Congress may torpedo Seattle City Councilmember Tim Burgess’ proposal to have businesses without retirement plans automatically enroll their employees in a city plan providing Individual Retirement Accounts.
For the past year, Seattle City Councilmember Tim Burgess has been working on a proposal to have businesses without retirement plans automatically enroll their employees in a city plan providing each with an Individual Retirement Account.
In theory, the plan could enroll as many as 200,000 Seattle workers, Burgess says.
Joined by counterparts in New York City and Philadelphia, the council member successfully lobbied then-President Barack Obama’s Department of Labor last year for a rule change giving large cities legal wiggle room to implement such a plan.
But congressional Republicans are trying to repeal the rule change for cities and a related change for states.
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The House of Representatives approved the repeal earlier this month in a 231-193 vote, and the Senate could consider it as early as this week. Washington state’s four Republican representatives voted for the repeal.
Burgess says he has found the turn of events in Washington, D.C., frustrating, particularly because he views his proposal as good for both employers and employees.
“This is pro-worker, pro-business and pro-growth,” the council member said.
Without savings, many retirees struggle to get by, Burgess said, citing a 2013 AARP survey. It found that 24 percent of Washington baby boomers had less than $25,000 in savings and that 81 percent wished they would have saved more.
Employees are more likely to save when they have access to retirement plans through their employers, but about 40 percent of private-sector workers in the Seattle area have no such access, according to the Pew Research Center.
People of color and small-business employees are least likely to have access to retirement…