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Chittenden Central Supervisory Union
Serving the Essex Junction, Essex Union #46, and Westford Schools

CCSU 403(b) Plan Changes

The IRS has revised regulations for 403(b) Plans, which are tax-deferred accounts that you are currently investing in through payroll deductions. The new regulations take effect on January 1, 2009, and will impact how we administer 403(b) plans going forward. Non compliance with these new rules may result in tax consequences or other risks for the employee, or in plan disqualification. Consequently, the district is reviewing its 403(b) practices and developing a plan of action in order to ensure compliance with the new regulations.

In order to comply with the new regulations and avoid tax consequences and/or plan disqualification, we are working closely with our existing investment providers to determine which providers are willing and able to comply with the new IRS rules and/or the requirements of our plan. There is a good possibility that some, if not many, of the providers currently in use may not be able or willing to comply with the new IRS regulations. Any provider who is unwilling or unable to meet the new IRS compliance rules and/or the requirements of our plan will no longer be a participating investment provider in our 403(b) Plan as of 1/1/09. This means that employees would no longer be able to make contributions (via payroll deductions) to the service provider as of 1/1/09. However, any existing funds with these providers could remain with that provider. Employees using these providers would need to select a new provider from those that are approved in order to continue participation in the district’s 403(b) Plan as of 1/1/09. We are hoping to finalize the list of approved investment providers by the end of October, 2008.

An informational meeting related to this topic was held on Thursday, June 12th at 3:30 pm in the Essex High School Auditorium.   Please click here for a copy of the PowerPoint Presentation reviewed at the meeting. 

A Transitional Advisory Committee (TAC) has been developed for the purpose of ensuring compliance with the IRS regualtions and Plan requirements in order to protect our employees from unnecesssary penalties and tax consequences.  The TAC we help ensure employees will have a variety of vendor/investment options available to them, and will assist in the development of a 403(b) Plan that best meets the individual needs of our employees.  The TAC members are as follows:

Mike Deweese, Superintendent

Grant Geisler, CFO

Deb Robbins, Executive Director of Human Resources

Kathy Barron, Director of Finance and Accounting

Jeff Goodrich, EHS

Susan Plunkett-Dunning, ADL

Kurt Sherman, Westford

Mike Mahoney, Property Services (ESP)

Denise Kerner, Property Services (ESP)

You will be receiving additional communication regarding these changes in the near future, as well as information annually on how you can benefit from investing in a 403(b) plan. In the meantime, if you have further questions, please contact Kathy Barron or Deb Robbins.