RESOLUTION NO. (N.C.S.)
A RESOLUTION APPROVING TRUST ADOPTION AND TRUST ADMINISTRATIVE SERVICES AGREEMENTS BETWEEN THE CITY AND PFM ASSETS MANAGEMENT LLC AND AUTHORIZING AND DESIGNATING STAFF TO EXECUTE OTHER TRUST-RELATED DOCUMENTS WHEREAS, City pension costs are expected to dramatically increase to potentially unsustainable levels; and WHEREAS, limited options are available to the City to address its growing pension liability; and WHEREAS, establishment of a pension trust will play an important role in the City’s fiscal sustainability, including allowing the City to accumulate funds to reduce the City’s unfunded pension liability and mitigate the impact of fluctuations in future pension costs; and WHEREAS, on March 20, 2018, the City Council approved a resolution adopting an irrevocable supplemental Section 115 pension trust agreement and authorizing execution of an agreement with PFM Asset Management LLC and other related documents required to establish the trust and receive trust administration and trust asset investment services on behalf of the City; and WHEREAS, the trust agreement and related documents approved by the Council have not been executed and the pension trust has not been established; and WHEREAS, the previous trustee of the pension trust, Wells Fargo, NA, was replaced by Principal Bank, following the acquisition of the Wells Fargo Institutional Retirement and Trust business in July 2019 by Principal Financial Group, Inc., of which Principal Bank is a wholly owned subsidiary; and WHEREAS, updates of the pension trust agreement and related documents approved by Council are necessary to change the name of the trustee of the pension trust from Wells Fargo, NA, to Principal Bank and incorporate other changes into the agreements and documents which are non-substantive and/or inure to the benefit of the City, including reduction of the rates of compensation for trust administration services.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Salinas that the Council:
approves the updated Adoption Agreement For The Post-Employment Benefits Trust between the City and PFM Assets Management LLC (“PFM”); approves the updated Trust Administrative Services Agreement between the City and PFM; and authorizes the City Manager, Director of Finance, and Assistant Finance Director to execute the agreements and other documents required to establish a pension trust and receive trust administration and trust asset investment services on behalf of the City.
PASSED AND APPROVED this 12th day of April 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
________________________
Kimbley Craig, Mayor
ATTEST:
_________________________
Patricia M. Barajas, City Clerk
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