Rep. Tim Walberg (R-MI) introduced H.J.Res. 66 on Feb. 7; it states that the House and Senate disapprove of the rule the DOL adopted on savings arrangements established by states for non-governmental employees and provides that the rule will have no force or effect. On the same day, Rep. Francis Rooney (R-FL) introduced H.J.Res. 67; it makes a similar expression and has similar provisions concerning the DOL rule concerning savings arrangements that state political divisions established for private-sector employees.
Neither the House nor the Senate have yet adopted the resolutions; they are both before the House Committee on Education and the Workforce.
In 2015, President Obama directed Secretary of Labor Thomas Perez to publish a proposed rule to “provide a clear path forward for the states to create retirement savings programs.” In August 2016, the DOL adopted a final rule outlining the circumstances in which state retirement savings programs would not be treated as creating ERISA-covered pension plans — and in the process tilting the playing field in favor of those programs in competition with the private sector.
Subsequently, after receiving inquiries about the viability of a similar approach for municipalities and “political subdivisions,” last December the DOL amended those final regulations, expanding the state-run safe harbor to include those programs as well.
In introducing the new resolutions, the congressmen noted that concerns have been raised that the DOL’s actions will not only discourage small businesses from offering private-sector plans, but in the process will also leave working families with less retirement security, inadequate safeguards and limited control over their retirement savings.
They note that under the Congressional Review Act, Congress may pass a resolution of disapproval to prevent, with the full force of law, a federal agency from implementing a rule or issuing a rule that is substantially the same without congressional authorization.
The resolution introduced by Walberg (H. J. Res 66) would roll back the regulatory “safe harbor” created by the Obama administration that will result in private-sector workers being forced into government-run IRAs managed by states. Rooney’s resolution (H. J. Res 67) would block a second regulation that extended the “safe harbor” to include cities and counties. Both resolutions would prevent a future administration from promulgating similar regulations. The resolutions themselves are remarkably straightforward, stating only: “That Congress disapproves the rule submitted by the DOL relating to ‘Savings Arrangements Established by States for Non-Governmental Employees’ and such rule shall have no force or effect.”
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