BEFORE THE PUBLIC EMPLOYEES' RETIREMENT BOARD
OF THE STATE OF MONTANA
In the matter of the amendment of ARM 2.43.3504 pertaining to defined contribution plan default investment fund and 2.43.5103 pertaining to deferred compensation plan investment options
NOTICE OF PROPOSED AMENDMENT
NO PUBLIC HEARING CONTEMPLATED
TO: All Concerned Persons
1. On October 30, 2015, the Public Employees' Retirement Board proposes to amend the above-stated rules.
2. The Public Employees' Retirement Board will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice. If you require an accommodation, contact the Montana Public Employee Retirement Administration no later than 5:00 p.m. on September 21, 2015, to advise us of the nature of the accommodation that you need. Please contact Kris Vladic, Montana Public Employee Retirement Administration, P.O. Box 200131, Helena, Montana, 59620-0131; telephone (406) 444-2578; fax (406) 444-5428; TDD (406) 444-1421; or e-mail firstname.lastname@example.org.
3. The rules as proposed to be amended provide as follows, new matter underlined, deleted matter interlined:
2.43.3504 DEFINED CONTRIBUTION RETIREMENT PLAN DEFAULT INVESTMENT FUND (1) The board will identify
a balanced fund an age- appropriate target date fund offered by the DCRP to be the default investment fund.
The Unless otherwise directed by the DCRP participant, the following assets will be deposited in the default investment fund:
(a) through (3) remain the same.
AUTH: 19-2-403, 19-3-2104, MCA
IMP: 19-3-2114, 19-3-2115, 19-3-2117, 19-3-2122, MCA
2.43.5103 DEFERRED COMPENSATION PLAN INVESTMENT OPTIONS
(1) remains the same.
(2) A Deferred Compensation Plan participant with assets in a discontinued investment option will be given notice and 90 days to move assets from the investment option being discontinued to an offered investment option. Assets remaining in a discontinued investment option at the end of the 90-day period will be automatically transferred to the investment option similar in investment category and style selected by the board to replace the discontinued investment option. If the discontinued investment option is not replaced, the board will transfer the fund balance to
a balanced fund an age-appropriate target date fund offered by the Deferred Compensation Plan.
(3) remains the same.
AUTH: 19-50-102, MCA
IMP: 19-50-102, MCA
STATEMENT OF REASONABLE NECESSITY: The Pension Protection Act of 2006 was amended by 2008 Department of Labor regulations to include Target Date Funds (TDFs) in the list of Qualified Default Investment Alternatives (QDIAs) allowed in governmental defined contribution retirement plans. At its August 11, 2011 meeting, the Public Employees' Retirement Board added TDFs to its list of available investment funds in both plans and identified the TDF as the QDIA in the DCRP.
Staff recently noted that ARM 2.43.3504 was not amended to reflect that decision and that a QDIA is needed for the state of Montana's Deferred Compensation Plan. Therefore, these rules are proposed to be amended to clarify that the QDIA for both the DCRP and the State of Montana's Deferred Compensation (457(b)) Plan is the plan participant's age-appropriate target date fund.
4. Concerned persons may submit their data, views, or arguments concerning the proposed action in writing to: Montana Public Employee Retirement Administration, P.O. Box 200131, Helena, Montana, 59620-0131; telephone (406) 444-3154; fax (406) 444-5428; or e-mail email@example.com, and must be received no later than 5:00 p.m., September 28, 2015.
5. If persons who are directly affected by the proposed amendments wish to express their data, views, or arguments orally or in writing at a public hearing, they must make written request for a hearing and submit this request along with any written comments they have to Kris Vladic at the above address no later than 5:00 p.m., September 28, 2015.
6. If the Public Employees' Retirement Board receives requests for a public hearing on the proposed amendments from either 10 percent or 25, whichever is less, of the persons directly affected by the proposed amendment; from the appropriate administrative rule review committee of the Legislature; from a governmental subdivision or agency; or from an association having not less than 25 members who will be directly affected, a hearing will be held at a later date. Notice of the hearing will be published in the Montana Administrative Register. Ten percent of those directly affected has been determined to be 1,132 persons based on approximately 2,188 participants in the Defined Contribution Retirement Plan and 8,488 participants in the Deferred Compensation Plan as of June 30, 2014, for a total of 11,320 participants.
7. The Public Employees' Retirement Board maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list shall make a written request that includes the name, e-mail, and mailing address of the person to receive notices and specifies for which program the person wishes to receive notices. Notices will be sent by e-mail unless a mailing preference is noted in the request. Such written request may be mailed or delivered to the contact person in 5 above or may be made by completing a request form at any rules hearing held by the PER Board.
8. An electronic copy of this proposal notice is available through the Secretary of State's web site at http://sos.mt.gov/ARM/Register. The Secretary of State strives to make the electronic copy of this notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that if a discrepancy exists between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered. In addition, although the Secretary of State works to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems.
9. The bill sponsor contact requirements of 2-4-302, MCA, do not apply.
10. With regard to the requirements of 2-4-111, MCA, the Public Employees' Retirement Board has determined that the amendment of the above-referenced rules will not significantly and directly impact small businesses.
/s/ Melanie A. Symons /s/ Sheena Wilson
Melanie A. Symons Sheena Wilson
Chief Legal Counsel President
and Rule Reviewer Public Employees' Retirement Board
Certified to the Secretary of State August 17, 2015