Among plans with more than 1,000 participants, only 9 percent said they were unsure about existing revenue-sharing arrangements.

About 40 percent of the 250 non-profits surveyed by PSCA said they use revenue sharing to pay for plan expenses. The largest plans use revenue sharing with the greatest frequency–60 percent of the time. Of the smallest plans that were aware of how their plan is paid for, only 18 percent use revenue sharing.

In a 2003 field bulletin, the Labor Department recognized that the Employee Retirement Income Security Act does not define exactly how sponsors can pay for plan expenses.

“Plan sponsors and fiduciaries have considerable discretion in determining, as a matter of plan design or a matter of plan administration, how plan expenses will be allocated among participants and beneficiaries,” the bulletin says.

But regulators go on to caution that sponsors must be “prudent” in determining how plans are paid for, and the method must be implemented “solely in the best interests' of participants.”

Among the largest plans PSCA surveyed, participants absorb the cost of plan administration 64 percent of the time. Only 7 percent of the largest non-profits foot the bill for plan administration.

Plans can charge an asset-based percentage, pro-rata rate recordkeeping fee, or a flat fee to plan participants, regardless of the size of an individual's account.

In the lawsuits pending against large 403(b) sponsors, plaintiffs allege that asset-based charges are imprudent, because the cost of recordkeeping unjustifiably increases as asset values increase.

While charging a flat fee among all participants could alleviate the potential imprudence of an asset-based fee, some argue that structure disproportionately favors participants with higher account balances.

In plans that offer a blend of investment options with and without revenue sharing, participants that invest in funds with the payments can unwittingly end up covering the cost of plan administration for participants that choose investment share classes without payments.

To address that imbalance, sponsors can levelize fees among participants when using investments with revenue sharing by crediting payments back to participants when they choose an investment with revenue sharing.

In effect, that allows plans to use revenue sharing to pay for plan administration, while spreading the cost of the plan evenly among participants, according to a white paper from Principal Financial Group, which sponsored PSCA's 403(b) survey.

While the levelization of fees is widely seen as an emerging trend in retirement plans in light of greater scrutiny on fees and high profile fiduciary lawsuits, most 403(b) sponsors don't know what fee levelization means, according to PSCA's survey.

Nearly half of the largest plans were unaware or only somewhat familiar with the option; only 36 percent of plans with 200 to 1,000 participants claimed familiarity with the option; only 6 percent of the smallest plans knew what fee levelization was.

“We are hearing a lot of buzz around equalizing or levelizing retirement plan administrative fees, especially as awareness of fiduciary responsibility heightens,” said Aaron Friedman, non-profit national practice leader at Principal, in a statement.

“But this survey tells us there's still a significant opportunity for plan sponsors – especially smaller organizations – to work with advisors that can help them better understand revenue sharing and look into fee levelization as an option,” he added.

Another option at sponsors' disposal is to do away with investment options with revenue sharing. One-fifth of the largest plans said they were considering moving to a so-called zero share platform in the next year, according to the survey. Among all plan sizes, 14 percent are considering doing so.