 Welcome, Representative Mary Calfen Stone and I'm Barbara Rachel Sen. We are the district legislators for Chittenden 14. And we welcome you here tonight. We're so excited to have CCTV here recording this and have the opportunity to reach so many Berlin Tonians. Because we've heard how much people want to hear about the exciting New Vermont States program. And I'm going to turn it over to you, Mary Catherine, to talk about our exciting speaker. Yes, and we are honored to have our state treasurer, Mike Pichek, here with us tonight to talk more about Vermont Saves, an exciting new retirement plan that passed through the legislature this past session. Just to tell you a little bit about Mr. Pichek, Treasurer Pichek served six years as the commissioner of the Vermont Department of Financial Regulation where he was first appointed by Governor Shumlin in 2016 and reappointed by Scott in 2017. He has quite a lengthy resume prior to his public service. He practiced law in New York City gaining experience in commercial transaction, corporate governance, and investment in financing transactions. He grew up in Brattleboro and graduated cum laude from Union College with a degree in political science. He then went on to get his law degree from University of Miami School of Law. He currently resides in Wanooski, Vermont with his partner, Will, and his beautiful English setter, Jetty. Without further ado, I'll hand the mic over to Treasurer Pichek. Thank you. Well, thank you, Mary Catherine. Thank you, Barbara, very much. It's a pleasure to be here with you. I appreciate you putting this together. I appreciate CCTV being here as well. It's really important and critical, really, in this time to be able to get community forums like this and to get information out through local access television. So I really appreciate the opportunity to do that here this evening. So I do also want to thank Mary Catherine and Barbara because they mentioned that Vermont Saves went through the legislative process this year, and we were very excited to have their support and very excited that Vermont Saves passed unanimously in both the Senate and in the House of Representatives and was signed into law by Governor Scott. So we want to talk a lot about that this evening, but I also just want to talk maybe a little bit about our office more broadly as well. The Treasurer's Office has a lot of core responsibilities around retirement security for individuals who are teachers and state employees and municipal workers, both current workers and those who are retired. We have a lot of responsibility around managing the state's investments and the state's cash and making sure we pay our bills and making sure that we're making wise investments with our state's money. We've used that opportunity to also recently announce a 55.5 million dollar investment in affordable housing just a couple of weeks ago that we're really excited about and that's expected to combine with another $340 million of public and private capital to support about 1100 units of new housing in Vermont. So anything that really fundamentally ties back to our economy, ties back to our state revenues, our office is going to take an interest in it. So we're always eager and willing to listen to anyone that has ideas about ways that we can improve Vermont's economy. So I encourage you to reach out to our office and to myself. But one of those areas that impacts our economy really fundamentally is retirement security. Those that are fortunate enough to have a pension with the Vermont pension system, whether as a teacher, a state employee or a municipal worker, if you've worked 25 or 30 years with the state or as a teacher, fortunately you're able to retire with a relatively stable income for the rest of your lives and have good health insurance as well. About 75% of retirees that leave the education system or leave state employment stay here in Vermont. Every dollar that we put into the pension system turns into $7 when an individual retires and out of those $7, every dollar that's spent turns into a dollar and 80 cents of economic activity in Vermont when they receive their pension payments. So just looking at our pensions alone, we know that they're an economic driver when we give people economic security in retirement, but the inverse is also true. When people don't have security in retirement, they become dependent on state and federal programs, and those programs unfortunately have seen a tremendous amount of upswing over the past few decades, and more and more people in retirement are dependent on state and federal subsidies to make sure they can get by in retirement. When you look at the number of people who have saved for retirement across the country, it's a surprisingly low number, but when you think about it, maybe it's not all that surprising. This generation of Americans have not sort of the normal usual obligations that past generations have to be able to afford to go to school and to pay off a loan. That could be a 30-year process for a lot of young people in the United States, let alone then thinking about buying a house, which is another huge financial obligation. And then when you think about saving for retirement, it's usually an afterthought, and unfortunately when you start saving late, you lose out on a lot of opportunity for compound interest and income over the life of your career. So in Vermont, when we tried to solve for this problem and look at this problem, we understood that a large percentage of Vermonters don't have access to retirement at all through their employment. And then when you look at the data around that, it suggests that if you don't have access to retirement through your employer, then you are not saving for retirement. Ninety-five percent of people that don't have access to a workplace retirement program do not save a single penny for retirement. So if you have a pension system, if you have a 401k, then you're likely in a position to at least be able to save also to get an employer match to help sort of boost your retirement savings. But for those millions of Americans that don't have access to retirement through their workplace, they really don't know where to begin. It can be overwhelming. It can be confusing. And that was what we were trying to solve with this program called Vermont Saves. So in Vermont, we estimate about 80,000 to 100,000 Vermonters don't have access to retirement through their workplace. Those 80,000 to 100,000 individuals, that's obviously a significant percentage of our workforce. They're also overrepresented by younger Vermonters, female Vermonters, BIPOC Vermonters, Vermonters who have less education, Vermonters who are lower on the socioeconomic ladder than other Vermonters. So it's the exact kind of population that we want to make sure we're helping pull up and save for retirement so that they have a comfortable and dignified and secured retirement to look forward to when they're done working. So Vermont Saves tries to solve this problem by creating a publicly administered retirement program. It's a program that will be administered by our office through an executive director. It's a program that will be required to be signed up for, for every business and every organization that does not themselves offer a retirement program. So if you offer a 401K or a simple IRA or a pension program, then you'll be exempt from Vermont Saves. You're providing that access to retirement that we're looking for. But if you don't provide a retirement plan and many businesses can't afford to do that, it's not, it's not an indictment on them by any means. It's expensive to do. So if you're a smaller business that doesn't provide for retirement, then you'll be required to sign up for Vermont Saves. There's no cost to the business for signing up for Vermont Saves. They'll have to basically sign up as a business. They'll have to put their employee information in. They'll have to put their payroll information in. We went through it as an office to try to understand the burden that it would be on a small business. And the program was very sort of user friendly and very understandable. So we were taking great comfort in that. And it takes on average 15 or 20 minutes to sign up, even less from some of the states that have moved forward on a program like this elsewhere in the country. So once the business signs up, they'll have noticed to all their employees that they are now enrolled in Vermont Saves. And they have 30 days to decide whether they want to opt out of the program or stay in the program. If they do nothing, they will automatically be enrolled in the program. If they file a form that says I want to opt out or they tell their employer that they want to opt out, they'll be removed from the program. They can be removed from the program at any time. But that first 30-day window is what is provided until the program initiates for that new employee. Once the program initiates for them, then there'll be a 5% payroll deduction coming out of their paycheck every pay period. That 5% money will go into a Roth IRA. If for some reason down the road, that employee says, boy, I understood what Vermont Saves was, but I didn't really understand its impact on my take home pay. I really need that money. They can take the principal out of the Roth IRA at any time without penalty or interest. So it also serves as an emergency savings account, although we want people to save and to keep the money in there. But we also understand there needs to be flexibility for individuals participating in the program. So if you decide 5% is too little or 5% is too much, you can move that number down to 2% to 3%. You can move it up to 10%. Whatever percentage makes the most sense for you that you're able to save for retirement. And then once the money gets put into your Roth IRA, again, you can have control over where it goes. There'll be sort of a suite of simple investment options that are things like your retirement date is 30 years down the road or 20 years down the road or 10 years down the road. Or maybe there's a stable investment account if you just want to keep your money somewhere stable for the short term. So you'll be able to make those decisions. But if you don't make a decision on that, then the money will go into the retirement account that best meets your expected retirement age, based on the information that your employer set up for you. So basically, if you're enrolled in this program, not only will you have the Roth IRA automatically set up for you, you'll have the automatic payroll deduction set up for you, you'll have the money automatically taken out of your paycheck, always accessible to you, but taken out of your paycheck, and then it will be automatically invested for your benefit. So it really provides a really simple and easy way for individual employees to start saving for themselves for their retirement. And if they end up leaving the employer, then the Roth IRA is something that they can take with them. They can put more money into the Roth IRA down the road, even if they don't have an employer that participates in Vermont saves because they've moved out of state or their employer has a 401k. If they move to another employer that has a Vermont saves program, then that Roth IRA will automatically link up to that new employer's payroll deductions. So it's really simple and easy from that perspective, too, if you're changing jobs. And we know that a lot of people in this 80,000 to 100,000 are younger people, maybe in restaurant or retail jobs, maybe they do change jobs quite a bit. So that was really important to have that easy portability between employers, which we are able to get with Vermont saves. And there's also no ongoing cost to Vermont taxpayers either. The program is fully funded out of a fee and a percentage of money is charged on the assets that are in the retirement accounts for the individuals, similar to a 401k or similar to a pension fund as well. But because they're so low on administrative burden, the cost of doing that is considerably lower than many 401ks. Hopefully, we'll see what the program is and the contract is that we'll be able to enter into in Vermont. But we hope that it will be at least around half as expensive for an individual as they might otherwise be paying individually on their own or through the expense of a workplace 401k. So we're really excited about that. And then one of the reasons that it was so important, in my perspective, to get this done this year, and again why we're so appreciative of the legislature, was that the federal government has recognized also that there's a retirement crisis in the country and they implemented certain reforms last year to try to encourage people to save for retirement. And one of the big overhauls from my perspective that they did was create this expanded federal savers credit, which will begin in the year 2027. And if you are saving money in a qualified retirement account, which Vermont saves would qualify as such, then you're eligible, depending on your income threshold, you'll be eligible for up to a $2,000 match every year, depending on how much you're saving personally for retirement. So there's a possibility that somebody that signs up for Vermont saves that's in the right income bracket, basically, that program phases out at about $70,000 or $75,000 of income. But if you're able to put aside $2,000, you very well might get a $2,000 match from the federal government every year that you're putting aside $2,000. So that will really grow and compound quickly with that kind of assistance from the federal government. And when you're thinking, how does this program going to work? And is there examples of this program working in other parts of the country? One of the reasons we were so excited about it is that there are five or six other states that have implemented a similar program, and they are seeing a great deal of success. 70 to 75% of employees are staying in their program. Those 70 to 75% of employees, on average, are saving about $2,000 a year. So we estimate in Vermont that if we get the same kind of uptake rates as these other states, and those people that are saving save in the same kind of ways that we're seeing in other states, that within about a decade out from the implementation of Vermont saves, that Vermonters will have about $1 billion of retirement savings that they did not have when the program began. And that's not even considering the potential for the federal savers credit as well. So it's a program that we view as, again, economic development. We view it as something that will be able to help people maintain a level of financial security and dignity in retirement. So in that sense, it's really an anti-poverty tool as well, and we're able to provide it in a really simple, efficient way that will not cost taxpayers ongoing expense. But ultimately, hopefully, when we get long ways down the road, like five, 10, 20 years, you'll see more people with more savings on a regular basis who are less dependent on state resources to secure themselves in retirement that will put pressure off of the Vermont budget, put pressure off of other states budgets, so that we then have more resources to invest in things that are critical for our state and our communities. So we think it's really, we're quite optimistic about the future of the program. We're really quite optimistic about the way this program will benefit individual Vermonters. We've referred to this program as a program that will have a big impact without having a big price tag. And it's the kind of program that I think we should try to replicate as much as we can. It's a program that doesn't look short-term over the next year or two, but it really looks over the next decade or two and how can we make policy decisions now that will benefit generations of Vermonters and generations of Vermont leaders. But we, as the leaders that implemented it, might ourselves not see those immediate benefits. I think it is important for us to have that longer-term vision when we're thinking about policy in Vermont. Not just on this issue, but on economic issues, on climate change, on a whole host of sort of core government functions. That longer-term approach is something that I think unfortunately often is missing both from the business world and from the public policy world. So with that, you know, be happy to take any questions if there are any questions from folks in the room. Yes, well. So attributions automatically go into a Roth IRA. Are there plans for the contribution maximums? Yeah, exactly right. So I think it's $5,500 per year for an individual that you can contribute into the Roth IRA. I think under certain circumstances, that number goes up to $7,500, but there is an annual contribution maximum for the Roth IRA. So that is relatively straightforward and simple if that employee stays with the same employer for that entire period of time. The employer and us at Vermont say is we'll need to know that the employee is not otherwise putting money aside into a Roth IRA because that's a total annual investment. We can't put 5,501 Roth IRA and then 5,500 another. And then we'll have to monitor, you know, if an employee switches jobs, how we're making sure that they're staying under that threshold amount. So there is a cap. Contribution limits are the same for an individual. Yeah, exactly right. Now, most of the people like I mentioned, you know, the $2,000 is the average. So, you know, most people are not gonna be anywhere near the contribution maximum for the year, but we wanna make sure people don't, you know, run afoul of those maximums because they are sort of self-policing and self-executing. Yeah, Barbara, yeah. Yeah, so if you're interested in saving before the age of 18, there are opportunities to do that. You just need to have parental consent oftentimes to sign up for a bank account or a savings account or an investment account. With Vermont Saves, we picked that age of 18 because it simplifies a lot of things relative to needing parental consent and whatnot. So at 18 years old, I mean, you know, basically the legal age, you can start to participate in Vermont Saves. And we want it to be as accessible as possible. So if you're a part-time, you know, employee because you work only during the summer or you work part-time during the year as you're going to school, you know, we wanna make sure that all of those employees have the option and the access to Vermont Saves. And it's our intention to make it as broad as we can. Yeah, exactly right. As long as they work for a Vermont company. So even like for a place like Brattleboro where I grew up, if you live in New Hampshire but you work for a Vermont company, you'd be eligible for Vermont Saves. So it's based on your, you know, where your employer is based rather than where you live or where your residency is. Yeah. Yeah. So it's a piggyback on that. A part-time employee, a college student that gets a job over the summer if they would qualify for these mandatory contributions. Is there a minimum number of hours that an employee would need to work? Yeah, so we in this, we need to implement rules based on the statute and we don't have that set number yet. We, you know, we wanna be mindful of very short-term employment and, you know, the burden to signing up an employee, like I said, is not great. So we lean towards accessibility, but we haven't finalized the rules, you know, after engaging in sort of a thoughtful due diligence process and engaging with stakeholders. We just hired an executive director for the program that's gonna start in the first week of October. And once she's in her job then, you know, one of the immediate tasks is to sort of start to consider that rulemaking, which will answer all of these specific questions and we'll be engaging with the industry and with sort of the public and stakeholders along that process. But, you know, if you're gonna work for a summer, you're gonna be working 500 hours, 200 hours, you know, then I would think they're going to be eligible for Vermont saves. Now, of course, they can always opt out of the program, you know, for the summer or for their, for part of the summer, for, you know, for the year or whatever they wanna do it, but we wanna make sure that there's eligibility. Yes? If the employee so chooses, can they make those contributions on a traditional basis, or do they have to be raw contributions? So, we did allow for both to be considered a traditional IRA or a Roth. We think the Roth, the Roth is a way that a lot of other states have gone, but we wanted to implement that flexibility so we could think about it more. You know, it's the pro and the con, right? Like, you invest on a pre-tax basis, you're gonna get less of a hit on your paycheck now, you're gonna pay for that some point down the road. You can't access it in the same way as you could the Roth. So I think the Roth, you know, even though it's post-tax and it would be a bigger sort of, you know, immediate hit to your paycheck, if you will, because you're, you know, you're not getting any of that benefit of the pre-tax. Having access to that money, if you run into an emergency or, you know, you need to fix your car, you need to whatever, I think there is a big benefit into that. So if we can set it up with a vendor that there's an option, we'll definitely, you know, we'll definitely pursue that. I think we'd want the default to be the Roth IRA, but I just don't know if that's possible from our vendor yet, but we're something that we're gonna look into. Yeah. When is it going into effect? Yeah, great question. So it's set to go into effect in July of 2026. So it just passed in July of 20, sorry, July of 2025, right? So it just passed in July of 2023, and then we gave ourselves two years. So we think that that timeline is something that we'll be able to meet. A number of other states have recently entered into agreements with each other. Maine and Colorado entered into an agreement on their publicly administered retirement plan. Delaware just entered into that same consortium of states. In the state of Maine, it's allowing them to set it up much more quickly than they anticipated. So once the executive director gets into place, we'll be reaching out to Colorado, to Maine, to Connecticut, to some other states that have this program that wanna partner with states. And one of the things will be the implementation timeline. Now, we'll also wanna have a pilot program maybe six months before it actually launches. So employers that are interested, they could get access to it as soon as January of 2025. And we encourage people to reach out to us if they're interested in participating in the pilot program. But we might move all of those dates ahead too if it turns out that we can substantially, with certainty, stand up the program with another state more quickly and efficiently. And right now there is a phased roll-in. So if you're, I mentioned July of 2025. So that's if you are an employer of 25 or more people and then six months later, it's sort of like 15 or more than five or more. Again, we are a relatively small state compared to these other states that have implemented their similar public retirement program. So we think we could enroll all Vermont businesses with on one date based on what we're seeing in other states. So we might move that up as well to give people access more quickly. Yeah, Barbara. Is there a wall? Yeah. Oh, yeah, for sure. Yeah, missing. That's such a great. Ha, ha, ha. Yeah. Yeah, for sure. So the Treasurer's Office, one of the things we administer is the unclaimed property program. So unclaimed property, it could be something that, if you're a young person, you might have forgotten that you put a deposit down on a rental apartment. You might have forgotten that you had a cell phone deposit or utility deposit or that you had a small bank account that your parents set up for you or you set up for yourself. And all of those things when they go dormant and the bank or the landlord or the utility company can't get in contact with you because you've moved addresses or cell phones or whatever, then eventually they turn that money over to us at the state. And it's our responsibility to reconnect you with your money. We have about $120 million of unclaimed property in the state of Vermont. There's over a million different pieces, a million different individual pieces of property. So that could be something like a penny that we have for many people. It could be a half a million dollars. It was a recent claim that we've processed and paid out. It could be physical items too, like in a social security box or items that got left behind and some other situation that needed to get turned over to us. So we had a story about someone that had family heirlooms in a security deposit box and our unclaimed property director was able to get them back to that person. And they thought they were lost and they viewed them as priceless really and it was really rewarding for them to be able to do that. Just in the last six months we had another situation where our unclaimed property director and other folks in their office went out of their way to return $22,000 to an individual who was experiencing homelessness that didn't know they had this money available to them and they were able to work with the bank to get them access to that money and do with it what they please. So missingmoney.com is the website. You just type in your name and your town or whatever amount of contact information you have. Search for yourself, for your family member. Another thing I'll mention is a pilot project that we're starting with the Department of Tax. So we basically are passive in this process. You come to us, search our website, file a claim and then we send you your check but we're trying to be more proactive with returning money to individuals. So this pilot project we've selected about 1,500 names out of the list. They're people that have a Vermont address and that have a claim that we owe them but a claim for anywhere between $200 and $225. We sent those names over to the tax department with the social security numbers that we have for them. The tax department's gonna run it through their system and every time there's a hit they're gonna provide us with their most recent mailing address through their tax filing and then we're gonna send them a letter saying be on the lookout for a check from our office in the next two weeks. You're part of a pilot program to return money to people from unclaimed property and then we'll follow up with a check two weeks later. And we're gonna monitor how many of those 1,500 names get a hit from the tax department, how many of those mailings that we send out get bounced back to us, how many of those checks that we send out eventually get cashed and based on that we're gonna decide whether we want to or not but I think the results will be good and scale that program up and basically once or twice a year run through an even larger portion of our list like maybe more like five or 10 or 15,000 names that have somewhat of a sizable amount to return like 100 to $500 and return those to people to Vermonters automatically. So we're looking for, once we get the pilot project nailed down we'll have more information out about that but looking for opportunities to partner with legislators partner with nonprofits, partner with businesses, whomever to try to bring awareness to the unclaimed property and get the money back to Vermonters. So again, if people have interest in that please feel free to reach out but the website is missingmoney.com. I think our personal website is missingmoney.vermont.gov but either website is good and the missingmoney.com website will allow you to search every treasurer's office in the country not just ours. Yeah. Yeah, David. Just a point of clarification. Is it just people that have unclaimed property or do they have business or unclaimed property? Yeah, no, it's a great question cause anyone really can have unclaimed property, right? A nonprofit, we went to the United Way of Northwestern Vermont and returned a few thousand dollar check to them within the last year. Municipalities have unclaimed property. I'm sure we're here in Burlington tonight. I'm sure the city of Burlington has unclaimed property. Businesses have unclaimed property too. So we're trying to figure out a way to also work with the Secretary of State to set up a pilot project for returning money to individual businesses also cause unlike a person who's, the name just might be John Smith or Kevin Smith and we don't know how do we determine which Kevin Smith it is. When we know it's Cocoa Plum Appliances and Brattleboro, we have a pretty good sense of who that check belongs to and who that money belongs to. So we have to balance getting the money back to people with making sure we're getting it back to the right people. But businesses are ripe I think for a pilot project like that cause they're so easily identifiable relative to some individual names. Yeah, well thank you very much for being here. Thank you. Thank you, thank you.