President Trump signs resolution killing state auto-IRA rule

Five states have vowed to forge ahead with plans to create retirement programs, but the president's actions may slow development in other states.
MAY 18, 2017

President Donald J. Trump on Wednesday evening signed a joint resolution killing an Obama-era regulation that encouraged states to set up retirement plans known as auto-IRAs. The Senate passed the resolution, H.J. Res. 66, on May 3. The House passed it in February. The Department of Labor had issued the regulation in question in August under former President Barack Obama. The regulation created a safe harbor under which states could establish automatic-enrollment, payroll-deduction individual retirement accounts for private-sector workers who don't have access to a retirement plan through their employer. Five states — California, Connecticut, Illinois, Maryland and Oregon — have passed legislation to create such auto-IRA programs, which mandate that employers of a certain size offer a workplace plan, which can be either a private-sector option like a 401(k) or the state auto-IRA option. Employees can opt out. These states have vowed to forge ahead with their plans, which primarily affect smaller employers, despite Mr. Trump's signing the bill to overturn the DOL regulation. Oregon, the state furthest along in implementation, plans to open its program for enrollment this year. (More: What's really behind the opposition to state auto-IRAs?) While the reversal of the DOL rule doesn't rule out the creation of auto-IRA programs by states, it makes their path forward a little more uncertain. Observers expect Mr. Trump's action to have a chilling effect on the plans being developed by other states. Around 20 states have either proposed legislation or to study program options this year, according to Georgetown University's Center for Retirement Initiatives. Significantly, because the auto-IRA rule was overturned using a mechanism called the Congressional Review Act, the executive branch can't craft a "substantially similar" replacement rule in the future. In April, Mr. Trump signed a similar resolution killing a rule that facilitated auto-IRA programs established by cities and other municipalities.

Latest News

Advisor moves: LPL welcomes $750M Osaic team, Raymond James recruits Wells Fargo duo in New York
Advisor moves: LPL welcomes $750M Osaic team, Raymond James recruits Wells Fargo duo in New York

Elsewhere in Utah, Raymond James also welcomed another experienced advisor from D.A. Davidson.

UBS loses arbitration battle in fiduciary fight over foundation funds
UBS loses arbitration battle in fiduciary fight over foundation funds

A federal appeals court says UBS can’t force arbitration in a trustee lawsuit over alleged fiduciary breaches involving millions in charitable assets.

RIA moves: NorthRock adds $800M Parkside Advisors, NFP acquires Levine Group in Tennessee
RIA moves: NorthRock adds $800M Parkside Advisors, NFP acquires Levine Group in Tennessee

NorthRock Partners' second deal of 2025 expands its Bay Area presence with a planning practice for tech professionals, entrepreneurs, and business owners.

Three easy ways to boost your firm’s impact this summer
Three easy ways to boost your firm’s impact this summer

Rather than big projects and ambitious revamps, a few small but consequential tweaks could make all the difference while still leaving time for well-deserved days off.

Hightower taps Osaic alum Scott Hadley as first chief advisory officer, expands C-suite
Hightower taps Osaic alum Scott Hadley as first chief advisory officer, expands C-suite

Hadley, whose time at Goldman included working with newly appointed CEO Larry Restieri, will lead the firm's efforts at advisor engagement, growth initiatives, and practice management support.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.