If bills before both chambers of the Wisconsin legislature are enacted, America’s Dairyland will have a retirement plan marketplace to connect individuals and small employers with retirement plans offered by private financial services firms. 
Sen. Melissa Agard (D-Madison) introduced SB 1035 in the state Senate on Feb. 19. Rep. Dora E. Drake (D- Milwaukee) introduced AB 1138, the Wisconsin Assembly version, on the same day.
The legislation would create a marketplace similar to that established in Washington state in 2018. The Washington State Department of Commerce on March 19 of that year announced the launch of the state’s Retirement Marketplace, a virtual marketplace in which financial services firms offer low-cost retirement savings plans to businesses with fewer than 100 employees, including sole proprietors and the self-employed.
What the Measure Would Do
The legislation would create a retirement plan marketplace whose purpose would be to:
- connect eligible employers and eligible individuals with retirement plans offered by financial services firms;
- improve access to retirement income options for eligible individuals;
- encourage eligible individuals to plan for retirement and increase retirement savings; and
- remove barriers to entry for eligible employers to offer retirement plan options to employees by:
- educating eligible employers on the retirement plans that are available; and
- promoting qualified retirement plan options that have low costs and low administrative burdens.
The legislation would require the Wisconsin Department of Financial Institutions (DFI) to establish and manage a retirement plan marketplace to connect individuals and employers that have at least one, but fewer than 100, employees with retirement plans offered by private financial services firms.
Under the legislation, DFI must:
- contract with a vendor to create a website to host the marketplace;
- specify the retirement plans each firm approved to participate in the marketplace may offer on it;
- ensure that the marketplace offers only retirement plans that are in compliance with ERISA, charge reasonable fees, and offer a range of retirement plans and investment options, including retirement plans (1) for investors with different levels of risk tolerance and of various ages and (2) that are environmentally friendly and socially responsible; and
- in cooperation with the Department of Revenue, the Department of Workforce Development, and other state agencies, develop a marketing program to publicize and promote the marketplace to small employers and eligible individuals.
Financial Services Firms
The legislation provides that financial services firms would have to apply to DFI in order to offer retirement plans on the marketplace. And they could only charge a participant enrolled in a retirement plan offered on the marketplace administrative fees of no more than 100 basis points in total annual fees.
Status
SB 1035 is before the Senate Committee on Financial Institutions and Sporting Heritage; AB 1138 is before the Assembly Committee on Labor and Integrated Employment.
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