NOTICE FOR REQUEST FOR PROPOSALS

The City of Covington, hereinafter, (“the City”) desires to contract with a qualified vendor to provide

investment services for employee health benefits created under IRS Code Section 115 and 501(c)(9).

Responses must be in accordance with the guidelines as specified in this Request for Proposals. Services

may include, but not be limited to, 1)creation of a Voluntary Employee Benefit Association, (VEBA); 2)

preparing a section 115 Trust Document and Plan; 3) creating individual employee accounts; 4) training

of City staff assigned to managing this benefit; 5) providing adequate reporting to the City’s financial

auditors.

Those interested in providing this service to the City of Covington, Georgia must obtain a copy of the

RFP from the City website at www.cityofcovington.org, or a copy can be obtained from

Mr. Ronnie H. Cowan

Director of Human Resources

City of Covington, Georgia

2194 Emory Street

Covington, Georgia 30014

(770) 385- 2080

rcowan@cityofcovington.org

The City reserves the right to cancel, delay, amend, or reissue all or part of this Request for Proposals

(RFP) at any time without prior notice. This RFP does not commit the City to accept any proposals

submitted, nor is the City responsible for any costs incurred in the preparation of responses to this RFP.

The City reserves the right to reject any or all proposals, to accept or reject any or all items in the

proposals, and/or to award the contract in whole or in part as is deemed to be in the best interest of the

City.

Completed RFP must be received by January 16, 2015 to be considered.

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Notice: Request for Proposals

For

INVESTMENT SERVICES FOR EMPOYEE HEALTH BENEFIT TRUST CREATED

UNDER IRS CODE 501(c)(9)

Publication of Proposal

December 8, 2014

Submission of Proposal Deadline

January 16, 2015

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TABLE OF CONTENTS

SUMMARY.......................................................................................................3

I. INTRODUCTION ........…………………………………………………..…………3

II. INSTRUCTIONS FOR SUBMITTING PROPOSALS...........………………….. 4

III. PROPOSAL SCOPE OF SPECIFICAIONS & REQUIREMENTS..……….4 - 9

IV. PROPOSAL REVIEW & EVALUATION..………………………………………..9

V. AWARD OF CONTRACT...………..…………………………………………….10

VI. PROPOSAL COVER PAGE INSTRUCTIONS...……..………….……………10

VII. PROPOSAL COVER PAGE.....……..……………………………….………….11

VIII. AFFIRMATION......………………………………………………………………..12

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CITY OF COVINGTON, GEORGIA

REQUEST FOR PROPOSAL FOR

INVESTMENT SERVICES FOR EMPOYEE HEALTH BENEFIT TRUST CREATED UNDER IRS CODE 501(c)(9)

SUMMARY The City of Covington, Georgia is located in the heart of northeast Georgia, forty (40) miles east of Atlanta. Established in 1822, Covington has a rich heritage of southern charm. Antebellum homes, azalea gardens and magnolia trees surround its downtown square. The downtown square district has been the principal location of several TV dramas, including the “Dukes of Hazzard”, “In the Heat of the Night”, and “The Vampire Diaries”, and numerous movies, earning Covington the name, “Hollywood of the South”. In addition to its fame as a filming site, the City has also earned the distinction of several awards for excellence. Covington was named “A City of Excellence” and “A City of Ethics” by the Georgia Municipal Association and four of its departments have received national accreditation: the Police Department by the Commission on Law Enforcement Accreditation; the Fire Department by the Commission on Fire Accreditation; the 911 Center by the Public Safety Dispatch Commission; and the Public Works Department by the American Public Works Association. Covington employs 327 employees in 17 departments, including administrative and finance, human resources, accounting, electric and telecommunications, natural gas, engineering, water, wastewater, water & sewer distribution, streets, solid waste, airport, municipal court, police, fire, and 911 services. The intent of this solicitation is to obtain a qualified vendor to provide investment services for employee health benefits created under IRS Code Sections 115 and 501(c)(9). I. INTRODUCTION

The City of Covington, hereinafter, (“the City”) desires to contract with a qualified vendor to provide investment services for employee health benefits created under IRS Code Sections 115 and 501(c)(9). Responses must be in accordance with the guidelines as specified in this Request for Proposals. Services may include, but not be limited to, 1) creation of a Voluntary Employee Benefit Association, (VEBA); 2) preparing a Section 115 Trust Document and Plan; 3) creating individual employee accounts; 4) training of City staff assigned to managing this benefit; 5) providing adequate reporting to City’s financial auditors.

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The City reserves the right to cancel, delay, amend, or reissue all or part of this Request for Proposals (RFP) at any time without prior notice. This RFP does not commit the City to accept any proposals submitted, nor is the City responsible for any costs incurred in the preparation of responses to this RFP. The City reserves the right to reject any or all proposals, to accept or reject any or all items in the proposals, and/or to award the contract in whole or in part as is deemed to be in the best interest of the City. II. INSTRUCTIONS FOR SUBMITTING PROPOSALS

A. Format

Completed proposals shall consist of typewritten pages utilizing 12” font typing. There is no limit to the number of pages.

B. Signatures and Date

Signature of an individual authorized to represent the respondent shall sign and date proposal cover sheet. The signatory agent’s name must be printed; including the signatory agent’s title and the name of the organization.

C. Failure to Comply and Required Documents

Failure to address all elements within this Request for Proposal, omission of signatures or the failure to follow instructions provided in the Request for Proposal shall result in the application not being accepted for consideration.

D. Ex Parte Communication

The City discourages ex parte communication with any City Councilmember and/or staff member after the deadline for the submission of proposals. No City Councilmember and/or staff member shall initiate or accept oral communication regarding any proposal under consideration. Any written communication to the City Councilmembers and/or staff from potential contractors will be reported to the City Manager or City Attorney for review and appropriate action. Respondents who attempt to improperly influence the proposal review and evaluation process in any way shall be disqualified. III. PROPOSAL SCOPE OF SPECIFICATIONS and REQUIREMENTS

Respondents must provide a proposal that indicates a general description of the techniques, approaches and methods to be used to satisfy the following scope of the requirements and specifications in the following areas:

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A. Plan Design and Set Up

1. Describe the participation requirements/restrictions for the Plan – including any requirements between and among different employee groups?

2. Describe the contribution requirements/restrictions for the Plan (e.g., minimums,

maximums, only funds converted upon termination of employment).

3. Does your Plan specifically provide for public sector employers to pre-fund post-employment health care expenses utilizing a Section 501(c)(9) or Section 115 trust as the funding mechanism of the Plan?

4. Does your Plan specifically allow for accounts in conjunction with a high-deductible health plan election used to fund and make claim reimbursements during active employment?

5. Can a participant have two accounts; 1) specifically for post-employment and 2)

high-deductible health plan election? If so, can the participant invest each source separately?

6. If offered in conjunction with a high-deductible health plan, please describe your process and method to ensure integration with Flexible Spending Accounts.

7. Does your Plan integrate with insurance companies? If so, please list the carriers and explain the connectivity.

8. Does the investment vehicle associated with the Plan consist of an allocation of funds to an individual employee account? Are investments daily valued? If so, please describe.

9. Describe the requirements/restrictions regarding the definitions of spouse and eligible dependents for purposes of reimbursement under the Plan.

10. Describe how you propose to handle the application of COBRA including but not

limited to alternative(s) to COBRA coverage. 11. Does your Plan allow deposits of severance pay due to the individual in tax years

after employment? If not, can you propose an additional program to handle such severance payments?

12. Describe what happens to the assets in an account following the employee’s death or

divorce.

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B. Plan Fees and Costs

1. Please list all set up fees, renewal fees, transaction fees, and fees monthly or

account based loads that will be assessed to either the plan sponsor and to each account.

2. Are all Plan implementation fees and expenses included in the financial portion of your Proposal? Describe the requirements/restrictions, if any, regarding the employer payment versus employee payment of fees.

C. Vendor Information

For Proposals consisting of more than one vendor, the responses should address the requested information with respect to each vendor.

1. List each vendor involved in delivering your service model.

2. What is the name, title, address, and fax number of the person whom we may

contact with questions regarding your responses? For Proposals consisting of more than one vendor, please provide contact information with respect to each vendor.

3. Who will direct account management responsibilities? Please summarize his/her

qualifications, experience, and number of years with your company. From which office does this person work?

4. Has any vendor that is part of the Proposal ever been involved in a voluntary or involuntary bankruptcy action? Has any vendor that is part of this proposal ever made any assignment for the benefit of its creditors? If yes to either of these questions provide additional details.

5. Has any vendor that is part of the Proposal ever been cited or threatened with

citation within the last three years by federal or any employer regulators for violations of any employer or federal law or pending regulations? If the answer is yes, please describe fully.

6. Briefly describe each vendor’s record keeping abilities and methodology. Describe each vendor’s experience in interfacing on a daily basis with a variety of investment companies.

7. Do you provide quarterly participant statements of account? In the past 12 months, what percentage of statements were not mailed on the normal mail date because of an unresolved discrepancy?

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8. What advisory services can you provide in conformance with the appropriate laws and regulations?

9. Who is the Plan Trustee? How long has the Trustee provided fiduciary services

for employee benefits plans (e.g., pension, profit sharing, and other retirement plans; self-insured medical, cafeteria plan medical reimbursement, and other health/welfare plans)?

10. Will you agree to deliver an executed contract or employer agreement no later than sixty (60) days prior to the effective date?

11. Will you agree to provide at least ninety (90) days of notice of increases in fees

associated with your program?

12. Have you completed an SSAE 16 SOC procedural controls audit specific to the VEBA/115 HRA investment recordkeeping and claims processing operations you perform? If so, please provide a copy of the most recent audit results.

13. Are you committed to continual SSAE 16 SOC procedural controls audits? If so,

please describe your ongoing process.

D. Public Employers, Taxes, and Laws

1. Do you currently administer an Internal Revenue Code (“Code”) Section 501(c)(9) trust(s) and corresponding Plan(s) for the sole benefit of Public Sector Employees?

2. Do you currently administer a Code Section 115 trust(s) and corresponding

Plan(s) for the sole benefit of Public Sector Employees?

3. How do you handle compliance with Section 105 and 106 of the Code?

4. Has the Section 501(c)(9) or Section 115 trust(s) sought and received from the Internal Revenue Service (IRS) a favorable determination letter(s) or private letter ruling regarding the tax status of the trust(s)? If yes, please provide copies of any letters received. When was the first determination letter issued?

5. Does the Section 501(c)(9) or Section 115 trust(s) satisfy the requirements of GASB 43 as a qualified trust or equivalent arrangement for pre-funding post-employment benefit obligations?

6. Does delivery of all services comply with all federal and state regulations,

including but not limited to the Health Insurance Portability and Accountability Act (“HIPAA”), the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), and the Patient Protection and Affordable Care Act (“PPACA”)? If not, please specify.

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E. Client and Customer Service 1. Describe your client service philosophy? Will each client be assigned an

individual who is responsible for client relations?

2. Describe how you monitor client satisfaction.

3. Where is your customer service center located? Will your record keeping, claims processing and administrative services also be processed at this location? If not, where will these services be provided?

4. Describe your ongoing customer service representatives training procedure

regarding legislative and regulatory updates?

5. Are individuals’ calls recorded? How long are recordings kept? Are other methods used to create a record of employee inquiries and transactions?

6. What languages, other than English, are available for those requesting service?

F. System Support

1. Does your system support on-line inquiry and transactional capabilities? What on-line services are provided? When is the system available? How do you control system access?

2. How do you handle changes to pending transactions on your on-line system?

3. Does your system allow mobile inquiry and transactional capabilities? If so,

please describe.

4. How do you ensure the Plan is in balance daily? Do you use share or unit accounting methodology for daily valuations? Does the daily valuation accounting involve estimation? If so, how often are accounts reconciled?

5. Describe each vendor’s procedures for correcting erroneous contributions? If an

error is attributable to the action or inaction of a vendor, will the vendor make the individual whole at its expense (i.e., not at the Plan’s expense)?

6. Describe each vendor’s information technology infrastructure including back-up,

security, and disaster recovery procedures? Are files archived and stored at an off-site location?

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G. Submission Requirements To be considered responsive, a proposal must contain the following, referenced by number and in the following order: 1. A brief description of the respondent’s work history and previous experience as an Investment Services Provider. 2. Copies of business licenses, professional certifications or other relevant credentials, together with evidence that respondent, if a corporation, is in good standing and qualified to conduct business in Georgia. 3. A description of similar projects completed by the respondent within the past five 5 years. 4. References with contact information from organizations that have used respondent’s services for similar projects/installations within the last 12-18 months. 5. A detailed cost proposal, including hourly rates, any travel costs and other expenses.

H. Please note, proposals may not be sent via e-mail or facsimile. Provide one (1)

original, unbound response and two (2) stapled or bound copies of the applicant’s response, in a sealed package to the following address:

The City of Covington, Georgia 2194 Emory Street Covington, Georgia 30014 Attention: Ronnie H. Cowan, HR Director

I. Please submit all questions regarding this RFP to Ronnie H. Cowan, HR Director

at the following e- mail address: rcowan@cityofcovington.org. IV. PROPOSAL REVIEW AND EVALUATION

Proposals shall be reviewed and evaluated by the City staff based on the following criteria: a. Management and personnel qualifications;

b. Application to delivery of services;

c. Relevant experience of firm; d. Price for the Scope of Services requested;

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e. The value of any cost-saving option presented, to the extent the options are acceptable to the City at its sole discretion; and f. Any other factor that may be determined by the City to be necessary or appropriate at its sole discretion.

V. AWARD OF CONTRACT Each respondent submitting a proposal will be notified in writing or via e-mail of the City’s decision concerning their proposal. Formal notification of the decision to award a contract and the actual execution of a contract are subject to the following conditions: • Results of negotiations between selected vendor and the City’s management; • Continued availability of the City’s funds, and; • Approval by the City Council.

VI. PROPOSAL COVER PAGE INSTRUCTIONS

The following organization/agency information must be completed on the Proposal Cover page:

a. Name - Provide the name of the organization/agency responding to this RFP.

b. Address - Provide your agency or organization’s main office address.

c. E-Mail Address - Provide the e-mail address of agency submitting RFP.

d. Copy of Current Business License – Provide copy of local business license if you currently a local business possess or please obtain and provide us a copy of a local business license within 90 days of award of contract.

e. Federal Tax I.D. # - Provide your current federal tax I.D. number.

f. Phone Number - Provide phone number of agency and also name and phone number of contact person where the City can submit information regarding the proposal.

g. Fax Number- Provide fax number of agency the City can submit information regarding the proposal.

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h. References - at least two (2) current references and their contact information

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PROPOSAL COVER PAGE

1. Organization/Agency Information: (Please print all information on this page) Name: _______________________________________________________________ Agency’s Address: __________________ ______ ___________________________ E-Mail Address: __________________________ ____________________________ Copy of Current Business License Attached ______ yes: pending____________ Federal Tax I.D. #: ________________________ ____________________________ Phone #: Fax#: _______________________________________________________ Contact Person:______________________________________________________________ References: (1)___________________________________________________________________

(2____________________________________________________________________

Type of Organization: (Check One) _ Business, for profit _ Private, nonprofit

_ Public Agency _ Other____________________________

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AFFIRMATION:

I hereby affirm that the information within this proposal, to the best of my knowledge, is true and accurate. Further, I am duly authorized to sign and submit this proposal on behalf of this agency. I fully affirm and understand that failure to meet the requirements of this proposal at the submitted price may result in my organization’s contract being terminated. Signatory Name:___________________________Title ________________________ (Print) Name of Organization:__________________________________________________________ (Print) Signature: _____________________________________________ Date *Signature by authorized person(s) is required. Failure to sign this page will be

cause for proposal not to be considered.