(1) The Washington small business retirement marketplace is created.
(2) Prior to connecting any eligible employer with an approved plan in the marketplace, the director shall design a plan for the operation of the marketplace.
(3) The director shall consult with the Washington state department of retirement systems, the Washington state investment board, and the department of financial institutions in designing and managing the marketplace.
(4) The director shall approve for participation in the marketplace all private sector financial services firms, as defined in RCW
43.330.732.
(5) A range of investment options must be provided to meet the needs of investors with various levels of risk tolerance and various ages. The director must approve a diverse array of private retirement plan options that are available to employers on a voluntary basis, including but not limited to life insurance plans that are designed for retirement purposes, and plans for eligible employer participation such as a SIMPLE IRA-type plan that provides for employer contributions to participating enrollee accounts.
(6)(a) Prior to approving a plan to be offered on the marketplace, the department must receive verification from the department of financial institutions or the office of the insurance commissioner:
(i) That the private sector financial services firm offering the plan meets the definition in RCW
43.330.732; and
(ii) That the plan meets the requirements of this section excluding subsection (9) of this section which is subject to federal laws and regulations.
(b) If the plan includes either life insurance or annuity products, or both, the office of the insurance commissioner may request that the department of financial institutions conduct the plan review as provided in (a)(ii) of this subsection prior to submitting its verification to the department.
(c) The director may remove approved plans that no longer meet the requirements of this chapter.
(7) The financial services firms participating in the marketplace must offer a minimum of two product options: (a) A target date or other similar fund, with asset allocations and maturities designed to coincide with the expected date of retirement and (b) a balanced fund.
(8) In order for the marketplace to operate, there must be at least two approved plans on the marketplace; however, nothing in this subsection shall be construed to limit the number of private sector financial services firms with approved plans from participating in the marketplace.
(9) Approved plans must meet federal law or regulation for internal revenue service approved retirement plans.
(10) The approved plans must include the option for enrollees to roll pretax contributions into a different individual retirement account or another eligible retirement plan after ceasing participation in a plan approved by the Washington small business retirement marketplace.
(11) Financial services firms selected by the department to offer approved plans on the marketplace may not charge the participating employer an administrative fee and may not charge enrollees more than one hundred basis points in total annual fees and must provide information about their product's historical investment performance. Financial services firms may charge enrollees a de minimis fee for new and/or low balance accounts in amounts negotiated and agreed upon by the department and financial services firms. The director shall limit plans to those with total fees the director considers reasonable based on all the facts and circumstances.
(12) Participation in the Washington small business retirement marketplace is voluntary for both eligible employers and qualified employees.
(13) Enrollment in any approved plan offered in the marketplace is not an entitlement.