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City engineer urges Vanguard ETF and in‑plan Roth conversions; board says requests will be evaluated
Summary
Kamran Mokhtari, a City civil engineer, urged the board to add Vanguard Information Technology ETF (VGT) to the 457 lineup and to permit in‑plan Roth conversions; board members and advisers said they have heard these requests and will evaluate options with Voya and ACG.
Kamran Mokhtari, a civil engineer with the City of Oklahoma City, used the board‑comments period to urge low‑cost investment options and more in‑plan flexibility for participants. Mokhtari said he welcomed the transition to Voya and the new Roth option and requested two specific changes: add the Vanguard Information Technology ETF (VGT) as an investment option to provide a lower‑fee alternative to the Fidelity Contrafund, and allow in‑plan Roth conversions from traditional 457 contributions.
Mokhtari presented fee and return comparisons as part of his request, asserting that the Fidelity Contrafund charges about 0.56% annually while VGT charges 0.10%, and that over a long horizon these differences compound materially. He said adding VGT would provide a "low cost long term growth alternative, particularly beneficial for younger employees with longer time horizon." He also asked the board to consider permitting in‑plan Roth conversions for convenience and tax planning flexibility.
Board members acknowledged the requests. Jason of ACG and staff said the conversion request has been raised before and that the board would evaluate it after the Roth rollout stabilizes; staff said they would discuss fund‑lineup requests with advisers and Voya. A separate board member raised an employee inquiry about whether loans from 457 accounts could be allowed; staff said a loan program is not currently in place but they will evaluate what a loan option would entail and report back.
The board did not adopt either change at the meeting; advisers and staff committed to further evaluation and follow‑up.
