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Deputy treasurer lays out plan to use some unclaimed-property transfers to fund VT Saves; committee reviews retirement technical changes
Summary
Deputy Treasurer David Sherritt outlined a proposal to reconfigure transfers of unclaimed property (raising the per-account threshold to $150 and placing a $300,000 annual cap) so the VT Saves retirement program reaches self-sufficiency; the committee also heard testimony on allowing union presidents to purchase retirement service credit.
Deputy Treasurer David Sherritt (speaker 8) briefed the committee on a proposal to reconfigure an existing unclaimed-property transfer to help capitalize VT Saves, the state-facilitated retirement-savings program. He said VT Saves has grown from zero to more than 6,000 accounts and roughly $7 million in assets under management since launch and that the administration seeks a sustainable funding path until the program becomes self-sustaining.
"The proposal will do three things," David Sherritt (speaker 8) said: fund VT Saves until it reaches self-sufficiency, do so without impacting the general fund, and provide greater revenue in the long run to the Higher Education Trust Fund. Under the plan, the unclaimed-property transfer eligibility threshold would increase from $100 to $150 for transfers to the Higher Education Trust Fund, but a waterfall and an annual cap of $300,000 would smooth how much is reallocated each year so VT Saves is prioritized until it becomes self-sustaining.
Sherritt presented historical modeling showing the Higher Education Trust Fund would have seen notable increases under the proposal if it had been in place in prior years (he cited a 43% modeled increase in certain historical transfers) and projected that, while the trust fund would see a small dip in near-term contributions, it would receive more over the duration of the provision once VT Saves reaches self-sufficiency. He emphasized principal in the Higher Education Trust Fund would not be swept and that available transfers primarily affect contributions rather than existing principal distributions.
Committee members asked about administration, oversight and future uses of the Higher Education Trust Fund. Several members (speaker 5 among them) asked that protections be added to guard the fund's principal and to require formal oversight before its use is repurposed for non‑scholarship purposes; a member proposed additional council oversight and the inclusion of a student member on that council.
On related retirement items, witness Josh Hannaford (speaker 7) told the committee he supported technical corrections in sections 6 and 22. The panel also discussed sections 21–22, which would allow time served by a union president as a full‑time officer to be eligible for purchase as service credit in state retirement systems. Witness (speaker 6) explained purchase options follow existing service‑purchase mechanics and are permissive; Tim Duggan of the retirement division was noted as available to provide technical details.
No votes were taken on the funding proposal or retirement provisions. Staff and witnesses answered technical questions and the committee asked staff to circulate potential amendment language to the Higher Education Trust Fund distribution and oversight provisions before the next meeting.
