HomeMy WebLinkAboutContract 39887-A1 CSC No . 39887-Al
AMENDMENT TO THE
AGREEMENT FOR ADMINISTRATIVE SERVICES
FOR THE CITY OF FORT WORTH
PARS PUBLIC AGENCIES POST-RETIREMENT HEALTH CARE PLAN TRUST
The Agreement for Administrative Services ("Agreement") made the 17"' day of
September 2009, between Phase Il Systems, a California corporation, doing business as Public
Agency Retirement Services and PARS ("PARS") and the City of Fort Worth ("Agency"), is
hereby amended effective February 1, 2022, to reflect the updated annual asset fee as follows:
1. Exhibit 1B, Fees for Services, paragraph (A) of the Agreement for Administrative Services, is
hereby amended effective February 1, 2022, to read as follows:
(A) An annual asset fee paid from Plan assets based on the following schedule:
For Plan Assets from: Annual Rate:
$1 to $10,000,000 0.2125%
$10,000,001 to $15,000,000 0.1700%
$15,000,001 to $50,000,000 0.1275%
$50,000,001 and above 0.0850%
2. Section 15,Notices, paragraph (A) and (B) are hereby amended to read:
(A) To PARS: PARS; 4350 Von Karman Avenue, Suite 100,Newport Beach, CA 92660;
Attention: President
(B) To Agency: City of Fort Worth; 200 Texas Street, Fort Worth, TX 76102; Attention:
City Manager
3. All other terms and conditions of the Agreement remain in full force and effect.
IN WITNESS WHEREOF,this Amendment is hereby adopted effective as of February 1, 2022.
CITY OF FORT WORTH PUBLIC AGENCY RETIREMENT SERVICES
o /
By: By:
Reginald Zeno Tod Hammeras
Assistant City Manager Chief Financial Officer
Dated: !j S 2-— Dated: _5-- z I Ze9 Z
OFFICIAL RECORD
CITY SECRETARY
FT. WORTH, TX
FOR CITY OF FORT WORTII INTERNAL PROCESSES:
Approval Recommended: Contract Compliance Manager:
By signing I acknowledge that I am the person
responsible for the monitoring and administration
Approved as to Form and Legality: of this contract, including ensuring all
performance and reporting requirements.
By: (Ak--7
Name: Denis McElroy By:
Title: Assistant City Attorney Name: John Samford
Title: Assistant Finance Director&City
Treasurer
Contract Authorization:
M&C: C-23730
Res.No. 3779-08-2009 City Secretary: oq� OR as
-0
Form 1295:N/A 'ey 0 0� 00.0
FJA,o
F,1. 01
0
o. I Ap.
A)0 0
0
0
0
By: Jannette S.Goodall(juT7,2022 15:19 CDT) 0'4t
0
4%0
00 000
hy
Name: Jannette Goodall 00000
Title: City Secretary
OFFICIAL RECORD
CITY SECRETARY
FT. WORTH, TX
Contract #: 39887 amendment
A Resolution
NO. 3779-08-2009
ADOPTING THE PUBLIC AGENCIES RETIREMENT SERVICES (PARS)
POST-RETIREMENT HEALTH CARE PLAN TRUST
AND AUTHORIZING EXECUTION OF RELATED DOCUMENTS
WHEREAS, it is determined to be in the best interest of the City of Fort Worth
(the "City") to participate in the PARS Public Agencies Post-Retirement Health Care
Plan Trust (the "Program") to fund post-employment benefits for its employees; and
WHEREAS, the City is eligible to participate in the Program, a tax-exempt trust
and plan performing an essential governmental function within the meaning of Section
115 of the Internal Revenue Code, as amended, and the Regulations issued thereunder,
and is a tax-exempt trust under the relevant statutory provisions of the State of Texas.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF FORT WORTH, TEXAS:
1. That the City Council hereby adopts the PARS Public Agencies Post-
Retirement Health Care Plan Trust, including the PARS Public Agencies Post-Retirement
Health Care Plan, as part of the City's program of benefits, effective on the later of
September 1, 2009 or the date as of which all documents required to effectuate such Trust
have been executed (the "PARS Legal Documents")- and
2. That the City Council hereby appoints the City Manager, or his/her successor
or his"'her designee as the City's Plan Administrator for the Program; and
3. That the City Manager or any Assistant City Manager is hereby authorized to
execute the PARS Legal Documents on behalf of the City and to take whatever additional
actions are necessary to maintain the City's participation in the Program, and the City's
Plan Administrator for the Program is hereby authorized to maintain compliance of any
relevant regulation issued or as may be issued., therefore, authorizing him,,her to take
whatever additional actions are required to administer the City's PARS plan.
,Fq
RESOLUTION NO. 3779-08-2009
Adopted this 181h day of August 2009.
ATTEST:
r\
B Y:
A L)G, J-11 21,111-111)
Martv Hendrix, City Secretary
City sacl—'tar—c-'
"lity ta For'!Woil
ouwo®r
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 8/18/2009 - Res. No. 3779-08-2009
DATE: Tuesday, August 18, 2009 REFERENCE NO.: C-23730
LOG NAME: 130PEBTRUST
SUBJECT:
Adopt a Resolution Adopting the Public Agencies Retirement Services Post-Retirement Health Care Plan
Trust, Authorize the Transfer of$5,000,000.00 for Initial Funding of the Trust and Authorize Execution of
Related Documents
RECOMMENDATION:
It is recommended that the City Council:
1. Adopt the attached Resolution adopting the Public Agencies Retirement Services (PARS) Post-
Retirement Health Care Plan Trust as part of the City's program of benefits in order to provide a funding
source for retiree health care benefits in response to Governmental Accounting Standards Board
Statement 45 (GASB 45);
2. Authorize the transfer of$5,000,000.00 to PARS for the purpose of funding the Trust; and
3. Authorize the City Manager to execute an Adoption Agreement, Master Plan Document, Agreement for
Administrative Services and any other documents with Phase II Systems, a California corporation d/b/a
PARS (for Trust administration and compliance services), or Union Bank of California, N.A. (for trustee
and investment management services) that are necessary to incorporate the Trust as part of the City's
program of benefits in accordance with GASB 45.
DISCUSSION:
With the implementation of a new accounting rule, Government Accounting Standards Board Statement
45 (GASB 45), the City must begin accounting for its Other Post Employment Benefits (OPEB) which are
the City's retiree healthcare and death related benefits.
As of October 1, 2008, the Unfunded Actuarial Accrued Liability (UAAL) as determined by Aon Consulting
was $986 million and the associated Annual Required Contribution (ARC) was $103 million.
In order to lessen the City's future liability, the City Council modified the health benefit offered to retirees
(M&C G-16299). Consequently, employees and their dependents hired on or after January 1, 2009, upon
retirement, may receive continued health coverage under the City's plan by paying the full cost. No City
contribution will be made towards that coverage.
The City Council appropriated $5 million in the Fiscal Year 2009 budget to deposit in an irrevocable trust
that will be used to fund the City's OPEB liabilities. The trust will allow the City to assume a higher yield on
investments and therefore lessen the funding requirements of the overall liability.
A committee with representatives from Human Resources, Financial Management Services, the City's
financial advisors, the City Attorney's Office and outside bond counsel reviewed OPEB trust proposals
Logname: 130PEBTRUST Pagel of 3
from PARS and ICMA. Based on the committee's review, it is recommended that the City adopt the PARS
Health Care Plan Trust (the PARS Trust) as part of the City's program of benefits in order to provide a
funding source for retiree health care benefits. Following adoption of the attached resolution and execution
of all documents necessary to incorporate the PARS Trust as part of the City's program of benefits, the
City will transfer$5 million for deposit in the PARS Trust. PARS will provide Trust administration and
compliance services. Union Bank of California, N.A., will serve as trustee and will provide investment
management services.
Two investment strategies exist for the investment of Trust funds: 1) the City can actively, or directly,
manage the investments by selecting specific investments; or 2) the City can take a discretionary
approach and allow Union Bank to manage the funds based on a particular investment strategy and act as
fiduciary. Based on input from the City's financial advisors, staff anticipates opting for the latter,
discretionary approach.
Fees are based as a percentage of the fund's value. As the total value increases, the percentage
decreases. The fee schedules are outlined below:
Union Bank Fees
Trustee Approach Trustee/Custodial Fees Investment Management Fee
0.35 Percent for Assets Under $5M
0.25 Percent for Assets $5410M
Discretionary None 0.20 Percent for Assets $10-$15M
0.15 Percent for Assets $15-$50M
0.10 Percent on All Assets Over $50M
Directed 10.10 Percent of Assets Depends on Investments Selected
PARS's fee structure for trust administration, consulting and compliance is based solely on the fund's
value. The fee structure is outlined below:
PARS Fees
Plan Set-up Fee rust Administration/Consulting/Compliance
Fees
0.25 Percent for Assets Under $10M
0.20 Percent for Assets $10-$15M
None 0.15 Percent for Assets $15-$50M
0.10 Percent on All Assets Over $50M
($400 monthly minimum)
It is anticipated that as additional funding for retiree health care benefits becomes available, the City will at
some point create its own trust and will transfer any available funds in the PARS Trust into this specific
trust.
FISCAL INFORMATION / CERTIFICATION:
The Financial Management Services Director certifies that funds are available in the current operating
budget, as appropriated, of the General Fund.
FUND CENTERS:
Logname: 13OPEBTRUST Page 2 of 3
TO Fund/Account/Centers FROM Fund/Account/Centers
GG01 538070 0905500 $5,000,000.00
CERTIFICATIONS:
Submitted for City Manager's Office by: Karen Montgomery (6222)
Originating Department Head: Lena Ellis (8517)
Additional Information Contact: Greg Jordan (8843)
ATTACHMENTS
1. m&cfundloq.pdf (CFW Internal)
2. PARS Trust Resolution.doc (Public)
Logname: 13OPEBTRUST Page 3 of 3