• Changes Made to St. Thomas’ 403(b) Pension Plan

    In February the Pension Advisory Committee met with consultants from Fidelity Investments to review the University of St. Thomas’ current Fidelity funds. PAC’s responsibilities include selecting and reviewing fund performance for the university’s 403(b) and voluntary pension plans.

    The outcome of the meeting was to make the following changes to St. Thomas’ Fidelity fund choices.

     Fund additions:

    • PIMCO Low Duration
    • PIMCO Total Return Fund
    • PIMCO CommodityReal Return
    • Invesco Emerging Markets

    Fund closure and mapping of future contributions and current balances:

    • Fidelity US Bond Index: Balances will be mapped to PIMCO Total Return
    • Fidelity Disciplined Equity: Balances will be mapped to Fidelity Fund

    The new funds will offer employees additional fund choices. The closures are due to poor performance.

    All participants will receive a written notification from Fidelity 30 days prior to the effective date of this change.

    St. Thomas established the Pension Advisory Committee as one of several ways to assure the university’s continued compliance with the Employee Retirement Income Security Act and the Pension Protection Act. ERISA is a federal law that sets minimum standards for qualified pension plans − including those sponsored by nonprofits. The Pension Protection Act, a provision of the ERISA, establishes rules for plan asset investment, general plan funding and compliance.

    Both require strict accountability of plan fiduciaries − such as St. Thomas − which exercise discretionary control over the management and assets of an ERISA-qualified pension plan. For example, as a fiduciary of a 403(b) plan, the Pension Protection Act requires St. Thomas, as a 403(b) plan sponsor, to review on a regular basis the investment options it offers plan participants and to replace underperforming fund options with those that have a higher performance rate.  The role of the Pension Advisory Committee is to help the university fulfill this part of its fiduciary responsibility.

    The Pension Advisory Committee is a subcommittee of the Fringe Benefits Advisory Committee. Its members include Dan Fairchild, professor of Economics; John McCall, associate dean, Opus College of Business; Mark Vangsgard, vice president, Business Affairs, and chief financial officer; and Carol Peterfeso, investment officer. 

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