Philly Passes Auto-IRA Bill as Alaska Vetoes Similar Measure

Philadelphia has become the first U.S. city to create a board to oversee a government-facilitated retirement savings program, while Alaska’s attempt to implement a similar measure failed after the governor vetoed the legislation.

In January, Philadelphia Mayor Cherelle Parker signed a bill establishing the Philadelphia Retirement Savings Program, known as PhillySaves. This system will automatically enroll workers who lack access to an employer-sponsored plan into a city-sponsored IRA. Employers must facilitate payroll deductions for the program but do not have to fund employee contributions. The legislation required a separate ballot measure to proceed.

On May 19, more than three-quarters of Philadelphia voters approved the measure. Voters approved the creation of the Philadelphia Retirement Savings Board by a 78.4% margin, surpassing the simple majority needed to move forward. This approval makes the city the third in the nation to authorize such a program, following Seattle and New York, though those cities did not implement their plans after state programs launched.

Philadelphia-based businesses or nonprofits operating for at least two years and not offering a 401(k), pension, or other retirement plan will be required to enroll their workers in PhillySaves. Employees will default to having between 3% and 6% of their wages automatically deferred into either a traditional or Roth IRA, though they may opt out. The program is scheduled to be operational by July 1, 2027.

As of June 1, 2026, 22 state-facilitated retirement saving programs have been enacted, with 17 active and holding $3.26 billion in retirement savings.

Alaska Measure Fails

The Alaska House of Representatives passed a bill to create the Alaska Work and Save program on June 18, the day before Philadelphia voters approved their measure. The bill passed the House by a 31-to-9 vote after previously clearing the Senate 15-to-4.

However, Governor Mike Dunleavy vetoed the bill on June 19, arguing that the program places an administrative burden on employers. He wrote in a letter to Senate President Gary Stevens that Alaska businesses should not be required to administer a state-run investment program when private options exist. The governor noted that while employees may opt out, the bill relies on automatic enrollment.

Alaska State Senator Cathy Giessel moved to override the veto on June 19, but the combined legislature fell short. The override vote resulted in a 39-to-21 tally, one vote short of the two-thirds majority required to pass it. Of the representatives who had initially supported the bill, seven refused to vote to override the governor’s veto.

For workers in Alaska, the failed legislation means the state will not step in to fill the gap for those without private retirement plans. Without a mandate from the governor, private sector employees in the state remain dependent on existing employer offerings or personal savings strategies, leaving the state’s retirement security infrastructure unchanged for the foreseeable future.