19-3-112. (Subsection (1)(c) effective on occurrence of contingency or July 1, 2002, whichever is earlier) Education fund established -- allocation of employer contributions -- educational program requirements. (1) (a) The board shall establish an education fund and provide for educational programs for system members in a manner consistent with the provisions of this section.
     (b) For the initial transfer educational program established for system members, 0.1% of covered payroll from the employer contributions made pursuant to 19-3-316 must be allocated to the education fund established in subsection (1)(a).
     (c) For the ongoing educational and communication programs established pursuant to this section, from the employer contributions made pursuant to 19-3-316, 0.04% of covered payroll must be allocated to the education fund established in subsection (1)(a). The board shall from time to time review the sufficiency of this amount and recommend to the legislature the adjustments that it considers appropriate.
     (2) (a) The educational programs must provide system members with impartial and balanced information about plan choices. The programs must involve multimedia formats. Plan comparisons must, to the greatest extent possible, be based upon real rates of return on investments available in each retirement plan.
     (b) If an educational program is conducted by a contractor, the board shall monitor the performance of the contract to ensure that the program is conducted in accordance with the contract, applicable law, and the rules of the board. A contractor hired to provide educational services pursuant to this section may not be the same entity contracted to provide other services for the defined contribution plan or the optional retirement program.
     (3) The board shall provide for an initial and an ongoing transfer educational program to provide system members with information necessary to make informed plan choice decisions. The transfer educational program must include but is not limited to information on:
     (a) the amount of money available to a member to transfer to the defined contribution plan;
     (b) the features of and differences between the defined benefit plan and the defined contribution plan, both generally and specifically, as those differences may affect the member;
     (c) the expected benefit available if the member were to retire under each of the retirement plans, based on appropriate alternative sets of assumptions;
     (d) the aggregate rate of return from investments in the defined contribution plan and the period of time over which the aggregate rate of return must be achieved to equal or exceed the expected monthly benefit payable to the member under the defined benefit plan;
     (e) the historical rates of return for the investment alternatives available in the defined contribution plan;
     (f) the benefits and historical rates of return on investments available in deferred compensation plans or a plan under section 403(b) of the Internal Revenue Code for which the employee may be eligible;
     (g) the plan choices available to employees of the university system pursuant to 19-3-2112 and the comparative benefits of each available plan; and
     (h) payout options available in each of the retirement plans.
     (4) An ongoing educational and communication program must provide members of either plan with information necessary to make informed decisions about choices within their plan of membership and in preparation for retirement. The program must include but not be limited to information concerning:
     (a) rights and conditions of membership;
     (b) benefit features within the plan, options, and the effects of certain decisions;
     (c) coordination of contributions and benefits with a deferred compensation plan under section 457 of the Internal Revenue Code or a plan under section 403(b) of the Internal Revenue Code;
     (d) significant plan changes;
     (e) contribution rates and plan funding status; and
     (f) planning for retirement.
     (5) The board shall also establish a communication program to provide plan information to participating employers and the employer's personnel and payroll officers and to explain their respective responsibilities in conjunction with the retirement plans.
     (6) This section does not prohibit a plan vendor or vendors from providing system members with information necessary to make informed decisions about the defined contribution plan or the optional retirement program and investment alternatives within the defined contribution plan or the optional retirement program. (Subsection (1)(b) terminates July 1, 2001--sec. 81(1), Ch. 471, L. 1999.)

     History: En. Sec. 41, Ch. 471, L. 1999.