Independent Colleges of Indiana (ICI), the state’s member association of 30 private non-profit colleges and universities, is launching one of the largest 403(b) Multiple Employer Plan (MEP) among private colleges in the United States. The ICI MEP will include 12 institutions and cover more than 4,048 employees with $600 million in assets. The projected savings are estimated to reach nearly $500,000 each year.
“The ICI MEP is a major milestone in ICI’s work to develop collaborative programs over the past 15-plus years to save money and improve services for our campuses and their students,” says David W. Wantz, president & CEO at ICI. “The ICI MEP will provide substantial, sustainable savings year-after-year in money and staff time; result in better services not only to the campus but its faculty and staff; allow our campuses to directly collaborate with another as the governing board of the MEP’s work; and help control college costs.”
A MEP is a retirement savings plan adopted by two or more employers that are unrelated for income tax purposes. The Council of Independent Colleges in Virginia was the first higher-education MEP of its kind and is currently the largest.
The ICI MEP will accomplish several goals for ICI member institutions including:
- Strengthening pre-retirement investment planning that will help employees meet retirement goals;
- Increased monitoring of the investment options and recordkeeping;
- Lowering each institution’s administrative burden, fiduciary liability, and fees to manage their retirement plan.
Service providers for the ICI MEP are:
- TIAA: plan record keeper
- PlanPilot: 3(38) fiduciary, plan investment advisor
- Pentegra: 3(16) fiduciary, taking on day-to-day plan management
- Millennium Advisory Services: participant education through individual & group meetings
- ICI: staff will coordinate meetings and facilitate communications between MEP members and providers
The ICI MEP will expand the plan in phases throughout the next year starting with two institutions—Indiana Tech and Manchester University.
“The ICI MEP is a great example of the good that can happen when universities collaborate,” says Judy K. Roy, executive VP for finance & administration at Indiana Tech. “The combination of lower fees and improved financial education for our employees, along with reduced administrative burden and fiduciary liability for the university, results in a win-win situation that is a model for future collaborative efforts.”
“With streamlined administrative tasks, available compliance experts, and more robust services for our employees, this collaboration has significantly benefited Manchester University’s faculty and staff,” says Brandee Estes, director of human resources at Manchester University.
The ICI MEP has laid the groundwork and provided a model for another next-level collaboration with ICI’s member institutions—the ICI health benefits consortium.