CSU 403(b) Tax Sheltered Annuity (TSA) Program -
Frequently Asked Questions
Questions Regarding CSU Tax Sheltered Annuity Program Changes
(August 22, 2008)
- How is the CSU's TSA Program changing?
- Why has the CSU decided to make these changes to the TSA Program now?
- When will these changes to the CSU's TSA Program take effect?
- How will the CSU decide who will be the new TSA Master Administrator?
- How will the changes to the TSA Program affect the number of funds offered?
- Will the funds I'm currently invested in be available January 1, 2009?
- What happens to my current investments if the CSU stops offering the funds in which I'm currently invested?
- When will the list of vendors be available?
- If I enroll during the special enrollment period, when will the payroll contributions for the current TSA Program end and when will the contributions for restructured TSA Program begin?
- What is the status of transferring 403(b) funds from one vendor to another before the special enrollment period?
- Will the changes to the CSU TSA Program have any effect on the DPA Savings Plus Program?
- How is the CSU's TSA Program changing?
The TSA Program will undergo several important changes for 2009. The most visible changes will be the consolidation of fund vendors and the addition of a Master Administrator, who will be responsible for administering the TSA Program. The CSU will establish a plan administrative committee to oversee the program and will adopt a written plan document that governs the plan.
- Why has the CSU decided to make these changes to the TSA Program now?
Recent changes to IRS regulations mandate that employers who offer a 403(b) plan take a more active role in the oversight and governance of their plan. While the changes to the TSA Program are in response to these updated regulations, the CSU is committed to making the transition as smooth as possible. These changes will simplify participation in the TSA Program, will result in greater oversight of it, and are expected to reduce administrative fees paid by participants while improving the level of service they receive.
- When will these changes to the CSU's TSA Program take effect?
The changes to the TSA Program will take effect January 1, 2009. If you currently participate in the TSA Program and want to continue participating on that date, you’ll need to take action during the special enrollment period, which will be held October 2008 – November 2008. You’ll receive more information closer to that special enrollment period.
- How will the CSU decide who will be the new TSA Master Administrator?
The CSU has received proposals from leading 403(b) plan administrators for the Master Administrator role. The final selection of the Master Administrator will be made by an evaluation committee appointed by the CSU.
- How will the changes to the TSA Program affect the number of funds offered?
Currently, the TSA Program offers over 90 different investment product options from a variety of providers. Some of the funds overlap, and the large selection of options can be overwhelming.
To better manage and monitor the funds offered through the TSA Program, the number of funds will be reduced. While the number of options will be reduced from over 90 vendors and thousands of investment funds to a more streamlined selection, the options will continue to provide a broad range of choices for participants regardless of their investment strategies and tolerance for risk.
- Will the funds I'm currently invested in be available January 1, 2009?
While the committee responsible for selecting the funds has not yet reached a final decision, it is likely that some of the funds in which you’re currently invested will not be available as of January 1, 2009. This is because the CSU is consolidating the number of funds offered. No decision has been made whether any of the funds currently offered will be offered as of January 1, 2009.
- What happens to my current investments if the CSU stops offering the funds in which I'm currently invested?
Any money that you currently have invested in investment products offered through the TSA Program will remain invested in those products after January 1, 2009, even if those products aren’t offered by the TSA Program going forward. However, you’ll still be able to change investments within the products offered by your current vendor after January 1, 2009.
If you take action during the special enrollment period (October 2008 – November 2008), you’ll also be able to transfer the money you’ve invested in those products through the TSA Program to the new products that will be offered when the restructured TSA Program takes effect. In addition, you’ll be able to transfer your investments to the new funds at any time after that, based on your personal situation. Once you’ve transferred any prior investments to the new funds, you will not be able to transfer back to the closed funds. However, you’ll be able to transfer among any of the new funds at any time.
- When will the list of vendors be available?
The committee selecting the fund vendors is conducting a thorough review to ensure that the restructured TSA Program will offer a selection of top-quality products. The CSU expects this process to be complete no later than September 15, 2008, and a list of fund vendors will be available shortly thereafter.
- If I enroll during the special enrollment period, when will the payroll contributions for the current TSA Program end and when will the contributions for restructured TSA Program begin?
Your last contribution for the current TSA program will end with the November pay period (which is the last pay period of the 2008 tax year). The TSA Program deduction taken out of the December pay period warrant will be applied to the restructured TSA Program effective January 1, 2009.
- What is the status of transferring 403(b) funds from one vendor to another before the special enrollment period?
The CSU has placed a freeze on in-service transfers, with the exception of age 59½ rollovers. This means you cannot transfer funds from your current fund vendor to another fund vendor at this time. However, you still can change investment funds among those offered by your current fund vendor. Later in 2008, the CSU will notify you of the date you’ll be able to transfer your prior investments in the TSA Program to the new funds that will be offered once the restructured TSA Program takes effect.
- Will the changes to the CSU TSA Program have any effect on the DPA Savings Plus Program?
No. The Savings Plus Program will continue to administer 401(k) and 457 Plans, which aren’t affected by the new IRS regulations regarding 403(b) accounts.
- How can I find more information about the changes to the TSA Program?
The CSU is committed to giving you the information, tools, and resources you need to make decisions that are right for you. Before the special enrollment period, you’ll receive a packet with details about the Master Administrator, the new funds that will be offered, and the steps you’ll need to take to enroll. In addition, we’ll update the CSU’s online benefits portal with the most up-to-date information as it becomes available.