2015 2015 PLAN SPONSORS OF THE YEAR
Public DC

County of San ­Diego

FINALIST

PERSONAL AND PERSUASIVE: The County of San Diego needed to wage a full-blown campaign to educate its work force as a whole, and certain demographic groups in particular, about the need to augment their defined benefit (DB) savings with 457 contributions. This was brought on by recent pension reform that reduced the defined benefit formula for new employees, and by the fact that some employees are not long-tenured.

According to San Diego County Treasurer-Tax Collector Dan McAllister, additional challenges include: a lack of matching contributions in the county’s 457 plan; the inability to automatically enroll employees, due to California state law; and the knowledge that, with increasing health care costs and inflation, participants will likely need more savings than they think.

In October 2013, the county launched “Thanks a Billion” to call attention to the plan’s attainment of its $1 billion milestone. “It was a unique, celebratory campaign to increase program awareness, engage participants—make them feel proud of both their and the county’s achievement—and to show that the county and its recordkeeper, Nationwide, value them as employees and care about their future,” McAllister says.

A second campaign, “Relax: We’re Still Your Plan for Retirement,” was rolled out to encourage participants to keep their money in the plan, and staunch the more than $20 million leaving the plan annually. The idea behind this program is to negotiate lower fees for participants but, more importantly, McAllister says, to ensure that retirees remain in a plan that adheres to strict fiduciary standards rather than get sold an investment vehicle from a salesperson.

In June 2014, San Diego started the first of what it plans to be ongoing series of focus groups to better understand the concerns and goals of various participant demographics, starting with workers aged 50-plus. “Their time frame to invest is shorter than for younger employees; they represent 30% of our work force, and we wanted to educate them about the benefits of taking advantage of catch-up provisions,” McAllister says.

Through its “Program Champion” drive, San Diego also makes senior employees available to give peer guidance to their younger colleagues.

The initiatives taken so far have led to 48% of new employees electing to invest in the plan, an average 65% participation rate and 7% deferral rate—and, McAllister says, the county will continue working to drive those numbers higher.

—Lee Barney

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