post-secondary education journey.”

“After serving them during their years in foster care, the youth need our support now more than ever,” said Caroline Jones, President, and Founder of Kind to Kids Foundation. “We need to work hard to break down any barriers that can stand in the way of the success of these vulnerable young adults.”

In addition to $529, awardees will also receive valuable financial literacy education from $tand By Me®, a financial coaching program partnership of the State of Delaware and the United Way.

“Becoming educated on how to handle money is just as valuable as the education this money will help provide,” said Valerie Cannon, Senior Social Service Administrator in the Division of Social Services. “We commend Treasurer Davis and the Plans Management Board for including a financial literacy component to ASPIRE529 and are proud they chose Stand By Me to provide the lessons.”

With Memorial Day falling on May 29th, we have the opportunity to remember the heroes of our past and take the opportunity to invest in the heroes of our future…our children. State Treasurer Colleen Davis once again joins the nationwide celebration of saving for higher education.

529 Day, which takes place every year on May 29th (5/29), is a day dedicated to promoting awareness and encouraging families to save for college through a 529 savings plan. These tax-advantaged investment accounts allow parents, grandparents, and other family members to save for a child’s education expenses, such as tuition, books, and housing.

“We believe that every child deserves the opportunity to pursue their dreams and achieve their full potential, and a DE529 savings plan can help make that a reality,” Treasurer Davis said. “I’m proud that our office sponsors the DE529 Education Savings Plan and takes the lead in raising awareness about the importance of saving for higher education.”

Contributions to DE529 accounts now come with additional benefits. “First State, First Steps” is an incentive program for Delawareans to start saving early. The pilot program provides for a $100 contribution to a DE529 Education Savings Plan account if:

• The beneficiary is five years of age or younger at the time of account opening
• The beneficiary is a Delaware resident at the time the account is opened
• A minimum contribution of at least $100.00 is made to the DE529 account when the account is opened.

Additionally, this year marked the first time that Delawareans filing their state tax returns could take deductions for DE529 contributions.

To help spread awareness of the DE529 Education Savings Plan, Treasurer Davis will host a community resource fair Thursday May 25, 2023, at the Wilmington PAL Center at 3707 North Market Street in Wilmington. The event is presented in partnership with Fidelity Investments, the Delaware NAACP, the Metropolitan Wilmington Urban League, the Police Athletic Club of Wilmington, and the UD Center for Economic Education and Entrepreneurship.

Members of the General Assembly joined in supporting education saving with the passage of HCR 47, sponsored by Rep. Krista Griffith and Sen. Trey Paradee, declaring May 29th DE529 Day in Delaware.

To learn more about 529 plans and how you can start saving for your child’s future, visit 529.delaware.gov.

Delaware State Treasurer Colleen Davis began taking proactive measures to protect Delaware’s financial interests in anticipation of a potential federal government default. The move comes after U.S. Treasury Secretary Janet Yellin said that, without an agreement to raise the nation’s debt ceiling by June 1, 2023, the federal government could default on its loan obligations.

“I remain committed to ensuring the security and the stability of Delaware’s cash and investments,” Treasurer Davis said. “Though I hope we see an agreement in Washington, my obligation is to protect the financial resources of the state and it’s residents in the event that we don’t.”

The state’s overall investment portfolio holds approximately $2.3 billion in U.S. Treasuries. A default on the part of the federal government could result in significant loss if an agreement is not reached.

“What’s important to know is that Delaware has resources to meet its financial obligations in the near-term without the money from the U.S. Treasury holdings,” Davis said. “As always, we have developed strategies to buffet the tide of financial turmoil in Delaware. We will continue to monitor negotiations in Washington and urge our leaders to come to an agreement.”

Bills would reinstate employer match and allow casual/seasonal employees to participate in retirement plan

Remaining consistent with her three main priorities; bolstering retirement security and readiness, creating pathways to economic empowerment, and promoting a culture of financial excellence, Treasurer Davis has proposed two pieces of legislation with bi-partisan support designed to support state employees with their retirement saving.

The first bill, supported as a key strategic objective of the Delaware Plans Management Board, would reinstate the employer match for state employee contributions to the deferred compensation program. The State suspended the match in July 2008 during the early part of the ‘Great Recession’.

“It was always the intent of the General Assembly to revive the match after lawmakers reluctantly put it on hold in order to cut costs,” said Treasurer Davis. “In fact, every budget bill since Fiscal Year 2008 contained language reading ‘It is the intent of the General Assembly that this program be reinstated when funding becomes available.’”

Senate Bill 94, sponsored by Sen. Trey Paradee and House Majority Leader Valerie Longhurst restores the State’s match and adjusts it for cost-of-living increases by setting the maximum match at $20 per pay period. The previous maximum was set at $10 in the year 2000.

“For over a decade, the State of Delaware provided a meager match to the deferred compensation program as a way to encourage state workers to save for their future,” said Sen. Trey Paradee, D-Dover, Senate prime sponsor of SB 94. “Now, after six straight years of surpluses, I think it’s time we finally keep our promise and restore a match that keeps pace with inflation. This legislation is not only good for state workers, it also will help the State of Delaware at a time when it’s getting harder to compete with the private sector.”

During the time that the State offered the employer match, the employee participation rate was growing at an average of 3.25% per year. After the suspension, employee participation declined at an average rate of 1.6% per year.

Senate Bill 94 also provides retirement help to State employees with student loan debt who are struggling to save for retirement. The bill also authorizes the State to contribute to an employee’s retirement account if the employee is making payments on student loans, and as a result, the employee cannot afford to contribute to their retirement account.

A second piece of legislation will take another step towards increasing retirement saving opportunities for state employees. When passed, House Bill 130, sponsored by Reps. Longhurst, Krista Griffith, and Melissa Minor-Brown and Sen. Paradee will allow casual seasonal state employees to participate in the State’s 457(b) retirement savings plan. Currently, casual/seasonal employees, who are not eligible for benefits, are excluded from the plan. As a result, many casual seasonals are missing out on saving for retirement.

“Casual seasonal employees make up a critical part of the state government workforce, and they play a significant role in keeping our state running and delivering services to the people of Delaware.” said Treasurer Davis. “Among those in casual seasonal roles are nurses, park rangers, prosecutors, accountants, security officers, and social workers. The State should be taking care of these hard-working individuals by allowing them to participate in the State’s retirement savings plan so that they can save, invest, and build wealth for a more secure and comfortable retirement.”

“Our hardworking state employees dedicate their lives to serving our communities. It’s only fair that we give these civil servants the tools and resources they need to enter their retirement years with dignity and security. With these bills, we’re taking meaningful steps to fulfill that promise and secure the financial future of our state’s workforce,” said House Majority Leader Valerie Longhurst. “I commend State Treasurer Colleen Davis for her commitment to ensuring that all state workers have the opportunity to plan for their retirement with confidence and I look forward to passing these bills in the General Assembly.”