Vermont Saves reports 1,100 employers registered, $625,000 in participant assets

Becky Wasserman, director of economic empowerment at the Vermont State Treasurer’s Office, told the House Committee on Commerce & Economic Development on May 13 that about 1,100 employers have registered for the state’s Vermont Saves auto-IRA program, there are roughly 2,700 funded accounts and about $625,000 in assets under management.

The state launched a pilot in October 2024 and opened a full statewide launch on Dec. 1, 2024, with an initial three-month employer enrollment window. ‘‘We are going to continue the sort of enrollment process,’’ Wasserman said, adding that the treasurer’s office is ‘‘not inclined’’ to impose penalties for now and will focus on outreach to employers that have not registered.

Vermont Saves requires employers with five or more employees that do not already offer a workplace retirement plan to enroll employees in an opt-out Roth IRA via payroll deduction. The state contracts with Vestwell as program administrator and record keeper; Vestwell works with BNY Mellon for custody of accounts. ‘‘The state has partnered with a third-party vendor called Vestwell,’’ Wasserman said.

Wasserman told the committee the office identified roughly 7,000 employers potentially subject to the requirement by cross-referencing unemployment insurance records and forms that indicate existing plans, but that number likely overcounts employers because some plans do not require the same filing. She said about 2,800 employers have self-certified exemptions and roughly 46% of identified employers have provided no response so far; the office’s target response rate is about 70%.

The treasurer’s office has joined a multistate partnership called the Partnership for Dignified Retirement, led by Colorado, to lower participant fees and share administrative resources; Maine, Delaware and Nevada recently joined the partnership.

Wasserman explained eligibility rules shaped by federal law: the program excludes employees of employers that already offer workplace plans and, following state rulemaking effective Jan. 1, 2025, makes employees who are expected to work 500 hours or more in a calendar year eligible for enrollment. ‘‘We were trying to make the program accessible to people who work part time, temporary, or seasonal jobs,’’ she said.

Committee members asked about employer costs and small-business participation. Wasserman said Vermont does not impose fees on employers but acknowledged some payroll providers may charge to process payroll deductions. She also said employers with fewer than five employees are not currently required to enroll but that individuals can self-enroll in the program; the office reports about 30 self-enrolled accounts so far.

Committee discussion ranged from curiosity about eligibility limits to support for expanding access for small employers. Wasserman said the office is monitoring other states that have lowered employee thresholds and that lowering Vermont’s five-employee threshold is a likely future consideration.

The treasurer’s office said it will continue outreach and monitoring and will consider enforcement only after further education and communication with employers.

Next steps outlined to the committee included continued employer outreach, refining the employer contact list, and evaluating whether to lower the employer-size threshold for mandatory participation.