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State Treasurer Ted Wheeler is chair of the Oregon Retirement Savings Task Force. (Faith Cathcart/The Oregonian)

(Faith Cathcart/The Oregonian)

SALEM -- The Oregon House on Wednesday approved legislation to create a state-run retirement savings program.

Under House Bill 2960, employees who aren't offered a retirement plan by their employer would be automatically enrolled in the state plan, but could opt out. The accounts would be administered through a partnership between the state treasurer's office and a private bank.

The bill passed 32-26 and how heads to the Senate for consideration.

A new retirement savings board would select a bank, which would create a program similar to an individual retirement account. The bill authorizes the board to set a default contribution rate for employees.

Proponents say the program will help reverse a precipitous decline in retirement savings statewide. More than half of all workers in Oregon have less than $25,000 saved and more than a quarter have less than $1,000, according to a 2011 study by the Oregon State Treasury. The same study showed more than 40 percent of Oregonians work for companies that don't offer retirement savings plans.

"The Retirement Security Bill provides an attractive option to small business owners who would like to offer their employees a retirement plan, but cannot because of cost and administrative hassle," State Treasurer Ted Wheeler said in a statement Wednesday.

Opponents of the bill say it could conflict with federal laws regulating private pension plans and impose costs on businesses.

"Let's cut through the politics and deal with the reality that is before us: we have an income problem in Oregon. People in Oregon aren't saving enough for retirement because they aren't making enough money," House Minority Leader Mike McLane, R-Powell Butte, said in a statement. "We want to be able to raise the income of Oregonians because we have a government that partners with our communities and businesses, not against them."

-- Ian K. Kullgren

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