The Partnership for a Dignified Retirement expands with the addition of Delaware EARNS

DENVER, COLORADO: Last week, the Colorado SecureSavings Program and Delaware EARNS established a partnership to help more savers prepare for their future retirement.

“This is an important step towards expanding sustainable and dignified retirement options across the nation. We appreciate the vote of confidence from the Delaware EARNS Board, and we are looking forward to working closely with Treasurer Colleen Davis and her team.” Dave Young, Colorado State Treasurer

“We are grateful to the EARNS Program Board for supporting our entry into this innovative consortium with Colorado and Maine. Doing so will ensure that Delawareans have the highest quality choice when it comes to retirement savings,” said Delaware State Treasurer Colleen C. Davis. “Nearly 150,000 Delaware workers currently have no way of saving for retirement through their workplace. Today, we took a major step toward closing that gap.”

“Delaware joining the Partnership for a Dignified Retirement is an important milestone. The ability of employers to provide an accessible option to savers will help significantly improve the financial lives of families across the country.” Hunter Railey, Director of Colorado SecureSavings Program

“The Delaware EARNS Program Board was pleased to support this historic interstate collaboration to bring a much-needed retirement savings vehicle to Delaware workers,” said EARNS Board Chair Fayetta M. Blake. “Through joining this interstate effort, we’ll greatly accelerate the launch of the EARNS program. Not only will we save start-up time and costs, but we’ll also allow Delaware participants to benefit from economies of scale that will help them grow their savings over time.”

“We’re delighted to see innovation in state savings programs continue as Delaware joins the Partnership for a Dignified Retirement,” Douglas Magnolia, Chief Customer Officer and President of Vestwell State Savings. “Vestwell is proud to power Delaware EARNS and help close the savings gap for the nearly 40% of private sector employees that do not have access to retirement savings.”

The Delaware EARNS Program Board has voted to join the Partnership for a Dignified Retirement. This partnership helps the State of Delaware offer a cost-friendly, state-run retirement program for workers who don’t have access to a retirement savings program. Vestwell, in partnership with BNY Mellon, serves as the Program Administrator, providing recordkeeping, custodial, and administrative services to employers and employees in participating partner states. The Partnership for a Dignified Retirement provides a proven avenue for smaller states to offer a pathway to financial security for savers.

This partnership will help pave the way for more savers to be able to sign up for a retirement program through their work. It expands the program and focuses on the simplicity for employers and savers that other states can adopt. It is a state-facilitated retirement program for private-sector employers and their employees. The program leverages the benefits of compound interest, allowing retirement funds to grow faster. The longer retirement funds are invested, the more growth is expected.

Partnership programs are tied to the employee instead of the employer, making the account portable when the employee leaves and changes jobs. These retirement programs are an easy and accessible way for states to provide a critical tool for financial security to working people.

With the successes of the state-run retirement savings programs in California, Illinois, Oregon, and elsewhere, the expansion of the Partnership for a Dignified Retirement represents the next step in extending low-cost, portable retirement savings options to workers without access to a savings program.

House Bill 205 in Delaware requires employers with five or more employees to provide a private retirement plan or sign up for their state program. The goal of the Delaware EARNS program is to provide workers and employers access to low-cost retirement savings plans de.gov/earns.
Colorado business owners need to decide on their retirement plan options by December 31, 2023. For more information please visit coloradosecuresavings.com. The Colorado SecureSavings Program has over 124,000 savers, and 13,000 registered employers so far.

State Treasurer Colleen Davis led the first in a series of public forums to spread the word about the benefits of Delaware EARNS, an upcoming program that will provide workers and employers with access to low-cost retirement savings plans, beginning in January 2025. The Delaware NAACP, the Metropolitan Wilmington Urban League, and the Police Athletic League of Wilmington joined with the Office of the State Treasurer in the event Tuesday evening at the Wilmington PAL Center.

“Taking the EARNS message to communities with many small businesses and residents who work for these businesses will help us share the value of the program,” said Treasurer Davis. “Explaining to entrepreneurs that they can open the door for their employees’ retirement savings with no cost and minimal effort can help it become a valuable tool in hiring and retaining quality workers that help keep small businesses running.”

The presentation included information on how the pending retirement crisis created the need for Delaware EARNS. Currently 39% of the State’s workforce does not have an easy way to save through a retirement program at work. Delaware EARNS addresses the situation by automatically enrolling employees into a State-facilitated retirement savings plan unless they elect to opt-out. Delaware EARNS also benefits small businesses who may not be able to offer retirement plans to employees due to the cost and administrative burden, allowing them to attract and keep good employees by offering a crucial benefit like retirement savings.

The next forum takes place May 4, 2023, at 6:00 p.m., at the Living Grace Worship Cathedral in Middletown in conjunction with the Alpha Kappa Alpha Sorority, Inc. A third will take place in June co-sponsored by AARP Delaware.

Meanwhile, the Delaware EARNS Program Board continues to meet and establish policies and procedures for the program. The Board will meet tomorrow, April 13, 2023, and again on July 13, 2023, and October 12, 2023. The Board’s three standing committees, the Program & Investment Committee, Audit, Policy & Governance Committee, and the Outreach & Engagement Committee all continue to meet and work towards implementation of the program.

To learn more about Delaware EARNS, visit de.gov/earns. For more information about the work of the Board, visit https://treasurer.delaware.gov/earns_board/.

More to come in 2023

Delawareans continue to move closer to financial security in retirement thanks to ongoing development of the Delaware Expanding Access for Retirement and Necessary Savings (EARNS) Program, designed to provide workers and employers access to low-cost retirement savings plans.

Less than two months after being seated, members of the Delaware EARNS Program Board have already made significant strides towards how the program will run when implemented in 2025. Responsible for overseeing the initial design and implementation of the program, the board was composed with an emphasis on diversity and female leadership. Governor Carney appointed two members of the board, Fayetta Blake who serves as chair, has an extensive background in community banking and financial services.

“I am grateful for the opportunity to lead this group of people working toward making sure everyone has the prospect to save money and retire with dignity,” Blake said. “I am humbled by Governor Carney’s trust in me and excited to move forward.”

The other public member of the board is Robert Herrera, an entrepreneur with several businesses throughout Delaware and Maryland. Remaining members of the Delaware EARNS Program Board are State Treasurer Colleen Davis, Secretary of Finance Rick Geisenberger, Christina Haas from the Office of the State Insurance Commissioner, Ethel Belfon from the Department of Labor, and Donna Vieira who serves as the Chair of the Plans Management Board.

“Before passage of the EARNS Act, more than half of Delaware workers lacked an easy way to save for retirement, but that’s coming to an end,” said Treasurer Colleen Davis who championed the creation of EARNS. “With the EARNS Program Board in place and beginning its work, a more financially secure future for everyone in Delaware’s workforce is on the horizon.”

The board met in November at which time Program Directors from Colorado and Oregon shared insight on the development of Auto IRA programs in their states. Additionally, Ms. Blake also appointed chairs of the board’s newly established committees:

• Program & Investment Committee – State Treasurer Colleen Davis
• Audit, Policy & Governance Committee – State Finance Secretary Rick Geisenberger
• Outreach & Engagement Committee – Rob Herrera

The chairs will work with OST over the next several months to design the governance framework of their committees and to recruit committee members.

“I am excited to bring additional people into the fold by filling our committees with those that can not only effect change in retirement savings as Delaware EARNS moves towards implementation, but also those who will be affected and helped by the program,” Blake said.

Another step towards that implementation took place December 5, 2022, when the RFP for Program Consulting Services went live. The consultant selected will advise the EARNS Program Board and OST in areas such as program structure and design, implementation, administration, procurement, standards, and compliance.

The board will also hire an Executive Director for Delaware EARNS. That person will help launch, manage, and direct the EARNS program. Through closely working with the Board, the Executive Director will also partner with the Outreach & Engagement Committee to develop a comprehensive outreach and engagement strategy and conduct presentations to large, diverse audiences including the General Assembly, business advocacy groups, employers, and the general public.

As work continues into the new year, objectives for 2023 include hiring additional personnel to support the Executive Director and the board on issues including budget approvals around marketing, promotion, and outreach, as well as hiring legal support to assist with the program. The board will also investigate the possibility of forming an Interstate Partnership, a working alliance with other states that have similar programs in order to maximize results of efforts. Finally, the board plans to hold town hall meetings and listening sessions, along with the AARP of Delaware which has supported and advocated for Delaware EARNS from the start.

Signed into law by Governor Carney in August, Delaware EARNS provides a convenient way for all workers to save for retirement, particularly middle and low-income workers who lack access to employer-sponsored plans and small businesses unable to provide such a benefit.

In order to help keep the public informed of the board’s activity in a timely and transparent manner, the Office of the State Treasurer (OST) established a website  and established an email address for people to use for questions. Additionally, anyone interested can also register to receive updates on developments about DE EARNS.

“We began exploring the idea of bringing a secure choice retirement program like EARNS to Delaware way back in 2019,” said Treasurer Davis. “Thanks to the AARP and other community partners, EARNS will soon be a valuable asset in addressing my three main priorities: bolstering retirement security and readiness, creating pathways to economic empowerment, and promoting a culture of financial excellence.”

Signing of HB 205 by Governor Carney allows for next steps

Almost 150,000 Delaware workers got a step closer to secure retirement savings when Governor Carney signed HB 205, the Delaware EARNS Act, into law this morning. With the enactment of the legislation, the Office of the State Treasurer (OST) officially begins building the infrastructure that will drive the landmark retirement program.

Delaware EARNS (Expanding Access for Retirement and Necessary Savings) requires businesses with more than five employees that don’t currently offer a retirement plan to participate through a simple payroll process.

“We’ve worked long and hard to make this program a reality for Delawareans who lack access to an employer-sponsored retirement program,” said State Treasurer Colleen Davis. “I am grateful to Representative Larry Lambert, Senator Nicole Poore, all of their colleagues in the General Assembly, the AARP of Delaware, and of course the Governor for helping us get here.”

OST will hire an executive director who will guide the operation of the program and work with the Delaware EARNS Program Board, established by the legislation to oversee initial design and implementation of the program. The Board will consist of the State Treasurer, Secretary of Finance, Insurance Commissioner, Secretary of Labor, and chairperson of the Plans Management Board, each of whom may appoint a designee, as well as two members of the public chosen by the Governor.

“It shouldn’t matter what your background or job is: every Delawarean deserves the opportunity to enter into retirement with economic dignity and security,” said Rep. Lambert, D-Claymont, prime sponsor of the legislation. “For small businesses and the almost 150,000 Delaware workers lacking an employer-sponsored saving program, the Delaware EARNS program will be financially transformative, allowing residents to save for the future while filling a critical need in the marketplace. This new program will put thousands of working Delawareans on a level playing field when it comes to their financial future, and I am excited to see it in action.”

“While every Delaware worker deserves to enjoy their golden years, nearly one in five of our neighbors currently won’t be able to achieve the dream of a financially secure retirement, simply because their employer does not offer a retirement savings plan like a 401(k),” said Sen. Nicole Poore, D-New Castle, the Senate prime sponsor of HB 205. “I want to thank Rep Lambert and Treasurer Davis for recognizing that we can do better for Delaware’s working families. The Delaware EARNS Act signed into law today is a win for thousands of workers who will be able to sleep tonight with the peace of mind that comes from knowing they are on a stable path to a more financially secure future. It’s a win for the hundreds of small businesses that will be on a more even playing field with the major corporations that can afford to provide these competitive benefits, and it’s a win for Delaware’s middle class by bringing a financially secure retirement within reach for nearly 150,000 of our neighbors.”

AARP Delaware, its staff, and its more than 187,000 members advocated for the creation and passage of Delaware EARNS.

“The pandemic has shown how vital it is for Americans to have savings to depend on. We must make it easier for workers to save so they can take control of their future,” said AARP Delaware State Director Lucretia Young. “AARP was pleased to work alongside our State Treasurer to help provide an easy pathway for workers to start building a safety net and grow the savings they need for a more secure future.”

More information about Delaware EARNS can be found at de.gov/earns.

Delaware EARNS provides low-cost retirement savings plans

By a vote of 20 to 0 and 1 not voting, the Delaware State Senate passed House Bill 205 creating the Delaware Expanding Access for Retirement and Necessary Savings (EARNS) Program. The bill, which won House approval in May, now goes to Governor Carney for his signature.

“I am thankful that members of the General Assembly joined me in wanting to make sure every Delawarean has a reliable way to save for retirement,” Treasurer Davis said. “I’m especially grateful to Representative Lambert and Senator Poore for their sponsorship.”

Delaware EARNS is a “secure choice” program that amounts to State-facilitated, universally available retirement savings plans, providing a convenient way for all workers to save for retirement, particularly middle and low-income workers who lack access to employer-sponsored plans and small businesses that are unable to provide such a benefit.

“More than half of the State’s workforce lacks an easy way to save through a retirement program at work,” Davis said. “Not only will Delaware EARNS help those employees save for the future, it also benefits small businesses that may not be able to offer retirement plans to employees due to the cost and administrative burden, allowing them to attract and keep good employees by offering a crucial benefit like retirement savings.”

Delaware EARNS requires businesses with more than five employees that don’t currently offer a retirement plan to participate through a simple payroll process. The Office of the State Treasurer State Treasurer’s Office with the oversight of the Plans Management Board will handle all duties and functions of the plan once initial design and implementation takes place under the soon to be formed Delaware EARNS Program Board.

“The primary way for workers to save for retirement is through employer-sponsored plans, and now all employers will have a way to provide this essential benefit,” Davis said. “Delaware EARNS represents my continued commitment to bolstering retirement security and readiness, creating pathways to economic empowerment, and promoting a culture of financial excellence.”