Title
Deferred Compensation Plan, Defined Contribution Plan, and Post Employment Health Plan Vendor Recommendation - Hyas Group (Ordinance S-45536)
Description
Request to authorize the City Manager, or his designee, to enter into a contract with Hyas Group to provide investment consulting services for the City of Phoenix Deferred Compensation Plan (the “457 Plan”), 401(a) Defined Contribution Plan (the “401(a) Plan”), and Post Employment Health Plan (“PEHP”). Authorization is also requested for the City Controller to disburse funds throughout the life of the contract, as necessary. The expenditure will not exceed $600,000 over the life of the contract, including potential extensions. Funding for services related to the City’s 457 and 401(a) Plans is in the DCP budget; and funding for services related to the City’s PEHP is in the City’s General Fund account.
Report
Summary
The City issued a Request for Proposals (RFP) on June 25, 2018, seeking proposals for Investment Consulting Services for the City’s 457 Deferred Compensation Plan, 401(a) Defined Contribution Plan and Post Employment Health Plan. Five firms submitted responses to the RFP.
Procurement Information
Evaluations of the five proposals were conducted by an RFP selection committee composed of members of the City’s Deferred Compensation Plan (DCP) Board, PEHP Board, a member of Phoenix Fire Fighters Local 493 and City staff. Proposal scores (out of 1,000 points) were as follows:
Hyas: 960
Innovest: 930
SageView: 810
Segal Marco: 745
RVK: 740
Interviews were conducted with two finalists: Innovest Portfolio Solutions and Hyas Group. The committee’s recommendation was submitted to the DCP Board and the PEHP Board during the combined meeting of both Boards held on Jan. 10, 2019, and both Boards approved, unanimously, the selection of Hyas Group as the investment consultant to the 457 Plan, 401(a) Plan and PEHP for the following reasons:
- Ability to provide the full scope of services.
- Experience successfully serving the City’s Deferred Compensation Plans.
- Dedicated senior leaders who work directly with the City.
- Strong local public sector presence and experience.
- Understanding integration of Deferred Compensation Plans with pension plans and other employee and retiree benefits.
- Offered Overall Satisfaction guarantee with monetary consequences.
- Experience negotiation with recordkeepers.
Contract Term
The term of the agreement will be three years, starting March 1, 2019 through Feb. 28, 2022. Provisions of the contract will include an option to extend the term for up to two years, in one-year increments, which may be exercised by the City Manager, or his designee.
Financial Impact
The expenditure will not exceed $600,000 over the life of the contract, including potential extensions. Funding for services related to the City’s 457 and 401(a) Plans is in the DCP budget; and funding for services related to the City’s PEHP is in the City’s General Fund account.
Department
Responsible Department
This item is submitted by Acting Deputy City Manager Toni Maccarone and the Human Resources Department.