According to a Leesburg Today news report, under the previous system, county public school employees could choose any investment provider to invest their contributions to the plan. The new system requires all employees of Loudoun County Public Schools (LCPS) to go through Lincoln Financial Group to invest.
Currently only about 2,500 of 10,000 school system employees are participating in the 403(b) program, and several board members expressed concern that switching to a single vendor might seem like a punishment to them, the news report said. However, board member Tim Reed is hopeful the single-vendor program can bring in the other 75% of LCPS employees.
The single-vendor system was proposed by a committee of LCPS employees, including faculty, staff, and administrators from different schools in the area, as well as a representative of the Loudoun Education Association. The committee voted unanimously to support the single vendor program.
The committee said it would take approximately 120 days to implement the new program, which is intended to go into effect November 1.
The school board was required to create a request for proposal (RFP) committee to solicit bids from vendors to establish a new program in order to comply with new IRS regulations.