Maximize Americans' Retirement Security Act

Bill: 118-s-1563
Sponsor: full_name: Sen. Braun, Mike [R-IN]
Introduced: 2023-05-11
Policy area: Labor and Employment
Latest action: action_date: 2023-05-11
text: Read twice and referred to the Committee on Health, Education, Labor, and Pensions.

Summaries:
action_date: 2023-05-11
action_desc: Introduced in Senate
text: <p><strong>Maximize Americans' Retirement Security Act</strong></p> <p>This bill revises the fiduciary duties for a retirement or employee benefit plan that is regulated under the Employee Retirement Income Security Act of 1974.</p> <p>The bill generally requires a fiduciary to select and maintain investments for a plan based solely on pecuniary factors. Under the bill, a <i>pecuniary factor </i>is a factor that is expected to have a material effect on the risk or return of an investment based on appropriate investment horizons that are consistent with the plan's investment objectives and funding policy.</p> <p>A fiduciary may only use nonpecuniary factors if the fiduciary is unable to distinguish between investment alternatives on the basis of pecuniary factors alone. In such a case, the fiduciary must provide specified documentation to the plan's participants and beneficiaries, including an explanation of how the chosen nonpecuniary factors are consistent with their interests.</p>

tv_txt: II 118th CONGRESS 1st Session S. 1563 IN THE SENATE OF THE UNITED STATES May 11, 2023 Mr. Braun (for himself, Mrs. Blackburn , Mr. Cruz , Mr. Budd , Mr. Tuberville , Mr. Wicker , Mr. Marshall , Mr. Daines , and Mr. Cassidy ) introduced the following bill; which was read twice and referred to the Committee on Health, Education, Labor, and Pensions A BILL To amend the Employee Retirement Income Security Act of 1974 to clarify the fiduciary duty of plan administrators to select and maintain investments based solely on pecuniary factors, and for other purposes.

1. Short title This Act may be cited as the Maximize Americans' Retirement Security Act . 2. Fiduciary duty regarding the consideration of certain factors in investment decisions for employee benefit plans (a) In general Subsection (a) of section 404 of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1104 ) is amended by adding at the end the following new paragraph: (3) (A) The duties under paragraph (1) shall include the duty to select and maintain investments based, except as provided in subparagraph (B), solely on pecuniary factors. (B) Notwithstanding subparagraph (A), when choosing between or among investment alternatives that a fiduciary is unable to distinguish on the basis of pecuniary factors alone, the fiduciary may use non-pecuniary factors as the deciding factor in the selection or maintenance of an investment if the fiduciary furnishes to participants documentation on the following: (i) Why pecuniary factors were not sufficient to select or maintain the investment. (ii) How the investment compares to the alternative investments with regard to— (I) the composition of the investments of the plan with regard to diversification; (II) the liquidity and current return of the investments of the plan relative to the anticipated cash flow requirements of the plan; and (III) the projected return of the investments of the plan relative to the funding objectives of the plan. (iii) How the chosen non-pecuniary factor is consistent with the interests of participants and beneficiaries in their retirement income or financial benefits under the plan. (C) For purposes of this paragraph, the term pecuniary factor means a factor that a fiduciary prudently determines is expected to have a material effect on the risk or return of an investment based on appropriate investment horizons consistent with the plan's investment objectives and the plan's funding policy established pursuant to section 402(b)(1). . (b) Effective date The amendment made by this section shall apply to investments made after the date that is 60 days after the date of enactment of this Act.