AK WORK & SAVE PRGRM; PFD INVESTMENT ACCT, the official text

00Enrolled SB 21
01Establishing the Alaska Work and Save Program in the Department of Revenue; relating to 
02 depositing permanent fund dividends into investment accounts; and providing for an effective 
03 date. 
04 _______________ 
05 * Section 1. AS 43.23 is amended by adding a new section to read: 
06 Sec. 43.23.058. Deposits from dividends. (a) An applicant for a permanent 
07 fund dividend who is eligible under this chapter to receive a permanent fund dividend, 
08 or the applicant's authorized representative, may direct that the dividend payment be 
09 deposited in an investment account identified by the applicant. 
10 (b) The department shall design the permanent fund dividend application form 
11 to allow an applicant, or the applicant's authorized representative, to direct the 
12 department to make a deposit under this section and to provide the information that the 
13 department determines is necessary to implement this section. The application form 
14 must notify the applicant that the applicant assumes the risk of investments made

01 under this section. 
02 (c) The department may not use money from the dividend fund for 
03 administrative costs incurred in implementing this section. 
04 * Sec. 2. AS 43.23.130(a) is amended to read: 
05 (a) Notwithstanding AS 43.23.200, the Department of Revenue shall prepare 
06 the electronic Alaska permanent fund dividend application to allow an applicant who 
07 files electronically to direct that money be subtracted from the dividend payment and 
08 contributed to the applicant's Alaska Work and Save Program participant 
09 account (AS 44.25.400 - 44.25.490), the crime victim compensation fund 
10 (AS 18.67.162), the peace officer and firefighter survivors' fund, or one or more of the 
11 educational organizations, community foundations, or charitable organizations that 
12 appear on the contribution list contained in the application. A contribution to an 
13 Alaska Work and Save Program participant account, the crime victim 
14 compensation fund, the peace officer and firefighter survivors' fund or to an 
15 organization may be $25, $50, $75, $100, or more, in increments of $50, up to the 
16 total amount of the permanent fund dividend that the applicant is entitled to receive. If 
17 the total amount of contributions elected by an applicant exceeds the amount of the 
18 permanent fund dividend that the applicant is entitled to receive, contributions shall be 
19 deducted from the dividend in the order of priority elected by the applicant on the 
20 application until the entire amount of the dividend that the applicant is entitled to 
21 receive is allocated for contribution. The electronic dividend application form must 
22 include notice that seven percent of the money contributed will be used for 
23 administrative costs incurred in implementing this section, and money from the 
24 dividend fund will not be used for that purpose. 
25 * Sec. 3. AS 43.23.130(b) is amended to read: 
26 (b) The department shall list each educational organization, community 
27 foundation, or charitable organization eligible under (c) and (d) of this section, each 
28 university campus that applies under (l) of this section, the Alaska Work and Save 
29 Program, the crime victim compensation fund, and the peace officer and firefighter 
30 survivors' fund on the contribution list. The department shall maintain an electronic 
31 database for the contribution list that is accessible to the public and that permits

01searches by organization or fund name, geographic location, and type. The department 
02 shall provide a statement of the contributions made by an individual that is suitable for 
03 federal income tax purposes to each individual who elects to contribute under (a) of 
04 this section. 
05 * Sec. 4. AS 43.23.130(m) is amended to read: 
06 (m) In addition to the application fee in (f) of this section, the department shall 
07 withhold a coordination fee from each organization, foundation, or university campus 
08 that receives contributions under this section in the immediately preceding dividend 
09 year. The coordination fee for an organization, foundation, or university campus that 
10 receives contributions under this section shall be seven percent of the amount of 
11 contributions reported by the department under (j) of this section for the organization, 
12 foundation, or university campus for the immediately preceding dividend year. The 
13 coordination fee shall be separately accounted for under AS 37.05.142 and shall be 
14 accounted for separately from the application fee collected under (f) of this section. 
15 The annual estimated balance in the account maintained under AS 37.05.142 for 
16 coordination fees collected under this subsection may be appropriated for costs of 
17 administering this section. The department may not withhold a coordination fee for 
18 contributions to an Alaska Work and Save Program participant account, the crime 
19 victim compensation fund, or the peace officer and firefighter survivors' fund. 
20 * Sec. 5. AS 44.25 is amended by adding new sections to read: 
21 Article 5. Alaska Work and Save Program. 
22 Sec. 44.25.400. Alaska Work and Save Program. (a) The Alaska Work and 
23 Save Program is established in the Department of Revenue. The commissioner of 
24 revenue or the commissioner's designee shall administer the program. 
25 (b) An employer that does not offer a qualified retirement plan shall facilitate 
26 participation of the employer's employees in the program. 
27 (c) Under the program, 
28 (1) an eligible employee is automatically enrolled in the program at the 
29 default contribution rate established by the administrator; 
30 (2) an eligible employee's contribution rate increases at the default rate 
31 established by the administrator;

01 (3) an eligible employee may 
02 (A) opt out of the program or a contribution rate increase; 
03 (B) make contributions at a rate different than the default rate 
04 established by the administrator; 
05 (C) increase contributions at a rate different than the default 
06 rate established by the administrator; 
07 (4) any person who earns compensation in this state is eligible to 
08 voluntarily enroll in the program. 
09 (d) The state, the program, and the administrator 
10 (1) may not guarantee a specific rate of return or interest for a 
11 contribution; 
12 (2) are not liable for any loss incurred by a participant as a result of 
13 participating in the program; 
14 (3) have no proprietary interest in contributions to, or earnings on 
15 amounts contributed to, participant accounts. 
16 (e) Nothing in AS 44.25.400 - 44.25.490 prohibits an employer from 
17 establishing an alternative retirement plan for the employer's employees. 
18 Sec. 44.25.410. Purpose of program. The administrator is the trustee of all 
19 contributions and earnings on amounts contributed to participant accounts. The 
20 administrator's primary mission is to 
21 (1) develop a retirement program for employees in this state who are 
22 not offered a qualified retirement plan by an employer; 
23 (2) conduct a market and legal analysis of the program; and 
24 (3) facilitate the investment of funds contributed to participant 
25 accounts. 
26 Sec. 44.25.420. Powers and duties of the administrator. (a) The 
27 administrator shall 
28 (1) develop and administer the program; 
29 (2) adopt regulations to implement AS 44.25.400 - 44.25.490; 
30 (3) establish a process for enrollment in the program, including 
31 automatic employee enrollment and a process for an employee to opt out of the

01 program; 
02 (4) direct the investment of funds contributed to participant accounts 
03 and professionally manage participant accounts, consistent with 
04 (A) investment restrictions established by the administrator; 
05 and 
06 (B) standards of prudence; 
07 (5) provide a range of investment options and establish the rules by 
08 which a participant may direct the participant's investments among those options; 
09 (6) obtain an external performance review to evaluate the investment 
10 policies of the program and include the results in the report provided under (7) of this 
11 subsection; 
12 (7) by the first day of each regular legislative session, report to the 
13 governor and legislature on the financial condition of the program; 
14 (8) develop an annual operating budget; 
15 (9) in accordance with Internal Revenue Code limits, set a minimum, 
16 maximum, and default contribution rate and set a default rate for contribution 
17 increases; 
18 (10) allow a participant to adjust the rate of contributions to the 
19 participant's account and the rate of increases to the contribution rate; 
20 (11) establish a process to allow a participant to make contributions, in 
21 addition to the participant's contributions through payroll deduction, to the 
22 participant's account, including contributions from the participant's permanent fund 
23 dividend; 
24 (12) establish a process to allow a participant to withdraw funds from a 
25 program account; 
26 (13) deposit a contribution to the program directly in a participant 
27 account; 
28 (14) maintain separate records and accounting for each participant 
29 account; 
30 (15) provide program and account status reports to participants at least 
31 once a year;

01 (16) allow participants to maintain a program account regardless of 
02 employer; 
03 (17) keep fees assessed to defray program administration costs low; 
04 (18) disclose to employees, employers, and program participants 
05 (A) the benefits and risks of contributing to the program; 
06 (B) instructions on contributing to the program and changing 
07 contribution rates; 
08 (C) the process to opt out of the program; 
09 (D) the process to withdraw funds from a participant account; 
10 (E) how to obtain additional program information; 
11 (F) that the program is not an employer-sponsored retirement 
12 plan; 
13 (G) that financial advisors are best positioned to provide 
14 financial advice and that employers are not liable for employee financial 
15 decisions under AS 44.25.400 - 44.25.490; 
16 (H) that the state, the program, and the administrator do not 
17 guarantee participant accounts or a rate of return; 
18 (I) how an employee may file a complaint against an employer 
19 who fails to facilitate employee participation in the program; 
20 (19) to the extent practicable, develop and administer the Alaska Work 
21 and Save Program to allow employees in the state to benefit from applicable 
22 incentives for retirement savings that may be created or allowed by federal law. 
23 (b) The administrator may 
24 (1) contract for services necessary to execute the administrator's 
25 powers and duties; 
26 (2) employ outside investment advisors to review investment policies; 
27 (3) establish and collect fees to defray program administration costs; 
28 (4) consider and purchase pooled private insurance for the program; 
29 (5) develop and conduct outreach about the program and retirement 
30 savings; 
31 (6) when prudent or necessary to do so for the benefit of the program,

01enter into agreements, including contracts, memoranda of understanding, partnerships, 
02 or other arrangements, with other governmental entities, including other states, or 
03 agencies or instrumentalities of other states, that maintain or are establishing 
04 retirement savings programs compatible with or similar to the program; 
05 (7) change the default contribution rate and default rate for 
06 contribution increases; 
07 (8) use private sector partnerships to administer and invest 
08 contributions to the program; 
09 (9) access information held by, and enter into service agreements with, 
10 other departments and agencies of the state. 
11 Sec. 44.25.430. Confidentiality of information. (a) Individual account 
12 information for participant accounts, including an account holder's name, address, 
13 telephone number, personal identification information, contributions, earnings, and 
14 account balance, is confidential and not subject to disclosure as a public record. 
15 (b) The identity of an employee who files a complaint under AS 44.25.440 is 
16 confidential unless the employee waives confidentiality. 
17 (c) Notwithstanding (a) of this section, individual account information may be 
18 disclosed 
19 (1) to the extent necessary to administer the program in a manner 
20 consistent with the tax laws of the state and the Internal Revenue Code; or 
21 (2) if the account holder expressly agrees to the disclosure, in writing. 
22 Sec. 44.25.440. Employer compliance. (a) An employee may file a complaint 
23 with the administrator alleging that an employer subject to AS 44.25.400 - 44.25.490 
24 failed to facilitate employee participation in the program. 
25 (b) The administrator may investigate, in response to a complaint or on the 
26 administrator's own initiative, whether an employer is facilitating participation of the 
27 employer's employees in the program as required under this section. If the 
28 administrator determines that the employer failed to facilitate employee participation 
29 in the program, the administrator may provide advice and training to the employer. 
30 Sec. 44.25.490. Definitions. In AS 44.25.400 - 44.25.490, 
31 (1) "administrator" means the commissioner of revenue or the

01 commissioner's designee; 
02 (2) "employee" has the meaning given in AS 23.30.395; 
03 (3) "employer" means a person or business that has employed more 
04 than five other persons in the state for not less than three years and does not provide a 
05 qualified retirement plan to employees; 
06 (4) "program" means the Alaska Work and Save Program; 
07 (5) "qualified retirement plan" includes a plan qualified under 26 
08 U.S.C. 401(a) or (k), 403(a) or (b), 408(k) or (p), or 457(b) (Internal Revenue Code). 
09 * Sec. 6. This Act takes effect January 1, 2027.