This bill mandates that boards of education offering a 403(b) plan to eligible school district employees must select a minimum of six financial institutions or pension management organizations to provide investment services. However, for school districts with fewer than 1,000 students, the board may select fewer than six providers, while still ensuring that employees have sufficient opportunities to invest in annuity contracts or custodial accounts and are offered self-directed investment options. The selection process is required to be a mandatory subject of collective negotiations between the board and the applicable collective bargaining unit.

Additionally, the bill stipulates that selected financial institutions or pension management organizations must provide necessary data in an electronic format regarding the investment of 403(b) plan funds and disclose all related fees and charges. Importantly, the bill clarifies that neither the board of education nor the majority representative of the employees will be held responsible for any investment losses or failures to meet expected returns. Furthermore, the ability for employees to deposit supplemental compensation for unused sick leave into a 403(b) plan account is also designated as a mandatory subject of collective negotiations.