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Meeting Date:
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12/11/2024 - 7:00 PM
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Category:
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Consent Agenda Items
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Type:
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Action
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Subject:
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Approval of Adding Roth Contribution Option to 403b and 457 Tax Sheltered Annuity Plans
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Vision 2026:
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Operational Excellence Strategies 2 Maintain strong fiscal health of the organization.
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Background
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On December 23, 2023, Congress officially passed the SECURE – Setting Every Community Up for Retirement Enhancement – 2.0 Act. The legislation is aimed at helping employees better prepare for their financial future while strengthening the retirement system as a whole for both employees and employers. The policy builds on the original SECURE Act from 2019.
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File Attachment:
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Summary:
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As a part of SECURE 2.0, if an employee participates in a 403b or 457 plan and their prior year FICA wages from the employer sponsoring the plan exceeded $145,000, then a participant’s Age 50+ Catch-up deferrals can only be made as a Roth contribution. The $145,000 threshold is subject to IRS annual cost of living adjustments in $5,000 increments. This mandate goes into effect January 1, 2026. Currently District 200 does not offer Roth contributions for either 403b or 457 plans. To offer employees the most opportunity for retirement savings, and to be proactive, the Business Office has reviewed all our 403b and 457 plan providers and provider contacts and determined that the Roth 403b and Roth 457 plans can be incorporated to the eleven of twelve plans for 403b annuity provider companies and five of six plans for 457 annuity provider companies. The Roth 403b and 457 plans would be included as an option to all employees along with the Traditional 403b and 457 plans currently being offered.
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Funding:
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Board Policy
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Recommendation:
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It is recommended that the Board of Education approve adding the Roth option to all eligible 403b and 457 plans.
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Approvals:
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Recommended By:
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Signed By:
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Jordan Thorse - Treasurer
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Signed By:
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Brian O'Keeffe - Asst Superintendent Business Services
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Signed By:
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Jeff Schuler - Superintendent
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Vote Results:
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| Original Motion | | Member Julie Kulovits Moved, Member John Rutledge seconded to approve the Original motion 'It is recommended that the Board of Education approve adding the Roth option to all eligible 403b and 457 plans.'. Upon a Roll-Call Vote being taken, the vote was: Aye: 7 Nay: 0. | | The motion Carried 7 - 0 | | | | | Brad Paulsen | Yes | | Rob Hanlon | Yes | | Dave Long | Yes | | Angela Blatner | Yes | | Julie Kulovits | Yes | | Erik Hjerpe | Yes | | John Rutledge | Yes | |
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