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HomeMy WebLinkAboutContract 52423-A1 Vb 0\1��p CITY SECRETAR`f AA ��25 CONTRACT NO._ L"�_ TIAmendment No. 1 to the Amended and Restated Record Keeping Services Agreement Between Teachers Insurance and Annuity Association of America (TIAA) And City of Fort Worth Effective as of the dates outlined below,or such later date as the parties shall agree by Notice,the Record Keeping Services Agreement("Agreement"), recorded as city secretary's contract number 52423,between Teachers Insurance and Annuity Association of America("TIAA") and City of Fort Worth ("City") as Sponsor of the City of Fort Worth 457 Deferred Compensation Plan(the"Plan(s)"),is hereby amended as follows: 1. Effective as of April 1,2020,Section 8("Fees& Compensation for Services")is hereby amended to read as follows: 8. FEES & COMPENSATION FOR SERVICES 8.1 TIAA's annual revenue requirement for the services under this Agreement is 0.08% (8 basis points multiplied by plan assets equals,the"Revenue Requirement")per Plan. TIAA's Revenue Requirement for the Plan(s)will remain in effect for the five(5)year period that ends on March 31,2024(the"Revenue Requirement Term"). Where the City with respect to a Plan maintains a balance in and makes active contributions to any of the mutual funds, other investment vehicles, and/or TIAA-CREF annuity contracts recordkept on TIAA's platform,TIAA will compare the Revenue Requirement to the revenue generated by such Plan on a quarterly basis to determine if the Plan generated sufficient revenue to meet TIAA's Revenue Requirement ("Reconciliation Process"). TIAA will provide the City a Reconciliation report accessible on P1anFocus,TIAA's administrative web service,which will provide the results of the Reconciliation Process.The revenue generated by a Plan that is considered by the Reconciliation Process to pay for TIAA's Revenue Requirement for that Plan may be attributable to the following: 1. Investments that provide Revenue Sharing Payments: The City understands that certain proprietary and non-proprietary mutual fund investments may make Revenue Sharing Payments' to TIAA as a record keeper. A Revenue Sharing Payment is money paid from a mutual fund's expense ratio, or by a fund's investment manager,distribution company or transfer agent from their revenues to a plan record keeper for keeping track of the ownership of the mutual fund's shares and other shareholder services. Any revenue shared by an,, OFFECIA . REC0 ' Page 1 of 7 CITY AW Client ID:065299 FT. WORTH, -TX 406425 v.I.I " : TIAA investment provider is included as part of each of their investment's expense ratio and is not in addition to the published expense ratios. The City agrees that the amount of such Revenue Sharing Payments shall be used in the Reconciliation Process to satisfy the Plan Revenue Requirement. In addition,for those investments that provide revenue greater than 0.115%(11.5 basis points)such excess revenue shall be credited to the specific investments held in each Plan participant's and beneficiary's Plan accounts("Participant Accounts")that generated such revenue sharing credits("Investment Level Credit").The Investment Level Credit shall be based upon the participant's and beneficiary's average daily balance and processed in arrears on a quarterly basis. The current schedule of investments and their respective Revenue Sharing Payment amounts are listed in Schedule B, as amended from time to time. Revenue Sharing Payments are subject to change at the election of the fund company. In no event shall such changes to Revenue Sharing Payments change TIAA's Revenue Requirement as set forth above. 2. Any plan servicing fees deducted from participant accounts and paid to TIAA as follows: Effective as of April 1, 2020,TIAA shall deduct an annual plan servicing fee of up to 0.115%(11.5 basis points)from Participant Accounts held in the Retirement Choice annuity contracts(the"TIAA-CREF Annuity Contracts")and any of the mutual funds listed in Schedule B for the Contracted Services provided by TIAA under this Agreement. The amount of such fee will be determined and assessed at an investment level by subtracting the investment's revenue share percentage(as described in Schedule B)from the plan servicing fee of 0.115%(11.5 basis points). Such fees shall be used in the Reconciliation Process to pay TIAA's Revenue Requirement. The plan servicing fee shall be calculated based upon the participant's average daily balance during the assessment period. Such fees shall be deducted from the annuity contracts and mutual funds held in such Participant Accounts and shall be collected in arrears on a quarterly basis. The aforementioned plan servicing fee shall first be assessed on June 30,2020. However if the Agreement has not been executed by that date the aforementioned plan servicing fee shall first be assessed on the next available quarterly assessment date after the Agreement has been executed and will remain in effect for the duration of the Revenue Requirement Term.Notwithstanding the Page 2 of 7 T Client ID:065299 406425 V.I.] C', T I A foregoing,the City may adjust the annual plan servicing fee with thirty(30)days advance written Notice to TIAA but in no event shall such adjustment change the Revenue Requirement for the Plan(s). In the event the City adjusts the annual servicing fee,the City agrees to amend this Section 8 to detail the new annual servicing fee prior to such change in fee becoming effective. In addition,at the end of the Revenue Requirement Term,the annual plan servicing fee may be adjusted upon review by the City and TIAA of TIAA's revenue requirements and may change in the event that TIAA's has established a new Revenue Requirement for the Contracted Services under this Agreement. For fees deducted from Participant Accounts,with respect to the mutual funds described in Schedule B,the City authorizes TIAA,on its behalf,to instruct TIAA, FSB to debit the applicable Participant Account under the Plan in the appropriate amount. With respect to the TIAA-CREF Annuity Contracts,the City authorizes TIAA to debit the applicable Participant Accounts allocated to such TIAA-CREF Annuity Contracts under the Plan in the applicable amount. 8.2 In the event that the Reconciliation Process determines that the Plan(s)generated revenue in excess of TIAA's Revenue Requirement,TIAA shall credit the Plan(s)Revenue Credit Account in the amount of the excess. A Revenue Credit Account is a suspense account held under the terms of the Plan which is funded with excess revenue generated from that Plan. The Revenue Credit Accounts may only be used either to pay direct,reasonable and necessary Plan expenses which the Plan(s)are authorized to pay or to provide benefits for Plan participants and beneficiaries in the form of plan servicing credits. Such credits can be paid to Plan participants' accounts,with at least thirty (30)days' Notice from the City to TIAA prior to the plan year end, in a method elected by the City provided that TIAA can administer such City election and provided that TIAA determines, in its sole discretion,that the elected method will not violate applicable law. Payments from Revenue Credit Accounts directly to the City will be made only if the following procedures are followed: 1. Legal counsel for the City shall provide, in writing,assurance to TIAA that such legal counsel has reviewed the reimbursement arrangement for plan expenses to be paid directly to the City and that in its opinion the program for expense reimbursement, as structured, is set up in accordance with the Plan and state law and covers expenses that would not have been incurred by the City but for the retirement plan(e.g.,no overhead or settlor expenses, are covered). This will be a Page 3 of 7 Client ID:065299 406425 v.l.l CTIAA onetime certification and will be effective for the duration of the Revenue Requirement Term. 2. Prior to each payment the City shall provide T[AA with a written certification that the expenses to be paid meet the requirement that they are reasonable in amount, necessary for the administration of the Plan, are in accordance with Plan terms and would not have been incurred but for the Plan and are expenses that TIAA can pay in accordance with state law. The City represents that payments from Revenue Credit Accounts shall be used to reimburse direct,reasonable and necessary expenses of the Plan(s)that the Plan(s)are authorized to pay or to provide revenue credits to Plan Participants Accounts as stated above.No payments shall be made directly to the City or the Named Fiduciary of the Plan(s)without adherence to the above requirements. For payments made directly to a Plan service provider,TIAA shall facilitate transactions to cover reasonable and necessary Plan expenses that each Plan itself could pay. To establish a service provider for reimbursement,the City shall provide a W-9 to TIAA.Newly established service providers shall be reimbursed through electronic funds transfer(EFT)means only. In addition,the City is responsible for any applicable tax-withholding and reporting(e.g., 1099-MISC tax reporting).The service provider invoice must be submitted along with detailed payment instructions. The City agrees to utilize P1anFocus,TIAA's administrative web service to manage their Revenue Credit Accounts including establishing service providers, providing a W-9, and submitting reimbursement requests. Once instructed through PlanFocus, payments shall be made directly to the plan service provider within an administratively feasible period of time and no later than thirty(30) days after the date the instructions were received. 8.3 In the event that the Reconciliation Process determines that a Plan did not generate sufficient revenue to meet TIAA's Revenue Requirement and therefore results in a shortfall, the City understands and agrees that TIAA shall invoice the City for such shortfall and the City agrees to pay such invoice within thirty days of receipt. 8.4 If, in the good faith determination of both parties the assumptions and terms as determined above have changed substantially,the parties agree to revise this section. The City and TIAA will amend this section and any additional agreements in order to reflect the new Revenue Requirement that will be used for the Reconciliation Process. Notwithstanding the foregoing,TIAA agrees to give the City sixty(60)days advance notice prior to requesting such a revision. In the event the Revenue Requirement Term expires and a new Revenue Requirement and/or Revenue Requirement Term has not been established,the terms of this Section 8 will continue until the effective date of the new Revenue Requirement and/or Revenue Requirement Term. Page 4 of 7 Client ID:065299 406425 v.l.! TIAA 8.5 For the purpose of this Agreement,the table below details each Legal Plan and their associated TIAA identification numbers that will be utilized for the Reconciliation Process under this Section 8: Legal Plan Name TIAA Identification Numbers'. City of Fort Worth 457 Deferred Compensation Plan 1 406425 8.6 Other Fee Assessments not considered in Reconciliation Process include: The City understands and accepts that certain fees and commissions will apply to the TIAA Brokerage Accounts.Such fees and commissions shall be listed in the TIAA Self- Directed Brokerage Account Customer Agreement and,pursuant to the Agreement,such fees and commissions will be subject to change. If such fees or commissions are changed, TIAA will provide the Plan Administrator with 60 days prior written notice. Certain minimum balance and minimum investment amounts may also be required pursuant to the terms of that Agreement. If such fees cannot be paid from the Self Directed Brokerage Account itself,they may be paid from the participant's or beneficiary's other Plan accounts pursuant to the terms of the Customer Agreement. In addition,the City understands,with respect to TIAA's Revenue Requirement as set forth above,that the assets in a TIAA Brokerage Account are counted as Plan assets but any fees and commissions collected under a TIAA Brokerage Account Agreement shall not count for purposes of meeting a Plan's Revenue Requirement. 2. Effective as of March 11,2020,Schedule B is hereby amended as follows: Active Plan Funding Options TIAA-CREF Mutual Funds Annual Revenue Sharing Fund Name Payments(in basis points) Ticker TIAA-CREF International Equity Index Fund Premier Class 15 TRIPX TIAA-CREF Lifecycle Retirement Income Fund Premier Class 15 TPILX TIAA-CREF Lifecycle Funds TIAA-CREF Lifecycle 2010 Fund Premier Class 15 TCTPX TIAA-CREF Lifecycle 2015 Fund Premier Class 15 TCFPX The actual Lifecycle Funds currently available as funding options under the Plans are detailed in Schedule B of this Agreement. TIAA will deem Schedule B to this Agreement to be amended to include a new Lifecycle Fund when a new Lifecycle Fund becomes available and is subsequently approved by the City to be added as a funding option under the Plans.Any additional funds,that are not part of the Lifecycle family offunds,will need a signed and executed Amendment to the Record Keeping Agreement prior to being added as a funding option under the Plans. Page 5 of 7 Client ID:065299 406425 v././ 0 TIAA Annual Revenue Sharing Fund Name Payments(in basis points) Ticker TIAA-CREF Lifecycle 2020 Fund Premier Class 15 TCWPX TIAA-CREF Lifecycle 2025 Fund Premier Class 15 TCQPX: TIAA-CREF Lifecycle 2030 Fund Premier Class 15 TCHPX: TIAA-CREF Lifecycle 2035 Fund Premier Class 15 TCYPX TIAA-CREF Lifecycle 2040 Fund Premier Class 15 TCZPX TIAA-CREF Lifecycle 2045 Fund Premier Class 15 TTFPX TIAA-CREF Lifecycle 2050 Fund Premier Class 15 TCLPX TIAA-CREF Lifecycle 2055 Fund Premier Class 15 TTRPX TIAA-CREF Lifecycle 2060 Fund Premier Class 15 TLXPX Non-Proprietary Mutual Funds Annual 12b-1 and Revenue Fund Name 'Share(in basis points) Ticker American Funds SMALLCAP World Fund®Class R-5E 15 RSLDX American Funds The New Economy Fund®Class R-5E 15 RNGHX BlackRock High Yield Bond Portfolio Institutional Shares 15 BHYIX Carillon Scout Mid Cap Fund Class I 15 UMBMX DFA Emerging Markets Small Cap Portfolio Institutional Class 0 DEMSX DFA Real Estate Securities Portfolio Institutional Class 0 DFREX Goldman Sachs Small Cap Value Fund Institutional Class 15 GSSIX Invesco Diversified Dividend Fund R5 Class 35 DDFIX Lazard International Equity Portfolio Institutional Shares 15 LZIEX Metropolitan West Total Return Bond Fund Class I 10 MWTIX Vanguard Institutional Index Fund Institutional Shares 0 VINIX Vanguard Mid-Cap Index Fund Admiral Shares 0 VIMAX Vanguard Small-Cap Index Fund Admiral Shares 0 VSMAX Vanguard Total Bond Market Index Fund Admiral Shares 0 VBTLX Collective Investment Trust Annual Revenue Sharing Payments Fund Name (in basis points) CUSIP ICMA-RC VantageTrust PLUS Fund R10+ 5 92208J709 2 The 5 basis point administrative payment is subject to ICMA entering into a new participant agreement and platform agreement with City of Fort Worth and TIAA.Failure reach agreement with ICMA on the new agreements will result in administrative payment of 0 bps. Page 6 of 7 Client ID:065299 406425 V.I.] TIAA TIAA Brokerage Account Notwithstanding any other provision of the Agreement to which this Schedule is attached to the contrary,the following provisions shall apply to the TIAA Brokerage Account.If so directed by the City and subject to TIAA's acceptance of a properly executed TTAA Retirement Plan Self-Directed Brokerage Account Application of a Participant,all or a portion ofthe assets of the accounts of a Plan shall be segregated into individual TIAA Brokerage Accounts established for the benefit of Participants.Pursuant to the terms of the applicable Plan,each Participant shall have the power to direct the investment and reinvestment of assets in the TIAA Brokerage Account established for his or her benefit,subject to such administrative rules and procedures as TIAA may establish.Pursuant to the terms of the applicable Plan,Participants shall provide instructions regarding the investment of the TIAA Brokerage Account directly to the broker appointed for purposes of executing transactions under the account.For 403(b)Plans,investments in the TIAA Brokerage Account shall be limited to mutual funds in accordance with Internal Revenue Code Section 403(b)(7). Restricted Non-Proprietary Mutual Fund The following fund is no longer available as a Plan Funding Option for Plan Participants and is only an investment option for the Revenue Credit Account(s)of the Plan(s): Annuall2b4 s dRevenue Fund Name Share(in basis points) Ticker Vanguard Treasury Money Market Fund Investor Shares 0 VUSXX Teachers Insurance and Annuity Association of America By: Date: February 5,2020 Print Name: Michael Gordon Title: Director,Offer Delivery Lead City of Fort Worth By: 4Lt4,- Date:- X2� Print Name: Title: Page 7 of 7 ClrenrlD:065299 u 406425 City Secretary Contract No. ACCEPTED AND AGREED: CITY OF FORT WORTH: CONTRACT COMPLIANCE MANAGER: By signing I acknowledge that I am the person responsible for the monitoring and administration of ��-r� this contract, including ensuring all performance and By. reporting requirements. Name: >s lfs TL Title: Assistant City Manag r Date: a�" , 20,?0 By: -- Name: , APPROVAL RECOMMENDED: Title: s APPROVED AS TO FORM AND LEGALITY: A... By: oR Name: Title: By: ,f U; Name: e 1 ATTEST: ;` 'Title: Assistant City ttorney X '•�r, CONTRACT AUTHORIZATION: By: M&C: Name: Title: ity ecret FE UAL RECORD;' C[T SECA ° Y F'T. WORTH,7x _3