WAYNE COUNTY AIRPORT AUTHORITY DEFERRED COMPENSATION PROGRAM ENHANCEMENTS. Spring 2013

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1 WAYNE COUNTY AIRPORT AUTHORITY DEFERRED COMPENSATION PROGRAM ENHANCEMENTS Spring 2013

2 Today s Agenda What s Happening and Why? Implementation Overview Questions/Discussion 1

3 What is Happening? Background In 2010, WCERS selected the following four (4) active 457 Deferred Compensation plan providers: AXA Advisors Midland National ING The Hartford Nationwide Retirement Solutions and Great-West Retirement Services were frozen to new contributions. These changes were not fully implemented at the Airport Authority. Active Airport Authority providers currently are: AXA Advisors The Hartford Nationwide Retirement Solutions 2

4 What is Happening? Plan Review In 2012, WCERS conducted a comprehensive review of its 457 Deferred Compensation Program focusing on: Industry best-practices, including plan compliance and fiduciary oversight Plan and participant services Overall investment returns Review Findings Airport Authority: WCERS oversees both the County and Airport Authority s deferred compensation plans. For compliance, oversight and operational reasons, it is necessary for the Airport Authority to mirror Wayne County s plan. Wayne County: The assets with the two (2) frozen providers, Nationwide Retirement Solutions and Great- West Retirement Services, should be transferred to the active providers. 3

5 What is Happening? Reasons for Change Further align Plan with regulatory standards and industry best practices Plan compliance with all relevant IRS guidelines Fiduciary oversight to control costs and protect Plan participants Formal ongoing investment monitoring process to maintain competitiveness of Plan investment offerings Enhance participant services Onsite enrollment and account reviews Investment advice for active and retired account holders Individual retirement counseling Payout strategies for retirees Simplify Plan operation and coordination Update investment menu offerings Provide for future Plan enhancements, including a Roth 457 feature 4

6 What is Happening? Summary of Changes Two new 457 options are now available to Airport Authority employees effective April 1, 2013: Midland National ING Financial Partners AXA Advisors and The Hartford will remain available. Assets at Great-West Retirement Services (already frozen) will be transferred to an active provider. Nationwide Retirement Solutions will be terminated. Current assets and future contributions will be transferred to an active provider. 5

7 Implementation Overview Asset Transfer Options Option 1 - WCERS selected ING and Hartford as the providers for the automatic asset transfer. No fees charged or restrictions on transferring your account to another active provider. No surrender charges or deferred sales charges to transfer your account to another active provider at any time. Formal ongoing investment monitoring process and oversight by WCERS. Option 2 - You may choose to transfer your account to any of the four active providers. Individual transfers must be completed by May 22,

8 Implementation Overview Automatic Asset Transfer Process Your Nationwide and/or Great-West account will transfer to either ING or Hartford on May 31, Your investments will be transferred to similar investments ( mapping ). Money in a Fixed Account today will be mapped to a Fixed Account. Money invested in market-based investments today will be mapped to a like investment with a similar investment objective. If you have the optional supplemental life insurance with Nationwide or Great West, your new provider will work with you to maintain this important benefit. If you are retired and receiving monthly distributions: Your distributions will continue uninterrupted with no changes (same method and the same or similar dates as you have currently). 7

9 Implementation Overview Asset Transfer Blackout Period On May 22, 2013, the plan will enter a blackout period. During the blackout period, no financial transactions are allowed, including contributions, exchanges and withdrawals. If you have separated service or retired and are scheduled to receive a distribution during the blackout period, your payment will be processed immediately before the blackout period begins. The blackout period will end on or before June 14, Once the blackout period ends, financial transactions are allowed. After the Asset Transfer, you are encouraged to update your beneficiaries. Accounts transferred to ING or Hartford may be transferred to any of the other active providers with no penalty or surrender charges. 8

10 Summary Midland National and ING will now be active providers. Nationwide and Great-West accounts will be transferred on May 31, 2013, to ING and The Hartford. The blackout period starts on May 22, 2013, and will end on or before June 14, No financial transactions are allowed. You may choose among active providers at any time after the blackout. If your assets are mapped into ING or The Hartford, you will incur no fees or surrender charges on transfers out of ING or The Hartford. 9