(a) The state of Tennessee or any Tennessee political subdivision or instrumentality of such subdivision may, by contract, agree with any employee to defer, in whole or in part, any portion of that employee's income and may subsequently purchase or contract with any company licensed to do business in this state to provide a deferred compensation plan, as requested by the employee.

(b) The commissioner of finance and administration, the chair of the finance, ways and means committee of the senate, the chair of the finance, ways and means committee of the house of representatives, and the chair of the board of trustees for the Tennessee consolidated retirement system shall serve as trustees of any deferred or tax-sheltered compensation plans established pursuant to this chapter on behalf of state employees, including employees of institutions of higher education. For the purposes of this section, the term “state employees” shall not include kindergarten through grade twelve (K-12) teachers and other local education agency employees. Such plans include, but are not limited to, plans established pursuant to § 403(b) of the Internal Revenue Code (26 U.S.C. § 403(b)). The chair of the board of trustees for the Tennessee consolidated retirement system shall develop a plan document for the implementation and administration of deferred or tax-sheltered compensation plans established by the trustees. The terms of any deferred or tax-sheltered compensation plan established on behalf of state employees, including employees of institutions of higher education, may be modified by the chair of the board of trustees for the Tennessee consolidated retirement system with the concurrence of the commissioner of finance and administration.

(c) For plans provided to state employees, including employees of institutions of higher education, any company providing administrative plan services must be approved by the trustees prior to the company's participation in any deferred compensation plan. In the case of all other plans, any company providing investment or administrative plan services shall be approved by the chief governing body of the governmental unit.

(d) Any deferred compensation program implemented and operating under the authority of this part shall conform to all applicable laws, rules and regulations of the internal revenue service governing state deferred compensation plans.

(e) [Deleted by 2018 amendment.]