[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7310 Reported in House (RH)]
<DOC>
Union Calendar No. 471
117th CONGRESS
2d Session
H. R. 7310
[Report No. 117-557, Part I]
To protect America's retirement security, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 31, 2022
Mrs. McBath (for herself, Mr. Scott of Virginia, Mrs. Watson Coleman,
Mr. Courtney, Ms. Underwood, and Ms. Manning) introduced the following
bill; which was referred to the Committee on Education and Labor, and
in addition to the Committee on Ways and Means, for a period to be
subsequently determined by the Speaker, in each case for consideration
of such provisions as fall within the jurisdiction of the committee
concerned
November 14, 2022
Reported from the Committee on Education and Labor with an amendment
[Strike out all after the enacting clause and insert the part printed
in italic]
[Referral to the Committee on Ways and Means, extended grace period
ending not later than January 2, 2023]
[For text of introduced bill, see copy of bill as introduced on March
31, 2022]
November 14, 2022
Referral to the Committee on Ways and Means extended for a period
ending not later than January 2, 2023
December 20, 2022
Additional sponsors: Mr. Levin of Michigan, Ms. Leger Fernandez, Mr.
Sablan, Mr. Mfume, Ms. Bonamici, Mr. Mrvan, Mr. Takano, Mr. Espaillat,
Mr. DeSaulnier, Ms. Stevens, and Mr. Pocan
December 20, 2022
Committee on Ways and Means discharged; committed to the Committee of
the Whole House on the State of the Union and ordered to be printed
[For text of introduced bill, see copy of bill as introduced on March
31, 2022]
_______________________________________________________________________
A BILL
To protect America's retirement security, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Protecting
America's Retirement Security Act of 2022''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Defined contribution plan fee disclosure improvements.
Sec. 3. Personal finance education portal.
Sec. 4. Increasing spousal protection under defined contribution plans.
Sec. 5. Automatic reenrollment.
Sec. 6. Employee Ownership and Participation Initiative.
Sec. 7. Refund to Rainy Day Savings Program.
SEC. 2. DEFINED CONTRIBUTION PLAN FEE DISCLOSURE IMPROVEMENTS.
Not later than 2 years after the date of enactment of this Act, the
Secretary of Labor shall review section 2550.404a-5 of title 29, Code
of Federal Regulations, and explore how the content and design of the
covered disclosures may be improved to enhance participants'
understanding of fees and expenses as well as the cumulative effect of
fees and expenses on retirement savings over time. As part of such
review, the Secretary shall conduct outreach to stakeholders, including
those representing plan sponsors and retirement plan participants.
SEC. 3. PERSONAL FINANCE EDUCATION PORTAL.
(a) In General.--Not later than 3 years after the date of enactment
of this Act, the Secretary of Education, in consultation with the
Director of the Bureau of Consumer Financial Protection, the Secretary
of the Treasury as chair of the Financial Literacy and Education
Commission, and the Commissioner of Internal Revenue, shall create a
personal finance education portal on a centralized and publicly
available website of the Department of Education pertaining to Federal
financial aid for voluntary use by recipients of aid awarded under
title IV of the Higher Education Act of 1965.
(b) Content of Personal Finance Education Portal.--The personal
finance education portal created under subsection (a) shall include
information on personal finance concepts, including the following:
(1) Core personal finance concepts, such as earning,
saving, investing, spending, and borrowing, including--
(A) the concept of compound growth as it applies to
savings and retirement savings, with information about
the different types of retirement savings accounts; and
(B) budgeting and credit usage.
(2) Managing student loan repayment, including--
(A) the interaction between savings and retirement
decisions and Federal student loan repayment plans;
(B) Federal student loan discharge or forgiveness
options;
(C) the types of voluntary benefits employers may
use to help workers while they are paying down student
loan debt;
(D) tax credits or deductions that are relevant to
student loan borrowers in repayment; and
(E) any other Federal policies that significantly
impact student loan borrowers in repayment, as
determined by the Secretary.
(3) Any other personal finance concepts determined relevant
by the Secretary of Education, in consultation with the
Director of the Bureau of Consumer Financial Protection, the
Secretary of the Treasury as chair of the Financial Literacy
and Education Commission, and the Commissioner of Internal
Revenue.
(c) Provision of Content.--The personal finance content included
under subsection (b) may be provided in an interactive format through
text or video.
(d) Analytics.--The Secretary of Education, in consultation with
the Director of the Bureau of Consumer Financial Protection, the
Secretary of the Treasury as chair of the Financial Literacy and
Education Commission, and the Commissioner of Internal Revenue, shall
review not less than once every three years the utilization of the
portal, make recommendations to improve the portal, and make such
findings and recommendations publicly available.
(e) Authorization of Appropriations.--There are authorized to be
appropriated such sums as may be necessary to carry out this section.
SEC. 4. INCREASING SPOUSAL PROTECTION UNDER DEFINED CONTRIBUTION PLANS.
(a) Amendments to Employee Retirement Income Security Act of
1974.--
(1) In general.--Part 2 of subtitle B of title I of the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1051
et seq.) is amended by inserting after section 205 the
following new section:
``SEC. 205A. ADDITIONAL SPOUSAL CONSENT REQUIREMENTS.
``(a) In General.--Each individual account plan to which section
205 does not apply (but to which this title otherwise applies) shall
provide that, except as provided in subsections (c) and (d), no
distribution may be made under the plan unless the spousal consent
requirements of subsection (e) are met.
``(b) Coordination With Section 205.--Nothing in this section shall
be construed to exempt an individual account plan from the requirements
of paragraph (1)(B), (1)(C), or (2) of section 205(b) with respect to
any participant.
``(c) Exceptions for Certain Distributions.--Subsection (a) shall
not apply to--
``(1) any distribution that is--
``(A) a minimum required distribution described in
section 4974(b) of the Internal Revenue Code of 1986;
or
``(B) permitted under section 203(e)(1) to be made
without the consent of the participant;
``(2) any distribution in the form of a qualified joint and
survivor annuity (as defined in section 205(d)(1)), a qualified
optional survivor annuity (as defined in section 205(d)(2)), a
qualified preretirement survivor annuity (as defined in section
205(e)), or a series of substantially equal periodic payments
(not less frequently than annually) made for the joint lives
(or life expectancies) of the participant and the participant's
spouse; or
``(3) in the case of a participant who does not elect a
form of benefit described in paragraph (2) under the plan or
who is participating in a plan that does not provide such a
form of benefit, any distribution of the participant's entire
nonforfeitable accrued benefit if 50 percent of such accrued
benefit is transferred to an individual retirement plan (as
defined in section 7701(a)(37) of the Internal Revenue Code of
1986) of the spouse of the participant.
A transfer described in paragraph (3) to an individual retirement plan
shall be treated in the same manner as a transfer under section
408(d)(6) of the Internal Revenue Code of 1986.
``(d) Exceptions for Certain Rollover Contributions.--
``(1) In general.--Subsection (a) shall not apply to any
distribution that is an eligible rollover distribution (as
defined in section 402(f)(2)(A) of the Internal Revenue Code of
1986) made in the form of a direct trustee-to-trustee transfer
within the meaning of section 401(a)(31) of the Internal
Revenue Code of 1986--
``(A) to a plan to which this section or section
205 applies; or
``(B) to an individual retirement plan (as defined
in section 7701(a)(37) of the Internal Revenue Code of
1986) if--
``(i) the sole beneficiary of such plan is
the spouse of the participant, or the spousal
consent requirements of subsection (e) are met
with respect to any designation of 1 or more
other beneficiaries; and
``(ii) under the terms of the individual
retirement plan, the beneficiary of such plan
(whether the spouse or other beneficiary
designated under subparagraph (A)) may not be
changed unless--
``(I) the spousal consent
requirements of subsection (e) are met
with respect to any such change; or
``(II) the spousal consent under
clause (i) to the designation of a
beneficiary other than the spouse
expressly permits such designation to
be changed without the further consent
of the spouse.
``(2) Regulatory authority.--The Secretary of the Treasury
and the Secretary of Labor may jointly issue regulations to
implement subparagraphs (A) and (B) of paragraph (1).
``(e) Spousal Consent Requirements.--
``(1) In general.--For purposes of this section, except as
provided in paragraph (2), the spousal consent requirements of
this subsection are met with respect to any distribution or any
designation or change of beneficiary if--
``(A) the plan provides to each participant, within
a reasonable period of time before such distribution or
designation or change of beneficiary is made and
consistent with such regulations as the Secretary of
the Treasury may prescribe, a written explanation of
the rights of the participant and the participant's
spouse under this section;
``(B) the spouse of the participant consents in
writing to the distribution or designation or change of
beneficiary;
``(C) in the case of a distribution, the written
consent under subparagraph (B) is made during the
consent period; and
``(D) the written consent under subparagraph (B)--
``(i) acknowledges the effect of such
distribution or designation or change of
beneficiary; and
``(ii) is witnessed by a plan
representative or a notary public.
``(2) Exceptions.--The requirements of paragraph (1) (other
than subparagraph (A) thereof) shall not apply with respect to
any distribution or designation or change of beneficiary if a
participant establishes to the satisfaction of the
administrator that--
``(A) there is no spouse;
``(B) the participant and the participant's spouse
have not been married for at least 1 year as of the
date of the distribution or designation or change of
beneficiary; or
``(C) such consent cannot be obtained because--
``(i) the spouse cannot be located after
taking documented search efforts in accordance
with guidance from the Secretary of Labor;
``(ii) due to exceptional circumstances,
requiring the participant to seek the spouse's
consent would be inappropriate; or
``(iii) of such other circumstances as the
Secretary of the Treasury, in consultation with
the Secretary of Labor, may by regulations
prescribe.
The Secretary of Labor may issue regulations to implement this
paragraph.
``(3) Consent limited to spouse and event.--Any written
consent by a spouse under paragraph (1), or the establishment
by a participant that an exception under paragraph (2) applies
with respect to a spouse, shall be effective only with respect
to that spouse and to the distribution or designation or change
of beneficiary to which it relates.
``(4) Consent period.--For purposes of this subsection, the
term `consent period' means, with respect to any distribution--
``(A) the 90-day period immediately preceding the
date of such distribution; or
``(B) such other period as the Secretary of the
Treasury may provide.
``(f) Discharge of Plan From Liability.--Rules similar to the rules
of section 205(c)(6) shall apply for purposes of this section.''.
(2) Clerical amendment.--The table of sections of part 2 of
subtitle B of title I of the Employee Retirement Income
Security Act of 1974 is amended by inserting after the item
relating to section 205 the following new item:
``Sec. 205A. Additional spousal consent requirements.''.
(3) Parallel amendment to section 205.--Section
205(c)(2)(B) of the Employee Retirement Income Security Act of
1974 (29 U.S.C. 1055(c)(2)(B)) is amended by inserting ``,
because due to exceptional circumstances, requiring the
participant to seek the spouse's consent would be
inappropriate'' after ``located''.
(b) Conforming Amendment to Internal Revenue Code of 1986.--Section
401(a) of the Internal Revenue Code of 1986 is amended by inserting
after paragraph (17) the following new paragraph:
``(18) Additional spousal consent requirements.--
``(A) In general.--To the extent paragraph (11)
does not apply to a defined contribution plan to which
title I of the Employee Retirement Income Security Act
of 1974 applies, except as provided in subparagraphs
(C) and (D), a trust forming part of such plan shall
not constitute a qualified trust under this section
unless no distribution may be made under the plan
unless the spousal consent requirements of subparagraph
(E) are met.
``(B) Coordination with paragraph (11).--Nothing in
this paragraph shall be construed to exempt a defined
contribution plan from the requirements of subparagraph
(B)(ii), (B)(iii), or (C) of paragraph (11) with
respect to any participant.
``(C) Exceptions for certain distributions.--
Subparagraph (A) shall not apply to--
``(i) any distribution that is--
``(I) a minimum required
distribution described in section
4974(b), or
``(II) permitted under section
411(a)(11) to be made without the
consent of the participant,
``(ii) any distribution in the form of a
qualified joint and survivor annuity (as
defined in section 417(b)), a qualified
optional survivor annuity (as defined in
section 417(g)), a qualified preretirement
survivor annuity (as defined in section
417(c)), or a series of substantially equal
periodic payments (not less frequently than
annually) made for the joint lives (or life
expectancies) of the participant and the
participant's spouse, or
``(iii) in the case of a participant who
does not elect a form of benefit described in
clause (ii) under the plan or who is
participating in a plan that does not provide
such a form of benefit, any distribution of the
participant's entire nonforfeitable accrued
benefit if 50 percent of such accrued benefit
is directly transferred to an individual
retirement plan of the spouse of the
participant.
A transfer described in clause (iii) to an individual
retirement plan shall be treated in the same manner as
a transfer under section 408(d)(6) and shall be deemed
not to violate paragraph (2) or (13).
``(D) Exceptions for certain rollover
contributions.--
``(i) In general.--Subparagraph (A) shall
not apply to any distribution, involving a
participant who has a spouse, that is an
eligible rollover distribution (as defined in
section 402(f)(2)(A)) made in the form of a
direct trustee-to-trustee transfer within the
meaning of paragraph (31)--
``(I) to a plan to which this
paragraph or paragraph (11) applies; or
``(II) to an individual retirement
plan if--
``(aa) the sole beneficiary
of such plan is the spouse of
the participant, or the spousal
consent requirements of
subparagraph (E) are met with
respect to any designation of 1
or more other beneficiaries;
and
``(bb) under the terms of
the individual retirement plan,
the beneficiary of such plan
(whether the spouse or other
beneficiary designated under
clause (i)) may not be changed
unless--
``(AA) the spousal
consent requirements of
subparagraph (E) are
met with respect to any
such change, or
``(BB) the spousal
consent under subclause
(I) to the designation
of a beneficiary other
than the spouse
expressly permits such
designation to be
changed without the
further consent of the
spouse.
``(ii) Regulatory authority.--The Secretary
of the Treasury, in consultation with the
Secretary of Labor, may issue regulations to
implement subparagraphs subclauses (I) and (II)
or clause (i).
``(E) Spousal consent requirements.--
``(i) In general.--For purposes of this
paragraph, except as provided in clause (ii),
the spousal consent requirements of this
subparagraph are met with respect to any
distribution or any designation or change of
beneficiary if--
``(I) the plan provides to each
participant, within a reasonable period
of time before such distribution or
designation or change of beneficiary is
made and consistent with such
regulations as the Secretary may
prescribe, a written explanation of the
rights of the participant and the
participant's spouse under this
paragraph,
``(II) the spouse of the
participant consents in writing to the
distribution or designation or change
of beneficiary,
``(III) in the case of a
distribution, the written consent under
subclause (II) is made during the
consent period, and
``(IV) the written consent under
subclause (ii)--
``(aa) acknowledges the
effect of such distribution or
designation or change of
beneficiary, and
``(bb) is witnessed by a
plan representative or a notary
public.
``(ii) Exceptions under section
417(a)(2)(b) to apply.--The requirements of
clause (i) (other than subclause (I) thereof)
shall not apply with respect to any
distribution or designation or change of
beneficiary if a participant establishes to the
satisfaction of the administrator that--
``(I) there is no spouse,
``(II) the participant and the
participant's spouse have not been
married for at least 1 year as of the
date of the distribution or designation
or change of beneficiary, or
``(III) such consent cannot be
obtained because--
``(aa) the spouse cannot be
located after taking documented
search efforts in accordance
with guidance from the
Secretary of Labor;
``(bb) due to exceptional
circumstances, requiring the
participant to seek the
spouse's consent would be
inappropriate; or
``(cc) of such other
circumstances as the Secretary,
in consultation with the
Secretary of Labor, may by
regulations prescribe.
The Secretary, in consultation with the
Secretary of Labor, may issue regulations to
implement this clause.
``(iii) Consent limited to spouse and
event.--Any written consent by a spouse under
clause (i), or the establishment by a
participant that an exception under clause (ii)
applies with respect to a spouse, shall be
effective only with respect to that spouse and
to the distribution or designation or change of
beneficiary to which it relates.
``(iv) Consent period.--For purposes of
this subparagraph, the term `consent period'
means, with respect to any distribution--
``(I) the 90-day period immediately
preceding the date of such
distribution, or
``(II) such other period as the
Secretary may provide.''.
SEC. 5. AUTOMATIC REENROLLMENT.
(a) Eligible Automatic Contribution Arrangements.--
(1) Amendment to the employee retirement income security
act of 1974.--Section 514(e)(2) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1144(e)(2)) is amended--
(A) by redesignating subparagraphs (A) through (C)
as clauses (i) through (iii), respectively, and moving
the margins of such clauses 2 ems to the right,
(B) by striking ``(2) For purposes of'' and
inserting ``(2)(A) For purposes of'', and
(C) by adding at the end the following:
``(B) In the case of an automatic contribution
arrangement taking effect after December 31, 2024, the
requirements of subparagraph (A)(ii) shall be treated
as met only if, under the arrangement, at least every 3
years each employee--
``(i) who is eligible to participate in the
arrangement, and
``(ii) who, at the time of the
determination, has in effect an affirmative
election pursuant to subparagraph (A)(ii) not
to have contributions described in such
subparagraph made,
is treated as having made the election at the uniform
percentage of compensation described in subparagraph
(A)(ii) unless the employee makes a new election under
such subparagraph. Such determination may be made at
one time for all employees described in the preceding
sentence for a plan year, regardless of individual
employee dates of enrollment.''.
(2) Amendment to the internal revenue code of 1986.--
Section 414(w)(3) of the Internal Revenue Code of 1986 is
amended--
(A) by redesignating subparagraphs (A) through (C)
as clauses (i) through (iii), respectively, and moving
the margins of such clauses 2 ems to the right;
(B) by striking `` For purposes of'' and inserting
the following:
``(A) In general.--For purposes of''
(C) by adding at the end the following new
subparagraph:
``(B) Periodic automatic deferral required.--In the
case of an eligible automatic contribution arrangement
taking effect after December 31, 2024, the requirements
of this subsection shall be treated as met only if,
under the arrangement, at least every 3 plan years each
employee--
``(i) who is eligible to participate in the
arrangement, and
``(ii) who, at the time of the
determination, has in effect an affirmative
election under subparagraph (A)(ii) not to have
such contributions described in such
subparagraph made,
is treated as having made the election at the uniform
percentage level described in subparagraph (A)(ii)
unless the employee makes a new election under such
subparagraph. Such determination may be made at one
time for all employees described in the preceding
sentence for a plan year, regardless of individual
employee dates of enrollment.''
(b) Qualified Automatic Contribution Arrangements.--
(1) In general.--Section 401(k)(13)(C) of the Internal
Revenue Code of 1986 is amended by adding at the end the
following new clause:
``(v) Periodic automatic deferral required
for post-2024 arrangements.--In the case of a
qualified automatic contribution arrangement
which takes effect after December 31, 2024, the
requirements of this subparagraph shall be
treated as met only if, under the arrangement,
at least every 3 plan years each employee--
``(I) who is eligible to
participate in the arrangement, and
``(II) who, at the time of the
determination, has in effect an
affirmative election pursuant to clause
(ii) not to have contributions
described in clause (i) made,
is treated as having made the election
described in clause (i) unless the employee
makes a new affirmative election under clause
(ii). Such determination may be made at one
time for all employees described in the
preceding sentence for a plan year, regardless
of individual employee dates of enrollment.''
(2) Conforming amendments.--Clause (iv) of section
401(k)(13)(C) of such Code is amended--
(A) in the heading, by inserting ``for pre-2025
arrangements'' after ``required''; and
(B) by striking ``Clause (i)'' and inserting ``In
the case of a qualified automatic contribution
arrangement in effect before January 1, 2025, clause
(i)''.
(c) Effective Date.--The amendments made by this section shall
apply to arrangements taking effect after December 31, 2024.
SEC. 6. EMPLOYEE OWNERSHIP AND PARTICIPATION INITIATIVE.
(a) Definitions.--In this section:
(1) Existing program.--The term ``existing program'' means
a program, designed to promote employee ownership and employee
participation in business decisionmaking, that exists on the
date on which the Secretary is carrying out a responsibility
authorized under this section.
(2) Initiative.--The term ``Initiative'' means the Employee
Ownership and Participation Initiative established under
subsection (b).
(3) New program.--The term ``new program'' means a program,
designed to promote employee ownership and employee
participation in business decisionmaking, that does not exist
on the date on which the Secretary is carrying out a
responsibility authorized under this section.
(4) Secretary.--The term ``Secretary'' means the Secretary
of Labor.
(5) State.--The term ``State'' has the meaning given the
term under section 3 of the Workforce Innovation and
Opportunity Act (29 U.S.C. 3102).
(b) Employee Ownership and Participation Initiative.--
(1) Establishment.--The Secretary of Labor shall establish
within the Department of Labor an Employee Ownership and
Participation Initiative to promote employee ownership and
employee participation in business decisionmaking.
(2) Functions.--In carrying out the Initiative, the
Secretary shall--
(A) support within the States existing programs
designed to promote employee ownership and employee
participation in business decisionmaking; and
(B) facilitate within the States the formation of
new programs designed to promote employee ownership and
employee participation in business decisionmaking.
(3) Duties.--To carry out the functions enumerated in
paragraph (2), the Secretary shall--
(A) support new programs and existing programs by--
(i) making Federal grants authorized under
subsection (d); and
(ii) acting as a clearinghouse on
techniques employed by new programs and
existing programs within the States, and
disseminating information relating to those
techniques to the programs; and
(B) facilitate the formation of new programs, in
ways that include holding or funding an annual
conference of representatives from States with existing
programs, representatives from States developing new
programs, and representatives from States without
existing programs.
(c) Programs Regarding Employee Ownership and Participation.--
(1) Establishment of program.--Not later than 180 days
after the date of enactment of this Act, the Secretary shall
establish a program to encourage new programs and existing
programs within the States to foster employee ownership and
employee participation in business decisionmaking throughout
the United States.
(2) Purpose of program.--The purpose of the program
established under paragraph (1) is to encourage new and
existing programs within the States that focus on--
(A) providing education and outreach to inform
employees and employers about the possibilities and
benefits of employee ownership, business ownership
succession planning, and employee participation in
business decisionmaking, including providing
information about financial education, employee teams,
open-book management, and other tools that enable
employees to share ideas and information about how
their businesses can succeed;
(B) providing technical assistance to assist
employee efforts to become business owners, to enable
employers and employees to explore and assess the
feasibility of transferring full or partial ownership
to employees, and to encourage employees and employers
to start new employee-owned businesses; and
(C) training employees and employers with respect
to methods of employee participation in open-book
management, work teams, committees, and other
approaches for seeking greater employee input.
(3) Program details.--The Secretary may include, in the
program established under paragraph (1), provisions that--
(A) in the case of activities described in
paragraph (2)(A)--
(i) target key groups, such as retiring
business owners, senior managers, unions, trade
associations, community organizations, and
economic development organizations;
(ii) encourage cooperation in the
organization of workshops and conferences; and
(iii) prepare and distribute materials
concerning employee ownership and
participation, and business ownership
succession planning;
(B) in the case of activities described in
paragraph (2)(B)--
(i) provide preliminary technical
assistance to employee groups, managers, and
retiring owners exploring the possibility of
employee ownership;
(ii) provide for the performance of
preliminary feasibility assessments;
(iii) assist in the funding of objective
third-party feasibility studies and preliminary
business valuations, and in selecting and
monitoring professionals qualified to conduct
such studies; and
(iv) provide a data bank to help employees
find legal, financial, and technical advice in
connection with business ownership;
(C) in the case of activities described in
paragraph (2)(C)--
(i) provide for courses on employee
participation; and
(ii) provide for the development and
fostering of networks of employee-owned
companies to spread the use of successful
participation techniques; and
(D) in the case of training described in paragraph
(2)(D)--
(i) provide for visits to existing programs
by staff from new programs receiving funding
under this section; and
(ii) provide materials to be used for such
training.
(4) Guidance.--The Secretary shall issue formal guidance,
for recipients of grants awarded under subsection (d) and one-
stop partners (as defined in section 3 of the Workforce
Innovation and Opportunity Act (29 U.S.C. 3102)) affiliated
with the workforce development systems (as so defined) of the
States, proposing that programs and other activities funded
under this section be--
(A) proactive in encouraging actions and activities
that promote employee ownership of, and participation
in, businesses; and
(B) comprehensive in emphasizing both employee
ownership of, and participation in, businesses so as to
increase productivity and broaden capital ownership.
(d) Grants.--
(1) In general.--In carrying out the program established
under subsection (c), the Secretary may make grants to States
(except as provided in paragraph (5)) for use in connection
with new programs and existing programs within a State for--
(A) education and outreach as provided in
subsection (c)(2)(A);
(B) technical assistance as provided in subsection
(c)(2)(B);
(C) training activities for employees and employers
as provided in subsection (c)(2)(C);
(D) activities facilitating cooperation among
employee-owned firms; and
(E) training as provided in subsection (c)(2)(D)
for new programs provided by participants in existing
programs dedicated to the objectives of this section,
except that, for each fiscal year, the amount of the
grants made for such training shall not exceed 10
percent of the total amount of the grants made under
this section.
(2) Amounts and conditions.--The Secretary shall determine
the amount and any conditions for a grant made under this
subsection. The amount of the grant shall be subject to
paragraph (6), and shall reflect the capacity of the applicant
for the grant.
(3) Applications.--Each entity desiring a grant under this
subsection shall submit an application to the Secretary at such
time, in such manner, and accompanied by such information as
the Secretary may reasonably require.
(4) State applications.--Each State may sponsor and submit
an application under paragraph (3) on behalf of any local
entity consisting of a unit of State or local government,
State-supported institution of higher education, or nonprofit
organization, meeting the requirements of this section.
(5) Applications by entities.--
(A) Entity applications.--If a State fails to
support or establish a program pursuant to this section
during any fiscal year, the Secretary shall, in the
subsequent fiscal years, allow local entities described
in paragraph (4) from that State to make applications
for grants under paragraph (3) on their own initiative.
(B) Application screening.--In any case in which a
local entity makes an application for a grant pursuant
to subparagraph (A), the relevant State may take no
actions to screen such application.
(6) Limitations.--A recipient of a grant made under this
subsection shall not receive, during a fiscal year, in the
aggregate, more than the following amounts:
(A) For fiscal year 2023, $300,000.
(B) For fiscal year 2024, $330,000.
(C) For fiscal year 2025, $363,000.
(D) For fiscal year 2026, $399,300.
(E) For fiscal year 2027, $439,200.
(7) Annual report.--For each year, each recipient of a
grant under this subsection shall submit to the Secretary a
report describing how grant funds allocated pursuant to this
subsection were expended during the 12-month period preceding
the date of the submission of the report.
(e) Evaluations.--The Secretary is authorized to reserve not more
than 10 percent of the funds appropriated for a fiscal year to carry
out this section for the purposes of conducting evaluations of the
grant programs identified in subsection (d) and to provide related
technical assistance.
(f) Reporting.--Not later than 36 months after the date of
enactment of this Act, the Secretary shall prepare and submit to
Congress a report--
(1) on progress related to employee ownership and
participation in businesses in the United States; and
(2) containing an analysis of critical costs and benefits
of activities carried out under this section.
(g) Authorizations of Appropriations.--
(1) In general.--There are authorized to be appropriated
for the purpose of making grants pursuant to subsection (d) the
following:
(A) For fiscal year 2023, $4,000,000.
(B) For fiscal year 2024, $7,000,000.
(C) For fiscal year 2025, $10,000,000.
(D) For fiscal year 2026, $13,000,000.
(E) For fiscal year 2027, $16,000,000.
(2) Administrative expenses.--There are authorized to be
appropriated for the purpose of funding the administrative
expenses related to the Initiative, for each of fiscal years
2022 through 2026, an amount not in excess of the lesser of--
(A) $350,000; or
(B) 5.0 percent of the maximum amount available
under paragraph (1) for that fiscal year.
SEC. 7. REFUND TO RAINY DAY SAVINGS PROGRAM.
(a) Establishment.--
(1) In general.--Not later than December 31, 2024, the
Secretary of the Treasury or the Secretary's delegate (referred
to in this subsection as the ``Secretary'') shall establish and
implement a program (referred to in this subsection as the
``Refund to Rainy Day Savings Program'') to allow participating
taxpayers, pursuant to the requirements established under this
section, to defer payment on 20 percent of the amount which
would otherwise be refunded to such taxpayer as an overpayment
(as described in section 6401 of the Internal Revenue Code of
1986).
(2) Period of deferral.--Except as provided under paragraph
(3)(E), a participating taxpayer may elect to defer payment of
the amount described in paragraph (1) and have such amount
deposited in the Rainy Day Fund (as described in paragraph
(3)).
(3) Rainy day fund.--
(A) In general.--The Secretary shall establish in
the Treasury a fund, in such manner as the Secretary
determines to be appropriate, to be known as the
``Rainy Day Fund'', consisting of any amounts described
in paragraph (1) on which payment has been deferred by
participating taxpayers.
(B) Investment.--Any amounts deposited in the Rainy
Day Fund shall be invested by the Secretary, in United
States Treasury securities issued under chapter 31 of
title 31, United States Code, that are suitable for the
needs of the Rainy Day Fund.
(C) Disbursements from fund.--
(i) In general.--On the date that is 180
days after the date of deposit in the Rainy Day
Fund of an amount deferred by such taxpayer
under paragraph (1), the amounts in the Rainy
Day Fund shall be made available to the
Secretary to distribute to such taxpayer in an
amount equal to such amount plus any interest
accrued on such amount (as determined under
subparagraph (D)).
(ii) Distributed to taxpayers.--The amounts
described in clause (i) shall be distributed to
the account identified by the participating
taxpayer under paragraph (4)(B).
(D) Interest accrued.--The amount of interest
accrued on the amount deferred by a participating
taxpayer under subsection (a) shall be determined by
the Secretary based upon the return on the investment
of such amounts under subparagraph (B).
(E) Early withdrawal.--
(i) In general.--As soon as possible after
receipt by the Secretary of the individual
income tax return of the participating taxpayer
and October 15 of the applicable year, such
taxpayer may elect to terminate the deferral of
the amount described under paragraph (1) and
receive a distribution from the Rainy Day Fund
equal to such amount and any interest which has
accrued on such amount up to that date.
(ii) Complete withdrawal.--A participating
taxpayer making an election under clause (i)
must terminate deferral of the full amount
described under paragraph (1), and such amount
shall be distributed to the bank account
identified by the participating taxpayer under
paragraph (4)(B).
(4) Participating taxpayer.--For purposes of this section,
the term ``participating taxpayer'' means a taxpayer who--
(A) prior to the due date for filing the return of
tax for such taxable year, elects to participate in the
Refund to Rainy Day Savings Program, in accordance with
regulations to be issued by the Secretary; and
(B) provides the Secretary with an account and
routing number or any other financial information
deemed necessary by the Secretary for purposes of
subparagraphs (C)(ii) and (E)(ii) of paragraph (3).
(5) Forms.--The Secretary shall ensure that the election to
defer payment of the amount described in paragraph (1) may be
claimed on appropriate tax forms.
(6) Implementation.--
(A) Educational materials and outreach.--The
Secretary shall--
(i) design educational materials for
taxpayers regarding financial savings and the
Refund to Rainy Day Savings Program,
(ii) publicly disseminate and distribute
such materials during the first calendar
quarter of each calendar year and following
disbursement of amounts described in paragraph
(3)(C), and
(iii) engage in outreach regarding the
Refund to Rainy Day Savings Program to the
Volunteer Income Tax Assistance program and
paid tax preparers.
(B) Information for participating taxpayers.--The
Secretary shall ensure that a participating taxpayer is
able to electronically verify the status of the amount
deferred by such taxpayer under paragraph (1),
including any interest accrued on such amount and the
status of any distribution.
(C) Federally funded benefits.--Any amounts
described in paragraph (1) that are distributed to a
participating taxpayer, including any interest accrued
on such amount, shall be treated in the same manner as
any refund made to such taxpayer under section 32 of
the Internal Revenue Code of 1986 for purposes of
determining the eligibility of such taxpayer for
benefits or assistance, or the amount or extent of
benefits or assistance, under any Federal program or
under any State or local program financed in whole or
in part with Federal funds.
(b) Assets for Independence Innovation Demonstration Projects.--
(1) Reauthorization.--The Assets for Independence Act (42
U.S.C. 604 note) is amended--
(A) in section 416, by inserting ``, and, subject
to section 417, $25,000,000 for each of fiscal years
2024, 2025, 2026, 2027, and 2028, to remain available
until expended''at the end before the period; and
(B) by adding at the end the following new section:
``SEC. 417. RESERVATION OF FUNDS.
``(a) In General.--Subject to subsections (b) and (c), from the
funds appropriated for each of fiscal years 2024, 2025, 2026, 2027, and
2028 under section 416, the Secretary shall reserve--
``(1) $3,000,000 for general research and evaluation; and
``(2) any amounts remaining after application of paragraph
(1) to fund Assets for Independence innovation projects under
section 418.
``(b) Pilot Program Funding.--From the amounts reserved under
subsection (a) for each of fiscal years 2024, 2025, and 2026, the
Secretary shall make available for operating the pilot program
established under section 7(c) of the Protecting America's Retirement
Security Act of 2022--
``(1) 50 percent of the amount reserved for the relevant
fiscal year under paragraph (1) of subsection (a) (after any
adjustment under subsection (c)); and
``(2) 25 percent of the amount reserved for the relevant
fiscal year under paragraph (2) of subsection (a) (after any
adjustment under subsection (c)).
``(c) Proportional Adjustment.--In any of fiscal years 2024, 2025,
2026, 2027, and 2028, if the amount appropriated for such fiscal year
is greater or less than the amount authorized for such fiscal year
under section 416, the amounts reserved under subsection (a) shall be
increased or decreased for such fiscal year so that each such amount
bears the same proportion to the amount appropriated as each of the
amounts reserved under such subsection bears to the amount
authorized.''.
(2) Establishment of innovation program.--The Assets for
Independence Act (42 U.S.C. 604 note), as amended by paragraph
(1), is further amended by adding at the end the following new
section:
``SEC. 418. ASSETS FOR INDEPENDENCE INNOVATION PROJECTS.
``(a) In General.--The Secretary is authorized to make grants to
qualified entities to conduct Assets for Independence innovation
projects under this section.
``(b) Definitions.--For purposes of this section:
``(1) Assets for independence innovation project.--The term
`Assets for Independence innovation project' means a
demonstration project carried out by a qualified entity under
this section.
``(2) Innovation development account.--The term `innovation
development account' means an account that is established in a
federally insured financial institution or a State insured
financial institution and meets such other requirements as are
established by the Secretary.
``(c) Application.--
``(1) Criteria and preferences.--
``(A) In general.--Subject to subparagraph (B), in
considering an application to conduct an Assets for
Independence innovation project, the Secretary shall
apply subsections (c) and (d) of section 405 to the
application in the same manner that such subsections
apply to an application to conduct a demonstration
project under section 405.
``(B) Modification.--For purposes of this
paragraph, paragraph (1) of section 405(c) shall be
applied without regard to the phrase `through
activities requiring one or more qualified expenses'.
``(2) Approval of assets for independence innovation
projects.--Not later than 12 months after the date of the
enactment of this section, the Secretary shall, on a
competitive basis, approve such applications to conduct Assets
for Independence innovation projects as the Secretary considers
to be appropriate, taking into account the considerations
required by paragraph (1). The Secretary shall ensure, to the
maximum extent practicable, that the applications that are
approved involve a range of communities (spread out both
geographically and in rural and urban areas) and diverse
populations.
``(d) Project Duration and Grant Amount.--
``(1) Duration.--The Secretary shall award grants under
this section for a period not to exceed 5 project years.
``(2) Grant amount.--For each project year of an Assets for
Independence innovation project approved under this section,
the Secretary may make a grant to the qualified entity
authorized to conduct the project. In making such a grant, the
Secretary shall make the grant on the first day of the project
year in an amount not to exceed the lesser of--
``(A) the aggregate amount of funds committed as
matching contributions from non-Federal public or
private sector sources; or
``(B) $1,000,000.
``(e) Eligibility and Selection of Individuals to Participate in an
Assets for Independence Innovation Project.--
``(1) Eligibility criteria.--Subject to the approval of the
Secretary, each qualified entity conducting an Assets for
Independence innovation project shall establish eligibility
requirements for participants in the project. Such requirements
shall--
``(A) be more expansive than the requirements
established under section 408; and
``(B) ensure that eligibility is limited to low-
income individuals.
``(2) Selection of individuals to participate.--Each
qualified entity conducting an Assets for Independence
innovation project shall select, from among the individuals
that meet the eligibility requirements established by the
entity under paragraph (1), the individuals--
``(A) that the qualified entity determines to be
most appropriate to participate; and
``(B) to whom the qualified entity will make
disbursements or deposits in accordance with subsection
(f).
``(f) Disbursements by Qualified Entities.--
``(1) In general.--Each qualified entity conducting an
Assets for Independence innovation project shall, in a manner
consistent with the program requirements established by such
entity, disburse to a third-party or deposit into the
innovation development account of each individual participating
in the project from the funds described in subsection (d)(2), a
matching contribution of not less than $0.50 and not more than
$8 for every $1 deposited in the account by a project
participant, except that the rate of matching shall be equal
for all individuals participating in the project conducted by
such qualified entity.
``(2) Limitation on disbursements for an individual.--Not
more than $5,000 from a grant made under subsection (d)(1)
shall be provided to any one individual over the course of the
Assets for Independence innovation project.
``(3) Limitation on disbursements for a household.--Not
more than $10,000 from a grant made under subsection (d)(1)
shall be provided to any one household over the course of the
Assets for Independence innovation project.
``(4) Adjustment for inflation.--
``(A) In general.--For each calendar year after
2023, the dollar amounts in paragraphs (2) and (3)
shall be increased by an amount equal to the product
of--
``(i) such dollar amount, and
``(ii) the cost-of-living adjustment
determined under section 1(f)(3) of the
Internal Revenue Code of 1986 for the calendar
year, determined by substituting `2022' for
`2016' in subparagraph (A)(ii) thereof.
``(B) Rounding.--If any increase determined under
subparagraph (A) is not a multiple of $50, such
increase shall be rounded up to the next lowest
multiple of $50.''.
(3) Conforming amendments.--The Assets for Independence Act
(42 U.S.C. 604 note), as amended by paragraphs (1) and (2), is
further amended--
(A) in section 404(2), by inserting ``or section
418'' before the period;
(B) in section 406--
(i) in subsection (a), by striking ``to
conduct a demonstration project under this
title'' and inserting ``under section 405'';
and
(ii) in subsection (b), by striking
``conducted under this title'' and inserting
``approved under section 405'';
(C) in section 407--
(i) in subsection (c)--
(I) in paragraph (1)--
(aa) in subparagraph (A),
by inserting ``or, in the case
of a participant in a project
conducted under section 418,
other permitted expenses''
after ``qualified expenses'';
and
(bb) in subparagraph (B),
by inserting ``or subsection
(f) of section 418'' after
``section 410''; and
(II) in paragraph (3), by inserting
``or section 418(d)(1)''after ``
section 406(b)''; and
(ii) in subsection (d)(2)(A), by inserting
``or section 418(d)(1)'' after ``section
406(b)'';
(D) in section 408, by striking ``conducted under
this title'' each place it appears and inserting
``approved under section 405'';
(E) in section 409, by striking ``conducted under
this title'' and inserting ``approved under section
405'';
(F) in section 410, by striking ``under this
title'' and inserting ``conducting a demonstration
project approved under section 405'';
(G) in section 413(a), by inserting ``or section
418(c)'' after ``under section 405''; and
(H) in section 415, by inserting ``or innovation
development account'' after ``individual development
account''.
(c) Matched Refund to Rainy Day Savings Pilot Program.--
(1) In general.--Not later than 6 months after the date of
the enactment of this Act and using the funds made available
pursuant to section 417(b) of the Assets for Independence Act,
the Secretary of Health and Human Services, acting through the
Director of Community Services (in this section referred to as
``the Secretary''), shall establish under this subsection a
matched savings account pilot program to encourage saving by
eligible individuals. Under the pilot program, a qualified
entity may apply to the Secretary for a grant to conduct a
pilot project described in paragraph (2) (in this section
referred to as a ``pilot project''). The pilot program shall
operate for a period of 3 years.
(2) Pilot project described.--
(A) In general.--A pilot project is a project in
which a qualified entity establishes a matched savings
program that meets the requirements of subparagraph (B)
for eligible individuals who are selected by the entity
to participate in the program.
(B) Requirements.--
(i) Deposits into direct deposit
accounts.--
(I) In general.--A matched savings
program established as part of a pilot
project shall match amounts saved by
each eligible individual participating
in the pilot project--
(aa) with the amount
matched to be equal to or less
than the amount of any payment
deferred by such individual
under the Refund to Rainy Day
Savings Program established in
subsection (a)(1); and
(bb) with the rate of
matching to be equal for all
eligible individuals
participating in the program.
(II) Timing.--Any amount described
in subclause (I) shall not be
distributed to an eligible individual
until the amounts described in
subparagraphs (C)(ii) or (E)(ii) of
subsection (a)(1) have been distributed
to the bank account identified by such
individual.
(ii) Evaluation of program by independent
research organization.--
(I) In general.--From amounts made
available under section 417(b)(2) of
the Assets for Independence Act, as
added by subsection (b)(1)(B), the
Secretary shall enter into a contract
with an independent research
organization for purposes of evaluating
pilot projects conducted under this
section.
(II) Coordination.--Each qualified
entity that establishes a matched
savings program as part of a pilot
project shall collaborate with the
independent research organization
described in subclause (I) to evaluate
the outcomes and impact of the project.
(III) Impact.--The evaluation
described in subclause (I) shall
include an examination of the
demographic characteristics of the
individuals participating in the pilot
project, such as gender, race, age,
geographic location, and family makeup,
and how the impacts of the project vary
among different demographic groups and
the effects of the pilot program on
retirement savings for eligible
individuals.
(IV) Program features.--The program
features to be evaluated through the
pilot projects conducted under this
section may include--
(aa) different levels of
matching contributions by
qualified entities;
(bb) lock-out periods
during which an eligible
individual may not make
withdrawals from their account;
and
(cc) educational materials
intended to promote savings.
(V) Safeguarding privacy.--Any
contract entered into under this clause
shall require the selected independent
research organization to take all
necessary and proper precautions to
protect eligible individuals' privacy
and personally identifiable information
when conducting the evaluation.
(C) Duration.--A pilot project shall be for a
duration of not more than 3 years.
(D) Federally funded benefits.--Any amounts
described in subparagraph (B)(i) which are distributed
to an eligible individual shall be treated in the same
manner as any refund made to such taxpayer under
section 32 of the Internal Revenue Code of 1986 for
purposes of determining the eligibility of such
taxpayer for benefits or assistance, or the amount or
extent of benefits or assistance, under any Federal
program or under any State or local program financed in
whole or in part with Federal funds.
(3) Strategic communications plan.--The Secretary shall
devise a strategic communications plan to ensure a successful
pilot program.
(4) Annual report to congress.--The Secretary shall submit
an annual report to Congress on the progress and outcomes of
the pilot program established under this section.
(5) Definitions.--In this subsection:
(A) Eligible individual.--The term ``eligible
individual'' means an individual who--
(i) has deferred payment of the amount
described in subsection (a)(1) under the Refund
to Rainy Day Savings Program established in
such subsection, and
(ii) meets the eligibility requirements
under section 408 of the Assets for
Independence Act, except that subsection (a)(2)
of such section shall not apply.
(B) Qualified entity.--
(i) In general.--The term ``qualified
entity'' means--
(I) one or more not-for-profit
organizations described in section
501(c)(3) of the Internal Revenue Code
of 1986 and exempt from taxation under
section 501(a) of such Code;
(II) a State or local government
agency, or a tribal government,
submitting an application to conduct a
pilot project jointly with an
organization described in subclause
(I);
(III) a site that offers free tax
help to individuals who qualify through
the Internal Revenue Service's
Voluntary Income Tax Assistance or Tax
Counseling for the Elderly programs; or
(IV) an entity that--
(aa) is--
(AA) a credit union
designated as a low-
income credit union by
the National Credit
Union Administration;
or
(BB) an
organization designated
as a community
development financial
institution by the
Secretary of the
Treasury (or the
Community Development
Financial Institutions
Fund); and
(bb) can demonstrate a
collaborative relationship with
a local community-based
organization whose activities
are designed to address poverty
in the community and the needs
of community members for
economic independence and
stability.
(V) Rule of construction.--Nothing
in this paragraph shall be construed as
preventing an organization described in
clause (i)(I) from collaborating with a
financial institution or for-profit
community development corporation to
carry out the purposes of this section.
Union Calendar No. 471
117th CONGRESS
2d Session
H. R. 7310
[Report No. 117-557, Part I]
_______________________________________________________________________
A BILL
To protect America's retirement security, and for other purposes.
_______________________________________________________________________
December 20, 2022
Committee on Ways and Means discharged; committed to the Committee of
the Whole House on the State of the Union and ordered to be printed