PROJECT TRACKING RFP for Custodian and Benefit Disbursement Bank

Transcription

1 RFP for Custodian and Benefit Disbursement Bank 2012 Feb Assess the current relationship and re-price the services provided by the Master Custodian. State Street is performing to the satisfaction of staff, but the Board believes that periodic reassessments are worthwhile, and considers this part of ongoing diligence efforts Jun RFP was posted in P&I online beginning 6/20; in P&I print edition issued 6/20; and ed to main players on 6/20. RFP is posted on FCERA's website as well; 7/18/12 Deadline for submission was 7/13/12 at 5pm. Initial Review with Wurts Assoc's completed. Site visits completed. Final Analysis and recommendation to the Board 07nov12. Approved. Transition Planning commenced. To Board on Nov 07,2012. Contract and specific terms to be negotiated and approved. Implementation dates to be determined - contingent on benefit and benefit disbursement developments over the course of calendar Draft Agreements received, Client Profile data complete. Conservatice cash and securities lending collateral pools selected. Several planning meetings. Custody change completed April 1. Sec Lending May 30. Ben Disbursement July Gen Ledger Feed still under development as of Dec 2013 Earn Code Resolutions : PEPRA 2013 Implementaton Law \ Policy Develop and adopt the set of approved County and Courts payroll categories that the Board designates as Pensionable Compensation according to the definitions under PEPRA Input from Legal Counsel obtained. Initial Code Lists devloped. Additional information needed from County and Legal Counsel. Extended descriptions of codes obtained from Auditor staff - added to current draft lists. COUNTY Earn Code Resolutions completed in April. Superior Courts completed in September. FMAAA completed in November. May need to revisit issue of DOCK Time for all employer earn codes. High Speed Rail & Relocation 2012 Sep Find a new Location for FCERA Sep 2014 Mar Capital appropriation of $2.5 B was approved and the project authorized by the Legislature, in Sep $9 B in federal matching funds released. Appraisals of FCERA property followed. HRA designated initial properties for acaquisition in Feb Official acquisition date is still April, 2014, HSR Regional Director indicated January, 2015 is the earliest practical acquisition date. Official written notice requested and property appraisals solicited from HRA. Information on tieming and phases is pending. Further information will be provided on Relocaton Assistance program.. Timeline for this large, complex project will be very compressed. Optimal relocation search zones defined. \\ HSRA and FCERA Appraisals received - far apart. Referred to independent appraiser as of 06 JAN 14.

2 Courts Administration 2012 Mar The Courts are separating from the County administratively, raising questions about their status, participation, and administration of the relationship. Work with Superior Courts to draft an MOU related to retirement services for review and adoption by the Mar 5/2/12 In the process of gathering information with an expected discussion date in July/August. 12/7/11 Attorneys for both parties are in contact. We expect to have an MOU for your Board no later than early January. Meeting Planned for Spring, Special considerations regarding Court Recorder Transcription and earn codes. CT Fees approved for pension earn codes for PRE PEPRA in April. Discussion of Courts' budget and staffing issues relative to retirement fund obligations set for July Board approved Post-PEPRA CT Fees as pensionable. Retirement Coordinator Classificaton and Hiring Project Fall 2012 Fill a vacancy on the current Retirement Coordinator roster, and restructure the position class/series to better reflect skills required along with career progression map Jun Resumption of a process commenced with Board approval in The current series is not well structured to define qualificatons, performance expectations or career progression. Job Specs for the Retirement Coordinator Series OK with Personnel. Will hire 1 or 2 Coordinators based on current specs. New Specs Approved, April Benefit Analyst Series to be added. Next step is to advertise for TWO Retirement Coordinator positions, Hiring for first vacancy will be under the old Classification Specs. Revised Specs and Pension Benefit Analyst will come to the Board of Retirement, then County Personnel. \\ e position filled - May 28, Second vacancy to be filled in Two positions filled. An additional position is authorized by the Board. Will proceed in the next fiscal year, along with development of the Pension Analyst classification series. Actuarial Audit Issue RFP for Actuarial Audit Referrred to Consultants Evaluation Committee 2012 Nov 2014 Jan

3 Asset Liability Study Advisor Evaluate Capital Asset Prices Forecast for 5-10 year scenaios. Assess ability of current Asset Allocation to accomplish investment target objectives within acceptable limitatioins on risk. Define new Asset Allocation, revise Policy, revise Manager Structure as appropriate Dec Analyses and Educational Sessions completed in Nov Board opted for "Mix B" in Wurts Report. Mandate determinations, and manager searches are nderway as of Dec Disabilities Application, Review, Case Management Improvements Evaluate current processes for application, FCERA case review processes, management of disability cases overalll. Disabilities Committee recommended new forms to the Board in Dec, Fact-finding on site visits at SBCERA and OCERS to occur in Feb, Apr No Date Joint Boards Steering Committee - Propose guidelines, establish understandings about future relationship between FCERA and county boards and operations 2012 Aug Define the proper relationship between our two organizations, the status of FCERA employees, and the Board of Retirement authority in establishing policies to govern personnel management and operation of the retirement programs under it's charge. Nature of BOS & roles Nov No Date Begun in Nov, 2011, the process stalledout with the departure of Mr. Pena. appointed delegates to a new Joint Baord Steering Committee on Aug BOS appointees at Sep 11, 2012 meeting. Steering Committee met on Oct 31, Significant progress made in defining the scope and nature of organizational and policy concerns. New members to be appointed at the Board Meeting on February 6, 2013 meeting. P. Kapler met with CAO for County in early Aug 2012 to discuss process and outline of topics for the Steering Committee. Steering Committee met on Oct 31, 2012 (missing Mssrs Criego and Souza). Steering Committee agreed that follow-up needed, with ideas to promote goals of BOS and to be identified and discussed. Meeting Wed, February 6th with Beth Bandy, Personnel Director. No significant progress.

4 IRS Compliance - Plan Qualification Status. Administration to proceed with submission of tax determination packet and enrollment in the Voluntary Correction Program Staff Satisfy filing and plan qualification requirements of IRS to maintain favorable tax treatment of FCERA retirement programs Aug 8/18/10 Administration is gathering the data necessary to file the packet; 11/3/10 Written update on status of the project provided to ; 12/15/10 Formal presentation held; 1/19/11 Final documents presented for approval, filing to occur 1/31/11; 2/2/11 Filing made timely. Received IRS approval of FCERA VCP Correction in November, Administration proceeding with submission of tax determination packet and enrollment in the Voluntary Correction Program. Pending IRS Review. Final adoptioin of the policy pending before the Board in January, PEPRA Anti-Spiking Policy or Procedures. Develop for the Board's consideration FCERA's implementation plan for monitoring, evaluating and deciding whether compensation has been increased in the final salary period with the express intent to increase a member's retirement benefit. Law \ Policy Sep Fulfill the new statutory requirement under CalPEPRA 2013 (AB-340) that the Board determine what consititutes a doubtful case, evaluate whether compensation has been modified in order to "spike" a new retiree's benefit. Cases for review must be identified and analyzed by Administration, brought to the Board for determination, and a hearing process established Jan 2013 Apr Policy and Procedures to be drafted separately. Several county plans have adopted policies. Others are considering incorporating within existing Appeals and Hearings policy and process, leaving specific criteria and administrative procedures for analyzing potential cases an inhouse, administratively developed process. Seek direction from the Board on their preference for approach and how the matter should be agendized at the February 20, 2013 Meeting. \\ Action at April 19, 2013 Mtg - Policy Adopted. Procedures Draft (internal guidelines and process) reviewed at June 5, 2013 meeting. Review of Charters, laws, Policies of FCERA 2012 Mar Keep our policies and procedures up-to-date. Reconsider and revise if statutes, ordinance, laws, priorities, needs, or operating conventions suggest modifications are needed Jul No Date This is a long-term, housekeeping project - an ongoing process that is easily displaced by more immediate concerns, and therefore requires that it be a standing item on the regular meeting agenda - bi-monthly or quarterly. A number of polices are up for review in 2013 based on 3 year cycle. Discussion to be taken up with new Administrator to determine process and definition of priorities. May need to distinguish between policies and procedures. \\ Separate Committee designated for Policy Reviews estblished (Feb 2013) Trustee Education and Travel will be first reviewed, then Due Diligence

5 2012 Audit Operations Issues and Recommendations Respond to Recommendations on internal operations for accounting and benefit calculations and processing 2013 Feb 2013 Dec FCERA received the best audit report possible for the year ended June 30, 2012, wth an unqualified opinion from our Auditor. Though our financial information was unblemished and legal compliance were given high marks, a number of isolated (not systematic) accounting and benefits management issues did arise in the course of their review. The Retirement Administrator will work with the Audit Committee to define the strategy, implementation and ongoing assessment of progress in resolving the operational and accounting procedure issues raised by the Auditors. The first meeting of the Audit Committee has been set by the Chair for February 14, 2013 Resolved Auditor Report indicated that all significant operating failures appear to be corrected through more thorough analysis and review by staff and management. No significant unresolved items for 2013 Audit. Elimination of Backlog in Requests for Service Purchase and Re-deposits for Members 2013 Nov A significant backlog in estimate development and distribution for requested cost analyses by members. Special projects, staff turnover, and process dysfunctionality appear to be contributing causes. FCERA tells members they should expect results within 6-9 months.some pending estimates are over 2 years old Dec 2014 Dec The Account Clerks group is now fully staffed, and all staff, at the direction of Supervisor Gonzalez have accelerated the rate of calculation and review. Progress had been made on the backlog in the first two months (Nov / Dec 2013) The caseload could come down precipitously if we can develop a quick, less precise tool for developing "buy-back" and service credit estimates. Work on that phase will commnece in Feb, Withdrawal \ Reduction in Force Planning 2013 Apr Evaluate need for and possibly develop new policy. Supplement existing statutory provisions and existing Contribution Equity Policy with a more encompassing Termination / Withdrawal / Workforce Reduction Policy 2013 May 2014 Feb To assure adequate and equitable contributions in event of participation or structural changes to employer staffing or budget circumstances. First stage Scoping - survey / dialogue with employer units, staff and Board. Second phase will be review of sufficiency and insufficiencies in governing statutes. Third phase is Policy. Develop Workplan and Study Design. Conslt with Actuary and Counsel. Develop discussion Timeline and Draft Policy - target for completion after Experience Study and Valuation for June The CAAP Board released Funding Policy standards report in December, Meetings have been held with the Superior Courts and FMAAA. Mosquitoes, Vets Memorial and County to follow.

6 Funding Policy. In response to discussion about Special Ad Hoc Asset Smoothing formula change in Fall, Nov In the Fall of 2012, the Board adopted a proposal from the actuary to apply an Ad Hoc smoothing methodology to "level" cumulative variance in asset gains and losses to offset a forecasted spike in required amortization contributions due to "tail volatility" in the valuation assets measurement due to the extreme market drop of The Board requested that a Funding Policy be drafted and provided for the Board's consideration in order that the decision criteria for any similar decisions might be more clear and more readily understood Nov 2014 Dec The overall and existing "policy" is embedded in the actuarial assumptions and methodologies adopted by the Board in conformity with statute, actuarial practice guidelines, and Board actions on recommendatons by FCERA's actuary over time. \\ April Memo Funding Policy Drafted in April, An explicit, separate policy relating to Ad Hoc adjustments to asset smoothing has been requested. Administrator rec is to develop this within the context of valuation and experience study processes underway in Copies of previous memoranda have been obtained from the actuary. Those are more comprehensive in scope than the Board's initial directive. As of June 2013, and considering the pending Experience Study, California Actuarial Advisory Panel (CAAP ) study just competed, it will benefit FCERA to incorporate those products into the development of a dedicated Funding Policy. Administrator recommends development in conjunction with Experience Study for Internal Auditor. Consider adding or contracting with an outside firm to provide nonfinancial reporting audit services going monitoring of internal controls, compliance with policies, statutes, regulations. Currently, the financial audit does not include compliance or internal control assessment 2009 Dec 2013 Mar Administration considered including in budget discussion for fiscal year 3/17/10 directed that the Audit Committee discuss outsourcing with FCERA's external auditors Not included in budget for FY Budget Committee discussed 6/12. Decision deferred until new administrator is on board. Item for discussion in Budget. Need to explore goals and need. Generally, "internal auditors" are required when an external entity monitors regularly for compliance with externally established operating and accounting requirements. Question: is thiis the case with FCERA? In-house Investment Position Chief Investment Officer role? Advisor 2010 Mar Fill a possible gap in coverage. Accounting personnel monitor investments for accounting reasons, while Administrator fills dual roles of CEO and CIO. Consider whether a full-time person or staff is needed to manage the investment side of the business internally Mar 2013 Jun The candidate pool for such a position will define cost. These positions often require offering salaries beyond normal senior staff or executive levels in public sector. Expenses would be significant in nominal terms, but in terms of scale, not so high if it actually results in better asset management. 3/17/10 Administration scheduled discussion in and cycles. Budget Committee deferred action in June/ision to be deferred until new administrator is on board. inistrator suggests commencing discussion at Educational Offsite Meeting in Oct Topic not agendized for 2012 Offsite due to number of other presentations. Pending.

7 Actuarial Services RFP Issue RFP for Actuary Services. Project lost momentum with the resignation of the Committee Chair in Board Chir has expressed interest in re-commening the work. Law \ Policy 2013 Feb 2014 Mar Portfolio Monitoring and Class Action Litigation Define the proper level of monitoring, the number and desired capabilities of legal firms to be contracted for the activity of monitioring FCERA holdings and potential or actual securities litigation for recovery of losses precipitated by alleged improper activities or below standard diligence on the part of corporate officials Feb Discussion in Dec, 2012 and January 2013 meetings, initially about whether to add firms to the current roster of 3. Further deliberations raised questions about workload management, the factors for determining adequate coverage, criteria for seeking lead plaintiff status. Item tabled for further review, Legal Counsel advice on contracts submitted by candidate law firms. New Policy Adopted on 20FEB13 Process seems to be workgin well as of Jan, A "scoresheet" has been developed to assist the Board in determing the degree to which potiential cases conform to criteria for seeking lead plaintiff status, allowing for more objective asssessments and decisions. Chief Investment Officer - Consider creation of a Chief Investment Officer position within FCERA Long, Long Ago Consider addition of CIO position for in-house management and leadership of investment activity and oversight within FCERA. 3 3 In a Galaxy Far, Far Away????? Frozen in Carbonite Held over in spring, 2012 for further review after selection of new Retirement Administrator. 12/16/09 Administration will consider including in budget discussion for fiscal year ; 1/6/10 Discussion to be brought back at a later meeting; 3/17/10 directed that the Audit Committee discuss with FCERA's external auditors outsourcing an Internal Audit function including the requirements and goals; 6/15/11 Not included in budget for FY Further discussion expected during next fiscal year; 6/6/12 discussed with Budget Committee. Decisions will be deferred until new administrator is on board.