AGENDA ITEM NO. 4
TO: MAYOR AND CITY COUNCIL
FROM: JOHN T. SCHAEFER, CITY MANAGER
BY: LISA BAILEY, FINANCE DIRECTOR
DATE: FEBRURARY 28, 2014
SUBJECT: CONTRACT WITH TIAA CREF FOR ADMINISTRATION
OF EMPLOYEE’S DEFERRED COMPENSATION
PROGRAMS
BACKGROUND
The City provides a program for its employees to invest their tax deferred contributions in various types of investments as directed by the employees. The City has contracted with the International City/County Management Association Retirement Corporation (ICMA RC) for many years. Over the years employees have inquired if the City could change providers so that the employees could select certain funds which they deemed to have better returns than the funds available through ICMA RC. City staff engaged Capital Research & Consulting, LLC to request proposals from ICMA RC and other administrators of deferred compensation programs. They received proposals from four firms including ICMA RC. TIAA CREF gave the most advantageous proposal to the City. Capital Research contacted ICMA RC to inquire if they would meet TIAA CREFF’s proposal, to which they declined. ICMA RC has been receiving approximately $386 in annual revenue per participant per year. TIAA CREF’s offer amounts to approximately $128 per participant per year. Staff has convened a committee with representatives from each employee group to review the proposals. The Committee unanimously agreed that TIAA CREF’s proposal was the most advantageous.
The City Attorney was asked if he had a qualified person in his firm to review the subject agreements.
He said he did not and recommended that the City have an attorney specializing in such agreements review them on behalf of the City. Staff received proposals from two attorney’s specializing in such agreements and engaged Jay Knight of Jackson Lewis on the recommendation of Capital Research. Mr.
Knight has reviewed and approved these agreements.
FISCAL IMPACT
There is an administrative fee of $2,500 per year for the Retirement Health Savings Plan. Staff is currently negotiating this with TIAA CREF.
City of San Marino
AGENDA REPORT
Dennis Kneier, Mayor
Eugene Sun, Vice Mayor
Allan Yung, MD, Council Member
Richard Sun, DDS, Council Member
Richard Ward, Council Member
AGENDA ITEM NO. 4
RECOMMENDATION
If Council concurs, the appropriate action would be:
“A motion to instruct the City Manager to execute agreements as necessary with TIAA CREF to administer the employees’ deferred compensation programs, including the Management Money Purchase Plan, the 457 (b) plans and the Retirement Health Savings Plans.”
Attachments: Recordkeeping Services Agreement for Governmental Plan(s) Retirement Healthcare Program Administrative Services and Record Keeping Agreement
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TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA
RECORDKEEPING SERVICES AGREEMENT FOR
GOVERNMENTAL PLAN(S)
THIS AGREEMENT ("Agreement") is entered into as of this 1 st day of December, 2013, or such later date as the
parties shall agree by Notice
corporation organized and existing under the laws of the State of New York, and the City of San Marino under this Agreement.
WITNESSETH:
WHEREAS, Employer sponsors and maintains the City of San Marino Management Money Purchase Plan and the City of San Marino 457(b) Plan Plan(s)
WHEREAS, assets of such Plan(s) are allocated to and invested in certain mutual funds , other investment funds and Teachers Insurance and Annuity Association of America- - annuity contracts selected by Employer and made available by Employer under the terms of the Plan(s) for the benefit of Participants;
WHEREAS, Employer and the administrators of the Plan(s) seek the provision of certain record keeping services in connection with the operation and administration of the Plan(s); and
WHEREAS, TIAA desires to provide such services to Employer and the Plan Administrators in connection with the operation and administration of the Plan(s) as set forth in more particularity in this Agreement.
NOW, THEREFORE, in consideration of the promises and mutual covenants, representations and warranties set forth herein, TIAA and Employer agree, as follows:
1. APPOINTMENT; ACCEPTANCE; AUTHORITY TO DIRECT OTHERS
1.1 The Employer hereby appoints TIAA as a record keeper for the Plan(s) to provide the Services as defined in this Section 1.1. TIAA shall provide the Contracted Services in accordance with the provisions of the Plan(s), but TIAA shall have no discretionary control over the Plan(s). 2 PLNSETRKA
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-product/services outputs, outcomes,
communications to Plan Parties and quality assurance over the foregoing included in the description of services in Part I Contracted Services of Schedule A to this Agreement; and Employer, the Plan Administrator, and employees of the
Employer eligible to participate in the Plan.
The Contracted Services shall not include any infrastructure or ancillary or supporting activities, functions or operations of TIAA and/or its affiliates or subcontractors, including, without Infrastructure
TIAA Infrastructure and Other Operations do not constitute a part of the Contracted Services and are not subject to the terms and requirements of this Agreement.
1.2 TIAA hereby accepts the appointment as a record keeper for the Plan(s) and agrees to provide the Contracted Services. TIAA is responsible for exercising reasonable care in providing the Contracted for reasonable care is limited solely to correcting processing errors resulting from malfunction of TIAA equipment, error by staff, or error by programs.
TIAA shall make a good faith effort to correct any error caused by its performance subject to the limitations herein set forth; provided that the Employer notifies TIAA in writing of such error and furnishes all data necessary to make such correction within sixty (60) days following the date on which the Employer is furnished with a report in which the claimed error is contained. Correcting an error includes restoring any los . The
correct any error brought to its attention after such time period has expired. TIAA shall in no event be liable, regardless of the form of the action, for loss of profit, goodwill, or other special consequential damages suffered by the Employer or its Plan(s) as a result of the Contracted Services. The Contracted Services perform
part through subcontractors designated by TIAA. TIAA shall continue to be liable for the performance of any Contacted Service performed by such subcontractors and shall be solely responsible for paying the fees such subcontractors charge for the performance of such Contracted Services. To the extent that Contracted Services are to be performed by a broker-dealer as determined solely by TIAA, the Employer agrees that such Contracted Services may be performed by TIAA-CREF Individual & Institutional Services, LLC, a wholly owned subsidiary of TIAA.
2. NON- FIDUCIARY STATUS
Except with respect to its offering a Contracted Service that delivers investment and savings advice to Plan participants as described in Schedule A, it is intended that the Contracted Services be ministerial in nature and that nothing in this Agreement should be construed as granting any discretionary authority or discretionary responsibility to TIAA with respect to the Plan(s), the participants, or the investments under the Plan(s). 3 PLNSETRKA
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3. CHANGES TO ADMINISTRATIVE PROCEDURES
TIAA reserves the right to make changes to any administrative procedures in order to assure quality service; provided, that TIAA agrees to provide the Employer with (i) reasonable advance notice of any changes, and (ii) the opportunity to have input into the manner in which any such changes are made and implemented.
4. DATA REQUIREMENTS; TRANSMITTAL OF DATA
TIAA and the Employer shall work together to develop guidelines for data processing. The Employer shall be responsible for the timely transmittal to TIAA of participant data that is materially correct and complete.
5. PERSONNEL AND RESOURCES
TIAA shall provide sufficient personnel and resources as may be necessary to perform the Contracted Services in a thorough and professional manner. The personnel designated by TIAA to perform the Contracted Services shall have the training and background necessary to perform such Contracted Services.
6. ERRORS, OMISSIONS OR DELAYS
6.1 Each Party to this Agreement will be responsible to the other Party for their own respective errors, omissions or delays in the performance of their responsibilities under this Agreement. Each Party shall notify the other Party (i) of any errors, omissions or interruptions in, or delay or unavailability of, the Contracted Services in the case of TIAA and services performed by Employer in the case of Employer, or (ii) if it is unable to perform any of its obligations under this Agreement. Such notice shall be provided as promptly as possible but in no event later than the next business day following the occurrence of any events covered by (i) or (ii) of this paragraph. Notification under this provision shall be in such form as is required by Section 13 of this Agreement. Such notice shall not relieve the notifying Party of its obligations under this Agreement.
6.2 The Employer acknowledges that in performing the Contracted Service. TIAA must rely exclusively on the data and information provided to TIAA by the Employer and participants, and that TIAA is not obligated to inquire into and is not responsible for the authenticity or accuracy of such data or information. If TIAA is required to repeat or reprocess any task as a result of incomplete or inaccurate information provided by a Plan, TIAA may charge a reasonable reprocessing fee. In addition, if amounts are sent with incorrect instructions, or in amounts that do not reconcile with the instructions given, TIAA may (1) apply the amounts for which accurate instructions are given and refund any excess amounts to the Employer, or (2) if amounts are less than the instructions call for, refund the entire amounts to the Employer.
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6.3 A Plan Administrator of a Plan shall review all record keeping reports and shall immediately notify TIAA of any claimed error with respect to any data or report. TIAA assumes no responsibility for verification and any report not challenged in writing by a Plan Administrator within one hundred and twenty (120) days of receipt thereof shall be conclusively presumed accurate and complete. The foregoing notwithstanding, TIAA will, at the Plan
correct any error brought to its attention after such time period has expired.
7. REPRESENTATIONS, WARRANTIES AND COVENANTS
7.1 Each Party represents that it is free to enter into this Agreement and that by doing so it will not breach or otherwise impair any other agreement or understanding with any other person, corporation or entity.
TIAA further represents, warrants and covenants that:
a. It has full power and authority under applicable law, and has taken all action necessary, to enter into and perform this Agreement, and that the person executing this Agreement on its behalf is duly authorized and empowered to execute and deliver this Agreement; b. This Agreement, when executed and delivered, shall constitute the valid, legal and binding obligation of TIAA, enforceable in accordance with its terms; c. TIAA is a stock life insurance company duly organized, existing and in good standing under the laws of the State of New York; and
The Employer further represents, warrants and covenants that:
d. It has full power and authority under applicable law, and has taken all action necessary, to enter into and perform this Agreement, and that the person executing this Agreement on its behalf is duly authorized and empowered to execute and deliver this Agreement; and e. This Agreement, when executed and delivered, shall constitute the valid, legal and binding obligation of the Employer, enforceable in accordance with its terms. f. In the event TIAA or its affiliates or subsidiaries provide the Employer with communications intended for use with or distribution to plan participants. Examples of such communications could include, but are not limited to, institutional marketing materials surrounding products and services and institutional client presentations. The Employer agrees not to distribute such materials to plan participants.
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8. FEES
8.1 TIAA shall be paid an annual administrative fee of 25 basis points (0.25%) based on the assets in each Participant A
Choice and Retirement Choice Plus annuity contracts - and any of the other funding options listed in Schedule B for the Contracted Services provided by TIAA under this Agreement. This fee will be collected by assessing such accounts a 6.25 basis points (0.0625%) quarterly administrative fee. Such basis point fees shall be deducted pro rata from the annuity contracts TIAA each calendar quarter in arrears. The aforementioned annual administrative fee shall remain in effect for five (5) years as of the effective date of this Agreement. At the end of the five (5) year term, ts. If the
annual administrative fee changes after the five (5) year term, TIAA shall give the Employer at least one hundred and eighty (180) days advanced written notification prior to implementing any such change in the annual administrative fee. Unless Employer provides TIAA at least ninety (90) days prior written notice of the termination of this Agreement in accordance with Section 14, Employer agrees to amend section 8.1 to reflect the new annual administrative fee.
TIAA revenue requirement for its Contracted Services during the initial contract period is 35 basis points (0.35%) annually, which shall be calculated and deducted on a quarterly basis following the Plan year end for the three-month periods ending each March 31st, June 30th, September 30th and December 31st, and which 10 basis points shall be derived from the funding options as set forth in Schedule B of this Agreement and 25 basis points shall be derived from the annual administrative fee as set forth above. Notwithstanding the foregoing, if the funding options as set forth in Schedule B of this Agreement are modified and the modification generates less than 10 basis points or exceeds 10 basis points, TIAA and the Employer shall amend this section 8.1 in order to document the process of how such shortfall shall be paid or how such excess shall be credited to the Employer Plans.
For fees deducted from Participant Accounts, with respect to the funds described in Schedule B, the Employer authorizes TIAA, on its behalf, to instruct JPMorgan Chase Bank to debit the applicable TIAA-CREF Annuity C
n Accounts allocated to such TIAA-CREF Annuity Contracts under the Plan in the applicable amount. Such fees are subject to change upon advance Notice from TIAA. In addition, the Employer understands and accepts that TIAA may be further compensated for the Contracted Services by payments made by providers of mutual funds, or their affiliates, used as allocation options under the Plan and from fees under the TIAA-CREF Annuity Contracts. This shall include sharing, on a periodic basis, in the revenue derived by such mutual fund providers and TIAA-CREF.
8.2 The Employer understands that certain non-proprietary mutual funds listed in Schedule B may pay costsharing payments. The Employer agrees that the amount of such cost-sharing payments shall be collected by TIAA and used to provide the Contracted Services under this agreement. The current schedule of cost-sharing payments is listed in Schedule B. Such fees and payments are subject to change upon advance written notice from TIAA but in no event shall such chang administrative fee of 25 basis points during the initial contract period as set forth in Section 8.1. 6 PLNSETRKA
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9. MAINTENANCE OF RECORDS
TIAA agrees that the books, records, accounts, ledgers, documents, and other compilations of data (whether written, electronic, computer related or otherwise) collected and maintained by TIAA for the Employer and/or the Plan(s) under any provision or requi the
Employer. During the term of this Agreement, TIAA will at all times cooperate with and grant the Employer s. If any litigation,
claim, negotiation, audit, or other action involving the Records is commenced prior to the expiration of the applicable retention period, both TIAA and the Employer shall retain all Records until completion of the action and resolution of all issues resulting therefrom, or until the end of the applicable retention period, whichever is later. Upon the expiration or termination of this Agreement, TIAA shall provide Records to the Employer upon such schedule and in such form or format as the Employer and TIAA agree is reasonable.
10. INDEMNIFICATION
10.1 TIAA agrees to indemnify and hold harmless the Employer and its respective employees, officers, directors, agents, affiliates and subcontractors or other related persons or organizat osed upon, or asserted against the Employer Parties, on account of any claim or action at law or in equity brought by a third party against the Employer Parties to the proportionate extent that it results from the negligence, errors, omissions or wrongdoing of TIAA, or its employees, officers, directors, agents, affiliates and subcontractors or other related persons or Notwithstanding the foregoing, TIAA shall not hold harmless or indemnify the Employer Parties
10.2 The Employer agrees to indemnify and hold harmless the TIAA Parties against Losses that may be incurred by, imposed upon, or asserted against the TIAA Parties, on account of any claim or action at law or in equity brought by a third party against the TIAA Parties to the proportionate extent that it results from the negligence, errors, omissions or wrongdo performance of their duties and obligations hereunder. Notwithstanding the foregoing, the Employer bad faith, negligence, or willful misconduct.
10.3 Notwithstanding anything to the contrary herein and in this Section 10, TIAA shall expressly indemnify, defend and hold harmless any of the Employer Parties from all, loss, damage, costs, charges, liability penalties, fines or expense, including without limitation, reasonable 7 PLNSETRKA
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upon, or asserted against any of the Employer Parties, on account of any claim or action at law or in equity against any of the Employer Parties to the proportionate extent that it results from the negligence, errors, omissions or wrongdoing of the Custodian, its employees, agents, subcontractors and affiliates under that certain Custodial Account Agreement for a 457(b) Plan and under that certain Custodial Account Agreement for a 401(a) Plan between the Employer and JPMorgan Chase Bank, N.A., entered into on or about the date of this Agreement. 10.4 If any third party threatens to commence or commences any action for which one Party (the Indemnifying Party shall be entitled, at its own expense and without limiting its obligations to indemnify the Indemnified Party, to assume control of the defense of such action with counsel selected by the Indemnifying Party, which counsel shall be reasonably satisfactory to the Indemnified Party. If the Indemnifying Party assumes the control of the defense, the Indemnified Party may participate in the defense of such claim at its own expense. Without the prior written consent of the Indemnified Party, which consent shall not be withheld unreasonably, the Indemnifying Party may not settle or compromise the liability of the Indemnified Party in such action, or consent to or permit the entry of any judgment in respect thereof, unless such settlement, compromise or judgment is exclusively for monetary damages and in connection with such settlement, compromise or consent the Indemnified Party receives from such claimant an unconditional release from all liability in respect of such claim.
10.5 The indemnities granted by the Parties in this Section shall survive the termination of this Agreement.
11. CONFIDENTIALITY; EMPLOYER NAME
11.1 TIAA and the Employer recognize and acknowledge that, by entering into this Agreement, each Party may have access to certain information of the other Party that is confidential and constitutes valuable, special and unique property of that other Party. The Parties agree that they will not at any time, either during or subsequent to the term of this Agreement, disclose confidential information to others, or use, copy or permit the transmittal of confidential information to others, or use, copy or permit confidential s express prior written consent, except that TIAA may
disclose confidential information to others, or use, copy or permit the transmittal of confidential information to others, or use copy or permit confidential information to be copied by others to the extent TIAA deems necessary to provide the Contracted Services. Except for disclosure by their Parties to their legal counsel, accountant or financial advisors (none of whom will be associated or affiliated in any way with the other Party or any of its affiliates), the Parties will not disclose the terms of this Agreement to any other person, unless disclosure is required by law or otherwise authorized by this Agreement or with the consent of the non-disclosing Party. Unauthorized disclosure of the terms of this Agreement will be a material breach of this Agreement and will provide the non-breaching Party the option of pursuing remedies for breach or immediate termination of this Agreement.
11.2 All payroll, employee, and Participant information received by TIAA under this Agreement shall be treated as confidential information and shall be handled by TIAA in accordance with applicable law, 8 PLNSETRKA
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Agreement.
11.3 Subject to the express written consent of the Employer, TIAA shall have the non-exclusive and nontransferable right to use the name of the Employer solely in connection with rendering Contracted Services
be used shall be submitted to the Employer in hard copy for review and approval prior to use by TIAA.
Upon termination of this Agreement, TIAA agrees to immediately discontinue use of the Employer name.
12. WAIVER
The failure of either TIAA or the Employer at any time to require performance of any provisions hereof will in no manner affect its right at a later time to enforce such provision and will not act as a waiver thereof.
13. NOTICE
Any notices that may be required under this Agreement shall be given in writing and delivered personally or mailed by certified mail or courier service to the other Party at the following address or such other address as each Party may give notice to the other.
If to TIAA, to:
Client Agreement Team
TIAA-CREF
730 Third Ave-16th floor
New York, NY 10017-3206
Attention: Director Institutional Client Services
If to the Employer, to:
Ms. Lisa Bailey
Finance Director
City of San Marino
2200 Huntington Dr.
San Marino, CA 91108
14. EFFECTIVENESS; TERMINATION
This Agreement shall become effective as of the date set forth above. The Employer may remove TIAA as record keeper upon ninety (90) days prior written notice to TIAA. TIAA may resign as record keeper upon ninety (90) days prior written notice to the Employer.
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15. APPLICABLE LAW
This Agreement shall be construed, and the provisions hereof interpreted under, in accordance with the laws of the State of New York.
16. COMPLETE AGREEMENT; MODIFICATIONS
This Agreement embodies the entire agreement between the Parties and supersedes all prior agreements and documents relating to the subject matter of this Agreement. All amendments to this Agreement must be in writing and signed by both Parties.
17. COUNTERPARTS
This Agreement may be executed simultaneously in two or more counterparts, each of which taken together shall constitute one and the same Agreement.
18. SEVERABILITY
If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of this Agreement shall not be affected thereby.
19. SUCCESSORS AND ASSIGNS
This Agreement will be binding upon, inure to the benefit of, and be enforceable by the respective successors of the Parties. This Agreement will not be assignable by any Party hereto without the written consent of the other Party.
20. NON-EXCLUSIVITY
Each of the Parties acknowledges and agrees that this Agreement and the arrangements described herein are intended to be non-exclusive and that each of the Parties is free to enter into similar agreements and arrangements with other entities.
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IN WITNESS WHEREOF, the Parties hereto have executed and delivered this Agreement as of the date first above written.
Teachers Insurance and Annuity Association of America
By: ______________________ Date: ___________________
Print Name:
Title:
City of San Marino
By: ______________________ Date: ____________________
Print Name:
Title:
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SCHEDULE A
Part I Contracted Services
TIAA shall provide the Contracted Services as listed in this Schedule A.
1. Through online enrollment and centralized Telephone Counseling support, TIAA will provide Plan enrollment kits and shall otherwise aid in the enrollment of employees eligible to participate in a Plan.
2. TIAA will provide the Plan Parties with a recordkeeping system which will use and rely upon information provided to TIAA solely by the Plan and/or its participants. TIAA shall maintain records of each Plan nts paid as premiums to and balances in
TIAA-CREF annuity contracts. The records of each such account balance shall reflect amounts attributable to employer contributions, participant elective-deferral contributions, rollover contributions (when permitted by the applicable Plan) and transfers, and any after-tax contributions (when permitted by the applicable Plan).
The recordkeeping system shall also include an allocation among investment options plus any investment gains/losses incurred in the accounts. TIAA shall also maintain records of rollover Roth contributions, as
3. the
mutual funds under a Plan, other investment funds under a Plan or in TIAA-CREF annuity contracts available death. The mutual funds, other funds and TIAA-CREF annuity contracts initially chosen for the Plan(s) are set forth in Schedule B. All contributions shall be allocated among such contracts, mutual funds and other investment funds in accordance with the most recent valid instructions. Transfers among plan funding options shall be made pursuant to the instructions of the participant or beneficiary in accordance with the terms of the Plan(s) but subject to any restrictions in the applicable mutual fund or TIAA-CREF annuity contract. TIAA shall provide to the participant or beneficiary all of the forms necessary to enable him or her to allocate contributions or transfer amounts among the Plan funding options. In the event that Schedule B is amended to eliminate a mutual fund or funds as an investment under the Plan(s), TIAA shall enable transfers of accumulation pursuant to the instructions of the Plan Administrators from the eliminated mutual fund or funds to the fund or funds chosen by the Employer as replacement(s) and prevent future allocations to the eliminated fund or funds. TIAA will work with the Plan Administrators to develop a plan for such transfers and in communicating with the Plan s participants and beneficiaries concerning the change in the Plan(s) investment options.
4. TIAA shall send periodic record keeping reports and communications to the Plan Administrators and each Plan participant and beneficiary, including but not limited to information regarding returns and investment performance under the mutual funds and TIAA-CREF
under a Plan.
5. TIAA shall send any communication that it is required to provide by mail to a participant or beneficiary to the address provided to TIAA by the Plan or by the participant or beneficiary. 12 PLNSETRKA
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6. TIAA shall, as authorized under a Plan by a Plan Administrator and subject to applicable law, administer and account for plan loans available under the terms of a Plan and shall, as authorized under a Plan by a Plan administrator and subject to applicable law, administer and account for hardship distributions.
7. TIAA shall, as authorized under a Plan by a Plan Administrator and subject to applicable law, provide for the liquidation of amounts in and make plan benefit payment distributions permitted under, the TIAA-CREF Plan Administrator and subject to applicable law, provide instructions to JPMorgan Chase Bank for the liquidation of investments in and to make plan benefit payment distributions permitted under the mutual funds
8. the participants or the Plan.
9. To the extent permitted under applicable law, TIAA shall assure the performance of any required withholding of income tax from distributions and withdrawals. The foregoing notwithstanding, TIAA shall not provide for the performance of withholding of income tax from distributions and withdrawals from any private taxexempt Code section 457(b), any Code section 415(m) plan or any Code section 457(f) Plan covered under this Agreement unless appropriate arrangements are made in writing with TIAA. Prior to the distribution of Code, when applicable.
10. TIAA may receive instructions from a Plan and/or Plan participant on behalf of JPMorgan Chase Bank for the Instructions which
executed by JPMorgan Chase Bank at the net asset value determined as of the Close of Trading on such Close of Trading, will be executed by JPMorgan Chase Bank at the net asset value determined as the Close of Trading on the next Business Day following the date of receipt of the Instruction. Instructions shall be Instructions balance and conform to all other operating procedures, including any restrictions or limits set forth in the applicable fund prospectus or as otherwise set forth by TIAA on behalf of JPMorgan Chase Bank. twithstanding the
foregoing, in the event that the Securities and Exchange Commission promulgates or amends rules under which the foregoing procedures would be impermissible, this paragraph 11 shall be amended to provide a procedure that conforms to such rules.
11. TIAA shall cause to be delivered to the Plan Administrator or at the direction of the Plan Administrator, directly to Plan participants and beneficiaries, all notices, prospectuses, financial statements, proxies and proxy soliciting materials received by TIAA relating to the TIAA-CREF annuity contracts or the mutual fund of the participants or beneficiaries. If no instructions for voting proxies applicable to mutual fund shares are 13 PLNSETRKA
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received, TIAA shall not exercise the voting rights for such shares and shall not be responsible for the failure to vote, or instruct the vote on such shares.
12. At such times as the Plan Administrators and TIAA shall agree, TIAA shall provide reports to the Plan Administrators concerning employee elective deferrals in order to aid in their compliance with the applicable limits on employee elective deferrals in sections 402(g), 457(e) and 414(v) of the Code, as applicable.
13. TIAA shall, as authorized by a Plan Administrator, offer a Plan level service that delivers investment and savings advice to Plan participants from an independent third party advice provider. The program follows the guidelines set forth in Department of Labor ("DOL") Advisory Opinion 2001-09A (known as the Sun America Opinion). Ibbotson Associates, Inc. is the independent financial expert under this participant advice program. The advice service will be delivered to participants over the phone, through the web, and by TIAACREF consultants in the field. TIAA accepts fiduciary responsibility for the provision of advice under this program.
14. TIAA shall provide employee services through four primary access channels, TIAA-CREF Website with an -free Telephone Counseling
Center for information and advice on topics ranging from enrollment to investment choices to retirement planning goals, Text Telephone Service for the Hearing or Speech-impaired, and an Automated Telephone Service.
15. TIAA shall provide Administrators with the support required to manage their retirement plans. This will be done through two primary access channels, TIAA-CREF Administrator Website with an array of comprehensive tools and information, secure site to obtain reports, enroll employees, remit contributions, and our Administrator Relationship Management Center offers direct toll-free access to trained consultants.
16. As authorized by the Plan Administrator and subject to applicable law, TIAA will administer the spousal consent requirements applicable to a Plan and have distributed Plan balances in accordance with any Qualified Domestic Relations Order (as defined in section 414(p) of the Internal Revenue Code) received by TIAA or forwarded to TIAA by a Plan and in accordance with the instructions of the Plan Administrator.
17. TIAA shall provide three (3) on-site Individual Counseling day(s) for employees and/or on-site participant Education seminars, as agreed upon with the Employer, for the calendar year ending (December 31, 2014).
For subsequent years, TIAA shall provide three (3) day(s) of services on-site consisting of either Individual Counseling for employees or participant Education seminar(s), as agreed upon with the Employer. .Part II TIAA Infrastructure and Other Operations
All services, activities and functions performed by or for TIAA which are not expressly included in Schedule A, Part I
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include TIAA corporate and business lines systems, quality control, data entry and other activities and operations that are ancillary to the provision of Contracted Services as defined in the Agreement and this Schedule A, Part I.
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SCHEDULE B
FEES: The fees applicable to the Plan(s) are described in Sections 8.1 and 8.2 of this Agreement. Revenue sharing for non-proprietary mutual funds, which shall be collected and retained by TIAA, are as set forth below:
Plan Funding Options
TIAA-CREF Mutual Funds
FUND NAME SHARE CLASS TICKER
TIAA-CREF Growth & Income Fund Institutional Class TIGRX TIAA-CREF Inflation-Linked Bond Fund Institutional Class TIILX Non- Proprietary Mutual Funds, Servicing Fees and Revenue Sharing Payments American Funds American Balanced Fund R6 RLBGX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
Baron Growth Fund Institutional BGRIX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 15 basis points.
Columbia Contrarian Core R4 CORRX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 25 basis points.
DFA US Small Cap Portfolio Institutional DFSTX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
DFA US Small Cap Value Portfolio Institutional DFSVX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
First Eagle Global Fund Class A SGENX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
First Eagle Global Fund Class I SGIIX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
Franklin Mutual Global Discovery Z MDISX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 20 basis points.
Ivy High Income A WHIAX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 50 basis points.
JPMorgan Equity Income Fund Select Class HLIEX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 25 basis points.
Laudus Growth Investors US Large Cap Gr LGILX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 10 basis points.
Loomis Sayles Bond Instl LSBDX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 20 basis points.
Metropolitan West Total Return Bond I MWTIX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 10 basis points. 16 PLNSETRKA
Client ID: 065264 v.1.5
Plan(s): 406315 & 406314
Oakmark Global Fund Class I OAKGX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 25 basis points.
Oakmark International Fund I OAKIX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 25 basis points.
Oppenheimer International Growth Y OIGYX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 15 basis points.
PIMCO Foreign Bond (USD-Hedged) I PFORX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
PIMCO GNMA Instl PDMIX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
PIMCO Total Return Fund Inst PTTRX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
T. Rowe Price Capital Appreciation Fund PRWCX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 15 basis points.
Vanguard 500 Index Fund Signal VIFSX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
Vanguard Equity Income Fund Investor VEIPX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
Vanguard Mid-Cap Index Fund Signal VMISX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
Vanguard Selected Value Fund Investor VASVX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
Vanguard Small-Cap Growth Index Fund Investor VISGX
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
Non- Proprietary Stable Value Fund
FUND NAME CUSIP
Invesco Stable Value Fund 46X161XX9
The annual 12b-1 and revenue sharing TIAA shall receive for services rendered is 0 basis points.
Retirement Healthcare Program
Administrative Services and
Recordkeeping Agreement
THIS AGREEMENT, which includes the Schedules attached hereto, ("Agreement") is between The City of San Marino (“Plan Sponsor”) and Teachers Insurance and Annuity Association of America ("TIAA"). TIAA agrees to provide administrative services with respect to Plan Sponsor’s program for Employees and their eligible Dependents beginning <Date>, in consideration of payment by Plan Sponsor of the agreed upon fee and performance by Plan Sponsor of the functions itemized in this Agreement.
WITNESSETH:
WHEREAS, Plan Sponsor sponsors and maintains the City of San Marino Retirement Healthcare Plan (the “Plan”), for the benefit of eligible employees, retirees and their beneficiaries (“Participants”) and will establish a trust to hold employee contributions and employer contributions, if any; WHEREAS, assets of such Plan trust are allocated to and invested in certain mutual funds selected by Plan Sponsor for the exclusive benefit of Participants; and
WHEREAS, Plan Sponsor and the administrator of the Plan appointed by Plan Sponsor (the “Plan Administrator”) seek the provision of certain third party administration services in connection with the operation and administration of the Plan;
NOW, THEREFORE, in consideration of the promises and mutual covenants, representations and warranties set forth herein, Plan Sponsor and TIAA agree, as follows:
1. Appointment by Plan Sponsor
1.1. Plan Sponsor hereby appoints TIAA as third-party administrator and recordkeeper for the Plan to provide ministerial and recordkeeping services listed in Schedule A and claim administration and recordkeeping services described in Schedule B of this Agreement. TIAA shall provide such services in accordance with the provisions of the Plan, but TIAA shall have no discretionary control over the Plan.
1.2. TIAA may perform any of the services described in this Agreement through agents and subcontractors selected by TIAA including without limitation ConnectYourCare (“CYC”), a Maryland Limited Liability Company that specializes in health claim administration and will be providing the services described in Schedule B of this Agreement and the Business Associates Agreement between Plan Sponsor and CYC, which Plan Sponsor and CYC shall execute separately. TIAA shall reasonably supervise CYC and any other agent or subcontractor it may retain. The retention of agents or subcontractors shall not relieve TIAA of its duties hereunder. TIAA, with whom Plan Sponsor has contracted directly, shall ultimately be responsible for all work performed by CYC and any other agents and subcontractors that TIAA may retain to perform services described Retirement Healthcare Program Administrative Services and Recordkeeping Agreement this Agreement.
2. Non-Fiduciary Status
2.1. The duties to be performed by TIAA under this Agreement shall be ministerial in nature. Nothing in this Agreement should be construed as granting discretionary authority or discretionary responsibility to TIAA, its affiliates, officers, employees and subcontractors with respect to the Plan, the participants, or Plan assets. Since CYC has been retained by TIAA to process health claims under the Plan, CYC’s status as claim fiduciary is described in Schedule B, Section (1)(a)(iii) of this Agreement. CYC shall adjudicate claims in accordance with the terms of the Plan, applicable laws, rules and regulations, and guidance provided by Plan Sponsor. CYC shall manage records relating to its administration of health claims, whereas TIAA shall manage records relating to the administration of the Plan.
3. Changes to Administrative Procedures
3.1. TIAA, its agents and subcontractors reserve the right to define and make changes to their administrative practices and procedures in order to assure quality service.
3.2. TIAA shall notify Plan Sponsor of any changes to its administrative practices and procedures or those of its agents and subcontractors that might affect the administration of the Plan or Plan Sponsor’s obligations under this Agreement. TIAA shall obtain Plan Sponsor’s approval before implementing any changes. Approval shall not be unreasonably withheld by Plan Sponsor.
4. Data Requirements; Transmittal of Data
4.1. TIAA and Plan Sponsor shall work together to develop guidelines for data processing and transmittal of data. These guidelines shall be set out in a separate document entitled “Statement of Work.” Any data the Plan Sponsor may be required to provide shall be submitted in a timely manner and shall be materially correct and complete. Any data referred to in this Section shall be subject to the terms of Section 11 of this Agreement, including, without limitation, the terms of any agreements incorporated therein by reference.
5. Personnel and Resources
5.1. TIAA, its agents, and subcontractors shall provide sufficient personnel and resources as may be necessary to perform the services contemplated under this Agreement in a thorough and professional manner. The personnel designated by TIAA, its agents, and subcontractors to perform the services contemplated under this Agreement shall have the training and background necessary to perform such services.
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement
6. Errors, Omissions or Delays
6.1. Each Party to this Agreement will be responsible to the other Party for its own respective errors, omissions or delays in the performance of services contemplated under this Agreement. Each Party shall notify the other Party of any errors, omissions or interruptions in, or delay or unavailability of the services contemplated under this Agreement, or if it is unable to perform any of its obligations under this Agreement. Such notice shall be provided as promptly as possible or in accordance with written guidelines approved by both Parties. Unless otherwise agreed upon by the Parties, notifications under this provision may be made by telephone or by e-mail. Such notice shall not relieve the notifying Party of its obligations under this Agreement.
6.2. The Plan Sponsor acknowledges and agrees that in performing the services contemplated under this Agreement, TIAA, its agents and subcontractors must rely on data and information provided to TIAA by the Plan Sponsor and participants, and that TIAA is not obligated to inquire into and is not responsible for the authenticity or accuracy of such data or information. If TIAA is required to repeat or re-process any task as a result of incomplete or inaccurate information provided by the Plan Sponsor, TIAA may charge a reasonable reprocessing fee. In addition, if amounts are sent with incorrect instructions, or in amounts that do not reconcile with the instructions given, TIAA may apply the amounts for which accurate instructions are given and any excess will be deposited into the Plan’s Trust and held in suspense until the Plan Sponsor provides instructions regarding the disposition of such amounts.
6.3. The Plan Administrator of the Plan shall review all recordkeeping reports and shall immediately notify TIAA of any claimed error with respect to any data or report. TIAA assumes no responsibility for verification and any report not challenged in writing by the Plan Administrator within ninety (90) days of receipt thereof shall be conclusively presumed accurate and complete. The foregoing notwithstanding, TIAA will, at the Plan Administrator’s request, make a good faith effort to correct any error brought to its attention after such time period has expired.
7. Representations, Warranties and Covenants
7.1. Each Party represents that it is free to enter into this Agreement and that by doing so it will not breach or otherwise impair any other agreement or understanding with any other person, corporation or entity.
TIAA further represents, warrants and covenants that:
a. It has full power and authority under applicable law, and has taken all action necessary, to enter into and perform this Agreement, and that the person executing this Agreement on its behalf is duly authorized and empowered to execute and deliver this Agreement; b. This Agreement, when executed and delivered, shall constitute the valid, legal and binding obligation of TIAA, enforceable in accordance with its terms; Retirement Healthcare Program Administrative Services and Recordkeeping Agreement c. TIAA is a stock life insurance company duly organized, existing and in good standing under the laws of the State of New York; and
The Plan Sponsor further represents, warrants and covenants that:
d. It has full power and authority under applicable law, and has taken all action necessary, to enter into and perform this Agreement, and that the person executing this Agreement on its behalf is duly authorized and empowered to execute and deliver this Agreement; and e. This Agreement, when executed and delivered, shall constitute the valid, legal and binding obligation of the Plan Sponsor, enforceable in accordance with its terms.
8. Fees
8.1. Plan Sponsor understands and accepts that TIAA may be compensated for its services under this Agreement. All fees shall be listed in Schedule D of this Agreement.
8.2. In addition to the fees described in Schedule D, Plan Sponsor understands and accepts that charges imposed by the funds listed in Schedule C of the Agreement, including any non-proprietary funds that may be added to the Schedule. Plan Sponsor shall refer to the prospectus for each of the funds listed in Schedule C. The Plan Sponsor may direct TIAA to act on its behalf in conveying instructions to J. P. Morgan Chase Bank to debit each notional account under the Plan in the appropriate amount to cover administrative service fees for services essential to the operation of the Plan.
8.3. Plan Sponsor understands and accepts that TIAA may collect fees on behalf of its subsidiaries and affiliates, such as TIAA-CREF Trust Company, FSB, that have entered into agreements with Plan Sponsor to provide services to the Plan.
8.4. TIAA shall be solely responsible for paying for the services performed by its agents and subcontractors and all taxes thereof. When this Agreement is terminated, TIAA shall settle all outstanding charges and claims of its agents and subcontractors.
9. Maintenance of Records
9.1. TIAA agrees that the books, records, accounts, ledgers, documents, and other compilations of data (whether written, electronic, computer related or otherwise) collected and maintained by TIAA for Plan Sponsor and/or the Plans under any provision or requirement of this Agreement (the “Records”) are the property of Plan Sponsor. During the term of this Agreement, TIAA will at all times cooperate with and grant Plan Sponsor or its designee reasonable access to the Records during TIAA’s normal business hours. If any litigation, claim, negotiation, audit, or other action involving the Records is commenced prior to the expiration of the applicable retention period, TIAA and Plan Sponsor shall retain all Records until completion of the action and resolution of all issues Retirement Healthcare Program Administrative Services and Recordkeeping Agreement resulting therefrom, or until the end of the applicable retention period, whichever is later. Upon the expiration or termination of this Agreement, TIAA shall provide Records to Plan Sponsor upon such schedule and in such form or format as Plan Sponsor and TIAA agree is reasonable.
10. Indemnification
10.1. TIAA agrees to indemnify and hold harmless the Plan Sponsor and its respective employees, officers, directors, agents, affiliates and subcontractors or other related persons or organizations (the “Plan Sponsor Parties”) from all loss, damage, costs, charges, liability, or expense, including without limitation, reasonable attorneys’ fees, and accountants’ fees and disbursements (hereinafter referred to as “Losses”) that may be incurred by, imposed upon, or asserted against the Plan Sponsor Parties, on account of any claim or action at law or in equity against the Plan Sponsor Parties to the proportionate extent that it results from the negligence, errors, omissions, or dishonest, fraudulent, or criminal acts of TIAA, or its employees, officers, directors, agents, affiliates, subcontractors, or other related persons or organizations (the “TIAA Parties”) acting alone or in collusion with others. Notwithstanding the foregoing, TIAA shall not hold harmless or indemnify the Plan Sponsor Parties against Losses stemming from the Plan Sponsor Parties’ bad faith, negligence, or willful misconduct. TIAA, its agent and its subcontractors shall maintain Bond and insurance coverage appropriate for the services provided under this Agreement.
10.2. The Plan Sponsor agrees to indemnify and hold harmless the TIAA Parties against Losses that may be incurred by, imposed upon, or asserted against the TIAA Parties, on account of any claim or action at law or in equity against the TIAA Parties to the proportionate extent that it results from the negligence, errors, omissions or wrongdoing of the Plan Sponsor’s Parties in the performance of their duties and obligations hereunder. Notwithstanding the foregoing, the Plan Sponsor shall not hold harmless or indemnify the TIAA Parties against Losses stemming from the TIAA Parties’ bad faith, negligence, or willful misconduct.
10.3. If any third party threatens to commence or commences any action for which one Party (the “Indemnifying Party”) may be required to indemnify the other Party hereunder (the “Indemnified Party”), the Indemnified Party shall promptly give notice thereof to the Indemnifying Party. The Indemnifying Party shall be entitled, at its own expense and without limiting its obligations, to indemnify the Indemnified Party, to assume control of the defense of such action with counsel selected by the Indemnifying Party, which counsel shall be reasonably satisfactory to the Indemnified Party. If the Indemnifying Party assumes the control of the defense, the Indemnified Party may participate in the defense of such claim at its own expense. Without the prior written consent of the Indemnified Party, which consent shall not be withheld unreasonably, the Indemnifying Party may not settle or compromise the liability of the Indemnified Party in such action, or consent to or permit the entry of any judgment in respect thereof, unless in connection with such settlement, compromise or consent the Indemnified Party receives from such claimant an unconditional release from all liability in respect of such claim.
10.4. The indemnities granted by the Parties in this Section shall survive the termination of this Agreement.
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement
11. Confidentiality; HIPAA; Plan Sponsor Name
11.1. TIAA and the Plan Sponsor recognize and acknowledge that, by entering into this Agreement, each Party may have access to certain information of the other Party that is confidential and constitutes valuable, special and unique property of that other Party. As used herein, “Confidential Information” means (i) this Agreement and the terms hereof and thereof, and (ii) all information marked confidential, proprietary or similar legend by either Party. Confidential Information does not include information that (i) was publicly known through no unauthorized act of a Party, or otherwise known to a Party without an obligation of confidentiality, at the time of disclosure, (ii) subsequently becomes publicly known through no unauthorized act or omission of either Party, (iii) was rightfully received from a third party without an obligation of confidentiality; or (iv) independently developed by the Party without the use of Confidential Information. The Parties agree that, except as provided in this Agreement, they will not at any time, either during or subsequent to the term of this Agreement, disclose Confidential Information to others, or use, copy or permit the transmittal of Confidential Information to others, or use, copy or permit Confidential Information to be copied, without the other Party’s express prior written consent, which shall not be unreasonably denied or delayed. Except for disclosure by their Parties to their employees, officers, trustees, legal counsel, accountant or financial advisors (none of whom will be associated or affiliated in any way with the other Party or any of its affiliates), the Parties will not disclose the terms of this Agreement to any other person, unless disclosure is required by law or otherwise authorized by this Agreement or with the consent of the non-disclosing Party, which shall not be unreasonably denied or delayed; provided, however, that Plan Sponsor may disclose Confidential Information relating to the operational terms of this Agreement and/or TIAA’s performance hereunder, or that of CYC or any other agent or subcontractor of TIAA (e.g., applicable service levels and measurements of TIAA or CYC’s performance with respect to such service levels) in connection with the solicitation of proposals for or the procurement of the same or similar services from prospective third party contractors so long as Plan Sponsor does not divulge TIAA’s pricing for the services or actual work product in connection with any such solicitation or procurement. Unauthorized disclosure of the terms of this Agreement will be a material breach of this Agreement and will provide the non-breaching Party the option of pursuing remedies for breach or immediate termination of this Agreement.
11.2. Participant health information, health claim information or any other personal information handled by CYC, TIAA’s subcontractor for claims processing, shall be maintained and safeguarded in accordance with the provisions of the Health Insurance Portability and Accountability Act (“HIPAA”) and other applicable data privacy and security law. Plan Sponsor and TIAA acknowledge and agree that the Plan is a “Covered Entity” under HIPAA and that TIAA will be performing services to the Plan that requires access to individually identifiable financial information, which the Plan Sponsor regards as individually identifiable health information. TIAA shall not have access to individually identifiable health claim information, medical records, or hospital records. To the extent TIAA maintains protected health information as defined under HIPAA (“PHI”), TIAA agrees to use safeguards that are consistent with the HIPAA privacy and security regulations with respect to such information.
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement
11.3. To the extent TIAA or CYC creates or receives Personal Information from the Plan Sponsor or the Plan, or on behalf the Plan Sponsor or the Plan, it shall collect, maintain, process, handle, use, disclose and destroy all Personal Information in compliance with all applicable data privacy and protection laws and maintain a comprehensive data privacy and security program, which shall include appropriate administrative, physical, technical and organizational measures to safeguard such data against the unauthorized access, possession, use, knowledge, process, disclosure, destruction, loss, alteration or theft, and which shall be no less rigorous than generally accepted privacy and security standards. To the extent any unauthorized acquisition or access to Personal Information is attributable to a breach of the obligations under this Agreement by TIAA or CYC, and notwithstanding any other provisions of this Agreement or any other agreement between the parties, both shall be responsible for the costs incurred by the Plan or Plan Sponsor to the extent it is necessary to comply with their legal obligations relating to such breach under the applicable breach notification statute or regulation, which shall include the following costs reasonably incurred by the Plan or the Plan Sponsor in responding to such breach: (1) the reasonable cost of preparing and distributing notifications to affected individuals, (2) the reasonable cost of providing notice to government agencies, credit bureaus, and/or other required entities, (3) to the extent required by the applicable statute, the reasonable cost of providing affected individuals with credit monitoring services for a specific period not to exceed twelve (12) months, or longer if required by law, (4) the reasonable cost of call center support for such affected individuals for a specific period not to exceed thirty (30) days from the date the breach notification is sent to such affected individuals, and (5) the reasonable cost of any other measures required under applicable law.
11.4. Subject to the express written consent of Plan Sponsor, TIAA, its agents and its subcontractors shall have the non-exclusive and non-transferable right to use the name of Plan Sponsor solely in connection with rendering services pursuant to this Agreement. Any material, including electronic, print, or other media, in which the Plan Sponsor’s name may be used, shall be submitted to the Plan Sponsor in hard copy for review and approval prior to use by TIAA, its agents or its subcontractors. Upon termination of the Agreement, TIAA agrees to immediately discontinue use of the Plan Sponsor name.
12. Waiver
12.1. The failure of TIAA at any time to require performance of any provisions hereof will in no manner affect its right at a later time to enforce such provision and will not act as a waiver thereof.
13. Notice
13.1. Except as provided in Section 6.1 or Schedule B of this Agreement, any notices that may be required under this Agreement shall be given in writing and delivered personally or mailed by certified mail or courier service to the other Party at the following address or such other address as each Party may give notice to the other.
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement If to TIAA, to:
Client Agreements Team
TIAA-CREF
PO Box 1299
Charlotte, NC 28262
Attention: Product Program Director
With copies to:
RHP Product Director
TIAA-CREF
630 Peter Jefferson Pkwy
Suite 260
Charlottesville, VA 22911
Attention: Richard Ward
Office of the General Counsel
TIAA-CREF
730 3rd Avenue
12th Floor
New York, NY 10017
Attention: Steven Kronheim
If to the Plan Sponsor, to:
<Plan Sponsor Name>
<Street Address>
<City, State, Zip>
<Attention: Individual>
14. Term of the Agreement; Termination
14.1. The term of this Agreement shall be 5 years from the effective date as set forth above. Any renewal of this Agreement shall be for a term of no less than three (3) years. The Plan Sponsor may remove TIAA as an administrative service provider and recordkeeper upon ninety (90) days prior written notice to TIAA. TIAA may resign as recordkeeper upon ninety (90) days prior written notice to Plan Sponsor. Upon termination of this Agreement, the parties agree that TIAA shall have no further duty or responsibility, except as agreed upon by both parties in writing to transfer all non-proprietary records and data to Plan Sponsor or to a successor service provider. Any unforeseeable costs or expenses incurred by TIAA in effecting this transfer shall be paid by Plan Sponsor directly to TIAA, unless waived in writing by TIAA.
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement
15. Applicable Law
15.1. This Agreement shall be construed, and the provisions hereof interpreted under, in accordance with the laws of the State of California.
16. Complete Agreement; Modifications
16.1. This Agreement embodies the entire agreement between the Parties and supersedes all prior agreements relating to the subject matter of this Agreement. All amendments to this Agreement must be in writing and signed by both Parties.
17. Counterparts
17.1. This Agreement may be executed simultaneously in two or more counterparts, each of which taken together shall constitute one and the same Agreement.
18. Severability
18.1. If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of the Agreement shall not be affected thereby.
19. Successors and Assigns
19.1. This Agreement will be binding upon, insure to the benefit of, and be enforceable by the respective successors of the Parties. This Agreement will not be assignable by any Party hereto without the written consent of the other Party.
20. Non-Exclusivity
20.1. Each of the Parties acknowledges and agrees that this Agreement and the arrangements described herein are intended to be non-exclusive and that each of the Parties is free to enter into similar agreements and arrangements with other entities.
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement IN WITNESS WHEREOF, the Parties hereto have executed and delivered this Agreement as of the date first above written.
TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA
By: __________________________________________ Date: ___________________ Print Name: ___________________________________
Title: _________________________________________
PLAN SPONSOR
By: __________________________________________ Date: ___________________ Print Name: ___________________________________
Title: _________________________________________
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement
SCHEDULE A
Plan Administration Services
1. TIAA shall facilitate the enrollment of employees eligible to participate in a Plan. In addition, TIAA shall make available trained personnel to provide guidance and retirement planning assistance to such employees before and after enrollment in the Plan.
2. TIAA shall maintain records of each Participant’s notional account balances. The records of each such account balance shall reflect amounts attributable to employee contributions. In the event the Plan Sponsor contributes to the Plan, TIAA shall keep records that separately account for such contributions.
The records maintained pursuant to this paragraph 2 shall be based solely on information provided to TIAA by the Plan.
3. (a) TIAA shall arrange for contributions to and investments in a Participant’s notional account to be allocated to the mutual funds selected by the Plan Sponsor. A minimum of $25 per pay period is required for Employee Voluntary Contributions. The mutual funds chosen for the Plan are set forth in Schedule C.
All contributions shall be allocated among such contracts and mutual funds in accordance with the most recent valid instructions. Transfers among Plan funding options shall be made pursuant to the Participant’s instructions in accordance with the terms of the Plan but subject to any restrictions in the applicable mutual fund. Transfers between funds must be a minimum of $1,000. TIAA shall provide the means by which the Participant can allocate contributions to, or transfer amounts among, the Plan funding options. When the Plan Administrator is notified of the death of a Participant, the Participant’s spouse or domestic partner shall be entitled to provide investment direction. Other dependents shall not be entitled to provide investment direction following a Participant’s death. In the event there is no surviving spouse or domestic partner, all funds in the Participant’s account shall be transferred to a money market account unless those funds are forfeitable.
(b) In the event that Schedule C is amended to eliminate a mutual fund or funds as an investment under the Plans, TIAA shall follow the instructions of the Plan Administrators or the Trustees of the Plan Trust(s) in transferring accumulations from the eliminated mutual fund or funds to the fund or funds chosen by the Plan Sponsor or by the Trustees of the Plan Trust(s) as replacement(s) and no future allocations will be made to the eliminated fund or funds. TIAA will work with the Plan Administrator or the Trustees of the Plan Trust to develop a plan for such transfers and in communicating with Participants concerning the change in the Plan’s investment options.
4. TIAA shall send periodic reports and communications to the Plan Administrators, Trustees of the Plan Trust(s) and Participants, including, but not limited to, information regarding returns and investment performance under the mutual funds.
5. TIAA shall send any communication that it is required to provide by mail to a Participant to the address provided to TIAA by the Plan or by the Participant.
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement
6. TIAA shall administer, or cause to be administered, health claim payments and other distributions of Plan and Trust Assets in accordance with the terms of the Plan and instructions from the Plan Administrator.
7. TIAA shall, as authorized under a Plan by a Plan Administrator and subject to applicable law, provide for the liquidation of amounts needed to pay claims under the Plan.
8. The Plan Sponsor has advised TIAA that the Plan is a <public/private> institution within the meaning of Section 3(33) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and accordingly <is/is not> exempt from ERISA.
9. On each day the New York Stock Exchange (the “Exchange”) is open for business (each a “Business Day”), TIAA may receive instructions from a Plan, Trustee of the Plan Trust, and/or Plan Participant for the purchase or redemption of shares of the mutual funds offered under the terms of the Plan (“Instructions”). Instructions which are received in “good order” (defined below) prior to the close of regular trading of the Exchange (generally 4:00 pm Eastern Time) (the “Close of Trading”) on any given Business Day, will be executed at the net asset value determined as of the Close of Trading on such Business Day.
Instructions which are received in “good order” (defined below) on such day but after the Close of Trading, will be executed at the net asset value determined as of the Close of Trading on the next Business Day following the date of receipt of the Instruction. Instructions shall be considered received in “good order” when all necessary information and monies in connection with such Instructions balance and conform to all other operating procedures, including any restrictions or limits set forth in the applicable fund prospectus or as otherwise set forth by TIAA. The date the Instructions are executed shall be referred to as the “Participation Date.” Notwithstanding the foregoing, in the event that the Securities and Exchange Commission promulgates or amends rules under which the foregoing procedures would be impermissible, this paragraph 9 shall be amended to provide a procedure that conforms to such rules.
10. TIAA shall deliver, or cause to be delivered to the Plan Administrator or at the direction of the Plan Administrator, directly to the Trustees of the Plan Trust, and also to Plan Participants and beneficiaries as agreed by both parties, all notices, prospectuses, financial statements, proxies and proxy soliciting materials received by TIAA relating to the mutual fund shares held in a Participant’s Plan account(s).
Proxies shall be voted by, or in accordance with, the instructions of the Participants. If no instructions for voting proxies applicable to mutual fund shares are received, TIAA shall not exercise the voting rights for such shares and shall not be responsible for the failure to vote, or instruct the vote, on such shares.
11. TIAA shall apply for the EIN for the Plan Trust, and shall prepare and file the Form 1024 Application for tax exempt status, and file the annual Form 990 filing to the extent such applications are required by law.
The Plan Administrator agrees to cooperate with TIAA in reviewing the filings on a timely basis and providing all necessary information required for filing.
12. With respect to the Plan, the Plan Sponsor shall be responsible for (a) any fees payable under the Patient Protection and Affordable Care Act, (b) any health insurance exchange fees payable under state or federal law and (c) any other fees related to healthcare reform legislation. Neither TIAA nor TIAA-CREF Trust Company, FSB shall be responsible for such fees.
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement
SCHEDULE B
Claim Administration and Related Recordkeeping Services ConnectYourCare, LLC ("CYC"), a Maryland limited liability company with a place of business at 307 International Circle, Suite 200, Hunt Valley, Maryland 21030, is subcontracted by TIAA to process claims and to provide related recordkeeping services as follows:
1. Services: CYC shall provide to Plan Sponsor claims and recordkeeping services described in this Schedule B.
a. Nature of Services:
i. Administrative Services Only. Plan Sponsor understands and agrees that CYC's sole function under this Agreement is to act as recordkeeper and provide other administrative services on behalf of TIAA. Under the terms of this Agreement, CYC does not render investment advice, is not the "plan administrator," trustee or a fiduciary, as these terms or other analogous terms may be defined under applicable state, local, or federal law, and does not provide legal, tax or accounting advice or forms preparation services with respect to the creation, adoption or operation of a retiree health plan or a VEBA Trust. ii. Discontinuance of Services Inconsistent with Role. If, based on changes in the applicable regulatory structure or the interpretation of the regulatory structure, there is a reasonable likelihood that any service being, or to be, provided by CYC could constitute a discretionary function and thereby subject CYC to classification as a “fiduciary” under applicable state, local, or federal law with respect to an employer-sponsored health plan and such service could not be restructured in a manner that would not subject CYC to classification as a “fiduciary” under applicable state, local, or federal law, then CYC, upon reasonable notice to Plan Sponsor and TIAA, may decline to thereafter provide that service. The failure to provide any such service shall not constitute a breach of TIAA’s obligations under this Agreement. iii. Plan Status and Compliance Responsibility. Plan Sponsor has advised CYC that the retiree health plan is a <public/private> institution within the meaning of ERISA § 3(33) and accordingly <is/is not> subject to the requirements of Title I of ERISA. Any services provided by CYC with respect to the retiree health plan shall comply with requirements of applicable law. CYC shall comply only with applicable laws that apply to third party claim administrators, but the Plan Administrator for the retiree health plan shall hear all appeals. Plan Sponsor is solely responsible for ensuring compliance with all applicable provisions of the Internal Revenue Code and any applicable state and local laws governing the retiree health plan, including, but not limited to, preparation and submission of forms required by the Internal Revenue Code or such other applicable laws. CYC will provide basic information it has in its possession to assist Plan Sponsor with complying with the requirements of the Internal Revenue Code or other applicable law, but it reserves the right to charge an additional fee for extended services requested by Plan Sponsor, as it deems appropriate. CYC is paid certain service fees by TIAA, and Plan Sponsor acknowledges and agrees to the same. If Plan Retirement Healthcare Program Administrative Services and Recordkeeping Agreement Sponsor needs additional information regarding the compensation arrangement in order to prepare forms or for other legitimate legal reasons, Plan Sponsor will request such information from CYC and TIAA in writing and CYC and TIAA will promptly provide such compensation information so long as the request is reasonable. b. Reliance Upon Data: All services provided by CYC shall be based on information supplied by Plan Sponsor or any other designee or agent of Plan Sponsor (as designated by Plan Sponsor). Plan Sponsor acknowledges that the timely provision of accurate, consistent and complete data in the format specified by TIAA or by CYC is essential to its delivery of services, and Plan Sponsor is responsible for ensuring such timely and accurate data is delivered to CYC in TIAA’s or CYC’s approved format.
c. Data in Electronic Format: Plan Sponsor agrees that administrative, contribution and recordkeeping data shall be in an electronic format acceptable to TIAA and CYC and will be updated as either TIAA or CYC requires for proper processing. If the data is not submitted in an electronic format or if the format of the data requires additional translation, formatting or cleansing, CYC reserves the right to approve or refuse such submission and to charge additional datahandling fees as required. d. Reliance Upon Persons Designated by Plan Sponsor: TIAA shall provide a form to Plan Sponsor on which Plan Sponsor shall provide names and other information for persons authorized to take actions for or provide information on behalf of the retiree health plan or the VEBA Trust.
TIAA and CYC may reasonably rely upon this information and may act upon instructions received from and/or on information provided by these named persons. TIAA and CYC have the right to assume that those persons continue to be authorized unless notified otherwise. e. CYC Customer Service:
i. CYC Customer Service Representatives. CYC Customer Service Representatives will be available at a toll-free telephone number 24 hours a day, 7 days a week , (excluding emergency closings) to assist plan participants.
ii. Internet Services. CYC will provide access to the ConnectYourCare Web site as described in paragraph 1(f) of this Agreement to allow participants and Plan Sponsor to access certain account information and for participants to file claims. iii. Participant Statement of Account. Participants will have access to their accounts through a website provided by TIAA or by CYC.
f. Basic Benefits Portal System Services:
i. Participant Portal. CYC will provide participants with access to a CYC portal system.
This system will allow online claim filing. The participant will also have online access to the following:
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement Real-time history of claim submission and payment process; Account management with transaction history and account balance; Education tools.
g. ConnectYourCare Healthcare Payment Card: CYC will provide participants with a healthcare payment card integrated with the participant's account. The payment card will allow the participant’s entitled liquid account balance to automatically transfer to the payment card. The payment card can be used at any eligible merchant provided the merchant has properly configured the VISA® merchant code to identify itself correctly. Cardholders are subject to the terms and conditions described in the VISA®cardholder agreement, which will be provided with the payment card.
h. Claims Processing:
i. Review of Claims. CYC will review claims in accordance with the terms of the Plan documents for the retiree health plan, standards set forth under applicable law, including IRS guidelines concerning eligible expenses. Plan Sponsor retains authority to decide appeals.
ii. Payment of Claims. CYC will process claims within five (5) business days of the date CYC receives a claim request from a participant. Checks, if applicable, will be issued within two (2) scheduled check payment cycles, upon receipt of claims in good order.
Claims are in "good order" when the reimbursement request contains all pertinent information, including information required to substantiate the claim. CYC will not reimburse a participant’s claim unless the participant has sufficient entitled funds in the liquid account under the retiree health plan at the time the claim is submitted. If the participant does not have sufficient entitled funds at the time the claim is submitted, the reimbursement request will be held by CYC and processed in accordance with the time frame described in this paragraph starting with the date that such entitled funds are available.
iii. Unsubstantiated Claims/Ineligible Expenses. If a participant is not able to substantiate a claim, or if payment for an expense is advanced through the debit card and subsequently deemed ineligible for reimbursement, CYC will attempt to collect these amounts from the participant. Where CYC is unsuccessful, Plan Sponsor will be responsible for collecting such amounts. CYC will provide a report identifying the employees and amounts to enable Plan Sponsor to seek reimbursement from the Plan participant.
iv. Reports. CYC will provide Plan Sponsor with the ability to produce CYC’s standard Planlevel reports utilizing the information maintained on its recordkeeping system. Standard reports will summarize all transactions that occurred for each participant and report new enrollees within the specified time period.
2. Plan Document. Maintenance of a document consistent with the Plan’s operations and all legal requirements is the responsibility solely of Plan Sponsor. TIAA will provide a sample plan document to Retirement Healthcare Program Administrative Services and Recordkeeping Agreement Plan Sponsor if requested. TIAA will use reasonable best efforts to provide updates to Plan Sponsor in a timely manner after changes in the law and regulation. Plan Sponsor will inform TIAA of changes it desires to the Plan prior to the time TIAA is expected to implement those changes.
3. Use of Agents or Subcontractors. CYC may perform any of the services described in this Agreement through agents and subcontractors selected by CYC. CYC shall reasonably supervise any such agent or subcontractor, and the retention of agents or subcontractors shall not relieve CYC or TIAA of its duties.
4. ConnectYourCare not Legal Counsel. Plan Sponsor understands and agrees that it shall review with its legal and/or tax counsel all documents provided to it by CYC or TIAA and that Plan Sponsor should consult such counsel on any questions concerning Plan Sponsor’s responsibilities under this Agreement, the retiree health plan, plan documents for such plan, and the legal sufficiency of any documents so provided. Plan Sponsor understands that neither CYC nor any of CYC’s other affiliates are permitted to provide Plan Sponsor with legal or tax advice or otherwise engage in the practice of law. Plan Sponsor acknowledges that it will not rely on any information provided by CYC as if it were legal or tax advice.
5. Notice of Errors. All information supplied to Plan Sponsor or participant will be deemed correct if notice of discrepancies is not given to TIAA or CYC by the participant or Plan Sponsor within ninety (90) days of issuance of the report statement, confirmation, or other information. After that period, CYC will correct transactional errors, but will not be liable for consequential damages due to any errors not reported within that period.
6. Successor Recordkeeper:
a. Run-out Period. If requested, CYC will, for the ninety (90) day period immediately following the date of termination of its services by TIAA, Plan Sponsor or CYC ("Run-Out Period"), continue to administer claims for expenses incurred before the termination date or other date agreed upon by all parties and the successor to CYC, provided CYC is timely paid for its services both before and during the Run-Out Period. Upon expiration of the Run-Out Period, all obligations of CYC to administer claims or perform any other services under this Agreement shall cease. b. Successor Recordkeeper. Upon termination of CYC’s services, the parties agree that CYC shall have no further duty or responsibility, except as provided by the Run-Out Period described above in paragraph 6(a). However, CYC will use reasonable efforts to transfer all relevant non-proprietary information concerning the Plan that CYC deems necessary for future operations, in CYC’s standard format, to Plan Sponsor or to a successor service provider. Any unforeseeable costs or expenses incurred by CYC in effecting this transfer shall be paid by Plan Sponsor directly to CYC, unless waived in writing by CYC. Plan Sponsor agrees that CYC may charge Plan Sponsor reasonable fees for the provision of requested records or reports that CYC previously provided.
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement
SCHEDULE C
Investment Name Share Class Ticker Symbol
TIAA-CREF MONEY MARKET FUND Retirement TIEXX
TIAA-CREF LFCYLE RTMT INC-RTMT Retirement TLIRX
TIAA-CREF LIFECYCLE 2010-RTMT Retirement TCLEX
TIAA-CREF LIFECYCLE 2015-RTMT Retirement TCLIX
TIAA-CREF LIFECYCLE 2020-RTMT Retirement TCLTX
TIAA-CREF LIFECYCLE 2025-RTMT Retirement TCLFX
TIAA-CREF LIFECYCLE 2030-RTMT Retirement TCLNX
TIAA-CREF LIFECYCLE 2035-RTMT Retirement TCLRX
TIAA-CREF LIFECYCLE 2040-RTMT Retirement TCLOX
TIAA-CREF LIFECYCLE 2045-RTMT Retirement TTFRX
TIAA-CREF LIFECYCLE 2050-RTMT Retirement TLFRX
TIAA-CREF LIFECYCLE 2055-RTMT Retirement TTRLX
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement
SCHEDULE D
Service Fees
Per participant fees listed below will be deducted from the participant accounts on a monthly basis. (Option to bill sponsor is available)
Plan Implementation Fee
TIAA Services include the following:
Provide sample plan documents including Adoption Agreement, Administrative Guide and Forms, Summary Plan Description, and employee communications for the retiree health plan. Apply for the EIN for the Trust, prepare and file the Form 1024 Application for tax exempt status and the annual Form 990 filing to the extent such applications are required by law. Set up Plan on TIAA’s recordkeeping platform, ConnectYourCare recordkeeping platform and the TIAA-CREF Trust Company systems.
One Time Implementation Fee …………$5,500.00 (waived)
Per Participant Fee
TIAA Services include but may not be limited to:
Maintaining employee database, processing plan enrollments, maintaining individual notional accounts, processing contributions, preparing plan reports for Plan Sponsor and individual participant statements, and conducting meetings with plan sponsors and participants. During the claims active period, additional services are provided as outlined in Schedule B Section 1.
Per Participant Annual Fee for Participants not claims active ………………..$24.00 Per Participant Annual Fee for Participants who are claims active……..…… $39.00 Trust Service Fees
TIAA has been authorized by TIAA-CREF Trust Company, FSB to collect fees from Plan Sponsor for trust services provided to the Plan.
Annual Fee for Trust Services ……………………$2,500.00
Retirement Healthcare Program Administrative Services and Recordkeeping Agreement Affiliated Mutual Funds
When client account assets are invested in affiliated mutual funds, affiliates of the Trust Company receive fees from these products based on the amount of assets the client invested in them. These fees are in addition to the fees you pay directly under this agreement. When client assets, including ERISA assets, are invested in affiliated mutual funds, the Trust Company will comply with all applicable fiduciary and regulatory requirements including, if necessary, rebating to the account a portion of the management fee that an affiliated investment vehicle pays to our affiliates. You should note that our affiliates receive payments for providing services to affiliated mutual funds. As detailed in the prospectuses and statements of additional information, as the case may be, for these mutual funds, these funds pay their own fees and expenses, including fees for investment management and/or administrative services to the Trust Company’s affiliates, which may pay a portion of these fees to other affiliates.
All operating expenses of affiliated mutual funds are disclosed in the funds’ prospectus and statements of additional information, as the case may be. Annual operating expenses are the expenses that you pay each year as a percentage of the value of your investment in the investment vehicle, including management fees and/or administrative services or other expenses. The current prospectus for each affiliated mutual fund, including supplements to prospectuses, statements of additional information and other product disclosures, are available and can be viewed on, and downloaded and printed from, the website at http://www.tiaa-cref.org/prospectuses/index.html. They are also available in paper form, free of charge, upon request.
Unaffiliated Mutual Funds
When client assets are invested in third-party mutual funds or other non-affiliated investment vehicles, each mutual fund or investment vehicle also pays its own investment advisory fees and other fees and expenses.
These fees are in addition to the fees you pay directly under this agreement. Third-party mutual funds may, directly or through third parties, pay the Trust Company or its affiliates for services rendered on behalf of the client’s investments in the funds, as disclosed in the third-party mutual fund’s prospectus or offering materials.
Relationship with TIAA
The Trust Company is a wholly owned subsidiary of TCT Holdings, Inc., a wholly owned direct subsidiary of TIAA. TIAA and the Trust Company have entered into a service arrangement whereby TIAA, directly or through its subsidiaries, provides a variety of services to the Trust Company that are material to our investment management, trustee and other fiduciary related services. These services include administrative, auditing, data processing, legal and marketing services. Payments are made for these services.