Item #03
Date: August 15, 2023
To: Mayor and City Council
From: Nicole Moe, Human Resources Manager
Jim Schaad, City Manager
Subject: Retirement Plan for Part-Time and Temporary City Employees Recommendation:
Pass a Motion to 1) authorize the City Manager, or designee, to enter into an investment contract with Keenan & Associates to invest with the established Accumulation Program for Part-Time and Limited Service Employees (APPLE) retirement plan, 2) authorize the City Manager, or designee to complete all necessary paperwork needed for switching providers, 3) adopt Resolution 2023-XX and 4) authorize the City Manager, or designee to complete all necessary paperwork to cease contributions and close out the book of business with the previous provider effective November 1, 2023.
Rationale for Recommendation:
As a benefit to part-time City employees, the City saw a need to offer a supplemental retirement plan that has a better return on investment (ROI) that our current plan. Our current investment company, PARS, offers sub-par customer service and has a very large fee schedule that it passes along to the investor (the employee), while offering lower returns on invested funds. Important dates to keep in mind are, today’s Council meeting 8/15 – Termination letter & Council Resolution sent to PARS by 8/31 (fulfills the 90-day notice requirement for transfer of assets to new plan on 11/30/23), APPLE plan effective date – 11/1/2023 (APPLE can accept payroll contributions during the month of November), PARS blackout period – no distributions or contributions can be processed 11/1 - 11/30/2023, Transfer date of funds and participant records: 11/30/2023 and finally, APPLE blackout period for processing participant records and funds 12/1 – 12/10/2023.
Fiscal Analysis:
There is no fiscal impact as the contribution rates by the employee and employer will remain the same.
Attachment(s):
1) Resolution 2023-XX
2) PARS Termination Letter
3) APPLE Participation Agreement