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A former federal benefits official has been hired to bring to life New Jersey’s long-stalled push to provide a new retirement-savings option for private-sector workers.

Gov. Phil Murphy and other public officials announced several weeks ago that an executive director is in place to run the long-envisioned state-sponsored retirement plan, which has yet to be implemented several years after Murphy himself signed a law calling for its establishment.

Once up and running, the “Secure Choice Savings Program” could benefit nearly 2 million New Jersey residents and manage up to $10 billion in investments, according to the Murphy administration.

Among those who stand to benefit from the savings plan are employees of small businesses, who often lack access to the type of retirement benefits that many larger companies provide their workers, thus putting them at a savings disadvantage in a high-cost state like New Jersey.

The extended delay implementing the savings initiative has dragged on through the COVID-19 pandemic, coinciding with a period of high inflation that has only heightened financial concerns for many New Jersey residents.

Position filled

But Department of Treasury officials say progress is being made, including the late-December hiring of Todd Hassler, a former senior investigator for the U.S. Department of Labor’s Employee Benefit Security Administration.

With an annual salary of $220,000, according to public records, it’s now Hassler’s job to lead the effort to bring the envisioned savings plan to life.

“We’re excited to have him on board to lead this exciting new program that will help so many New Jerseyans save for retirement and plan for the future,” said Andrea Spalla, an assistant state treasurer who also serves as chair of the Secure Choice Savings Board.

Still, it remains to be seen exactly when the new savings option will finally debut for public enrollment. Treasury officials say no target date has been established for what will officially operate as an “in but not of” agency.

“It’s a very complex program of significant statewide magnitude, and being created from scratch,” Treasury spokeswoman Melinda Caliendo said last week.

Long to-do list

“The new executive director must hire staff, develop and run procurements for vendors, and many other tasks,” she said. “That just takes time.”

A bill seeking to establish a publicly administered retirement-savings option for private-sector workers whose companies don’t already provide one was passed by wide margins in both the Assembly and Senate in February 2019.

Sponsors of the legislation at the time cited studies that detailed ways more and more people were failing to put aside enough funds to cover a comfortable retirement, especially as medical breakthroughs and general public-health improvements were extending life expectancy.

According to AARP, which backed the retirement-savings proposal as it moved through both houses of the Legislature, roughly half of New Jersey’s working population lacks access to an employer-provided retirement account that allows them to make deposits automatically and on a pre-tax basis.

In a high-cost state like New Jersey, AARP has also estimated federal Social Security benefits are generally falling short of what the typical older family would need to cover basic expenses like food, utilities and healthcare.

Hit by high inflation

In more recent years, high annual inflation has only added to the financial challenges faced by many New Jersey residents, including those who were initially targeted for help through the retirement-savings initiative.

A survey conducted last year by the Allianz life insurance company indicated more than 50% of respondents had reduced retirement-savings contributions or stopped them altogether in response to financial pressure caused by inflation. More than 40% of respondents also said they had been forced to dip into their retirement savings due to inflation.

Under the 2019 law, the new retirement-savings option would have to be offered by businesses in New Jersey with 25 or more employees, and businesses with fewer employees than 25 employees would also be encouraged to participate. For workers, the law requires them to be automatically enrolled in the state-sponsored Individual Retirement Account, or IRA, using a standard, 3% contribution level.

But no worker would be forced to participate, according to the law, and businesses would not be required to make matching contributions. And if businesses meet the size threshold, they would be required to provide an automatic payroll deduction for either the state plan, or one they would establish on their own for their employees.

The savings program was modeled on successful state-sponsored retirement systems for private-sector workers in place in other states, including Illinois, according to AARP.

The New Jersey law called for the seating of a seven-person board that would oversee a savings program to be run by an outside investment firm that would be hired by the board.

Public records indicate New Jersey’s seven-member Secure Choice Savings Board held its initial public meeting in December 2021. The board, which continues to meet regularly, has also been provided with a $1 million appropriation from the most recent state budget, according to public records.

Nationwide candidate search

Hassler’s appointment as the inaugural executive director was approved by the board in December after it teamed up with a national recruiting firm to identify potential candidates.

“We’re thrilled to have him on board,” Evelyn Liebman, AARP New Jersey Director of Advocacy and vice chair of the board, said in a news release announcing Hassler’s appointment.

“With Todd’s appointment, New Jersey is one big step closer to making retirement security a reality for Garden State families who don’t have a way to save for their retirement at work,” Liebman said.

While working for the federal government, Hassler analyzed benefit-plan designs and investigated operational failures, according to details provided by Treasury in the news release. His resume also includes 15 years of private-sector experience overseeing retirement plans and human resources.

“I am very excited to be a part of the launch of New Jersey’s Secure Choice Savings Program,” said Hassler, who has a master’s degree in human resource development from Villanova University

“This program will provide a valuable benefit to many New Jerseyans who previously may not have had access to a retirement savings plan,” Hassler said.