403(b) Plan PETERSBURG CITY PUBLIC SCHOOLS OCTOBER 3, 2018 403(b) - - PowerPoint PPT Presentation

403(b) Plan

PETERSBURG CITY PUBLIC SCHOOLS OCTOBER 3, 2018

403(b) Background Information

 A 403(b) plan is a retirement plan for certain public school

employees

 Although the VRS provides retirement benefits, this Plan is offered to

employees as an optional supplemental plan

 Currently participant assets are invested across eight (8) vendors  Of the eight, AXA Equitable, First Investors (PenServ) and VALIC are

the most prevalent; none of the five other vendors have more than 10 participant balances

 AXA = $1.9 million, 62 participants with balance  First Investors = $668 thousand, 62 participants with balance  VALIC = $2.3 million, 230 participants with balance

 Approximately $315,000 in distributions last year

RFP Process and Goals

 PCPS desired to consolidate the 403(b) program under one

vendor

 Reduction of plan sponsor responsibilities relating to coordination

among vendors

 Simplification of service provider fee monitoring  Streamlining of investment options, facilitating improved participant

behavior and limiting investment monitoring responsibilities

RFP Process and Goals

 PCPS conducted a provider search (RFP) the with following

goals in mind:

 Improved servicing for both PCPS and plan participants

 Outsourcing and automation of plan administrative tasks where possible  Enhanced participant enrollment/education services, whether in-person

• r multimedia

 Intuitive website for participants and administrators

 Competitive fees considering overall “value proposition”  Streamlining of investment options combined with increased flexibility

in regard to selection

RFP Process and Goals

 Initially requested proposals from 9 providers, all of whom

declined to proposed

 PCPS reissued the RFP to AXA Equitable, PenServ, and

VALIC as they are the Plan’s top 3 current providers

 PenServ was removed from contention due to a lack of

scale in the public school market and other considerations

RFP Process and Goals

 AXA Equitable and VALIC were scored according to the criteria set

forth in the RFP

 VALIC received the top score

Factor Points

Quality of Plan Administration Services 10.0 Commitment to/Quality of Employee Education Program 20.0 Breadth, Depth and Quality of Investment Platform 10.0 Quality of Services for Plan Participant 10.0 Cost for PCPS and Plan Participants 20.0 Performance and Cost Guarantees 15.0 Offeror’s Credentials (Experience, Financial Stability, etc.) 10.0 Quality of Proposal and Overall Responsiveness of Offeror 5.0 Grand Total 100.0

Next Steps

 Notification to VALIC of contract award with a “go live” date of

1/1/2019

 Any participant may leave their asset balances with their current

provider, but all new contributions beginning 1/1/2019 must be made to a VALIC account

 VALIC will work with each participant to ensure options are

discussed and decisions made prior to the go live date

 One of our primary goals is to have more participants in the

program; VALIC has committed to an educational program to assist our employees with understanding the benefits of this supplemental retirement plan