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San Joaquin County committee approves moving employer contributions into 401(a) plan
Summary
To expand contribution flexibility for high‑wage employees and align with peer counties, the advisory committee approved moving county employer contributions from the 457(b) plan into a 401(a) plan; implementation will require payroll coordination and a short document amendment.
The San Joaquin County Deferred Compensation Advisory Committee voted Feb. 26 to direct staff to move county employer contributions into a 401(a) account structure for employees who receive an employer contribution.
Consultant Vincent Galindo noted that among 29 California counties surveyed, most put employer contributions into a 401(a) — a structure that provides a separate annual contribution limit in addition to 457 limits. County staff and consultants said the change would allow higher‑wage employees and certain bargaining units to make the most of available tax‑favored retirement contribution options without immediate additional administrative costs.
Staff clarified the change would be applied wholesale to the population of employees who receive the county contribution; employees’ existing assets in the 457(b) would remain where they are. Nationwide said it can mirror the existing investment menu for the 401(a) or offer a different allocation if desired; payroll and recordkeeping steps will be required. Nationwide estimated it could amend the 401(a) agreement within about two weeks after receiving instruction, with payroll adjustments to follow.
A committee member stressed that moving employer contributions should not increase plan administration costs; staff and consultant representatives confirmed there are no additional hard‑dollar fees expected for the change. A motion to adopt the 401(a) change passed by voice vote.
Next steps: staff will coordinate logistics with Nationwide and county payroll and set an implementation timeline, then communicate details to affected employee groups.
