[§389-5]  Hawaii retirement savings program; due diligence; establishment; payroll deduction upon election to contribute.  (a)  There is established within the department, for administrative purposes only, a Hawaii retirement savings program.  The program shall be administered by the board, in consultation with the department and the department of budget and finance.  The board may determine the time frame for development and implementation of the program; provided that prior to implementation of the program, the board shall meet the requirements of subsections (b) and (c).

     (b)  Prior to implementation of the program, the board may conduct a detailed implementation and evaluation study and perform other due diligence tasks to determine the feasibility of the program parameters established by this chapter and the resources and time needed to implement the program.  Upon completion of the study, the board shall report its findings and recommendations, including any proposed legislation and funding requirements, to the legislature.

     (c)  Upon submittal of its report to the legislature pursuant to subsection (b) and prior to implementation of the program, the board may determine the level of staffing necessary to implement the program, develop an implementation strategy and timetable, and conduct outreach efforts to potential covered employers and covered employees.

     (d)  Any covered employee may elect to contribute a portion of the employee's salary or wages to an individual retirement account provided by the program through payroll deduction.

     (e)  Beginning on a date to be determined by the board pursuant to subsection (a), a covered employer shall:

     (1)  Allow a covered employee to enroll into the program after providing the covered employee with a written notice of the employee's right to opt in; and

     (2)  For any covered employee who has opted in to the program:

          (A)  Withhold the covered employee's contribution amount from the employee's salary or wages; and

          (B)  Transmit the covered employee's payroll deduction contribution to the program on the earliest date the amount withheld can reasonably be segregated from the covered employer's assets, but no later than the fifteenth day of the calendar month following the month in which the covered employee's contribution amounts are withheld.

     (f)  The program shall establish for each enrolled employee a Roth IRA, into which the contributions deducted from an employee's payroll shall be deposited.  The board may add an option for all participants to affirmatively elect to contribute to a traditional IRA in addition to a Roth IRA.

     (g)  The contributions to and earnings on the amounts contributed to an employee's IRA under the program shall be owned by the employee.  The State and employers shall have no proprietary interest in the contributions or earnings in an employee's IRA.

     (h)  Covered employers shall not make contributions, whether matching or not, to the program.

     (i)  The board may authorize matching contributions of up to $500 per participant account from the special fund for the first 50,000 covered employees who participate in the program for twelve consecutive months after initial enrollment. [L 2022, c 296, pt of §2]