Finance and Management Services
www.santa-ana.org/finance
Item # 8
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
December 3, 2024
TOPIC: Administrative, Investment, and Communication Advisory Services
AGENDA TITLE
Agreement with Benefit Financial Services Group for Administrative, Investment, and Communication Advisory Services
RECOMMENDED ACTION
Authorize the City Manager to execute an agreement with Benefit Financial Services Group ("BFSG") for administrative, investment, and communication advisory services for a total aggregate amount not-to-exceed $175,000 for a three-year term beginning January 1, 2025, and expiring December 31, 2027, with a provision for a two-year extension (Agreement No. A-2024-XXX).
GOVERNMENT CODE §84308 APPLIES: Yes
DISCUSSION
The City of Santa Ana's full-time employee 457 Deferred Compensation Plan (“Plan”) was established in 1973, with the adoption of City Resolution 7-21. The 457 Deferred Compensation Plan is a voluntary supplemental retirement savings program that allows employees to make contributions to the Plan up to an amount established by the Internal Revenue Service. Other than the amounts pursuant to City Council-appointee contracts, the City does not contribute any funds to the plan. As of June 30, 2024, the City’s 457 Deferred Compensation Plan holds $152 million in plan assets for 1,349 participants. The Retiree Health Savings plan holds $17 million in plan assets.
The 457 Deferred Compensation Plan is administered through the Finance and Management Services Agency, with advisory contributions from Human Resources.
Management of the plan includes quarterly performance review of investments, analyzing the Plan’s fund options, maintaining and revising the Plan’s investment policy Statements as necessary, and ensuring the Plan’s cost-effectiveness. In addition, the Retiree Health Savings (RHS) plan was included as part of the Request for Proposals (more information is in the paragraph below), so the selected firm will provide services similar to those provided to the 457 plan. Currently, the City utilizes an independent fiduciary firm, Benefits Financial Services Group (BFSG), to assist in reviewing investments, compliance, and fund selection.
Administrative, Investment, and Communication Advisory Services December 3, 2024
4 6
9 7
On September 19, 2024, the Finance and Management Services Agency released Request for Proposals (RFP) No. 24-109 for plan and investment advisory services for the 457 and RHS Plan. Four firms submitted proposals in response to the RFP: BFSG, LLC, Fiduciary Experts LLC, SageView Advisory Group, and Shuster Advisory Group, LLC. The selection committee with experience in the related services evaluated proposals.
Staff recommends awarding an agreement to the highest-ranked vendor, BFSG, LLC.
Following a comprehensive evaluation of the four bids received, which assessed both cost and professional expertise, BFSG, LLC was determined to offer the best overall value. Their proposal demonstrated the firm has the necessary resources and expertise to complete the required services as specified in the RFP. Their fee was competitive and aligned with the other bids received.
ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.
FISCAL IMPACT
There is no fiscal impact associated with this action. All administrative fees pertaining to the services will be borne by the plan participants. Internal Revenue Code permits administrative reimbursement from plan assets.
EXHIBIT(S)
1. Agreement
Submitted By: Kathryn Downs, Executive Director of Finance and Management Services
Approved By: Alvaro Nuñez, City Manager