There is a Maryland Small Business Retirement Savings Board. The Board is a body politic and corporate and is an instrumentality of the State. Except as provided in subparagraphs (ii) and (iii) of this subsection, the Board is not subject to any law, including § 6–106 of the State Government Article, that affects governmental units. The Board is subject to: the Open Meetings Act; and the Public Information Act. The Board and its employees are subject to the public ethics law. The Board consists of the following members: the State Treasurer, or the State Treasurer’s designee; the Secretary of Labor, or the Secretary’s designee; the Comptroller, or the Comptroller’s designee; and nine members with expertise in retirement programs and benefits, investments, financial systems and controls, or small business, appointed as follows: three members, appointed by the Governor; three members, appointed by the President of the Senate; and three members, appointed by the Speaker of the House of Delegates. The term of a member is 4 years. The terms of members are staggered as required by the terms provided for members of the Board on July 1, 2016. At the end of a term a member continues to serve until a successor is appointed and qualifies. A member who is appointed after a term has begun serves only for the rest of the term and until a successor is appointed and qualifies. The Board shall elect a chair from among the members of the Board. The appointing authority may remove a member whom the appointing authority appointed, for incompetence or misconduct.

The Board shall meet at the times and places that the Board determines. The Board may employ a staff and may hire consultants, administrators, and other professionals as necessary to help implement, maintain, and administer the Program and the Trust. All expenses, including employee costs, incurred to implement, maintain, and administer the Program and the Trust shall be paid from money collected by or for the Program or the Trust. Consistent with its fiduciary duties, the Board may enter into an agreement to borrow funds from the State or any other entity to provide funding for the operation of the Program until the Program can generate sufficient funding for operations through fees assessed on Program accounts.

The Board, the Program administrator, and staff shall discharge the duties with respect to the Trust solely in the interest of the Program participants as follows: for the exclusive purposes of providing benefits to Program participants and defraying reasonable expenses of administering the Program; and by selecting investment options or programs that will invest with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with those matters would use in the conduct of an enterprise of a like character and with like aims. The Board shall prepare, adopt, and annually review a written statement of investment policy that includes a risk management and oversight program. The investment policy shall consider investment options or programs that will seek to mitigate risk by maintaining a balanced investment portfolio that provides assurance that no single investment or class of investments will have a disproportionate impact on the total portfolio. The risk management and oversight program shall be designed to ensure that an effective risk management system is in place to monitor the risk levels of the Program investment portfolio and ensure that the risks taken are prudent and properly managed.

In addition to the powers and duties set forth elsewhere in this title, the Board: shall cause the Program or payroll deposit IRA arrangements established under the Program to be designed, established, and operated; shall appoint a Program administrator and determine the duties of the Program administrator; shall employ staff as necessary and set the compensation of the staff; shall make provisions for the payment of costs of administration and operation of the Trust; shall evaluate and establish the process for an employee to contribute automatically to the Program; shall evaluate and establish the process for a participating employer to provide a payroll deposit retirement savings arrangement for covered employees and to forward the employee contribution and related information to the Program or its agents, which may include financial services companies and third–party administrators with the capability to receive and process employee information and contributions for payroll deposit retirement savings arrangements or other arrangements authorized by this title; shall design and establish the process for the enrollment of Program participants; shall evaluate and establish a range of investment options, including a default investment selection for employees’ payroll deposit IRAs; may procure insurance against any loss in connection with the property, assets, or activities of the Trust, and secure private underwriting and reinsurance to manage risk; shall procure insurance indemnifying each member of the Board from personal loss or liability resulting from a member’s action or inaction as a member of the Board; shall set minimum and maximum employee contribution levels in accordance with contribution limits set for IRAs by the Internal Revenue Code; may arrange for collective, common, and pooled investment of assets of the Program or arrangements, including investments in conjunction with other funds with which those assets are authorized to be collectively invested, with a view to saving costs through efficiencies and economies of scale; shall determine the allocation of administrative fees to individual retirement accounts; shall explore and establish investment options that offer employees returns on contributions and the conversion of individual retirement savings account balances to secure retirement income without incurring debt or liabilities to the State; shall determine the eligibility of an employer, employee, or any other individual to participate in the Program; and may evaluate and establish the process by which a noncovered employer, an employee of a nonparticipating employer, or a self–employed individual may enroll in and make contributions to the Program. The Board shall adopt regulations and take any other action necessary to implement this title consistent with the Internal Revenue Code and regulations issued in accordance with the Internal Revenue Code to ensure that the Program meets all criteria for federal tax deferral or tax–exempt benefits or both. The Board shall take any action necessary to ensure that the Program is not preempted by federal law.

The Board shall establish procedures and disclosures to protect the interests of participants and employers. Before opening the Program for enrollment, the Board shall design and disseminate to employers and employees information regarding the Program. The information provided shall include background information on the Program and appropriate disclosures for employees, including: the benefits and risks associated with making contributions to the Program; the mechanics of how to make contributions to the Program; how to opt out of the Program; the process for withdrawal of retirement savings; how to obtain additional information on the Program; and information about alternative retirement savings options. The disclosure form shall clearly state the following: employees seeking financial advice should contact financial advisors because employers are not in a position to provide financial advice; in accordance with § 12–501 of this title, employers are not liable for decisions made by employees; the Program is not an employer–offered savings arrangement; and in accordance with § 12–502 of this title, the Program fund may be privately insured and is not guaranteed by the State. The Board shall establish procedures for: a covered employee to opt out of participation in the Program; a participating employee to opt out of participation in the Program after the participating employee has commenced participation; and an employee who has opted out of participation to participate or resume participation in the Program.

On or before August 1 each year, the Board shall submit an annual audited financial report, prepared in accordance with generally accepted accounting principles, on the operations of the Trust to the Governor and, subject to § 2–1257 of the State Government Article, the General Assembly. The annual audit shall be made by an independent certified public accountant and shall include direct and indirect costs attributable to the use of outside consultants, independent contractors, and any other persons who are not State employees.