House Passage of the Virginia Saves Program is Welcome News to Small Businesses in the State

“We're thrilled the House of Delegates passed a bill that would create the Virginia Saves Program (HB 2174) yesterday, which would establish a state-run retirement savings program funded by modest payroll deductions. This is an important step to supporting small business owners and their employees in the Commonwealth who face barriers to accessing traditional retirement benefits. 

Many small business owners suffer from a retirement savings gap, which has only intensified because of the COVID-19 pandemic, particularly for businesses owned by people of color and women. Our polling has found that just 19% of small employers are able to offer a retirement plan, and we expect that number could shrink further as a result of the pandemic. The need to promote financial stability for business owners and their employees alike has never been more important. 

We know that many small business owners want to offer retirement benefits to attract and retain talented employees, but they struggle to do so due to the cost and complexity of setting up a retirement plan. Most small business owners simply don’t have the human resource or administrative staffing capacity to oversee a benefits program and lack the time and resources to navigate this on their own. It should come as no surprise that nearly two-thirds of small business owners in Virginia said they support state efforts to enact a state-administered retirement program that would automatically enroll employees of businesses without their own plan.

The Virginia Saves Program would allow our entrepreneurs and their employees to plan for their futures. And since employers are forbidden from contributing to the state-facilitated auto IRA structure, this program would protect small businesses' bottom line. We applaud the House of Delegates for passing this measure for the good of small businesses, and we encourage the Senate to act on it swiftly.”