Nurturing the Nest Egg

School districts get new federal duties in overseeing workers’ 403(b) supplemental retirement accounts.

Seemingly arcane new federal rules about supplemental retirement plans have sparked a seismic shift in responsibility for school districts, thrusting them into the retirement business with new oversight—and burdens—involving their employees’ 403(b) accounts.

Once merely paper-pushers between their employees and investment choices, district business officials must now vet and pick the investment firms that offer such plans, craft a highly technical document governing the 403(b) accounts , and assume responsibility for making sure employees seeking hardship withdrawals or loans from their accounts are following the rules.

And the clock is ticking toward the Jan. 1 Internal Revenue Service deadline to comply with the most significant change in 403(b) plans since the regulations were...