HARTFORD, Conn. (AP) — Dorry Clay, a small business owner unable to save for retirement, is counting on the Connecticut legislature to establish a state-run retirement savings account accessible to millions of workers.
Lawmakers in Connecticut and other states are responding to a widespread loss of private-sector pensions, a lack of access to employer-sponsored retirement accounts in smaller businesses and stagnant incomes that make it hard for workers to contribute to their own retirement plan or company account.
The measures vary in their details, but the general aim is to establish a retirement fund in a state agency that would collect employee contributions, invest the money and pay out benefits when employees retire.
Financial services businesses are fiercely lobbying to defeat the proposals, calling the proposed state-run enterprises unnecessary and a threat to private business. Opponents already have claimed one victory this year, knocking off a public retirement system proposed in the West Virginia Legislature.
Clay, 54, says her savings ran out after she lost a job and was diagnosed with cancer. Now, as a business owner, she says she has "no feasible way" to save for retirement and worries she'll have to work into her 70s.
"You can do everything right, go to school, be talented, work and things happen," she said.
Catherine Ernsky, president of the Connecticut financial planning firm Ernsky Group, said financial planning services can tailor retirement plans without the state's help.
Business lobbyists also are fighting the proposal, with the Connecticut Business and Industry Association putting the legislation at the top of its list of legislative targets. Lou Tashash, owner and president of R-D Manufacturing Inc., a precision sheet manufacturer employing 14 workers in East Lyme, sees it as a burdensome mandate.
"We already have a system in place that Connecticut is proposing. It's called Social Security," he said. "Why does the state feel it has to do something that's already on the federal level?"
Details still are being worked out before Connecticut's legislative session ends at midnight Wednesday. Gov. Dannel P. Malloy supports the ideals behind the bill, a spokesman says, but his administration is negotiating with legislative leaders "on the best way forward."
Continue reading this story on the...