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DIVISION MEMORANDUM 2015-03
April 22, 2015

ATTENTION: Human Resource and Benefit Officers
Participants in the 403(b) and 457 Plans
SUBJECT: Third Party Administration Transition


I. Introduction

The purpose of this memorandum is to announce an upcoming change in the third party administrator for the State's three defined contribution plans: the Alternate Retirement Program, the 403(b) Plan, and the 457 (Deferred Compensation) Plan. Every five years the Office of the State Comptroller issues a Request for Proposals for administration of our defined contribution plans. After conducting a thorough evaluation, the review committee selected Prudential Retirement® to take over administration of the Plans beginning July 1, 2015. Prudential offers a comprehensive financial education initiative with enhanced tools and lower administration costs.

Voya Financial, the current administrator, will begin the process of transferring account data and assets to Prudential's recordkeeping system at the end of June 2015. Employees currently participating in the Plans do not need to re-enroll or take any action in connection with the transition. Prudential will offer all of the same investment options.

During the transfer process from Voya to Prudential there will be a brief interval, known as a "black-out period", during which certain transactions cannot be made. For this reason, we want participants and their agencies to be aware of the schedule so that those planning to retire in June and July have sufficient time to make arrangements for deferral of vacation and sick leave.

II. Transition Schedule

The black-out period will begin at 4:00 p.m. on Monday, June 29, 2015, and is scheduled to end on July 9, 2015. Participant contributions will continue as is and will be invested according to existing asset allocations. No investment fund changes or withdrawals can be made during the black-out period.

Investment fund changes or withdrawal requests submitted late or are missing required information will be processed by Prudential after the black-out period ends.
A. Contribution Election Changes for Existing Members

Existing members in the 403(b) and 457 Plans can continue to submit contribution election changes throughout the black-out period, subject to the following schedule:

B. Agency paycheck reversals

Agencies that have a paycheck reversal request for employees with 403(b) or 457 Plan deduction codes are requested to process these reversals before June 1, 2015 or to wait until after July 9, 2015 to do so.

III. Deferral of Vacation and Sick Pay for June 1 and July 1 Retirees

Employees who are retiring may want to reduce the taxes on their final paycheck by deferring some of their vacation and sick payouts to the 403(b) or 457 Plan. This process is described in the Healthcare Policy & Benefit Services Division Memorandum 2014-02.

June and July retirees who want to make a deferral of vacation and sick leave should set up an account with Voya in the 403(b) or 457 Plan (if they have not already done so) no later than May 2015. It is recommended that paper forms be used to record your deferral of vacation and sick leave payouts during the transition period.

The deadlines for June and July retirees on a bi-weekly pay schedule are shown below. Employees with other pay frequencies should consult the attached payroll cutoff schedule for applicable deadlines.

A. June 1st Retirees:

For those retiring June 1st, the final check date for bi-weekly payees should be June 26, 2015; however, be sure to check with your payroll officer before submitting your forms. For the June 26th paycheck, all necessary forms must be received in good order by Voya by May 26, 2015. The required forms are: a New Enrollment Form (if you are not a current member of the 403(b) or 457 Plan) and either the "Participation Agreement Form" for the 457 Plan or the "Salary Deferral Agreement" for the 403(b) Plan. Make sure to insert the date of your final paycheck in the space entitled "effective check date", just under the amount of your deferral.

If your vacation and sick leave deferrals to the 457 Plan will cause your calendar year contributions to exceed $18,000, you must check off the Age 50 catch-up option on the "catch up contribution election" section of the Participation Agreement Form," and fill in your Normal Retirement Age (your current age) and insert "2015" as the year in which your will attain your Normal Retirement Age.

B. July 1st Retirees

For those retiring July 1st, the final check date should be July 24, 2015; however, check with your payroll officer before submitting your forms. All necessary forms must be received in good order by Voya by June 23, 2015. The required forms are; a New Enrollment Form (if you are not currently participating in the 403(b) or 457 Plan) and either the "Participation Agreement Form" for the 457 Plan or the "Salary Deferral Agreement" for the 403(b) Plan. Make sure to insert the date of your final paycheck in the space entitled "effective check date", just under the amount of your deferral.

If your vacation and sick leave deferrals to the 457 Plan will cause your calendar year contributions to exceed $18,000, you must check off the Age 50 catch-up option on the "catch up contribution election" section of the Participation Agreement Form," and fill in your Normal Retirement Age (your current age) and insert "2015" as the year in which your will attain your Normal Retirement Age.

C. August 1, 2015 and Later Retirees

Those retiring in August 2015 and thereafter should submit required forms directly to Prudential according to the payroll cut-off schedule. In the coming months, we will post more information about obtaining enrollment and contribution election materials through Prudential.

IV. Transition Questions

Employees will continue to have access to Voya's customer service representatives and retirement counselors through 4:00 p.m. on June 29, 2015. Prudential's representatives will be attending the May 2015 Open Enrollment Health Fairs to introduce themselves to employees and answer transition questions. The May 2015 Open Enrollment Health Fair schedule is posted on the Comptroller's website, www.osc.ct.gov. We will use that website to post Frequently Asked Questions and provide regular updates on the Voya to Prudential transition process.

V. Conclusion

We are excited about the prospect of working with Prudential Retirement and the enhancements that will be available to Plan participants. Beginning in mid-to-late May 2015, Prudential will launch a transition website, www.ctdcp.retirepru.com , to provide ongoing communications.

Payroll and Human Resources Personnel are strongly encouraged to assist June and July retirees with anticipated vacation/sick leave deferrals during this transition phase. You may contact Amy Cason at amy.cason@ct.gov or 860-702-3553 for assistance or questions.

Very truly yours,

THOMAS C. WOODRUFF, Ph.D.
Director

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