Va. Code Ann. tit. 2.2, ch. 27.1

Va. Code Ann. tit. 2.2, ch. 27.1
in effect

Va. Code Ann. § 2.2-2744 Definitions

As used in this chapter, unless the context requires a different meaning: "Board" means the governing board of the Commonwealth Savers Plan. "Committee" means the Program Advisory Committee established pursuant to § 2.2-2746 . "Eligible employee" means any individual who is (i) 18 years of age or older, (ii) currently employed, and (iii) receiving wages. "Eligible employer" means a nongovernmental business, industry, trade, profession, or other enterprise in the Commonwealth, whether conducted on a for-profit or nonprofit basis, that employed five or more eligible employees for the period ending December 31 of the preceding calendar year prior to the Program's open enrollment period for that calendar year. "Eligible employer" does not include an employer that sponsors, maintains, or contributes to a qualified employer-sponsored retirement plan in compliance with federal law for its employees, including plans qualified under § 401(a), 401(k),403(a), 403(b), 408(k), or 408(p) of the Internal Revenue Code. An employer shall become an eligible employer at any time if it meets the eligibility requirements under this chapter. "Fee" means any investment management charges, administrative charges, investment advice charges, trading fees, marketing and sales fees, revenue sharing, broker fees, and other costs necessary to run the Program. "Individual retirement account" or "IRA" means a Roth or traditional individual retirement account or annuity under § 408 or 408A of the Internal Revenue Code. "Participating employee" means any eligible employee who is enrolled in the Program. "Participating employer" means an employer that facilitates a payroll deposit retirement savings agreement pursuant to this chapter for its eligible employees. "Participating individual" means any individual who enrolls in the Program independent of an employment relationship with an eligible employer, is at least 18 years of age, maintains an account in the Program, and is not a participating employee. "Payroll deposit retirement savings agreement" means an arrangement by which an employer allows employees to remit payroll deduction contributions to the Program. "Plan" means the Commonwealth Savers Plan. "Program" means the state-facilitated IRA savings program established in this chapter and administered by the Plan. "Program Trust" means the Program trust fund established by § 2.2-2752 . "Wages" means any compensation, as such term is defined in § 219(f)(1) of the Internal Revenue Code, that is paid to an eligible employee by his employer during the calendar year. 2021, Sp. Sess. I, c. 556 ; 2024, c. 217 ; 2026, cc. 84 , 85 .

Va. Code Ann. § 2.2-2745 Program authorized

To promote greater voluntary retirement savings for private-sector workers in a convenient and portable manner, the Plan is authorized, in accordance with this chapter, to establish a state-facilitated IRA savings program for private-sector workers. The Program shall be sponsored and administered by the Plan. In addition to the provisions of this chapter, the Program shall be subject to the provisions of Chapter 7 (§ 23.1-700 et seq.) of Title 23.1. 2021, Sp. Sess. I, c. 556 .

Va. Code Ann. § 2.2-2746 Program Advisory Committee; membership; qualifications; duties

A. In order to assist the Board in fulfilling its duties under § 23.1-704 and this chapter and to assist the Plan's chief executive officer in directing, managing, and administering the Program, the Board shall appoint the Program Advisory Committee to provide sophisticated, objective, and prudent program administration, advice, design,and direction, as requested by the Board. The Committee may develop Program recommendations for the Board and perform such other duties as the Board may delegate to the Committee. B. The Board shall develop requirements, procedures, and guidelines regarding Committee membership. C. Members of the Committee shall demonstrate extensive experience in one or more of the following areas: retirement plan administration,design, andinvestments, domestic or international equity or fixed-income securities, cash management, alternative investments, institutional real estate investments, or managed futures. D. Members of the Committee shall serve at the pleasure of the Board and may be removed by a majority vote of the Board. E. Members of the Committee shall receive no compensation but shall be reimbursed for actual expenses incurred in the performance of their duties. F. The recommendations of the Committee shall not be binding upon the Board. G. The disclosure requirements of subsection B of § 2.2-3114 shall apply to each member of the Committee who is not also a Board member. H. The Board may appoint such other advisory committees as it deems necessary and shall set the qualifications for members of any such advisory committee by resolution. 2021, Sp. Sess. I, c. 556 ; 2026, cc. 84 , 85 .

Va. Code Ann. § 2.2-2747 Powers and duties of the Board

The Board shall: 1. Administer the Program authorized by this chapter; 2. Invest moneys in the Program in any instruments, obligations, securities, or property deemed appropriate by the Board; 3. Develop requirements, procedures, and guidelines for the Program, including: a. Eligibility requirements for employers and employees, in accordance with this chapter; b. Procedures for enrollment, reenrollment, and disenrollment of participating employees; c. Selecting whether to offer Roth IRAs, traditional IRAs, or both, and if both, which type of IRA shall be the default IRA; d. Default contribution rates; e. Default annual escalation rates; f. Selecting one or more investment funds in which Program participants may elect to invest their savings, including a lifetime income option, and a default investment fund for participants who do not make an affirmative investment election; g. Minimum and maximum contribution levels in accordance with applicable limits established by the Internal Revenue Code; h. A fee structure; i. Procedures for noncompliance with this chapter, including development of enforcement mechanisms and penalties not to exceed $200 per eligible employee annually; j. Education and outreach campaigns to eligible employers and eligible employees; k. Procedures for enrollment, reenrollment, and disenrollment of participating individuals; l. Resources, tools, and incentives to promote greater financial education and literacy for Program participants consistent with the purposes of this chapter; and m. Procedures for receiving and crediting federal matching contributions to an IRA or qualified retirement savings account for eligible Program participants in accordance with the requirements established by federal law. 4. Enter into all contractual agreements, including contracts for legal, financial, program management, and consulting services necessary to develop and administer the Program; 5. Procure insurance as determined appropriate by the Board (i) against any loss in connection with the Program's property, assets, or activities and (ii) indemnifying Board and Committee members from personal loss, accountability, or liability arising from any action or inaction as a Board or Committee member; 6. Adopt policies and procedures and perform any act or function consistent with the purposes of this chapter; 7. Explore and, as appropriate, establish incentives to encourage participation in the Program by eligible employers and eligible employees, including initiatives that incentivize compliance with the Program or defray any costs incurred by an eligible employer to facilitate Program participation; 8. Assess the feasibility of multistate or regional agreements to administer the Program through shared administrative and operational resources and enter into those agreements if deemed beneficial to the Program; 9. Establish procedures for receiving and providing data relevant to Program administration. This shall include information collected from other state agencies, including the Department of Labor and Industry, the Department of Taxation, and the Virginia Employment Commission, as appropriate; 10. Accept any funds appropriated to the Program and any gifts, donations, grants, bequests, and other funds received on its behalf, including any funds made available for use in facilitating education and outreach initiatives for the Program; 11. Design and operate the Program in a manner that will cause it not to be an employee benefit plan within the meaning of § 3(3) of the Employee Retirement Income Security Act of 1974; and 12. Explore and, as appropriate, establish requirements for which Program participants may elect to defer contributions at a level deemed appropriate by the Board to a short-term emergency savings mechanism that provides additional flexibility and access to savings. 2021, Sp. Sess. I, c. 556 ; 2026, cc. 84 , 85 .

Va. Code Ann. § 2.2-2748 Cooperation of other agencies

All agencies, departments, and commissions of the Commonwealth shall cooperate as requested by the Plan in the performance of its duties under this chapter, including, unless otherwise prohibited, the sharing of relevant data, technical assistance, and compliance and enforcement mechanisms as the parties shall mutually agree. 2021, Sp. Sess. I, c. 556 ; 2026, cc. 84 , 85 .

Va. Code Ann. § 2.2-2749 Board actions not a debt of the Commonwealth

No act or undertaking of the Board is a debt or pledge of the full faith and credit of the Commonwealth or any political subdivision of the Commonwealth, and all such acts and undertakings are payable solely from the Program. The Commonwealth shall have no obligation for payment of benefits arising from this chapter. 2021, Sp. Sess. I, c. 556 .

Va. Code Ann. § 2.2-2750 Standard of care; investment and administration of the Program

The provisions of § 23.1-706 relating to the standard of care and the investment and administration of the Plan shall apply, mutatis mutandis, to the Program authorized under this chapter. 2021, Sp. Sess. I, c. 556 .

Va. Code Ann. § 2.2-2751 Program enrollment; participating employer liability and status under the Program

A. 1. Any employer that is not an eligible employer may facilitate the participation of its employees in the Program. However, such employer shall take all steps necessary to ensure that such facilitation does not constitute an employee benefit plan regulated under Title I of the Employee Retirement Income Security Act (ERISA). 2. Any employee whose employer does not facilitate his participation in the Program pursuant to subdivision 1 or any self-employed individual may participate in the Program under terms and conditions prescribed by the Board. 3. No employee shall be permitted to participate in the Program unless such individual has Virginia taxable income, as defined in Article 2 (§ 58.1-320 et seq.) of Chapter 3 of Title 58.1. B. The Program shall be established and enrollment of eligible employers shall begin on July 1, 2023, or as soon thereafter as practicable. The Board shall establish an implementation timeline under which eligible employers shall enroll their eligible employees in the Program. C. The Board shall develop a Program rollout timeline, including deadlines for the enrollment of eligible employers. The Board may alter the rollout timeline in its discretion, though in all instances any alterations of established rollout dates shall include reasonable notice to affected eligible employers. D. Participation in the Program shall be mandatory for eligible employers. Eligible employers shall enroll in the Program in accordance with the timeline established by the Plan. Eligible employers shall facilitate a payroll deposit retirement savings agreement pursuant to this chapter for their eligible employees. E. Eligible employers that withhold a contribution from a participating employee's wages in connection with the Program shall remit such contribution on the earliest date the amount withheld from the eligible employee's compensation can be transmitted, but not later than 10 business days following the date upon which the eligible employee's contribution amount was withheld from the employee's paycheck. F. An eligible employer who withholds wages but fails to submit contributions to the Program in accordance with the payroll deposit retirement savings agreement and in the time and manner specified may be subject to a violation of federal and state labor laws and incur penalties thereof. G. Each eligible employee of an eligible employer shall be enrolled in the Program unless the employee elects not to participate in the Program in a manner prescribed by the Board. H. A Program participant may also terminate his participation in the Program at any time in a manner prescribed by the Board. I. Participating employers shall not have any liability for a participating employee's decision to participate in or opt out of the Program or for the investment decisions of participating employees whose assets are deposited in the Program. J. Participating employers shall not be a fiduciary, or considered to be a fiduciary, over the Program. The Program is a state-administered program, not an employer-sponsored program. If the Program is subsequently found to be preempted by any federal law or regulation, participating employers shall not be liable as Program sponsors. A participating employer shall not bear responsibility for the administration, investment, or investment performance of the Program. A participating employer shall not be liable with regard to investment returns, Program design, and benefits paid to Program participants. K. A participating employer shall not have civil liability, and no cause of action shall arise against a participating employer, for acting pursuant to this chapter. L. The Board shall develop and provide to participating employees and participating individuals Program summaries and other information concerning participation in the Program, including information on Program investments and fees, and the consequences of contributing to an IRA, and a statement that the Program is not an employer-sponsored retirement plan, as required by applicable law and as otherwise determined by the Board. M. Participating employers shall retain the option at all times to set up any type of employer retirement plan, including plans qualified under § 401(a), 401(k),403(a), 403(b), 408(k), or 408(p), of the Internal Revenue Code, in which event such employer shall no longer be considered an eligible employer and shall cease facilitating contributions to the Program in accordance with such procedures as shall be established by the Board. N. No employer shall be permitted to contribute to the Program or to endorse or otherwise promote the Program. O. The Program shall be exempt from the provisions of subsection D of § 40.1-29 . 2021, Sp. Sess. I, c. 556 ; 2026, cc. 84 , 85 , 1040 .

Va. Code Ann. § 2.2-2752 Program Trust Fund

A. There is hereby established a permanent and perpetual fund to be known as the Program Trust Fund (the Fund). The moneys in the Fund shall be (i) deemed separate and independent trust funds, (ii) segregated and accounted for separately from all other funds of the Commonwealth, and (iii) administered solely in the interests of the individuals who are participants in the Program established pursuant to this chapter. B. The assets of IRAs established for Program participants shall be allocated to the Fund and combined for investment purposes. Fund assets shall be managed and administered for the exclusive purpose of providing benefits to Program participants and defraying reasonable expenses of administering, maintaining, and managing investments of the IRAs and the Program Trust. No property rights in Fund assets shall exist in favor of the Commonwealth or any participating employer. C. The Board shall establish within the Fund one or more investment funds, each pursuing an investment strategy and policy established by the Board in accordance with § 2.2-2747 . D. Notwithstanding any provision to the contrary, the Fund shall be exempt from the securities registration requirements provided in Chapter 5 (§ 13.1-501 et seq.) of Title 13.1. 2021, Sp. Sess. I, c. 556 .

Va. Code Ann. § 2.2-2753 Audit and annual reports

The Program shall be subject to the reporting requirements set forth in § 23.1-709 . The Program shall be subject to the applicable provisions of the Commonwealth Savers Plan Oversight Act (§ 30-330 et seq.). 2021, Sp. Sess. I, c. 556 ; 2024, c. 217 .

Va. Code Ann. § 2.2-2754 Virginia Freedom of Information Act

The provisions of the Virginia Freedom of Information Act (§ 2.2-3700 et seq.) applicable to the Plan shall also apply to the Program. 2021, Sp. Sess. I, c. 556 .

Va. Code Ann. § 2.2-2755 Coverage limitations

Nothing in this chapter or any payroll deposit retirement savings agreement entered into pursuant to this chapter shall be construed as a promise or guarantee that the expenses associated with a participating employee's or participating individual's retirement will be covered in full by contributions to or earnings on any account, nor that the contributions to or earnings on any account will be sufficient to fund any particular level of benefit upon retirement. In no event shall the Commonwealth, the Program, the Board, any Board member, or any participating employer be liable for any losses incurred by Program Trust investments or otherwise by any employee or other person as a result of participating in the Program. 2021, Sp. Sess. I, c. 556 .

Va. Code Ann. § 2.2-2756 Duty and liability of the Commonwealth

A. The Commonwealth shall have no duty or liability to any party for the payment of any retirement savings benefits accrued by any individual under the Program. Any financial liability for the payment of retirement savings benefits in excess of funds available under the Program shall be borne solely by the entities with whom the Board contracts to provide insurance to protect the value of the Program, if applicable. B. No Commonwealth board, commission, political subdivision, or agency, or any officer, employee, or member thereof, is liable for any loss or deficiency resulting from particular investments selected under this chapter, except for any liability that arises out of a breach of fiduciary duty. 2021, Sp. Sess. I, c. 556 .

Va. Code Ann. § 2.2-2757 Liberal construction of chapter

Insofar as the provisions of this chapter are inconsistent with the provisions of any other general, special, or local law, the provisions of this chapter shall control. This chapter constitutes full and complete authority, without regard to the provisions of any other law, for performing the acts authorized in this chapter and shall be liberally construed to effect the purposes of this chapter. 2021, Sp. Sess. I, c. 556 .
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://law.lis.virginia.gov/vacode/title2.2/chapter27.1/Fetched: 10/16/2026