The State Investment Commission unanimously voted to select TIAA-Cref of New York as the vendor to administer Rhode Island's new defined contribution program, General Treasurer Gina Raimondo announced Monday.
Raimondo made her announcement after TIAA-Cref and the other finalist, Great-West Retirement Services, made presentations Monday to the commission. Other companies on a short list were Fidelity Investments and ICMA Retirement Corp.
"After evaluating the two finalists in the core areas defined in the [request for proposals], I am confident that TIAA-Cref offers the best options, fees, and level of service for Rhode Island," Raimondo said.
TIAA-Cref, according to the firm's website, has $441 billion in combined assets under management as of Sept. 30. It plans to open a Rhode Island office with dedicated staff to provide support, education, and customer service to defined contribution plan members.
The state last November passed the Rhode Island Retirement Security Act, which overhauled its pension system for public employees. It creates a hybrid plan that merges conventional public defined-benefit pension plans with 401(k)-style plans. It also includes a suspension of cost-of-living adjustment increases for retirees and raises the retirement age for employees not yet eligible for retirement.
The new program will take effect July 1.
The defined contribution program will be a core part of each participating employee's retirement plan. Raimondo's office estimated that the plan will initially cover about 30,000 government employees and that annual contributions will be in the $100 million to $150 million range.