House Rules Committee takes up bill to open 403(b) plans of charities, schools and churches to collective investment trusts
The panel meets Nov. 9 on H.R. 1013, which would let 403(b) retirement plans buy the pooled trusts and insurance separate accounts that 401(k) plans already use. The House passed the same text in December inside a larger bill that the Senate has not taken up.
Washington. The House Rules Committee is scheduled to meet on Monday, Nov. 9, on a bill that would let the 403(b) retirement plans of charities, public schools and churches invest in collective investment trusts, according to the committee's announcement of Nov. 5. The Rules Committee sets the terms on which a bill is debated on the House floor.
H.R. 1013, the Retirement Fairness for Charities and Educational Institutions Act of 2025, was introduced on Feb. 5, 2025, by Rep. Frank Lucas, a Republican from Oklahoma, and has 24 cosponsors from both parties. The Financial Services Committee approved it 43 to 8 on May 20, 2025.
What the bill changes
Employees in 401(k) plans can already invest in collective investment trusts, pools of assets run by a bank or trust company, and in insurance company separate accounts, which are exempt from registration with the Securities and Exchange Commission. The committee's report says the exemption lets these products be offered at lower cost, and that 403(b) plans, which only charities and public educational institutions may maintain, are largely shut out of it.
The SECURE 2.0 Act of 2022 changed the tax code to allow such trusts in 403(b) plans with custodial accounts, but the securities laws must change as well, the trade publication PlanAdviser reported. H.R. 1013 amends the Investment Company Act, the Securities Act and the Securities Exchange Act to do that.
Under the bill's text, a 403(b) plan would qualify if it is covered by the Employee Retirement Income Security Act, if it is a governmental plan, or if the employer agrees to act as a fiduciary in choosing the investments offered to employees. In committee, Rep. Stephen Lynch, a Democrat from Massachusetts, proposed limiting the change to plans covered by that act; his amendment failed 23 to 28.
The House has passed it before
The same text was Section 202 of the INVEST Act, H.R. 3383, which the House passed 302 to 123 on Dec. 11, 2025. All 215 Republicans voting and 87 Democrats voted for it. The Senate referred that bill to its Banking Committee on Dec. 15, 2025, and has not acted on it since.
A Senate version, S. 424, was introduced by Sen. Katie Britt, a Republican from Alabama, with Democratic and Republican cosponsors. It remains in the Banking Committee, the legislative news service Legis1 reported. An earlier version passed the House in March 2024 as part of another capital markets bill and died in the Senate.
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