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State of Rhode Island 457(b) Deferred Compensation and 401(a) Defined Contribution Plans

REQUEST FOR PROPOSAL TO PROVIDE DEFERRED COMPENSATION & DEFINED CONTRIBUTION SERVICES

Recordkeeping/Administration, Communication/Education, Onsite Education, Investment Advisory, Investment Management and Custodial Trustee Services

Issue Date: February 14, 2017 Deadline for Questions: February 21, 2017 Deadline for RFP Submission: March 7, 2017

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Ta b l e o f C o n t e n t s

Request for Proposal to Provide Bundled Deferred Compensation and

Defined Contribution Services: Recordkeeping/Administration,

Communication/Education, Onsite Education, Investment Advisory, Investment

Management, and Custodial Trustee

Intent to Reply ..................................................................................................................... 1

I. General Invitation ........................................................................................................ 1

II. State Required Information......................................................................................... 3

III. Scope of Services ...................................................................................................... 4

IV. Preparing Proposals: Required Information .............................................................. 4

V. Evaluating Proposals ................................................................................................. 4

VI. Confidentiality ............................................................................................................ 8

Section 1:Scope of Services .............................................................................................. 10

Purpose/Objective .......................................................................................................... 10

Scope of Services ........................................................................................................... 11

Information Regarding the 457(b) Plan .......................................................................... 15

Plan Demographic Information: Fidelity ......................................................................... 16

Plan Demographic Information: VALIC .......................................................................... 18

Plan Demographic Information: Voya. ............................................................................ 20

Investment Line-ups. ...................................................................................................... 20

Information Regarding the 401(a) Plan .......................................................................... 26

Plan Demographic Information: TIAA ............................................................................. 26

Investment Line-up ......................................................................................................... 32

Goals and Objectives of the Request for Proposal ........................................................ 34

Finalist Presentations ..................................................................................................... 34

Exceptions/Additions ...................................................................................................... 35

Section 2: Administrative Services Questionnaire .......................................................... 36

Organization and History ................................................................................................ 36

References ..................................................................................................................... 38

Client Service/Quality Assurance ................................................................................... 38

Recordkeeping/Administration........................................................................................ 39

Systems Capabilities and Hardware .............................................................................. 40

Custodial Trustee ........................................................................................................... 41

Regulatory/Compliance Service ..................................................................................... 41

Communication & Education .......................................................................................... 42

Plan Sponsor Reporting ................................................................................................. 42

Participant Reporting ...................................................................................................... 43

Participant Services/Automated Voice Response System (VRS) .................................. 43

Participant Services/1-800 Customer Service Center .................................................... 44

Participant Services/Internet Services ............................................................................ 45

Field Service Representatives ........................................................................................ 45

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Investment Advisory Services ........................................................................................ 46

Plan Implementation ....................................................................................................... 47

Section 3: Investment Management Services Questionnaire......................................... 48

Investment Management Services ................................................................................. 48

Self-Directed Brokerage ................................................................................................. 49

Stable Value Fund .......................................................................................................... 49

Section 4: Fees .................................................................................................................... 52

Section 5: Attachments ...................................................................................................... 56

Attachment A: Certification of Compliance with Minimum Requirements of RFP .......... 56

Attachment B: Certification of Compliance with Standard State Contract ..................... 57

Section 6: Appendices........................................................................................................ 58

A. 457(b) Plan Document ............................................................................................... 58

B. 401(a) Plan Document ............................................................................................... 58

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Intent to Reply

Please complete the information below and send an email copy of this form to Craig Chaikin at

Segal Marco Advisors, [email protected] regarding your intent to reply to this RFP by

February 21, 2017.

The State in consultation with Segal Marco Advisors will issue responses to inquiries and any

other corrections or amendments it deems necessary in addenda issued prior to the Proposed

Submission Deadline. Respondents should not rely on any representations, statements or

explanations other than those made in this RFP or in a formal addendum. It is the respondent’s

responsibility to ensure receipt of all addenda.

Amendments to the RFP will only be sent to those firms that complete and return this form via

fax or provide the requested information by e-mail.

RFP Name: State of Rhode Island 457(b) Deferred Compensation and 401(a) Defined

Contribution Plans Recordkeeping and Investment Services

Company name

Mailing address

Phone number

Fax number

Contact person

E-mail address

All amendments will be sent via e-mail.

Any alterations to this document made by the respondent may be grounds for rejection of the

proposal, cancellation of any subsequent award, or any other legal remedies available to the

Committee.

From the date this RFP is issued until the award of the contract, all communication related to this

RFP shall be only directed to Segal Marco Advisors.

I. General Invitation

The Deferred Compensation Plan, Defined Contribution Retirement Plan and FICA Alternative

Retirement Plan (FARP) for Public Employees of the State of Rhode Island ("Plans"), invites the

submission of proposals for investment management, recordkeeping/administration,

communication/education, investment advisory and custodial trustee services. The intent of the

RFP is to identify organization(s) as described in greater detail below.

Organization(s) with demonstrated experience in this area, and with an interest in making their

services available to the Plans, are invited to respond to this RFP.

Respondents means the organization(s) that submit their qualifications to this RFP. The

documents submitted will be referred to as "Proposal."

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A. General Information and Guidelines

1. Communications Between the Plan and Respondents

Respondents should not communicate with the State regarding the RFP and must

communicate only with Segal Marco Advisors who has been retained by the Plans to

coordinated the evaluation process. Current vendors may discuss ongoing business with the

State but are not permitted to discuss any aspects of this RFP. All questions or requests for

clarification must be in writing, sent by e-mail, and directed to the attention of:

Craig Chaikin, Vice President

Segal Marco Advisors

333 West 34th Street 5th Floor

New York NY 10001

[email protected]

A Respondent that deviates from any of these restrictions is subject to immediate disqualification

from this RFP process.

There should be no communication, either in person, in writing, or by phone, between any

respondent (or prospective respondent) and any (1) member of the State Investment Commission

or staff, (2) elected officials or their staff members, or (3) any other person in a position to

influence the decision of the State any time during the RFP process. Direct communication with

any person who falls within the descriptions in this section in an attempt to influence the

awarding of the RFP shall be considered grounds for disqualification.

B. Submission of Proposals

Each vendor must submit their RFP response in accordance with all stipulations listed

below:

Each service provider must submit a total of copies, as outlined below, by 5:00 p.m.

Eastern Standard Time on March 7, 2017 to the following:

Two (2) bound copies and one (1) electronic, PDF copy to:

Kimberly Shockley

Associate Director, College & Retirement Savings Plans

50 Service Avenue

Warwick, RI 02886

[email protected]

One (1) bound copy and one (1) electronic, PDF copy to:

Craig Chaikin, CFA

Segal Marco Advisors

333 West 34th Street, 5th Floor

New York, NY 10001

[email protected]

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Proposals must be clearly labeled: Request for Proposal Response: State of Rhode Island

457(b) Deferred Compensation Plan, 401(a) Defined Contribution Retirement Plan and

FICA Alternative Retirement Plan Services.

RFPs received after the deadline are late and will not be considered. Respondents are

responsible for ensuring that their proposals are received in a timely fashion.

RFP Schedule

The timetable for the selection process is summarized below. Note that these target dates are

subject to change by the Plan.

Key Activity Target Date

RFP release February 14, 2017

Submission of vendor questions February 21, 2017

Responses to vendor questions February 28, 2017

Proposals Due March 7, 2017

Finalist Presentations Week of April 17th

Selection of vendor Week of April 17th

Recommendation to Board April 26, 2017

Board Approval April 26, 2017

Contracts Approved May 2017

Implementation/Transition October 1, 2017

II. State Required Information

The selected respondents must agree to abide by all applicable Rhode Island minority hiring

laws, Equal Opportunity Rules and Regulations, Executive Orders, and any and all other

applicable Rhode Island employment laws, rules and regulations.

The successful vendor/s will be required to be in compliance with Title 7 Chapter 1.2 of the

General Laws of Rhode Island requiring that foreign corporations (those without a Rhode Island-

based business) must procure and maintain a Certificate of Authority to transact business from

the Rhode Island Secretary of State.

All materials submitted in response to this RFP become the property of the State and will not be

returned. Vendors are advised that all materials submitted to the State for consideration in

response to this RFP will be considered to be public records pursuant to Title 38, Chapter 2 of

the General Laws of Rhode Island.

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III. Scope of Services

A. Scope of Services

The Services that the Plans seek to acquire are described in detail in Section 1 to this RFP (the

“Services”).

B. Term of Services

The initial contract term will be five (5) years from the date on which a contract is awarded by

the Plans. The contract may be renewed for an additional term based upon the discretion of the

State Investment Commission.

IV. Preparing Proposals: Required Information

Each RFP must contain all of the following documents and must conform to the following

requirements.

A. Format of Proposals

Qualifications should be prepared on “8½ x 11” letter size paper (preferably recycled), printed

double-sided and bound on the long side. The Plans encourage using reusable, recycled,

recyclable and chlorine-free printed materials for bids, proposals, reports, and other documents

prepared in connection with this solicitation.

Sections should be separated by labeled tabs and organized in accordance with subject

matter sequence as set forth below.

V. Evaluating Proposals

The State of Rhode Island along with Segal Marco Advisors will review and evaluate the

Proposals, as described below.

The State of Rhode Island and Segal Marco Advisors will first examine proposals to eliminate

those that are clearly non-responsive to the stated requirements. Therefore, respondents should

exercise particular care in reviewing the proposal format required for this RFP.

In evaluating the proposals, all aspects of the required services will be fully evaluated. The State

may consider any factors it deems necessary and proper for best value, including but not limited

to:

1. Commitment to onsite employee enrollment, ongoing communication, customer service,

and employee education. This includes an understanding of the DB plan at a level where a

member can be assisted on their full retirement package as it relates to their state

employment.

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2. Data-management services, including creation and maintenance of employee data,

transaction data and history, interfaces with suppliers and Payroll, and other record keeping

and administrative functions, including compliance.

3. Overall cost structure.

4. Size, structure, resources, and experience in providing deferred compensation and defined

contribution services that are similar in size and scope to that of the Plans.

5. Open architecture investment platform.

6. Investment advisory services.

7. Responsiveness: The State will consider the completeness and accuracy of Respondent's

Proposal.

8. Financial Stability: Respondent must be financially stable, helping to ensure performance

over the duration of the services.

9. Compliance with Laws, Ordinances and Statutes: The State will consider Respondent's

compliance with all laws, ordinances, and statutes governing the services and of the

respondent.

10. Conflict of Interest: The State will consider any information regarding a Respondent,

including information contained in a Respondent's proposal, that may indicate any conflicts

(or potential conflicts) of interest which might compromise the Respondent's ability to

successfully perform the proposed services or undermine the integrity of the competitive

procurement process. If any Respondent has done any work for the Plan in researching,

consulting, advising, drafting, or reviewing this RFP or any work related to this RFP, such

Respondent may be disqualified from further consideration.

11. Legal actions, if any, against Respondent and any division, subsidiary or parent company

of Respondent.

Selection Criteria

The State will evaluate all proposals according to the factors and weights listed below.

Evaluation will be done in two phases as described:

Phase One: Will utilize all factors below but pricing for winning ONLY the 401(a) and

FICA plans. This evaluation will result in a winner for just the 401(a) and FICA plans.

Phase Two: Will utilize all factors below but pricing for winning ONLY a 457(b)

component. This evaluation will result in the top three most competitive proposals for just a

457(b) component.

For the winner of Phase One, pricing provided for winning the 401(a), FICA & a

457(b) component will be used instead of the 457(b) only pricing.

Those Contractors that score in the Competitive Range may be invited to make presentations to

the State. Each proposal will be scored on a scale of 0 to 100, with 100 being the highest. The

major evaluation categories are listed below:

1. Experience of Contractor (15 points), including but not limited to:

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a. Financial condition

b. Public sector 401(a) and 457(b) experience respective to the phase being scored

1) Number of similar plans

2) Number of public sector participants

c. Quality assurance

d. Prior performance record (including references)

e. Experience of transition and ongoing teams

2. Proposed Plan of Work (40 points), including but not limited to:

a. Timeliness of transition plan

b. Participant communication

c. Participant education

d. Investment advisory services

e. Recordkeeping and administration

f. Dedicated field representatives

g. Reporting to the State

h. Participant services (1-800, VRS & Internet)

i. Technology management

3. Investment Services (20 points), including but not limited to:

a. Breadth of standard investment platform

b. Breadth of stable value offerings

c. Proposed stable value option

4. Cost (25 points), including but not limited to:

a. Transition costs;

b. Recordkeeping and administration costs;

c. Optional participant services (e.g. loans & QDROs)

d. Other administrative costs (if any)

e. Deferred sales charges (if any)

Minimum Qualifications of Service Provider

Respondent(s) must meet all of the following minimum qualifications to be given further

consideration. If a proposal is submitted by a company that does not satisfy the minimum

qualifications it will not be reviewed or considered. The incumbent providers are exempt

from satisfying the minimum requirements.

1. Respondents must certify that they are a qualified firm to provide administrative services

pursuant to Sections 457 and 401(a) of the Internal Revenue Code, including all rules and

regulations of the State of Rhode Island.

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2. Respondents must offer bundled administrative services (i.e.,

recordkeeping/administration, communication/education, custodial trustee services, and

investment advisory services), as well as an open architecture investment platform.

3. Respondent must have at least ten (10) years' experience in providing the proposed

services and products to the public sponsor defined contribution marketplace.

4. Respondents must administer a minimum of three (3) 457(b) deferred compensation plans

and three (3) tax advantaged governmental plans of similar size.

5. Respondent must also have at least three (3) plans where you administer both the 457(b)

deferred compensation plan and the tax advantaged governmental plan.

6. Respondent must have a minimum of $2 billion under administration for public sector

plans.

7. Respondent must have at least three (3) public sector 457(b) plans each with 3,000 or more

participants.

8. Respondent must have at least three (3) tax advantaged governmental plans each with

30,000 or more participants.

9. Any relationships proposed to provide services offered in this RFP must have been in place

for at least five (5) years and provide services to similar plans (size and demographics).

10. Respondents who elect to provide investment advisory services/onsite services utilizing a

joint-venture must have a minimum of five (5) years’ experience with the proposed service

provider.

Service Provider Preferences

1. Respondents should be able to accommodate an October 1, 2017 implementation date.

2. Respondents should have the capability to establish a two-way data interface with the Plans

and will be solely responsible for timely, accurate transmission and, as appropriate, editing

and validation of data for processing enrollments and contribution activity. The successful

service provider will absorb all of the Plans’ programming costs to accommodate any

changes to its payroll system.

3. Respondent should have a Statement on Standards for Attestation Engagements (SSAE) 16

Audit conducted at least annually and provide their most recent SSAE 16 as part of their

response to this proposal.

4. Respondents should have its IT security and systems tested regularly as part of the SSAE

16 or through a separate IT audit and provide the results as part of their response to this

proposal.

5. Respondents must provide field service representatives to support the on-going

consultation to all the Plans’ participants located throughout the State. Representatives

should provide enrollment, education and participant communication services and may not

have commission-based compensation or any financial incentives to promote any

investment product or services. The selected vendor must have field service support

available by August 2017 to commence the new plan roll out.

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6. Respondents should be able to maintain and track participant contribution rate changes and

report an electronic feedback file with updated information to payroll so that they can in

turn update their payroll deduction records.

7. Respondents should be solely liable and responsible for any processing errors of the

provider or its agents. In the event of a participant’s loss of interest and/or dividend and/or

principal due to an error by the selected respondent or its agent in processing transactions

on behalf of the participant, the selected respondent agrees to adjust the participant’s

account to the same position as if the processing error had not occurred.

8. Respondents should be able to provide the daily ongoing administration of a Roth 457(b)

provision. This feature is not offered under the current plan design but is being considered

by the State.

Any responses not meeting the minimum qualification may be considered, at the sole

discretion of the State as non-responsive. While the service provider preferences are not

required, the State strongly prefers the selected bidder to have all qualifications.

As part of the evaluation process, the State will review the information required by Sections II,

III and IV for each Proposal received. The State may also review any other information that is

available to it, including but not limited to information gained by checking references and by

investigating the Respondent(s) financial condition.

The Plans reserve the right to seek clarification of any information submitted by any Respondent

in any portion of its Proposal or to request additional information during the evaluation process.

Any material misrepresentation made by a Respondent may void the Proposal and eliminate the

Respondent from further consideration.

VI. Confidentiality

Responses to this RFP become the exclusive property of the Plans. All documents submitted in

response to this RFP are subject to the State of Rhode Island Open Records Law and may be

regarded as public records subject to disclosure.

Confidentiality Requirements Related to Plan Information

All of the reports, information, or data, prepared or assembled by or provided to the Respondent

in this RFP are confidential. Except as may be required by law, the Respondent will not make

available such reports, information, or data, to any other individual or organization and will use

the reports, information or data only to assist in preparation of Respondent’s Proposals.

Additional Details of the RFP Process

A. Addenda

If it becomes necessary to revise or expand upon any part of this RFP, an addendum will be sent

to all of the prospective Respondents that have completed the Notice to Respondent Form.

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B. Plan's Rights to Reject Qualifications

The Plans reserve the right to reject any and all Proposals that do not conform to the

requirements set forth in this RFP; or that do not contain at least the information required by

Section III, below or for any reason.

C. No Liability for Costs

The Plans are not responsible for costs or damages incurred by Respondents, team member(s),

subcontractors or other interested parties in connection with the RFP process, including but not

limited to costs associated with preparing the Proposals and of participating in any finalists’

presentations or negotiations.

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Section 1: Scope of Services

Purpose/Objective

The State of Rhode Island, 457(b) Deferred Compensation Plan and 401(a) Defined Contribution

Retirement Plan (“Plans”), are seeking competitive proposals from qualified organization(s) to

provide recordkeeping/administration, communication/education, onsite education, investment

advisory, investment management and custodial trustee services.

The State expects to award either three or four contracts for this proposal. Pursuant to Rhode

Island General Laws (R.I.G.L.) §36-13-1(b), the State is required to maintain three vendors in

the 457(b) program. Currently there is a different vendor for the 401(a) program. The 401(a)

vendor also administers a FICA Alternative Retirement Income Security Program. Through this

proposal process, it is possible that one vendor could win a 457(b) component and the 401(a) and

FICA plans.

Any vendor that is selected for the 401(a) plan will also be required to administer the FICA

plan.

The 457(b) Plan currently has three service providers: Fidelity Investments, VALIC and Voya

Retirement Services. They provide plan administration, recordkeeping, investment management,

communication and education, participant services (1-800, VRS & Internet) and onsite

education. Fidelity has approximately $120.9 million of assets and 2,900 accounts, VALIC has

$58.9 million of assets and 1,000 accounts and Voya has $156.0 million of assets and 4,100

accounts.

The 457(b) program has approximately 11,000 eligible employees.

If a 457(b) service provider is deselected, the State will make its best efforts for those assets to

move to the newly selected provider. However, participants will be given the choice of assets

mapping to the new service provider or choosing among the remaining providers.

Additionally, if there is more than one 457(b) vendor deselected, the State expects to award

457(b) assets based on 457(b) scoring and subsequent ranking.

The Defined Contribution Retirement Plan is a defined contribution (money purchase) plan that

operates under Section 401(a) of the Internal Revenue Code (IRC). The Plan is established

pursuant to R.I.G.L. 36-10.3 et.sea. The Plan was effective as of July 1, 2012.

All Eligible Employees of an authorized employer under RIGL 36-10.3 (“Employer”) can

participate in the Plan. An Eligible Employee means all employees with less than 20 years of

service as of June 30, 2012 who are eligible to participate under the Defined Benefit plans

administered by the State under the Employees’ Retirement System of Rhode Island (“ERSRI”)

or the Municipal Employees’ Retirement System (“MERS”), excluding legislators, correction

officers, and MERS general police and fire employees who participate in Social Security. Judges

and state police officers are also excluded from the Plan. Leased Employees are not eligible to

participate in the Plan. Individuals deemed by the Plan Administrator to be independent

contractors are also not eligible to participate in the Plan.

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The 401(a) Plan is currently administered by TIAA who provides plan administration,

recordkeeping, investment management, communication and education, participant services (1-

800, VRS & Internet) and onsite education. The Plan has approximately $585.2 million of assets

and 35,000 accounts.

TIAA also administers the FICA Alternative Retirement Plan, which has approximately $2.2

million of assets and 1,600 accounts.

For additional information, the Plan documents for the 457(b) and 401(a) Plans have been

included in the Appendix to this RFP.

As noted above, the State is required to have three, 457(b) vendors. It is possible that a

vendor could successfully bid on a piece of the 457(b) and the 401(a) and FICA.

Scope of Services

Implementation Services

The successful respondent will be required to provide a detailed plan transition strategy along

with communication materials to explain any new plan changes and enhancements. The potential

conversion from the current plan provider to a new provider will require you to provide an

explanation of the process, blackout period and reconciliation of plan assets to the individual

participant records. It is required that onsite support team be in place prior to the actual transition

date.

The implementation will be crossing the Plans’ fiscal year. Detailed reconciliations of assets at

the plan and member level will be required.

Administration and Recordkeeping Services

The successful respondent will be required to provide detailed information about their

recordkeeping and administrative systems and use of technology. Important factors include the

ability to process payroll deductions, monitor compliance, daily processing of participant

transactions, provide timely and accurate participant statements and financial statements. The

respondent must have in place a toll-free customer center, voice response services and internet

services that allow participants access to their accounts.

Employee Communication, Education, and Enrollment Services

The successful respondent will be required to provide a comprehensive employee

communication and investment education program. Communication services are to be supported

by customer service representatives and comprehensive Internet services that provide

participants with interactive financial and retirement planning tools and software. A dual high-

touch, high-tech approach will be required to provide the participants with all of the necessary

financial information and data to make informed investment decisions related to their elections.

An explanation that outlines your firm’s capabilities in designing and implementing a

communication and education strategy will be required for both the initial transition and ongoing

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process. The goal is to identify a respondent that offers comprehensive communication and

education services supported by field representatives to accommodate the needs of the

employees located throughout the Plan. In addition to your core communication services, it is the

expectation that your field service representatives will be available to provide one-on-one

counseling and investment advisory services. Additionally, the State requires that all onsite

representatives be able to discuss the State’s Defined Benefit Plan’s features in addition to the

DC component.

The compensation structure of the field service representative should not allow for any

cross selling of any investment products or services, unless the bidder provides services on

both a 457(b) component and the 401(a) and FICA, in which case they would only be

allowed to cross-sell this one product. Compensation and incentive awards for your field

representatives must be structured to maintain an objective and unbiased distribution of

investment products and services to the Plans’ participants.

Your proposal should clearly define the number of field service representatives that will be

devoted to this relationship, their compensation structure, and ability to provide one on one

participant level investment advisory services.

The successful respondent will be required to assist employees with the completion of

enrollment forms, verify the completeness of the forms and coordinate the institution of salary

deferrals with the Plan’s payroll system.

The winning 401(a) respondent must be willing to provide a permanent field representative at

50 Service Ave, Warwick, RI if requested by the State. The State will provide the office space

and IT/phone equipment.

Trustee/Custodial Services

The successful respondent must provide trustee/custodial services for the Plan or arrange for

trustee services with an outside party. Any additional costs for trustee/custodial services are to be

fully disclosed in the fee section of this Request for Proposal.

Investment Management Services

The Plans are interested in selecting a service provider that offers an attractive and flexible array

of investment options.

For the 401(a) line-up, recommendations are not being considered with the RFP with the

exception of stable value. The 401(a) investment line-up will be designed by Segal Marco

Advisors along with the State Investment Commission once the RFP process has been

completed.

Respondent should propose a Stable Value/Fixed Income Fund that is fully diversified, limits

credit risk/exposure, provides competitive returns with no benefit payment limitations and

provides attractive contract termination conditions.

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For the 457(b) line-up, the State is requesting a recommended line-up be proposed for

informational purposes. Similar to the 401(a), the final investment options will be fully vetted

and approved by the State Investment Commission.

The liquidity provisions on the current stable value options are below. The assets will be

transferred to the selected stable value product subject to the best interests of the Plans’

participants.

Fidelity: Not applicable

VALIC:

Fixed Account Plus:

Individual annuity contracts that require participant consent to transfer asset

Fixed Account:

5-year payout with equal installments

5-year payout with decreasing balance method (increasing percentage each year)

In addition to the Stable Value restrictions, approximately $13.8 million of the VALIC assets are

in individual annuity contracts. These assets are only transferable with a participant’s consent.

Voya:

Voya Fixed Account:

Equal payments, with interest, over a period not to exceed 60 months

Single payment subject to a Market Value Adjustment

Guaranteed Accumulation Account:

Single payment subject to a Market Value Adjustment

TIAA: Lump sum at book value; payment will either be made within 90 days of the

discontinuance date or two years from the discontinuance date depending on the result of a

contractual formula intended to serve as a proxy for the movement of interest rates over time

Fees

The State will carefully examine all the costs associated with each provider’s products and

services. Each respondent will be required to fully disclose fees based on the plan information

provided in this RFP.

Currently members earning less than $35,000 indexed in a calendar year do not pay the plan

admin fees:

§ 36-10.3-13 Waiver of administrative fees.

Any plan administration fees assessed to members of the plan after July 1, 2015, shall be

reimbursed by the state for any member whose annual compensation is thirty-five thousand

dollars ($35,000) or less, said dollar amount to be indexed annually in the same percentage

determined under § 36-10-35(h)(1)(B).

History of Section.

(P.L. 2015, ch. 141, art. 21, § 10.)

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Preparation Costs

All costs incurred or in any way associated with the qualification’s preparation, response,

submission, presentation, or oral interviews shall be the sole responsibility of the respondent and

shall not be reimbursed by the Plans.

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Information Regarding the 457(b) Plan

Plan: State of Rhode Island and Providence Plantations

Plan Type: Section 457(b) Deferred Compensation Plan

Eligible Employees: 11,083

Eligibility: All State of Rhode Island public employees receiving compensation with the exception of certain school employees

Rollovers: Rollover contributions from other eligible plans and IRAs are allowed

Plan Year: January 1 to December 31

Benefit Payment Events: The Plan allows for withdrawals for the following events:

Termination of employment

Retirement

Death

Financial Hardship

In-Service Withdrawals: Participants may withdraw their contributions plus interest for the following reason:

Unforeseeable Emergency Withdrawals as defined under section 457(d)(1)(A)(iii) of the Code

If 1) total amount payable does not exceed the dollar amount under section 411(a)(11)(A) of the Code 2) No payment has been deferred during the two-year period ending on the date of distribution 3) No prior in-service or force out distributions

Force outs: If the State elects, it may pay out a participants account under the following conditions:

If total amount payable does not exceed $1,000

No payment has been deferred during the two-year period ending on the date of distribution

No prior in-service or force out distributions

Forms of Distribution: Forms of Annuity

Lump Sum

Partial Lump Sum

Payment in equal amounts for period designated by participants

Systematic Withdrawal Option

Minimum Required Distributions

Any other method agreed upon between the Participant and the State and accepted by the service provider

Catch-up Contributions: As permitted by law

Purchase of Service Credit: Yes, if transfer is for the purchase of permissive service credit (as defined in section 415(n)(3)(A) of the Code) or a repayment to which section 415 of the Code does not apply by reason of section 415(k)(3) of the Code

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Plan Demographic Information: Fidelity

1. Frequency of contributions (weekly/bi-weekly/monthly): Bi-Weekly

2. Medium used to remit contributions files (electronic, disk, magnet tape, etc.): Electronic

3. Funding method (check, wire, ACH): Wire

4. Number of payroll locations: 1

5. Number of payroll files: 26

2016 2015 2014 2013

Participation Breakdown: Fidelity

Total Active 1,435 1,384 1,336 1,306

Actively Contributing 1,006 1,026 1,030 1,040

Total Accounts 2,874 2,830 2,804 2,781

Cash Flow: Fidelity

Contributions 6,985,626 6,315,700 5,957,034 5,793,025

Withdrawals (6,482,344) (4,882,201) (3,539,091) (3,522,330)

Net Cash Flow 503,282 1,433,498 2,417,943 2,270,695

Participant Information: Fidelity 457 Plan 12/31/16

Number of participants active and contributing 1,006

Number of participants active, not contributing 433

Number of terminated participants w/balances 36

Number of terminated participants w/balances less than $5,000 10

Number of participants suspended due to hardship 4

Total account balances - participants active and contributing $117,236,039

Total account balances - terminated participants w/balances $2,513,131

Total account balances – participants with loans $80,494

Average account balance $42,085

17

Transaction Activity: Fidelity

457 Plan 2016 2015 2014 2013

Number of new participants 22 13 5 21

Number of new loans N/A N/A N/A N/A

Number of outstanding loans N/A N/A N/A N/A

Number of hardship withdrawals 4 9 6 8

Number of in-service withdrawals not due to financial hardship 33 23 10 35

Number of lump sum distributions 67 42 46 52

Number of recordkeeper IRAs opened N/A N/A N/A N/A

Number of minimum required distributions 38 28 20 17

Number of QDROs 2 1 1 0

Number of rollovers into the plan 10 6 6 7

Contributions/Cash-in: Fidelity

457 Plan 2016 2015 2014 2013

Employee Pre-tax (excluding catch-up contributions)

$6,479,997 $6,181,480 $5,849,161 $5,701,105

Age 50 catch-up N/A N/A N/A N/A

3-year catch-up N/A N/A N/A N/A


Roth N/A N/A N/A N/A

After-Tax N/A N/A N/A N/A

Employer Match N/A N/A N/A N/A

Employer Discretionary N/A N/A N/A N/A

Rollover Contributions $505,629 $134,220 $107,873 $91,920

90-24 Contract exchanges $37,999 $295,519 $139,489 $26,350

Loan repayments N/A N/A N/A N/A

Withdrawals/Cash-out: Fidelity

457 Plan 2016 2015 2014 2013

Lump sum distributions – cash $544,878 $293,595 $288,793 $472,191

Lump sum distributions – rollover $4,933,268 $4,071,588 $2,930,321 $2,467,933

De Minimum payments (less than $5,000) $0 $0 $0 $0

Installment payments $153,384 $108,005 $76,072 $18,935

Unforeseeable/Hardship withdrawals $1,287 $62,208 $124,731 $65,908

In-service withdrawals (ex-hardships) $639,391 $346,805 $116,208 $497,364

Loan withdrawals N/A N/A N/A N/A

Fees (i.e., loans, self-directed brokerage) ($25) ($119) ($169) ($1,664)

18

Plan Demographic Information: VALIC

1. Frequency of contributions (weekly/bi-weekly/monthly): Bi-weekly





2016 2015 2014 2013

Participation Breakdown: VALIC

Total Active, Non-Contributing

564 555 567 583

Actively Contributing 480 491 516 526

Total Accounts 1,044 1,046 1,083 1,109

Cash Flow: VALIC

Contributions 1,635,011 1,760,010 1,761,489 1,867,299

Withdrawals (2,461,815) (3,112,269) (2,741,605) (1,981,887)

Net Cash Flow (1,388,196) (1,352,259) (980,115) (114,588)

2016 2015 2014 2013

Stable Value Participation Breakdown: VALIC

Under age 25 $43,290 $39,082 $37,087 $41,623

Age 26 - 35 $116,176 $120,046 $110,388 $109,981

Age 36 - 45 $745,324 $750,291 $805,036 $912,822

Age 46 - 55 $4,528,951 $4,812,615 $5,643,140 $6,384,297

Age 56 - 65 $11,780,296 $11,630,364 $11,672,167 $11,666,479

Age 65 - 70.5 $7,935,569 $6,902,518 $5,475,101 $5,007,603

Age 71 - 80 $4,381,423 $5,091,631 $5,098,324 $4,987,682

Age 80+ $2,502,985 $1,621,917 $1,572,998 $1,284,182

Stable Value Cash Flow: VALIC

Contributions 719,604 809,198 838,879 937,371

Withdrawals (1,398,505) (1,768,485) (1,941,725) (1,268,098)

Net Cash Flow (678,901) (959,287) (1,102,846) (330,727)

Participant Information: VALIC 457 Plan 12/31/16

Number of participants active and contributing 480


Number of terminated participants w/balances Not available

Number of terminated participants w/balances less than $5,000 Not available

19

Number of participants suspended due to hardship 0


Total account balances - terminated participants w/balances Not available

Total account balances – participants with loans N/A


Transaction Activity: VALIC

457 Plan 2016 2015 2014 2013





Number of in-service withdrawals not due to financial hardship 0 0 3 2


Number of recordkeeper IRAs opened - - - -

Number of minimum required distributions 92 91 85 76

Number of QDROs 3 3 3 0


* Number of recordkeeper IRA’s opened not available

Contributions/Cash-in: VALIC

457 Plan 2016 2015 2014 2013


$1,635,011 $1,760,010 $1,761,489 $1,867,299

Age 50 catch-up Not Available Not Available Not Available Not Available

3-year catch-up Not Available Not Available Not Available Not Available

15-year catch-up Not Available Not Available Not Available Not Available



Employer Match 0 0 0 0

Employer Discretionary 0 0 0 0

Rollover Contributions 0 0 0 0

90-24 Contract exchanges Not Available Not Available Not Available Not Available


Withdrawals/Cash-out: VALIC

457 Plan 2016 2015 2014 2013

Lump sum distributions – cash $419,110 $517,426 $448,504 $500,378

Lump sum distributions – rollover $1,093,395 $1,420,753 $1,131,651 $478,205

20

De Minimum payments (less than $5,000) Not Available Not Available Not Available Not Available



In-service withdrawals (ex-hardships) $0 $0 $3,450 $6,333

Loan withdrawals $0 $0 $0 $0

Fees (i.e., loans, self-directed brokerage) $0 $0 $0 $0

Plan Demographic Information: Voya

1. Frequency of contributions (weekly/bi-weekly/monthly): Bi-weekly





2016 2015 2014 2013

Participation Breakdown: Voya

Total Active* 4,078 3,982 3,886 3,779


Total Accounts 4,078 3,982 3,886 3,779

Cash Flow: Voya

Contributions 8,875,107 8,734,707 8,017,941 7,758,620

Withdrawals (8,420,120) (9,632,013) (6,605,577) (5,391,480)

Net Cash Flow 454,987 (897,306) 1,412,364 2,367,140

* Includes all participants with a balance

2016 2015 2014 2013

Stable Value Participation Breakdown: Voya

Under age 25 5 4 3 2

Age 26 - 35 207 205 198 191

Age 36 - 45 465 457 462 455

Age 46 - 55 998 965 919 874

Age 56 - 65 1,069 1,058 1,045 1,016

Age 65 - 70.5 258 266 273 287

Age 71 - 80 126 150 158 160

Age 80+ 51 54 51 58

Stable Value Cash Flow: Voya

Contributions 3,593,185 3,537,187 3,358,329 3,340,152

Withdrawals (4,101,439) (4,237,017) (3,391,031) (2,370,026)

21

Net Cash Flow (508,254) (699,830) (32,702) 970,126

* Includes all participants with any monies invested during applicable year

Participant Information: Voya 457 Plan 12/31/16


Number of participants active, not contributing Not available

Number of terminated participants w/balances Not available

Number of terminated participants w/balances less than $5,000 1,426*

Number of participants suspended due to hardship Not monitored


Total account balances - terminated participants w/balances Not available



* Includes all participants with balances less than $5,000; data for terminated participants not provided the State

Transaction Activity: Voya

457 Plan 2016 2015 2014 2013





Number of in-service withdrawals not due to financial hardship

Not Tracked Not Tracked Not Tracked Not Tracked


Number of recordkeeper IRAs opened Not Available Not Available Not Available Not Available

Number of minimum required distributions

Not Available Not Available Not Available Not Available

Number of QDROs Not Available Not Available Not Available Not Available


Contributions/Cash-in: Voya

457 Plan 2016 2015 2014 2013


$8,875,107 $8,734,707 $8,017,941 $7,758,620

Age 50 catch-up Not Tracked Not Tracked Not Tracked Not Tracked

3-year catch-up Not Tracked Not Tracked Not Tracked Not Tracked





22


Rollover Contributions $494,202 $844,825 $1,457,674 $1,514,670

90-24 Contract exchanges $378,203 $138,143 $239,292 $878,443


Withdrawals/Cash-out: Voya

457 Plan 2016 2015 2014 2013

Lump sum distributions – cash $4,496,270 $6,406,269 $4,429,071 $2,655,069

Lump sum distributions – rollover $525,215 $639,908 $583,593 $1,103,923

De Minimum payments (less than $5,000)* - - - -



In-service withdrawals (ex-hardships) Not Tracked Not Tracked Not Tracked Not Tracked


Fees (i.e., loans, self-directed brokerage) N/A N/A N/A N/A

* Have not been requested by State

23

Fidelity Investment Line-up

Asset Class Fund Name Fund Ticker Symbol Market Value

Stable return / Money market FMMT RETIRE GOV II FRTXX $6,507,212

Domestic Fixed Income FID US BOND IDX PR FSITX $1,269,965

Domestic Fixed Income PIM TOTAL RT INST PTTRX $6,161,377

Large Cap Value INVESCO DIVRS DIV R6 LCEFX $3,013,377

Large Cap Core FID 500 INDEX INST FXSIX $9,489,623

Large Cap Core FID LARGE CAP STOCK FLCSX $7,851,656

Large Cap Growth FID CONTRAFUND K FCNKX $25,624,614

Mid Cap Value FID LOW PRICED STK K FLPKX $9,612,769

Mid Cap Core FID MID CAP IDX PR FSCKX $1,205,249

Small Cap Core FID SM CAP IDX PR FSSVX $988,076

International FID INTL INDEX PR FSIVX $977,894

International HARBOR INTL INST HAINX $4,048,087

Target Date FID FREEDOM K INCOME FFKAX $1,473,733

Target Date FID FREEDOM K 2005 FFKVX $208,811

Target Date FID FREEDOM K 2010 FFKCX $3,999,174

Target Date FID FREEDOM K 2015 FKVFX $2,164,677

Target Date FID FREEDOM K 2020 FFKDX $13,092,687

Target Date FID FREEDOM K 2025 FKTWX $2,191,549

Target Date FID FREEDOM K 2030 FFKEX $8,789,445

Target Date FID FREEDOM K 2035 FKTHX $1,214,897

Target Date FID FREEDOM K 2040 FFKFX $579,892

Target Date FID FREEDOM K 2045 FFKGX $513,634

Target Date FID FREEDOM K 2050 FFKHX $172,118

Target Date FID FREEDOM K 2055 FDENX $221,863

Target Date FID FREEDOM K 2060 FDKNX $38,063

Self-Directed Brokerage Self-Directed Brokerage $9,490,751

Total $120,901,191

24

VALIC Investment Line-up

Asset Class Fund Name

Fund

Ticker

Symbol

Market

Value

Stable return / Money market SHORT TERM FIXED ACCOUNT N/A $163,603

Stable return / Money market FIXED ACCOUNT PLUS N/A $10,357,055

Stable return / Money market FIXED INTEREST OPTION N/A $21,513,358

Stable return / Money market AMER CENT US GOVT MMKT TCRXX $37,794

Stable return / Money market CAPITAL CONSERVATION N/A $3,927

Stable return / Money market GOVERNMENT MONEY MARKET I N/A $40,920

Domestic Fixed Income PIMCO TOTAL RET PTTAX $484,767

Government Fixed Income GOVERNMENT SECURITIES FUND N/A $4,569

Long-term Fixed Income VANGUARD LT INV-GRADE FUND N/A $8,510

Inflation-Protected Fixed Income AMCENT INF-ADJ BOND ACITX $756,665

High Yield Fixed Income FEDERATED INSTL HI YLD BD FIHBX $123,978

International Fixed Income INTERNATIONAL GOVERNMENT BOND N/A $3,466

Balanced ASSET ALLOCATION FUND N/A $92,226

Balanced VANGUARD WELLINGTON FUND INC N/A $227,552

Large Cap Value DIVIDEND VALUE N/A $7,088

Large Cap Value VANGUARD DIVIDEND GROWTH VDIGX $312,510

Large Cap Value VANGUARD WINDSOR II N/A $47,960

Large Cap Core VANGUARD 500 IDX ADM VFIAX $7,013,033

Large Cap Core STOCK INDEX FUND N/A $1,048,056

Large Cap Core CORE EQUITY FUND N/A $80,318

Large Cap Growth LARGE CAPITAL GROWTH N/A $32,706

Large Cap Growth GROWTH FUND N/A $314,332

Large Cap Growth MFS MASS INVEST GR STK MIGHX $2,532,329

Mid Cap Core DREYFUS MIDCAP INDEX PESPX $6,353,764

Mid Cap Core MID CAP INDEX FUND N/A $884,276

Mid Cap Growth MID CAP STRATEGIC GWTH N/A $35,265

Small Cap Core DREYFUS SM CAP STK INDX DISSX $3,308,414

Small Cap Core SMALL CAP INDEX FUND N/A $157,711

Global GLOBAL SOCIAL AWARENESS FUND N/A $37,482

International INTERNATL EQUITIES INDEX FUND N/A $43,673

International AMER FUNDS EUROPAC REREX $1,608,115

International FOREIGN VALUE N/A $536

Emerging Markets EMERGING ECONOMIES N/A $11,877

Target Date VANGUARD TGT RTMT 2010 VTENX $105,119

Target Date VANGUARD TGT RTMT 2020 VTWNX $445,605

Target Date VANGUARD TGT RTMT 2030 VTHRX $514,082

Target Date VANGUARD TGT RTMT 2040 VFORX $2,343

Target Date VANGUARD TGT RTMT 2050 VFIFX $28,248

Target Date VANGUARD TGT RTMT 2060 VTTSX $0

Specialty SCIENCE & TECHNOLOGY FUND N/A $157,341

Total $58,900,571 * Approximately $13.8 million of the assets is invested in individual annuity contracts and is not transferable without participant

consent

25

Voya Investment Line-up


Fund

Ticker

Symbol Market Value

Stable return / Money market Voya Government Money Market

Portfolio

IVMXX $220

Stable return / Money market Voya Fixed Account - 457/401 N/A $73,242,492

Stable return / Money market Voya Fixed Account N/A $27,805

Stable return / Money market Voya Long Term Guaranteed

Accumulation Account

N/A $32,526

Domestic Fixed Income Voya U.S. Bond Index Portfolio ILBAX $534,630

Domestic Fixed Income Voya Intermediate Bond Portfolio IPIIX $5,669,196

Inflation-Protected Fixed Income PIMCO VIT Real Return Portfolio N/A $336,381

High Yield Fixed Income Prudential High Yield Fund PHYZX $617,740

Balanced Voya Balanced Portfolio IBPIX $18,249

Large Cap Value BlackRock Equity Dividend Fund MADVX $3,266,169

Large Cap Core Voya U.S. Stock Index Portfolio INGIX $7,099,501

Large Cap Core Voya Growth and Income Portfolio IIVGX $22,023,978

Large Cap Growth Voya Large Cap Growth Portfolio IEOHX $7,080,027

Large Cap Growth VY® T. Rowe Price Capital Appreciation

Portfolio

ITRIX $6,917,699

Mid Cap Core Voya Russell Mid Cap Index Portfolio IIRMX $862,419

Mid Cap Growth Principal MidCap Fund PMBPX $8,040,442

Small Cap Core Voya Russell Small Cap Index Portfolio IIRSX $833,836

Small Cap Core Voya Small Company Portfolio IVCSX $7,413,839

Global VY® Oppenheimer Global Portfolio IGMIX $5,601,712

International Voya International Index Portfolio IIIIX $266,958

International American Funds EuroPacific Growth REREX $4,330,155

Target Date Voya Solution Income Portfolio ISWIX $306,791

Target Date Voya Solution 2025 Portfolio ISZIX $439,964

Target Date Voya Solution 2035 Portfolio ISQIX $453,472

Target Date Voya Solution 2045 Portfolio ISRIX $441,398

Target Date Voya Solution 2055 Portfolio IISPX $165,773

Total $156,023,370 * The variable investment options are offered through the insurance company's separate account

26

Information Regarding the 401(a) Plan

Plan: State of Rhode Island Defined Contribution Retirement Plan

Plan Type: Section 401(a) Defined Contribution Plan

Eligible Employees: 25,000

Eligibility: Employees of an authorized employer under RIGL 36-10.3

All employees who are eligible to participate under the Defined Benefit plans administered by the State under the Employees’ Retirement System of Rhode Island (“ERSRI”) or the Municipal Employees’ Retirement System (“MERS”), excluding legislators, correction officers, and MERS general police and fire employees who participate in Social Security. Judges and state police officers are also excluded from the Plan.

Leased Employees are not eligible to participate in the Plan. Individuals deemed by the Plan Administrator to be independent contractors are also not eligible to participate in the Plan.

Employee Contributions: Teachers covered by SS – 5%

State employees covered by SS – 5%

MERS general non-police & fire covered by SS – 5%

Teachers not covered by SS – 7%

MERS general non-police & fire not covered by SS – 7%

MERS general police & fire not covered by SS - 3%

Employer Contributions: State employees - 1%

Teachers covered by SS – 1%

MERS general non-police & fire employees covered by SS – 1%

Teachers not covered by SS – 3%

MERS general non-police & fire not covered by SS – 3%

MERS general police & fire not covered by SS – 3%

Effective July 1, 2015, the State revised the contribution schedule and contributed an additional 0.25% for employees with 10 years of services and an additional 0.5% for employees with 15 years of service as of June 30, 2012

Rollovers: Rollover contributions from other eligible plans and IRAs are allowed

Plan Year: July 1 to June 30

Benefit Payment Events: The Plan allows for withdrawals for the following events:

Termination of employment

Retirement

Death

In-Service Withdrawals: Not allowed

Forms of Distribution: Single or Joint and Survivor Annuity

Lump sum

Installments

Minimum Required Distributions

Purchase of Service Credit: Yes, in accordance with the rules of the ERSRI or MERS

27

Plan Demographic Information: TIAA 401(a)

1. Frequency of contributions (weekly/bi-weekly/monthly): Annual/Semi-Annual, Quarterly, Monthly/Semi-Monthly, Biweekly (most common) Weekly, Daily


3. Funding method (check, wire, ACH): Wire & ACH


5. Number of payroll files: 5,184/year

2016 2015 2014 2013

Participation Breakdown

Total Active 31,732 31,280 30,385 30,295


Total Accounts 35,616 34,329 33,197 31,985

Cash Flow

Contributions 111,536,930 121,368,325 128,098,537 126,138,075

Withdrawals (11,001,101) (7,157,519) (3,917,565) (1,529,965)

Net Cash Flow 100,537,845 114,212,821 124,182,986 124,610,123

2016 2015 2014 2013

Stable Value Participation Breakdown

Under age 25 7 3 4 3

Age 26 - 35 98 83 80 78

Age 36 - 45 202 179 173 163

Age 46 - 55 341 300 294 272

Age 56 - 65 415 348 316 296

Age 65 - 70.5 67 55 46 41

Age 71 - 80 24 20 18 12

Age 80+ 0 0 0 1

Stable Value Cash Flow

Contributions 1,052,173 1,303,263 1,545,748 1,640,762

Withdrawals (585,073) (238,503) (91,997) (72,768)

Net Cash Flow 469,116 1,066,776 1,455,766 1,570,007

Participant Information 401(a) Plan 12/31/16


Number of participants active, not contributing 5,841

Number of terminated participants w/balances 2,909

Number of terminated participants w/balances less than $5,000 1,272

Number of participants suspended due to hardship -

28


Total account balances - terminated participants w/balances $26,398,935



Transaction Activity

401(a) Plan 2016 2015 2014 2013

Number of new participants* 377 369 944 N/A



Number of hardship withdrawals** 0 0 0 0

Number of in-service withdrawals not due to financial hardship**

0 0 0 N/A

Number of lump sum distributions** 125 87 58 N/A

Number of recordkeeper IRAs opened

Number of minimum required distributions**

0 0 0 N/A

Number of QDROs** 0 0 0 N/A

Number of rollovers into the plan** N/A 2 N/A N/A

* Number of participants that enrolled in the period

** Number of transactions processed in the period

Contributions/Cash-in

401(a) Plan 2016 2015 2014 2013


$82,191,689 $92,266,685 $99,366,691 $97,543,213

Age 50 catch-up - - - -

3-year catch-up - - - -





Employer Discretionary $26,512,743 $27,247,212 $28,057,738 $27,608,917

Rollover Contributions $2,832,497 $1,854,428 $674,108 $985,945

90-24 Contract exchanges - - - -


Withdrawals/Cash-out

401(a) Plan 2016 2015 2014 2013

Lump sum distributions – cash $5,005,649 $6,226,917 $3,378,090 $862,106

29

Lump sum distributions – rollover $5,217,644 $528,310 $315,479 $584,160

De Minimum payments (less than $5,000) $1,446 $1,085 $763 $570

Installment payments $469 N/A N/A N/A

Unforeseeable/Hardship withdrawals N/A N/A N/A N/A

In-service withdrawals (ex-hardships) $10,428 $0 $0 $0


Fees (i.e., loans, self-directed brokerage) - - - -

Plan Demographic Information: TIAA FICA

6. Frequency of contributions (weekly/bi-weekly/monthly): Dependent on work, set for bi-weekly


8. Funding method (check, wire, ACH): Wire & ACH


10. Number of payroll files: 31/year

2016 2015 2014 2013

Participation Breakdown

Total Active 1,252 997 679 N/A

Actively Contributing 695 719 941 N/A

Total Accounts 1,591 1,276 941 N/A

Cash Flow

Contributions 393,186 1,516,431 347,325 N/A

Withdrawals (82,887) (38,927) (20,683) N/A

Net Cash Flow 312,315 1,479,520 328,656 N/A

2016 2015 2014 2013

Stable Value Participation Breakdown

Under age 25 2 1 - -

Age 26 - 35 - - - -

Age 36 - 45 - - - -

Age 46 - 55 - - - -

Age 56 - 65 - - - -

Age 65 - 70.5 - - - -

Age 71 - 80 1 - - -

Age 80+ - - - -

Stable Value Cash Flow

Contributions N/A N/A N/A N/A

Withdrawals N/A N/A N/A N/A

30

Net Cash Flow N/A N/A N/A N/A

Participant Information FICA Plan 12/31/16

Number of participants active and contributing 649


Number of terminated participants w/balances 224

Number of terminated participants w/balances less than $5,000 223

Number of participants suspended due to hardship -


Total account balances - terminated participants w/balances $32,443



Transaction Activity

FICA Plan 2016 2015 2014 2013

Number of new participants* 377 369 944 N/A



Number of hardship withdrawals** 0 0 0 0

Number of in-service withdrawals not due to financial hardship**

0 0 0 N/A

Number of lump sum distributions** 125 87 58 N/A

Number of recordkeeper IRAs opened

Number of minimum required distributions**

0 0 0 N/A

Number of QDROs** 0 0 0 N/A

Number of rollovers into the plan** N/A 2 N/A N/A

* Number of participants that enrolled in the period

** Number of transactions processed in the period

Contributions/Cash-in

FICA Plan 2016 2015 2014 2013


$393,186 $426,295 $347,325 N/A

Age 50 catch-up - - - -






31


Rollover Contributions N/A $1,090,136 N/A N/A

90-24 Contract exchanges - - - -


Withdrawals/Cash-out

FICA Plan 2016 2015 2014 2013

Lump sum distributions – cash $66,899 $38,035 $20,683 N/A

Lump sum distributions – rollover $15,514 $808 N/A N/A

De Minimum payments (less than $5,000) 126 89 57 N/A

Installment payments $0 $0 $0 N/A

Unforeseeable/Hardship withdrawals N/A N/A N/A N/A

In-service withdrawals (ex-hardships) $- $- N/A N/A


Fees (i.e., loans, self-directed brokerage) - - - -

32

TIAA 401(a) Investment Line-up


Fund Ticker

Symbol Market Value

Stable return / Money market TIAA Stable Value N/A $7,973,831

Domestic Fixed Income Vanguard Total Bond Market Index VBTLX $4,107,174

Inflation-Protected Fixed

Income

PIMCO Real Return PRRIX $4,223,365

Large Cap Core Vanguard Institutional Index VINIX $14,885,470

Large Cap Core TIAA-CREF Social Choice Equity TISCX $727,147

Mid Cap Core Vanguard Mid-Cap Index VMCIX $6,326,254

Small Cap Core Vanguard Small-Cap Index VSMAX $6,163,664

International TIAA-CREF Intl Eq Idx-Inst TCIEX $3,236,223

Emerging Markets Vanguard Emr Mkts Stk Idx Adm VEMAX $2,526,162

Real Estate TIAA Real Estate N/A $4,021,594

Target Date Vanguard Tgt Rtmt Income Tr I N/A $2,451,087

Target Date Vanguard Tgt Rtmt 2010 Tr I N/A $7,928,032










Target Date Vanguard Tgt Rtmt 2060 Tr I N/A $722,598

Total $585,247,873

33

TIAA FICA Investment Line-up


Fund Ticker

Symbol Market Value

Stable return / Money market TIAA Stable Value N/A $3,218

Target Date Vanguard Tgt Rtmt Income Tr I N/A $157












Total $2,150,050

34

Goals and Objectives of the Request for Proposal

As part of the vendor selection criteria, the State is looking for a respondent that has the

capability of dealing directly with both the 457(b) and 401(a) Plans. For these programs to be a

success, an administrative process must be in place to address the needs of all eligible

employees.

The State wants to develop a relationship with a respondent who will offer strong and

competitive fund choices, accurate and timely recordkeeping services, and administer the Plans

within pre-described service standards. It places a high value on finding a respondent that meets

the following qualifications:

1. Focus on Quality and Consistency of Service Delivery

a. Adheres to successful quality assurance procedures;

b. Follows a successful problem resolution methodology;

c. Has a history of performing services on a timely basis;

d. Performs services correctly and accurately every time;

e. Provides accurate and consistent responses to inquiries; and

f. Provides reports on quality assurance.

2. Proactive Approach

a. Educates participants through participant friendly communications;

b. Educates participants by providing informed toll-free customer service center and

field service representatives; and

c. Provides on-going on-site visits to individual Plan groups for participant enrollment

and group meetings.

d. Participates in on-going employee training sessions that discuss retirement planning

issues, including one-on-one individual financial advising.

3. Commitment to Technology Development

a. Keeps up to date on technological developments such as Internet access;

b. Continuously invests in enhanced technology; and

c. Demonstrates improvement (accuracy, timeliness, etc.) in client service through

technological enhancements.

Finalist Presentations

The State, at its discretion, may conduct finalist presentations to a short-list of respondents based

on the initial scoring.

The purpose of the finalist presentations is to give each finalist an opportunity to further explain

its qualifications, services, and capabilities.

35

When final presentations are made to the State, it is expected that each respondent will bring to

the meeting those people who will work directly with the State, if respondent is successful.

Travel expenses and costs related to the interview will be the responsibility of the respondent.

Exceptions/Additions

Any replacement language proposed by a respondent will be submitted for clarification only, and

is understood to be contingent upon the State’s acceptance. The State assumes no obligation to

accept, reject, or negotiate proposed replacement terms or conditions with the successful

respondent.

The respondent is responsible for clarifying any ambiguity, conflict, discrepancy, omission, or

other error in the Request for Qualifications before submitting the proposal; otherwise, the right

to raise such issues shall be waived.

36

Section 2: Request for Qualification—Administrative Services Questionnaire

Organization and History

1. Respondent Information: Provide a brief overview of your organization. The narrative

shall include the following:

a. date established;

b. ownership (public, partnership, subsidiary, etc.);

c. years active in the public sector market;

d. years active in the public 457(b) market;

e. years active in the public 401(a) market; and

f. relationships with other entities relevant to or related to the subject matter of this

RFP.

2. Provide the following information:

a. Total assets under administration

b. Total defined contribution assets under administration

c. Total deferred compensation assets under administration

d. Total public 457(b) deferred compensation assets under administration

e. Total public 401(a) assets under administration

3. How many proposals have you submitted in the last three years in response to public

457(b) deferred compensation plan service provider RFPs? How many for public 401(a)

plans?

4. What are your client retention statistics for each of the last three years broken out by year?

What percentage left due to issues pertaining to services provided by your organization?

5. How many public 457(b) deferred compensation plans have you lost in the last three years

broken out by year? How many public 401(a) plans broken out by year?

6. How many public 457(b) deferred compensation plans have you gained in the last three

years broken out by year? How many public 401(a) plans broken out by year?

7. What is the average client relationship duration? What is the average relationship duration

for your public sector plans?

37

8. List the number and total assets of the public 457(b) plans that you currently administer in

the following categories:

Plans Assets

Number of Participants 457 Plans Number Percent Amount Percent

Under 1,000

1,001 – 5,000

5,001 – 10,000

10,000+

Total

9. List the number and total assets of the public 401(a) plans that you currently administer in

the following categories:

Plans Assets

Number of Participants 401(a) Plans Number Percent Amount Percent

Under 5,000

5,001 – 15,000

15,001 – 25,000

25,000+

Total

10. What is the total number of participants in all public sector deferred compensation plans

currently being administered by your organization? Break out by 457(b) and 401(a) as well.

11. Describe your errors/omissions liability insurance and coverage. Describe the various types

of insurance coverage and indemnification provided to protect clients.

12. Has your company, or any affiliates, been a party to any litigation during the last three

years involving your deferred compensation recordkeeping and administration services? If

yes, please provide: 1) the nature of the claim or action 2) the current status of the

litigation, 3) any fines or settlements paid.

13. What is the last date when your organization had a change in its business structure, whether

through an acquisition or divestiture or through an alliance arrangement? If applicable,

how did this change in business affect the recordkeeping division?

14. Describe any pending or anticipated plans to re-organize your company within itself or as

part of the larger organization of which your company is a part.

38

References

1. Please provide references for three current 457 clients and three current tax advantaged

governmental clients that have similar plan demographics (i.e., size and plan design). If

available, at least one of the three should have converted within the last year. For each

reference, please provide client name, contact name, address, phone number, services

provided, and year they became a client.

2. Please provide references for three former clients who had similar plan demographics (i.e.,

size and plan design). At least one of the three should have left within the last year. Please

provide former client name, contact name, address, phone number, services provided, year

they ceased to be a client and the reason(s).

Client Service/Quality Assurance

1. How many of your employees work on DC plans? Is there staff dedicated specifically to

public 457(b) and/or public 401(a) plans? If so, please provide the numbers in addition to

completing the chart below on the number of full-time equivalent employees working on

DC:

Personnel Type Number

Management

Call Center Mgmt./Supervisors

Customer Service Reps

Field Reps

Systems Management

Systems Staff: Development & Operating/Maintenance

Website

Other

2. What is the average tenure (in years) of the following positions?

a. Plan Administrator

b. Client Relationship Manager

c. Field Service Representatives

d. Conversion Project Manager

e. 800 Customer Service Center Representatives

3. Do you currently have staff located in the State of Rhode Island? If yes, where is your

office located? If no, where is the closest office?

4. Describe the team that would deal directly with the State on an ongoing basis. Indicate size,

roles, experience, and turnover rates. In addition, provide a brief resume for each

individual.

5. What location(s) would provide the services described in this RFP?

6. Briefly describe the training program and licensing requirements for your field service

representatives. What are the licensing requirements?

39

7. Briefly describe the training program and licensing requirements for your 800 customer

service representatives. What are the licensing requirements?

8. Will you need to hire any additional staff in order to service this account?

9. Describe your service standards and turnaround time for the completion of the following:

Transaction Turnaround

Time Penalty ($) for Not Meeting Standard

Implementation

Issuance of Participant Statements

Transaction Confirmation Statements

Hard Copy Plan Level Administrative Reports (hard copies)

Processing Payroll Contributions

Hardship/Unforeseen Emergency Withdrawals

Termination/Rollovers/Direct Transfers for Distribution

Fund Balance Transfers

Investment Election Requests

Error corrections and adjustments

Contribution Percentage Elections/ Changes

QDRO Processing

Setting an appointment with an onsite representative

10. What is the total, annual amount you are willing to put at risk?

11. How frequently do you conduct client and participant satisfaction surveys of your services

and performance? Provide the results of your last surveys for both.

Recordkeeping/Administration

1. What portion of your organization’s expenses is related to recordkeeping and system

technology development?

2. Briefly describe the level of customization available to the Plans on the administrative

forms used by Plans’ participants. Will the State have input on content and not just look?

(Yes/No)

3. Can you accept manual edits, adjustments, and indicative data changes to the contribution

input file? (Yes/No)

4. Can you handle negative data from the payroll files? (Yes/No)

5. Describe how your payroll contribution reports identify participants contributing up to the

current maximum contribution, and identify participants in catch-up status.

6. Are you able to fully administer hardship/unforeseen emergency distribution requests?

(Yes/No) Are you able to handle first level appeals? (Yes/No)

40

7. For systematic payment distributions, is payment made on a pro rata basis or can a

participant elect systematic payment from specific fund(s)?

8. Describe your process for searching for participants who have not cashed their distribution

payment checks.

9. Are you able to fully qualify and process Qualified Domestic Relations Orders (QDROs)

with the attorneys representing the parties? (Yes/No) Be specific about any role the State

will be required to play.

10. Are there any limits imposed on any participant initiated transactions (i.e.: mix changes,

contribution rate changes, etc.)? If yes, list them.

11. Describe the process you use to track and maintain employee beneficiary data.

12. How much historical plan information do you maintain on participants? List the type of

information available. How much information is immediately available?

Systems Capabilities and Hardware

1. What system do you use to recordkeep and administer defined contribution plans? Do you

have different systems for 457 and 401(a) plans? (Yes/No)

2. Was the software developed internally, leased, or purchased from another provider? Who

has the ultimate responsibility/authority to make sure the software remains current to laws,

regulations, client needs, etc.?

3. The 401(a) Plan consists of multiple employers each submitting their own payroll files.

Confirm that you are able to accept different submissions from the different employers.

4. What methods are available for submission of payroll data (i.e. record layout, template,

directly into system etc.)?

5. How long have you used these systems for recordkeeping?

6. Describe your system’s file interface/data feed capabilities:

a. Can your system support routine batch export capabilities to other systems?

b. Does your system have an external-facing Application Programming Interface (API)?

7. Are you planning any major change in the software or hardware supporting your

recordkeeping system in the next 24 months? If yes, please describe.

8. Describe your documented disaster recovery plan. How often do you test your recovery

system?

9. Where is your main data processing center located?

10. Where is your back-up center located?

11. How often is data backed-up?

a. Describe any system outages within the last three years and how have they been

handled?

41

b. Has any liability resulted from these outages and are there any pending claims related

to these outages?

12. Describe in detail your procedures and safeguards used to guarantee:

a. Security for your hardware and facility

b. Authorized access to data

c. Confidentiality of data

d. Security for any hard copy of plan-related data or documents

e. Explain your process in the event that participant data is compromised.

13. Provide a current SSAE16 audit of your recordkeeping system, or any other audit you have

performed. Who completes the audit and how frequently?

14. Do you test IT security as part of the SSAE16 or separately? If separately, who performs

and how frequently.

Custodial Trustee

1. For the custody/trustee services you propose, what is the name of the trust company, the

total number of years that they have been in operation, and the assets under custody as of

December 31, 2016?

2. What are the total public DC assets currently held by the custodian?

3. Are there any restrictions by investment type that pertain to your custodial services?

(Yes/No) If yes, what?

4. Confirm that you will trustee outside investment funds.

5. Do you have a limit on the number of checks/wires available to participants? (Yes/No)

6. Do you have an electronic link with the investment managers for updating participants’

accounts on the recordkeeping system? (Yes/No)

7. Will the Plans be required to execute a custodial agreement with your custodial trustee or

will it be part of the contract with the Plans? If a separate contract is required, please

provide a sample.

Regulatory/Compliance Service

1. Describe how you monitor §401(a)(9) required minimum distributions including:

a. Identification of individuals

b. Determination of the amount of the minimum required payment

c. Payment within required deadlines.

2. Describe your capabilities and timeframes for monitoring maximum deferral limits and the

catch-up provisions.

3. What resources do you have to obtain legal opinions, interpretations of laws, regulations,

and other matters on issues pertaining to deferred compensation plans?

42

4. How do you ensure that your recordkeeping system is in compliance with all applicable

rules and regulations?

5. How quickly are changes in the law reflected in the system?

6. Should the State wish to comply with 408(b)(2) and 404(a)(5) regulations, will you provide

408(b)(2) disclosures to the State and 404(a)(5) disclosures to participants? (Yes/No) If

yes, is there an additional cost for either?

Communication & Education

1. Describe separately your initial and on-going communication and education program

(including printed material, visits, training, etc.). Be sure to identify the key elements

provided as part of a standard communication and education program package including

the types marketing medium (e.g. print, e-mail, onsite, etc.).

2. Provide samples of initial enrollment and on-going communication and education

materials.

3. Describe the services you offer in the enrollment process. Be sure to include such items as

monitoring and tracking new hires. Outline any data requirements. Will you maintain and

control the inventory of all related enrollment materials that are to be included in the

enrollment kits?

4. Describe the communication and education process that you provide for non-active

participants (i.e., retirees and terminated employees with assets in the Plan).

5. Will you provide participants with onsite, group education, and retirement planning

sessions or financial/pre-retirement seminars on an on-going basis? (Yes/No). If yes, please

list the titles of the subjects that are covered in your program with a brief description.

6. Do you provide information to Plan participants regarding options on distributions?

Describe any services or programs you provide for participants leaving the Plan.

7. Describe the State’s role in the communication, education, and enrollment process.

8. To what extent can the State customize communication and investment education materials

(e.g., plan name, logos)? State if there would be additional charges for customizing or

editing these communication materials.

9. Briefly describe how you measure the success of your education/communication programs.

Plan Sponsor Reporting

1. Describe the standard reporting package that you would provide to the State (provide

samples).

2. Will the State be able to generate these reports on-line?

3. What is the standard timeframe for providing each plan sponsor report, including

investment asset reports, after the reporting period ends?

4. List the types of demographic participant data will you be able to provide?

43

Participant Reporting

1. Describe your standard participant statements (provide samples).

2. Are the any differences between your hard copy statements and the statements available

online? (Yes/No) If yes, briefly describe the differences.

3. What time periods are illustrated for a participant’s personalized rate-of-return?

4. Describe your customization capabilities for participant statements. Are these applied to

both hard copy and electronic statements? (Yes/No)

5. Are participants able to additionally customize the statements they receive (hard copy or

electronic)? (Yes/No)

6. How much space is there for customized messages from the State on your quarterly

participant statement? Is this included on both hard copy and electronic statements?

(Yes/No) Is there an additional cost?

7. Can you include other printed information, prepared by the State, with the mailing of

statements to participants? (Yes/No) Is this included on both hard copy and electronic

statements? (Yes/No) If so, please verify that this service is available at no additional cost.

8. Are fees disclosed to plan participants on the quarterly statements? (Yes/No) Do they

comply with 404(a)(5)? (Yes/No) What additional fee disclosure, if any, do you provide?

Participant Services/Automated Voice Response System (VRS)

1. Are there any transactions that cannot be processed through the voice response system (i.e.,

PIN changes, address changes, etc.)?

2. How quickly is the VRS updated after transactions are performed?

3. Is the VRS fully capable of generating all the necessary administrative forms to handle

enrollments, hardships, terminations, and beneficiary distribution requests?

4. In the situation whereby a participant calls the VRS but does not properly complete the

transaction, is there any follow-up with the participant? (Yes/No)

5. Can participants request contribution deduction changes through the VRS? (Yes/No) Can

you provide a feedback report back to the State and each local subdivision to update their

payroll records and contribution changes? (Yes/No) How frequently?

6. Does your VRS accommodate non-English speaking participants? What languages?

7. Does it accommodate the hearing/speech impaired participants?

8. Describe how data is secured within the system (i.e., PIN, audit trail, confirmations).

9. Describe any security breaches that resulted in improper access to one or more participant’s

accounts within the last three years and the steps you took to remedy the breach.

44

Participant Services/1-800 Customer Service Center

1. What are the standard hours of operation of your customer service center?

2. Where is your customer service center located?

3. Where is your back-up customer service center?

4. Are there any transactions that cannot be processed? If yes, what?

5. If allowed by the Plans, can employees enroll in the Plan through the customer service

center?

6. Can participants change their PIN through a CSR? Can PINs be reset and immediately

provided to a participant during the call? Can participants who misplace their PIN call the

customer service center and have a new PIN sent directly to their home address?

7. Provide the following information on your customer service reps:

a. Licensing requirements in addition to your training program

b. Relationship: employees or outside contractors

1) If contractors or a combination, include the percentage of each & duration of

subcontractor agreement

c. Average tenure

d. Total CSR agents employed year-round basis

e. Compensation structure

8. Do you dedicate CSR’s to specific accounts? (Yes/No) If yes, how many would be

dedicated to the State?

9. Provide the information below on your service center standards:

Performance Standard

4th Quarter 2016

3rd Quarter 2016

2nd Quarter 2016

Number of calls

Average length

Average response time

Percentage requiring follow-up

Abandonment rate

Percentage handled 100% via VRS versus 1-800

45

Participant Services/Internet Services

1. Provide an Internet address and instructions on how to access a demonstration of your

Internet capabilities for both the participant and plan sponsor.

2. Briefly highlight your participant website capabilities.

3. Specify any transactions that cannot be completed via your Internet site.

4. Do you have a mobile app or mobile optimized website? (Yes/No) Are the limitations to

the functionality versus the full site? (Yes/No) If yes, what?

5. What general and investment education materials and retirement planning tools do you

offer participants via the Internet?

6. Do you offer an automated enrollment process through the Internet? (Yes/No)

7. Do participants have the ability to implement auto escalation? (Yes/No)

8. Can participants e-mail account specific questions via the Internet site? (Yes/No) If yes,

who receives the e-mail, researches the issue, and responds? What is the turnaround time?

9. Does your Internet site have the ability to download participant account information

software programs (i.e. Quicken, Mint, etc.)? If yes, which programs?

10. Describe the security through which a participant passes to use your Internet system. What

firewalls do you have in place for your Internet services?

11. Describe any security breaches that resulted in improper access to one or more participant’s

accounts within the last three years and the steps you took to remedy the breach.

12. Can your website accommodate single sign-on using credential federation from Rhode

Island’s defined-benefit website? Describe any technology/SSO platform requirements.

13. What improvements to your Internet capabilities are designated to occur in the next two to

three years?

14. Are the same improvements being made to your mobile capabilities? (Yes/No) If no,

briefly describe what is being done to enhance your mobile capabilities.

Field Service Representatives

1. How many field service representatives are you dedicating to the State? Will they be 100%

full-time dedicated representatives?

2. Provide your rationale for determining the appropriate staffing for the Plan.

3. Describe the structure of how the field service representatives would be organized to

service this relationship:

a. Location

b. Staffing (including functions to be performed)

c. Standard hours of operation

d. How you would handle pre-scheduled consultations?

46

e. How you would handle walk-ins?

4. What is your annual cost associated for each dedicated service representative?

5. Briefly describe the credentials and related experience of local service representatives who

will be assigned to the Plan’s account.

6. If the representative is responsible for additional accounts, how many?

7. Will the representatives assigned to the Plan’s be employees of your firm?

8. Detail the compensation structure for the local representative (e.g. 85% salary, 15% bonus).

Include an explanation of how any bonuses and incentives are determined. As indicated in

the minimum service qualifications in Section 1, it is a requirement that your field service

representatives that provide enrollment and education services are not compensated on a

commissioned or incentive basis to promote any investment product or services.

9. Are field service representatives available to discuss the plan and investments with

participants on a one-on-one basis? If so, how often? Will you provide local annual account

reviews for participants?

10. How will these discussions be handled (e.g., in person, via telephone)?

11. Identify the annual number of group meetings and number of one-on-one consultations you

have assumed will be provided by the field service representatives.

Investment Advisory Services

1. Describe the investment advisory services you offer (i.e., Morningstar ClearFuture,

Financial Engines, etc.), including managed accounts. Note the different levels available.

2. Describe your due diligence process for selecting the partner and what services are

provided.

3. How long have you partnered with your current vendor for each of the services in your

advisory program?

4. What are the costs associated with the advisory services? Is it based on total plan level or

only charged to participants who elect these services?

5. Describe the difference between your Internet investment education tools and software

from your investment advisory services.

6. Does your service produce asset allocation recommendations? (Yes/No) Does it provide

recommendations of specific funds? (Yes/No)

7. Does your investment advisory service include savings rate recommendations? (Yes/No)

8. Does your investment advisory service take into account a participant’s assets outside the

Plans? If so, please list what assets.

9. Describe the generally accepted investment theories that form the basis for your advice

model.

47

10. Briefly describe the type and level of indemnification you provide to the State for your

advisory services.

11. What is disclosed to participants regarding your fiduciary role and the provider’s fiduciary

role with respect to these investment advisory services?

12. How many of your existing public sector clients have subscribed for each level of service

you offer?

13. Do you offer specific investment advice to participants on an in-person basis other than

through the on-line advice provider? (Yes/No) If yes, briefly describe.

14. For in-person investment advice, how do you manage conflicts of interest?

15. Will the Plans be required to execute a separate contract with your investment advisory

provider or it be part of your service contract and agreements? If a separate contract is

required, please provide a sample.

Plan Implementation

1. Explain your implementation/conversion process including timeframe, based upon an

October 1, 2017 conversion.

2. By what date would you need authority to proceed to accommodate the October 1, 2017

asset and recordkeeping transfer?

3. What involvement will be required from the State during the implementation process?

4. Do you have any limitations as to the format/media of participant data received from the

current recordkeeper?

5. How are investments handled during the conversion process? How are distributions

handled to accommodate the continuity of payments to retirees during the conversion

period?

6. Describe your procedures during the conversion period to communicate with non-active

employees (i.e. retirees and terminated employees with value in the plan).

7. What assurances/guarantees do you provide with respect to a timely implementation?

8. What is the standard length of your blackout period?

9. Identify comparable plan conversions in which you have been involved. How many

conversions and implementations has your company conducted during the past three years

involving Plans of similar size?

10. How many similar conversions have you done where you have converted both 457(b) and

401(a) programs?

48

Section 3: Investment Management Services Questionnaire

As noted above, the only investment option being considered by the State in this RFP is the

Stable Value fund. It is the State’s expectation that the investment line-up will be determined

during the implementation and will be structured to meet all revenue requirements.

Investment Management Services

1. Provide the number of outside fund family alliances with which you have relationships.

Approximately how many investment options does this represent?

2. For either the 401(a) or 457(b), do you have any proprietary investment requirements?

(Yes/No) If yes, what are they? Be specific which plan(s) this impacts.

3. What, if any, impact is there on administrative pricing for using proprietary options?

4. Is there a cost for making changes to the investment line-up?

5. What is the standard timeframe for making changes to the investment line-up?

6. Describe the administrative, financial, and any other impact on the plan sponsor and the

participants when a manager or fund offered to those participants ceases to be offered

through your organization.

7. For any funds managed in-house, briefly describe your research capabilities, including the

number of research professionals you employ.

8. Please describe your recordkeeping capabilities for exchange traded funds. Are the Plans

able to offer exchange traded funds as part of the core investment line up?

9. For the 457(b), provide a suggested investment line-up, for information only, in an Excel

spreadsheet. For each option, include:

a. Asset class

b. Fund name

c. Ticker or CUSIP

d. Applicable minimum balance requirements

e. Any withdrawal fees or transfer fees

f. Any trading restrictions (for both participants and the Plans)

10. If your suggestion for the stable value/fixed account is different than what you propose for

the 401(a) and FICA plans, complete the charts below for the product suggested.

11. Do you act as a fiduciary when making recommendations regarding the investment line-

up? If not, briefly describe any oversight or responsibility you assume.

49

Self-Directed Brokerage (For information only, not applicable for

401(a))

1. Who do you use in offering the self-directed brokerage services explain and their role.

2. Does your self-directed brokerage account require any minimum balance? What happens if

minimum balances are not maintained?

3. Can your brokerage account restrict a participant from certain investments?

4. Are there any transfer restrictions for moving money between the core investment line-up

and the self-directed brokerage account?

5. Do participants receive a detailed account summary of all assets held in the brokerage

account?

6. What information from the self-directed brokerage account is reflected and reported on

quarterly participant statements?

Stable Value Fund/Fixed Account

1. List the stable value/fixed account products available on your platform.

2. Provide your most recent ratings from A.M. Best, Moody’s and S&P.

3. What stable value product are you proposing for the State and why?

4. For the proposed product, does old money receive the same rate as new? If not, describe.

5. Complete the following charts for the proposed product as of December 31, 2016:

Manager

Vehicle

Fund Name

Class

Fund Inception

Fund Assets ($B)

Total Firm Stable Value Assets ($B)

Effective Duration

Market-to-Book Value Ratio

Gross Crediting Rate1

Net Crediting Rate*

Crediting Rate Reset Frequency

Minimum Crediting Rate

Recommended Benchmark

Benchmark for Underlying Portfolio

1 Gross of investment management fees, net of wrap fees, sub-advisory fees and other expenses.

50

Expense Ratio

Trustee

Book Value Structure % Allocation

Liquidity Buffer

Wrap Providers Please list wrap providers below

Total 100%

6. Is wrap capacity contingent on affiliated investment management? (Yes/No)

Fees

Investment Management

Wrap

Revenue Share

Other (please specify)

Total Expense Ratio

7. Do you anticipate any changes in wrap fees that would impact the total expense ratio?

(Yes/No) If yes, what is the expected impact?

Quality Allocation % Sector Allocation %

Cash/cash equivalents Cash/cash equivalents

AAA U.S. Treasury

AA U.S. Govt-Related

A Corporate

BBB Agency MBS

Below Inv Grade Non-agency MBS

NR ABS

CMBS

Municipal

Other

8. Fully describe the withdrawal/transfer restrictions at both the Plans’ level and for

participants.

51

9. Provide returns as of December 31, 2016 for the proposed product:

Trailing Returns 3-Mo. YTD 1-Yr 3-Yr 5-Yr 7-Yr 10-Yr Inception

Product

Benchmark

Annual Returns 2016 2015 2014 2013 2012 2011 2010

Product

Benchmark

* Returns should be gross of investment management fees; net of wrap/subadvisor/other

* Periods greater than 1-year should be annualized

52

Section 4: Fees


Phase One: Will utilize all factors outlined above but pricing for winning ONLY the 401(a)

and FICA plans. This evaluation will result in a winner for just the 401(a) and FICA plans.

Phase Two: Will utilize all factors outlined but pricing for winning ONLY a 457(b)


457(b) component.



The initial contract term will be five (5) years from the date on which a contract is awarded by

the Plans. The contract may be renewed for an additional term based upon the discretion of the

State Investment Committee.

1. What are the factors you consider in determining future fee decreases and when they are to

occur?

2. How are fees adjusted if a sizable number of participants are added or removed from the

Plans?

3. If a participant has multiple accounts in the Plans, will they be charged for each account?

4. Provide other alternatives not outlined in this proposal that could result in the lowering of

participant fees. Be clear in your response and provide the condition and the result.

5. Are you able to return revenue directly to participant accounts from which it was

generated? If no, are you working on this capability?

6. Briefly describe any additional fee leveling capabilities. What different arrangements are

available?

Based upon the information supplied in the RFP, please complete the cost structure charts on the

following pages. It is critical that you provide complete information so that fees can be compared

on an equitable basis. If there are additional fees not listed, describe them, in detail, under

“comments.”

If assumptions are necessary, please fully explain your assumptions and quote the related fees on

a unit cost basis, if possible.

Service providers can freely solicit participants amongst the 457 Plan providers. If there is

more than one 457(b) vendor deselected, the State expects to award 457(b) assets based on

457(b) scoring and subsequent ranking.

53

FEE SCHEDULE INCUMBENT PROVIDER

For the 401(a) and FICA Plans, the only investment product that is included as part of all

bidding scenarios is your proposed stable value/fixed account.

Respondents MUST provide information on ALL scenarios.

401(a) & FICA Plan ONLY Amount Assumptions underlying

the amount

Total basis point administrative fee for all services described in the RFP (based on all assets)

Total per participant dollar fee for all services described in the RFP

457(b) Component Amount Assumptions underlying

the amount



* Pricing should be based on your current assets in the 457(b) program

401(a), FICA & 457(b) Component Amount Assumptions underlying

the amount



* Fees quoted should be for your services only and should not include any reimbursements or

credit allowances.

* Clearly note if there is are different fee arrangements for Plans.






457(b) component.



54

FEE SCHEDULE NON-INCUMBENT PROVIDER

For the 401(a) and FICA Plans, the only investment product that is included as part of all

bidding scenarios is your proposed stable value/fixed account.

Respondents MUST provide information on ALL scenarios.

401(a) & FICA Plan ONLY Amount Assumptions underlying

the amount



457(b) Component Amount Assumptions underlying

the amount



* State expects proposed pricing to be the same for takeover of any one of the current 457(b)

providers

401(a), FICA & 457(b) Component Amount Assumptions underlying

the amount



* Fees quoted should be for your services only and should not include any reimbursements or

credit allowances.

* Clearly note if there is are different fee arrangements for Plans.






457(b) component.



55

ADDITIONAL FEES

Plan Level

Services Fee Comments

Plan Set-up/Installation (one-time fee)

Investment advisory services

Managed accounts

Plan documents (outside of prototype)

Check processing

1099-R forms

Postage

Custom website set-up

Custom website ongoing

Employee communication & education

Customized enrollment materials

Customized periodic newsletter

Customized communications

Annual notifications to eligible participants

Other (be specific)

Participant Level

Services Fee Comments

Investment advisory services

Managed accounts

Loan set-up

Loan maintenance

Self-directed brokerage

Hardship Qualifications

DRO Qualifications

Wire Fees

Other (be specific)

56

Section 5: Attachments

Attachment A: Certification of Compliance with Minimum

Requirements of RFP

I have read, understand and agree to comply with the minimum requirements specified in this Request for Proposal. Checking “YES” indicates acceptance, while checking “NO” denotes non-acceptance and should be detailed below. Any exceptions MUST be documented.

☐ Yes ☐ No

Signature

Primary Firm

EXCEPTIONS: Attach additional sheets if necessary. Please use this format.

EXCEPTION SUMMARY FORM

Minimum Requirement Number Explanation of Non-Acceptance

57

Attachment B: Certification of Compliance with Standard State

Contract

I have read, understand and agree to comply with the terms and conditions specified in the State’s contract. Checking “YES” indicates acceptance and checking “NO” denoted non-acceptance and should be detailed below. Any exceptions MUST be documented.

☐ Yes ☐ No

Signature

Primary Firm

EXCEPTIONS: Attach additional sheets if necessary. Please use the format.

EXCEPTION SUMMARY FORM

Contract Section Explanation of Non-Acceptance

58

Section 6: Appendices

A. 457(b) Plan Document

B. 401(a) Plan Document

state of rhode island 457(b) deferred compensation and 401 ... · segal marco advisors,...

Documents