More than 50 small nonprofits have enlisted in retirement savings plans newly made available through a state program, and Treasury officials hope to use this year’s state budget deliberations to open up the program to more nonprofits.
In late 2017, Treasurer Deb Goldberg’s office invited nonprofits to adopt the Connecting Organizations to Retirement (CORE) plan, which was launched as the nation’s first state-administered multiple employer retirement program for nonprofits with 20 or fewer employees.
The idea was to make 401(k) plans available to workers whose employers might find the costs of administering their own plans prohibitive.
The state Treasury reported Tuesday that 51 smaller nonprofit employers have now adopted the CORE plan, and efforts are underway to open up the program by uncapping the 20-employee limit.
“At small employers, access to quality retirement plans is often limited due to a lack of resources,” Goldberg said 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 amendment from Representative Ann-Margaret Ferrante to the House’s fiscal 2020 state budget would have allowed nonprofits of any size to participate in the CORE plan.
Supporters of the amendment, which was not adopted by the House, said nonprofits with 20 or fewer employees make up just 4 percent of the state’s nonprofit employee population and asserted that more sizable enrollment in the plan would enable the Treasury to achieve greater economies of scale.
A Treasury official said Tuesday that efforts are underway to try to work a similar proposal into the Senate’s fiscal 2020 budget, which will be released and debated in May.
James Klocke, chief executive of the Massachusetts Nonprofit Network, which has more than 700 members and helped the Treasury launch the CORE plan, called the enrollment figure a “great milestone.”
“For many nonprofits, it’s a challenge to offer competitive employee benefits,” Klocke said. “The CORE Plan provides small nonprofits with an affordable way to invest in their employees.”