Pre-Order the Robbins Schwartz TRS Supplemental Savings Plan Compliance Kit

In 2018, the Illinois legislature amended the Illinois Pension Code to add a requirement that the Teachers Retirement System (TRS) provide an optional defined contribution benefit to all eligible members of TRS (which is done through TRS employers).  The legislature’s purpose in enacting this amendment was to offer eligible employees a “low cost, uniform, high performing” savings plan to supplement their current retirement savings options. Neither employees nor school districts are required to contribute to the TRS Supplemental Savings Plan (“SSP”), although the statute provides the option to do so.

We note that the statutory language and legislative history do not explicitly require school districts to adopt a savings plan and approve a Participation Agreement related to their participation in the SSP.  However, based on our review of the information made available to date by TRS and Section 457(b) of the Internal Revenue Code, we understand that employer approval of a Participation Agreement is a prerequisite for employee participation in an approved plan. Notably, eligible employees must be able to participate in the SSP. Therefore, even if a school district offers another optional defined contribution plan to its employees, it is required to enter into a separate agreement with TRS to facilitate employees’ statutory right to participate in the SSP.

We understand that TRS hopes to begin offering its SSP to eligible employees in the second or third quarter of 2021.  In connection with this, TRS directed employers to enter into an Employer Participation Agreement as soon as possible (note that the March 31, 2021 deadline was withdrawn by TRS).  However, necessary related information, including the procedures related to the Plan document, still need to be released by TRS. The Plan document and related TRS procedures/forms should be carefully reviewed prior to adoption, particularly with regard to employer contributions. In addition, school districts should remember that conferral of this new benefit may result in union requests to bargain over its impact, even if the benefit does not require the employer to contribute.

We have reviewed the documents released by TRS to date and await release of the procedures to complete our review.  Based on questions and issues raised by clients, and following our review of the TRS procedures, our attorneys will develop a TRS Supplemental Savings Plan Compliance Kit for use by school districts in connection with offering the SSP to eligible employees. The TRS Supplemental Savings Plan Compliance Kit will include the following documents:

RESOLUTION

• Resolution to Adopt the TRS Supplemental Savings Plan

GUIDANCE DOCUMENT

• Guidance on Completing the Employer Participation Agreement for the TRS Supplemental Savings Plan

CHECKLIST AND SAMPLE NOTICE

• Administrator Checklist Related to Offering the TRS Supplemental Savings Plan and Sample Notice

NOTICE TO UNION(S)

• Notice to Respective Union(s) Regarding TRS Supplemental Savings Plan
• 2 Versions (one for school districts that have already adopted the plan and one for school districts that have not yet adopted the plan)

We are pleased to offer the opportunity to pre-order the TRS Supplemental Savings Plan Compliance Kit on a flat-fee basis. For more information, including pricing, please contact Catherine R. Locallo (clocallo@robbins-schwartz.com) or Philip H. Gerner III (pgerner@robbins-schwartz.com), or any other Robbins Schwartz attorney for assistance. For those that pre-order, the Compliance Kit documents will be released following our review of the TRS procedures.