HB 1477
In CommitteeHouse
WA saves trust account
Concerning the Washington saves administrative trust account.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill establishes the Washington Saves administrative trust account to fund program operations and clarifies how investment earnings from state trust funds are distributed. It also refines definitions and administrative structures for the Washington Saves payroll deduction IRA program, including employer and employee eligibility rules and the role of the administrative agency.
- Establishes the Washington Saves administrative trust account in the custody of the state treasurer, funded by state and federal appropriations and interest, to cover program administrative and operating expenses.
- Requires covered employers (those with 10,400+ hours worked, in business ≥2 years, with physical presence in WA, and not offering a qualified retirement plan to long-tenured employees) to facilitate payroll deductions into individual retirement accounts (IRAs) for covered employees (age 18+, employed ≥1 year).
- Designates a state agency as the administrative agency (starting July 1, 2027) to provide administrative support to the governing board and manage program operations.
- Amends investment and earnings rules for the state treasurer’s trust funds: investment income is used first to pay for banking services, then earnings are distributed monthly — most accounts (including the Washington Saves trust account) receive proportionate shares based on average daily balance.
- Includes a sunset clause: Sections 3 and 4 of the act (which amend RCW 43.79A.040) expire on July 1, 2030, while Section 4 itself takes effect on that same date (likely a drafting error, but as written, both sections reference the same effective/expiry dates).
Who is affected
- Covered employers — Employers who meet the criteria (at least two years in business, physical presence in Washington, no qualified retirement plan offered to long-tenured employees, and 10,400+ combined hours worked in the prior year) must set up payroll deduction systems to automatically contribute to individual retirement accounts (IRAs) for eligible workers.
- Covered employees — Workers who are 18 or older and employed by covered employers (and who have worked at least one year with the employer) will have a portion of their wages automatically deducted and deposited into a personal IRA unless they opt out.
- Administrative agency (to be designated) — The state agency designated as the administrative agency (starting July 1, 2027) will manage program operations, including oversight of employers, coordination with financial institutions, and support for the governing board.
- State Treasury — The Washington State Treasury will hold and manage the Washington Saves Administrative Trust Account, invest its funds, and distribute investment earnings per statutory rules.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
The bill establishes a dedicated administrative trust account funded by state/federal appropriations and interest, ensuring stable, ring-fenced funding for program operations — reducing reliance on general fund dollars and supporting long-term program viability without burdening the general budget.
Business & EmploymentPeopleRef: Sec. 2(2); Sec. 1(1); Sec. 1(2)The program creates a low-barrier, automatic payroll deduction IRA pathway for workers at mid-sized employers who lack access to employer-sponsored retirement plans — expanding retirement savings access to a population (e.g., service workers, part-timers) often excluded from traditional retirement benefits.
Business & EmploymentPeopleRef: Sec. 1(5); Sec. 1(6); Sec. 2(1)The bill includes the Washington Saves administrative trust account in the list of accounts receiving proportionate earnings based on average daily balance, ensuring its investment income is retained for program use — supporting program sustainability and reducing future taxpayer burden for administrative costs.
Public SafetyPeopleRef: Sec. 4(4)(b); Sec. 3(4)(b)The bill clarifies that investment income can be used to pay for banking services (e.g., depository, safekeeping) for all state trust funds, including Washington Saves — improving operational efficiency and reducing overhead costs across the state’s financial infrastructure.
Business & EmploymentRef: Sec. 4(3); Sec. 3(3)By defining 'qualified retirement plan' broadly (including 401(k), 403(b), etc.) and requiring employers to not offer such plans to long-tenured employees, the bill targets the right population for outreach — ensuring the program reaches workers most in need of retirement savings infrastructure.
Business & EmploymentPeopleRef: Sec. 1(17); Sec. 1(18); Sec. 2(1)
Potential Concerns (5)
The bill imposes new administrative burdens on covered employers (those with ≥10,400 hours worked, in business ≥2 years, no qualified retirement plan for long-tenured employees), requiring them to set up and maintain payroll deduction systems for IRAs. This may increase operational complexity and compliance costs for mid-sized employers, especially those without existing payroll infrastructure.
Business & EmploymentRef: Sec. 1(6)(d); Sec. 2(1)The 10,400-hour threshold (roughly 20 FTEs at 26 weeks/year) excludes many small businesses and sole proprietors, meaning most micro-businesses and mom-and-pop shops are not required to participate — reducing compliance burden on those groups but also limiting program reach.
Business & EmploymentRef: Sec. 1(5); Sec. 1(6)(d); Sec. 2(1)The bill designates the program as a payroll deduction IRA program, not a state-sponsored retirement plan, which limits employer liability but also means employers face no fiduciary responsibility — potentially reducing employer incentives to actively promote or support employee enrollment.
Business & EmploymentRef: Sec. 1(15); Sec. 1(16); Sec. 1(17)The bill clarifies investment earnings distribution for state trust funds, including the Washington Saves administrative trust account, but does not create new revenue or funding mechanisms beyond existing appropriations. This avoids new general fund costs but also limits program scalability if federal or state funding dries up.
Business & EmploymentRef: Sec. 4(1)-(5); Sec. 3(1)-(5)The bill exempts the Washington Saves administrative trust account from appropriation and allotment provisions under chapter 43.88 RCW, meaning its funding is not subject to annual legislative review — potentially insulating program operations from political interference but also reducing transparency and accountability in spending decisions.
Local GovernmentRef: Sec. 2(3); Sec. 1(1)
Who Is Most Affected
Covered employers (≥10,400 hours worked, ≥2 years in business, no qualified retirement plan for long-tenured employees) must implement payroll deduction systems — a modest administrative burden but no direct cost, as the program is self-funded via the administrative trust account.
Workers who meet the definition of 'covered employee' (18+, employed ≥1 year at a covered employer) gain automatic access to retirement savings with minimal effort, but must actively opt out if they do not wish to participate — expanding retirement access for many low- and middle-income workers.
The designated administrative agency (starting July 1, 2027) gains new responsibilities and potentially increased budget authority, but the bill does not specify which agency will be designated — creating uncertainty about implementation capacity and staffing needs.
The State Treasury gains a new dedicated trust account to manage, but the account is self-funded and exempt from appropriation, reducing future budgetary pressure while increasing operational responsibility for investment and disbursement.