Utica Teachers’ Association President Larry Custodero told the school board on Tuesday of the opposition, armed with 400 signatures. The Utica Observer-Dispatch reports that Custodero said the board’s recommended choice of Confidential Planning SmartChoice as the exclusive third-party adviser doesn’t leave room for the union to have its say.
“This proposed exclusive breaks with decades of past practice in offering employees choice of investment companies,” said teacher David Schiavi, who also is a financial adviser and works with district employees, according to the news report.
Business Official Maureen Albanese said she recommended Confidential Planning because it would not charge the district for its services while other vendors will. However, district employees believe the district will not be charged because fees will be passed to them.
The board is scheduled to hear presentations at its meeting next week from two other vendors before it will make a decision.
New 403(b) regulations effective January 1 have led many plan sponsors to pare down vendor offerings (see The New 403(b) Model: Exclusive versus Multiple Vendor Programs). Such decisions are prone to participant backlash.
In October, Baltimore County’s school board unanimously voted down a recommended contract with Lincoln Financial Group to be the system’s exclusive 403(b) provider (see Baltimore School Officials Give Thumbs Down on 403(b) Vendor Consolidation).