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Update: LD 1318 Work and Save

Written by Alyra Donisvitch | Published on June 7, 2016
Maine State House

LD 1318, known by its shortened name, Work and Save, did not survive the legislative process this past session in spite of  the concerted efforts of a group of  advocates led by Amy Gallant of AARP, and  supported by Eloise Vitelli for CA$H Maine and NVME, among others. Conversations have already begun, however, to re-introduce similar legislation when the new legislature convenes in 2017.

To recap – LD 1318 (its full title was An Act to Promote Individual Private Savings Accounts through a Public-Private Partnership, or the Maine Small Business Retirement Marketplace) was introduced by Rep. Henry Beck, Waterville and assigned to the Committee on Insurance and Financial Services.

The bill was intended to promote ‘IRA’ like retirement savings via payroll deductions for individual employees of small businesses who do not currently offer a retirement savings plan. Eligible small employers included the self-employed and sole proprietors and their employees. Employees would have to ‘opt-out’ of the plan making it more likely that people will save, while still allowing individuals to choose not to participate. While employers would be encouraged to make these accounts available to their employees, they would not be required to contribute to the accounts. Individual retirement accounts would be portable so if they change jobs, it would be easier for individuals to accumulate savings over time.

The bill got a divided Ought Not to Pass (ONTP) out of the Committee (7 voting against the bill, 6 in favor) and was voted ONTP in the House as well, in spite of a last minute effort to amend the bill, adding a tax incentive for employers.

There were a number of issues that led to the defeat of this bill:

  • The bill lacked an administrative “home” – the State Treasurer, Secretary of State, Office of Securities, in the Department of Financial Services, the Department of Labor, FAME were all approached as entities that could potentially house the ‘marketplace’. No one took up the offer.
  • The proposal met with opposition from the financial sector who argued, in part, that the product was not necessary as the marketplace already provided opportunities for people to save for retirement and it would increase costs and regulatory requirements for employers, among other concerns.
  • The Committee was divided and did not offer strong enough support to carry it forward onto the floor.
  • Finally, the bill did not receive sufficient grass-roots support to overcome resistance. The voices of the beneficiaries of the proposal – employees and the small businesses they work for who do not have retirement savings accounts, were not heard.


There is no question that the need for Work and Save remains: 254,000 Mainers still do not have access to retirement savings plans through their work and 1 in 3 Maine retirees live exclusively on Social Security , or about $1,100 a month.  To succeed the next time around we are going to need :

  • More specific information on the number/size of businesses that offer retirement savings and those who do not;
  • Current costs to the state of supporting low-income retirees (housing, transportation, food subsidies).
  • The potential savings to the state if more retirees were financially self-sufficient and  less dependent upon public support for basic needs.
  • We will need more people (constituents) to let legislators know how important it is to make saving for retirement easy and accessible to more workers. If you would like to get involved with this issue, signup to become an advocate with CA$H Maine!