Never miss a story — sign up for PLANSPONSOR newsletters to keep up on the latest retirement plan benefits news.
Benefits October 8, 2008
Baltimore School Officials Give Thumbs Down on 403(b) Vendor Consolidation
October 8, 2008 (PLANSPONSOR.com) - At a time when
many 403(b) plans across the country are consolidating to a
single service provider to ease compliance with new IRS
rules, the Baltimore County school board voted not to follow
that path in light of protest from hundreds of employees and
the district's five labor groups.
Reported by Fred Schneyer
A Baltimore Sun news report said board members unanimously opposed the recommended contract with 403(b) provider Lincoln Financial Group, which would have moved away from the multiple vendors currently available to employees.
403(b) sponsors moving to a single-provider model say they are seeking simplified administration in light of new IRS requirements to monitor participant transactions among vendors (See The New 403(b) Model: Exclusive versus Multiple Vendor Programs ).
“What I think the board would like to see is possible scenarios of multiple vendors, certainly not going beyond the five who have … answered the requests for proposals,” said President JoAnn C. Murphy during the board’s meeting on Tuesday, according to the Sun.
About 300 people gathered at the school system
headquarters to protest the possible vendor program
change.
After the vote,Cheryl Bost, president of the teachers union, said
she was glad the board acknowledged the letters it had
received from employees about retirement plan services.
“We’re pleased that they listened and at least want to
take the time to investigate it further,” Bost told the
Sun.
As of August 8, about 5,500 employees participated in the
county’s 403(b) program.
Sign-up for PLANSPONSOR’s(b)lines – a semi-monthly update on the latest news and information for 403(b) plan sponsors and those who support them here .