The purpose of this chapter is to create a vehicle through which all employees of the State may, on a voluntary basis, provide for additional retirement income security through a program of deferred compensation. The deferred compensation program provided by this chapter shall be in addition to any retirement or other benefit program provided by law for employees of the State.

60 Del. Laws, c. 146, §  1; 

As used in this chapter:

(1) “Board” shall mean the Plans Management Board pursuant to § 2722 of this title.

(2) “Deferred compensation” means income earned as a public officer or employee of the State which, pursuant to a written agreement between the State and the employee, is set aside for retirement purposes.

(3) “Deferred compensation program” means such plans to allow deferred compensation pursuant to §§ 457, 403(b) and 401(a) of the Internal Revenue Code [26 U.S.C. §§ 457, 403(b) and 401(a)], as may be adopted by the Board.

(4) “Employee” means an individual who is employed by the State, including elected or appointed officials, and who receives compensation wholly or in part directly from the State Treasury or through an agency within the State that is wholly or in part supported by the State. The term “employee” includes employees of the Delaware Transit Corporation and Delaware Solid Waste Authority. Individuals hired as consultants shall not qualify as employees.

(5) “Qualified participant” is defined as an employee of the State, including school districts, who has deferred compensation under the provisions of this chapter and satisfies either of the following conditions:

a. Employee must be enrolled in the deferred compensation program for no less than 6 consecutive months immediately preceding receipt of the match;

b. Employee has deferred the maximum allowable by the Internal Revenue Service within the 6 months preceding receipt of the match.

60 Del. Laws, c. 146, §  1;  72 Del. Laws, c. 488, §  1;  80 Del. Laws, c. 295, §  3;  84 Del. Laws, c. 154, § 1; 

As used in this chapter:

(1) “Automatic enrollment” means a provision in the state plan under 26 U.S.C. § 457(b) under which an employee is treated as having elected to have the employer make a specified contribution to the plan equal to a percentage or fixed amount of compensation until the employee affirmatively elects to opt out of automatic enrollment.

(2) “Board” shall mean the Plans Management Board pursuant to § 2722 of this title.

(3) “Covered employee” includes any person who is a new employee and who is eligible for automatic enrollment under the terms of the plan. Covered employee does not include any employee who is covered by a collective bargaining agreement unless automatic enrollment into the 457(b) [26 U.S.C. § 457(b)] plan is expressly authorized by the employee’s collective bargaining agreement.

(4) “Default contribution rate” means the percent of compensation that a covered employee contributes to the employee’s 457(b) [26 U.S.C. § 457(b)] account from and after automatic enrollment and until such time as the employee affirmatively elects to make a contribution in a different amount.

(5) “Default investment” means the investment in a qualified default investment alternative selected by the Board that is purchased with a covered employee’s contributions from and after automatic enrollment and until such time as the employee affirmatively elects a different investment option.

(6) “Deferred compensation” means income earned as a public officer or employee of the State which, pursuant to a written agreement between the State and the employee, is set aside for retirement purposes.

(7) “Deferred compensation program” means such plans to allow deferred compensation pursuant to §§ 457, 403(b) and 401(a) of the Internal Revenue Code [26 U.S.C. §§ 457, 403(b) and 401(a)], as may be adopted by the Board.

(8) “Employee” means an individual who is employed by the State, including elected or appointed officials, and who receives compensation wholly or in part directly from the State Treasury or through an agency within the State that is wholly or in part supported by the State. The term “employee” includes employees of the Delaware Transit Corporation and Delaware Solid Waste Authority. Individuals hired as consultants shall not qualify as employees.

(9) “New employee” means any person who becomes an employee from and after [the date of fulfillment of the contingency in 85 Del. Laws, c. 399, § 4]. New employee includes employees who have left and then returned to State employment, including post-retirement.

(10) “Qualified participant” is defined as an employee of the State, including school districts, who has deferred compensation under the provisions of this chapter and satisfies either of the following conditions:

a. Employee must be enrolled in the deferred compensation program for no less than 6 consecutive months immediately preceding receipt of the match;

b. Employee has deferred the maximum allowable by the Internal Revenue Service within the 6 months preceding receipt of the match.

60 Del. Laws, c. 146, §  1;  72 Del. Laws, c. 488, §  1;  80 Del. Laws, c. 295, §  3;  84 Del. Laws, c. 154, § 1;  85 Del. Laws, c. 399, § 1; 

60 Del. Laws, c. 146, §  1;  69 Del. Laws, c. 64, §  84;  75 Del. Laws, c. 88, §  20(6);  75 Del. Laws, c. 350, §  163;  repealed by 80 Del. Laws, c. 295, § 3, eff. July. 1, 2016.; 

(a) All plans of deferred compensation which may be adopted shall provide that each participating employee will be furnished a quarterly statement of the employee’s account, on a form approved by the Board, showing at least the amount of income deferred, the investments purchased and the charges assessed on such purchases.

(b) Each plan of deferred compensation which may be adopted shall provide that in the event of nonrenewal or termination, all accounts enrolled in the plan, including all records, investments and proceeds thereof, shall be transferred to an agent designated by the Board.

60 Del. Laws, c. 146, §  1;  70 Del. Laws, c. 186, §  1;  80 Del. Laws, c. 295, §  3; 

The Department of Finance and the State Treasurer are authorized to make payroll deductions under this chapter pursuant to regulations adopted by the Board for any public officer or employee of the State who has authorized such deductions in writing. The Treasurer of the State shall account for all such payroll deductions and shall make payment of such deductions in accordance with regulations adopted by the Board. Any income deferred under such a plan shall continue to be included as regular compensation for the purpose of computing the contributions to and benefits from the State Employees’ Pension Plan, any pension plan for members of the state judiciary and any pension plan for members of the State Police. Unless subject to the provisions of § 6062 of this title, any sum so deferred shall not be included in the computation of any federal or state income taxes withheld on behalf of any such employee, but shall be included for computation of Social Security Administration contributions.

60 Del. Laws, c. 146, §  1;  64 Del. Laws, c. 433, §  1;  80 Del. Laws, c. 295, §  3; 

The Office of Management and Budget is authorized to make payroll deductions under this chapter pursuant to rules or procedures adopted by the Board for any public officer or employee of the State who has authorized such deductions in writing, or who has been automatically enrolled under this chapter. The Treasurer of the State shall account for all such payroll deductions and shall make payment of such deductions in accordance with applicable law and regulations. Any income deferred under such a plan shall continue to be included as regular compensation for the purpose of computing the contributions to and benefits from the State Employees’ Pension Plan, any pension plan for members of the state judiciary and any pension plan for members of the State Police. Unless subject to the provisions of § 6062 of this title, any sum so deferred shall not be included in the computation of any federal or state income taxes withheld on behalf of any such employee, but shall be included for computation of Social Security Administration contributions.

60 Del. Laws, c. 146, §  1;  64 Del. Laws, c. 433, §  1;  80 Del. Laws, c. 295, §  3;  85 Del. Laws, c. 399, § 2; 

Any provision of this chapter notwithstanding, the maximum amount of income which any 1 employee may elect to defer after June 30, 1975, shall not exceed the limit established by the Internal Revenue Service.

60 Del. Laws, c. 146, §  1;  70 Del. Laws, c. 186, §  1;  71 Del. Laws, c. 354, §  39; 

The deferred compensation program may offer any of the following investment options and none other:

(1) Savings accounts in federally insured banking institutions.

(2) United States government bonds or debt instruments.

(3) Life insurance and annuity contracts, provided the companies offering such contracts are subject to regulation by the Insurance Commissioner of the State.

(4) Investment funds registered under the Investment Company Act of 1940.

(5) Securities which are traded on the New York Stock Exchange National Association of Securities Dealers Automated Quotations (NASDAQ) and American Stock Exchange.

60 Del. Laws, c. 146, §  1;  72 Del. Laws, c. 204, §  14; 

60 Del. Laws, c. 146, §  1;  repealed by 80 Del. Laws, c. 295, § 3, eff. July 1, 2016.; 

60 Del. Laws, c. 146, §  1;  74 Del. Laws, c. 68, §  81;  repealed by 80 Del. Laws, c. 295, § 3, eff. July 1, 2016.; 

The Board is hereby authorized and directed to establish a plan pursuant to § 401(a) of the Internal Revenue Code of 1986 (26 U.S.C. § 401(a)), as amended.

72 Del. Laws, c. 488, §  2;  80 Del. Laws, c. 295, §  3; 

Commencing January 1, 2001, and each pay period thereafter, an amount equal to 100 percent of the voluntary contribution of every qualified participant, not to exceed $10 per pay period, shall be credited to the § 401(a) [26 U.S.C. § 401(a)] account of each qualified participant making a voluntary deferral under the provisions of this chapter. The employer contribution shall be remitted each pay period by the State Treasurer from an appropriation authorized for this purpose.

Modifications to the match amount per pay period, percentage of contribution matched, number of pay periods per year to be matched and other fiscal and operational aspects of the program are contingent upon funding by the General Assembly and may be administered through rules and regulations promulgated by the Board and pursuant to § 401(a) of the Internal Revenue Code (26 U.S.C. § 401(a)).

72 Del. Laws, c. 488, §  3;  77 Del. Laws, c. 84, § 7(d);  80 Del. Laws, c. 295, §  3; 

(a) The Board shall ensure that 26 U.S.C. §§ 403(b) and 457(b) retirement plans allow participants the option to designate their contributions into the plans as Roth contributions.

(b) The Office of Management and Budget shall make all necessary changes to the state employee payroll system necessary to facilitate the addition of a Roth option to state 403(b) and 457(b) retirement plans for state employees.

(c) The State Treasurer shall take all necessary steps to facilitate the addition of a Roth option to state 403(b) and 457(b) retirement plans.

79 Del. Laws, c. 372, §  1;  80 Del. Laws, c. 295, §  3; 

(a) Notwithstanding anything to the contrary in § 5106 of this title, a covered employee who does not opt out shall be automatically enrolled into the 457(b) [26 U.S.C. § 457(b)] plan at the default rate specified by the Board pursuant to subsection (b) of this section.

(b) The initial default contribution rate shall be established by the Board. The initial default contribution rate may be changed by the Board from time to time. The initial default contribution rate may not be less than 3% of compensation. The Board may determine in its discretion to increase the automatic default contribution rate for all covered employees based on their years of participation, provided that such increases may be either 1% or 2% of compensation and shall not occur more frequently than annually. The maximum default contribution rate established by the Board may not exceed 15% of compensation. The initial or subsequent default contribution rates shall apply to all covered employees who do not affirmatively select a different initial or subsequent contribution rate. All contribution rates are subject to the dollar limits on contributions provided by law. A covered employee shall have the right to change the contribution amount or cease participating in the plan, subject to rules adopted by the Board.

(c) Contributions shall be invested in the default investment unless the covered employee affirmatively elects to invest some or all balances in one or more approved investment options offered in the 457(b) [26 U.S.C. § 457(b)] plan. Contributions normally shall start within 90 days of employment, subject to the new employee’s right to opt out. The Board shall select an age-appropriate target date fund as the default investment. A covered employee shall have the opportunity to change investments for future contributions or existing balances or both, subject to rules adopted by the Board. A covered employee who wishes to cease contributions and obtain a refund of amounts contributed to the plan pursuant to automatic enrollment must opt out of the plan and request the return of the employee’s account balance within the deadline established by the Board, which deadline may not exceed 120 days from the date of employment.

(d) (1) The Board must provide every covered employee with advance notice that includes all of the following:

a. A notification of the covered employee’s impending automatic enrollment into the 457(b) [26 U.S.C. § 457(b)] plan, the default contribution rate, and the investments purchases that will be made in the absence of the employee’s affirmative election.

b. A description of the rules and procedures for opting out of automatic enrollment.

c. A description of the rules and procedures for changing the contribution amount.

d. A description of the rules and procedures for selecting a different investment option.

e. A description of all investment options available under the plan.

f. A description of the rules and procedures for requesting the return of the employee’s account balance and the consequences of failing to make such request by the deadline established by the board.

(2) The Board or its designee shall provide notice required under this section to new employees as soon as practicable after the start of employment.

(e) The Board shall determine whether contributions to default investment options are pre- or post-tax.

(f) Covered employees who opt out of automatic enrollment may at a later date affirmatively elect to participate in the deferred compensation program.

(g) Any agency or other entity with covered employees must provide all employee data necessary for automatic enrollment.

(h) The Board shall promulgate such rules, procedures, and regulations as are necessary to implement this section.

85 Del. Laws, c. 399, § 3;