April 30, 2019; Boston Globe
For small nonprofits, establishing a retirement plan is something that must wait its turn—and sometimes that turn never comes. But in 2017, the state of Massachusetts established Connecting Organizations to Retirement (CORE), a program which to date has been used by 51 nonprofits which have 20 or fewer employees to establish 401(k) plans.
The next step planned for the program is to amend the law to open enrollment to nonprofits with more than 20 staff. Advocates argue that the program cannot achieve economies of scale enrolling only nonprofits with 20 or fewer employees because those account for only four percent of the state’s nonprofit employee population.
“At small employers, access to quality retirement plans is often limited due to a lack of resources,” said state treasurer Deb Goldberg in a statement. “The CORE Plan helps to close the retirement coverage gap within this critically important sector of the Massachusetts economy, and provides retirees and their families financial stability and security after leaving the workforce.”
An attempt to pass an amendment to the House’s fiscal 2020 state budget has failed, but a treasury official says that a similar proposal is due to be made and debated in the Senate in May.
The Massachusetts Nonprofit Network advocated for this program after it helped produce a benefits report for the Boston Foundation in 2009. Launching it still took until 2017. Let’s hope that the expansion is moved along more quickly.—Ruth McCambridge