If legislation passed last week by the Florida senate is signed by the governor, Florida would produce nearly 600,000 new potential defined contribution plan customers, according to Malcolm Campbell, vice president and chief counsel for government relations of TIAA-CREF.
It would also make Florida the first state to offer a defined contribution plan to all state employees, he said. While some states offer defined contribution plans to public school teachers, no state has offered a statewide program that covers all public employees, he said.
TIAA-CREF of New York, Fidelity of Boston, Prudential Insurance Co. of Newark, N.J., and Variable Annuity Life Insurance Co. of Houston are lobbying to provide products and services to the state, he said.
With $108 billion invested in Florida's pension program, state employees represent a significant market, Campbell said. The state wants the program available to its employees by June 1, 2002. The deadline will require the Senate to select a provider soon, he said.
The plan was approved earlier by the House of Representatives and now requires only the signature of Gov. Jeb Bush.
The state will probably design a defined contribution plan with a single third-party administrator providing investment options to the 799 payroll units that cover all state employees, Campbell said. Mutual funds and annuities are most likely to be offered in the plan, he said.
The state will select an established vendor with experience providing a variety of investment products to state-sponsored plans, Campbell said.