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HomeMy WebLinkAbout09-City Administrator I , Or. II" '" 4L Jii""il~rl CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION Dept: City Administrator's Office Subject: Resolution authorizing an agreement with Nationwide Retirement Solutions Inc. to administer the City's 457 and 3121 deferred compensation programs From: Fred Wilson, City Administrator Date: August 6, 2001 Synopsis of Previous Council Action: September 10,1999 Resolution 1999-217, Mayor and Common Council authorized an agreement with National Deferred Compensation for services as administrator of the City's deferred compensation programs. December 21, 1993 Resolution 93-460, Mayor and Common Council authorized an agreement with Great Western Savings for services as administrator of the City's deferred compensation programs. Recommended Motion: Adopt Resolution. 4il.:- Contact person: RogF!r POY7F!r Phone: 3R4-5R46 Supporting data attached: Yes Ward: FUNDING REQUIREMENTS: Amount: None Source: (Accl. No.) (Ar.d nF!",r.ription) Finance: Council Notes: ~ .J.> 2(:01- :J'l1 IIP,q 9Il1/f)1 CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION Staff Report Subiect: Resolution authorizing execution of an agreement with Nationwide Retirement Solutions Inc. (NRS) for services as administrator of the City's full-time employee 457 deferred compensation plan and the City's part-time, seasonal, and temporary employee (PST) 3121 deferred compensation plan. Backl!:round: In 1993 the City negotiated a contract with Great Western Savings to administer the City's deferred compensation programs. In 1994 Great Western Savings hired Fund Select to assume management responsibility of their deferred compensation accounts which included the City's programs. In 1996 Washington Mutual Bank purchased Great Western Savings and assumed administration of the City's deferred programs. Washington Mutual Bank continued to sub- contract management of the deferred programs to Fund Select. Later in 1996 Washington Mutual Bank discontinued their deferred compensation division, selling their administration agreements to National Deferred, parent company of Fund Select. In 1998 Nationwide Financial Services purchased National Deferred. and became the administrator of the City's deferred programs. During this entire period the terms of the original 1993 contracts remained in effect and were never re-negotiated. Supplemental retirement plans such as deferred compensation have become very popular in recent years. As a result assets in these plans have grown significantly since 1993. The increased assets have attracted additional vendors who offer wider investment choices, improved services, and lower fees. In February 2001 the Deferred Compensation Advisory Board initiated a request for proposal (RFP) process requesting bids to provide administration and recordkeeping services for both deferred compensation plans. Proposals were received from nine companies: . Aetna Financial Services . American General Financial Group. . CAL PERS . Fidelity Investments . Great West Benefits Life . Hartford Life Insurance Company . Investment Company Management Association (lCMA) . Mutual of America . Nationwide Retirement Solutions (NRS) The Deferred Compensation Advisory Board reviewed the nine proposals and scored them according to the criteria in the RFP which included: . Capabilities of the firm to effectively complete the project requirements. . Qualifications of the firm's related experience. . Reasonableness of the cost. . Completeness of response. . Completeness of transition plan Two companies, Great West Benefits Life and Nationwide Retirement Solutions (NRS) scored in excess of 80 points and were invited to make oral presentations. Both companies offered to eliminate the current service charge in exchange for a long-term, minimum five-year exclusive contract. Participant financial education was a major concern of the Advisory Board. Great West Benefits Life and NRS were both strong contenders in this area. Both companies offered to provide on- site educational seminars and investment counseling as part of the no service charge proposal. However, both companies required an increase in fees to provide full financial planning. The Advisory Board notes that financial planning is presently available to all City employees through PERS, at no cost. At the conclusion of the process the Deferred Compensation Advisory Board selected NRS, a wholly owned subsidiary of Nationwide Financial Services Inc.as the best proposal and recommend NRS be selected as administrator of the City's deferred compensation programs. The proposed agreements will provide significant enhancements to the current 457 and PST programs. These enhancements include the following changes: 457 Accounts: . Elimination of the current service charge, NRS will no longer charge .28% annual fee. Elimination of the service charge will increase yields for the participants. . Review of current investment options, eliminating those that are performing below expectations and replacing them with options that are performing within or better than expectations. . Annual review process of investment options to insure performance within expectations. . The availability of a "brokerage window" option in the 457 plan, which will allow experienced investors, access to numerous additional investment options including security trading. PST Accounts: . Elimination of the current service charge, NRS will no longer charge .59% annual fee. Elimination of the service charge will increase yields for the participants. . Increase returns by transferring assets from a Washington Mutual Savings liquid savings account to a Nationwide Life Insurance guaranteed account. Financial Imnact: No additional cost to the City. The participants pay the cost associated with both plans. Recommendation: Adopt Resolution e: _13 .14 e25 3 ~(Q)~V RESOLUTION NO. RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT WITH NATIONWIDE RETIREMENT SOLUTIONS, INe. FOR SERVICES AS ADMINISTRATOR OF THE CITY'S FULL- TIME EMPLOYEE 457 DEFERRED COMPENSATION PLAN AND THE CITY'S PART-TIME, SEASONAL, AND TEMPORARY EMPLOYEE (PST) 3121 DEFERRED COMPENSATION PLAN. 4 5 6 BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS: 7 Section 1. The Mayor of the City of San Bernardino is hearby authorized and directed 8 to execute on behalf of said City an agreement with Nationwide Retirement Solutions, Inc. for 9 services as administrator of the City's full-time employee 457 Deferred Compensation Plan and 10 the City's part-time, seasonal, and temporary employee (PST) 3121 Deferred Compensation 11 Plan, copies of which are attached hereto, marked Exhibit "A" and "B" and incorporated herin by 12 reference as fully as though set forth at length. 15 16 17 18 19 20 21 22 23 24 BCL:C:\WINDOWS\DESKTOP\DefComp Reso.doc 7 on the day of 8 Council Members: AYES 9 ESTRADA 10 LIEN 11 MCGINNIS 12 SCHNETZ e13 SUAREZ 14 ANDERSON 15 MCCAMMACK 16 17 e: e25 3 RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT WITH NATIONWIDE RETIREMENT SOLUTIONS, INe. FOR SERVICES AS ADMINISTRATOR OF THE CITY'S FULL- TIME EMPLOYEE 457 DEFERRED COMPENSATION PLAN AND THE CITY'S PART-TIME, SEASONAL, AND TEMPORARY EMPLOYEE (PST) 3121 DEFERRED COMPENSATION PLAN. 4 5 I HERBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and 6 Common Council of the City of San Bernardino at a meeting thereof, held ,2001, by the following vote, to wit: NAYS ABSTAIN ABSENT The forgoing Resolution is hereby approved this _ day of CITY CLERK ,2001. 18 19 20 Judith Valles, Mayor City of San Bernardino 21 22 Approved as to form and legal content: 23 JAMES F. PENMAN, City Attorney 24 By: L 7. f~ () BCL:C:\WINDOWSIDESKTOPIDefComp Rcso.doc e e e Deferred Compensation Plan Administration Agreement This Deferred Compensation Plan Administration Agreement is effective this day of . by and between Nationwide Retirement Solutions, Inc., a wholly owned subsidiary of NFS Distributors, Inc., a wholly owned subsidiary of Nationwide Financial Services, Inc. and an Ohio Corporation (hereinafter "NRS"), and the City of San Bernardino, California (hereinafter "EMPLOYER"). WHEREAS, EMPLOYER, pursuant to and in compliance with Internal Revenue Code Section 457, previously established a Deferred Compensation Plan in 1993, hereinafter referred to as PLAN; and WHEREAS, EMPLOYER, pursuant to its Request for Proposal (hereinafter "RFP") dated February 6, 2001 solicited bids to provide plan administration and recordkeeping services; and WHEREAS, National Deferred Compensation, Inc. (hereinafter "NDC") responded to such RFP; and WHEREAS, NDC is a wholly owned subsidiary of Nationwide Financial Services, Inc; and now, through its affiliate NRS, desires to enter into a formal agreement pursuant to the terms of the RFP; and WHEREAS, NRS desires to provide such services subject to the terms and conditions set forth herein: NOW THEREFORE, EMPLOYER and NRS agree as follows: 1. DESIGNATION EMPLOYER designates NRS as Administrator for deferred compensation funds. 2. TERM This Agreement shall remain in effect for an initial term of 5 years commencing as of the date listed herein, with the option for two (2) successive renewals thereafter for one (1) year each or until it is terminated by one or both parties in accordance with the provisions of this Agreement. 3. DEFAULT In the event the Agreement is terminated for "Cause" (which shall mean the failure of either party to perform any or all of its obligations as defined herein); the non-defaulting party shall give the defaulting party written notice, specifying the particulars of the default. If such default is not cured within sixty (60) days from the date in which notice of default is given, the non-defaulting party may terminate the Agreement effective thirty (30) days after the end of the sixty (60) day period. Page 1 of 11 e e e 4. INVESTMENT OPTIONS NRS agrees to accept deferred compensation plan funds for investment in the investment options referenced in Exhibit A hereto or such other options as mutually agreeable to the parties. A. The following provisions will apply: 1. The investment options referenced in Exhibit A will be available to the Plan Participants. Dividends (if applicable) will be automatically reinvested into the mutual fund. 2. Investment Management or other charges may be imposed on any of the investment options by the provider of such investment option. These charges will be disclosed in the investment option prospectus or other informational brochure. These charges, and along with any operating expenses of the investment, would be separate from any fees or charges described in this Agreement. B. Participants will be permitted to change their investment options as often as they wish, however, they shall be subject to any applicable penalty, charge, or restriction imposed for such change. 5. INVESTMENT GUIDANCE AND EDUCATION A. NRS agrees to provide reports and information for the analysis by the EMPLOYER of Plan investments on an annual basis or upon any other frequency as the parties mutually agree. Services shall include and relate to all investment options of the Plan as follows: 1. General investment consulting and advice. 2. Monitoring and reporting of returns and evaluation of performance. 3. Discussion of reasons for underlover performance and performance in relation to an investment options objectives and alternatives. B. Based upon the information in "A" above, NRS agrees to provide specific recommendations to the EMPLOYER each year by April 1 regarding whether an investment should be retained, deleted, or added to the list of available investment options of the Plan. C. Actions taken regarding the addition or deletion of investment options shall be specifically authorized by the EMPLOYER. D. NRS shall also provide education to Plan participants regarding the various investment options offered under the Plan. 6. ESTABLISHMENT OF ACCOUNTS A. ENROLLMENT SERVICES NRS agrees to process, or arrange to have processed, the enrollment of eligible employees who elect to participate in the Plan. NRS agrees to provide informational and Page20f11 e e e promotional material pursuant to the Plan for distribution to employees of EMPLOYER, subject to approval of such material by EMPLOYER, such approval not to be unreasonably withheld. EMPLOYER agrees to allow and facilitate the periodic distribution of such material to employees. NRS agrees to conduct group presentations periodically for employees of EMPLOYER, to explain the Plan. EMPLOYER agrees to facilitate the scheduling of such presentations and to provide facilities at which satisfactory attendance can be expected. NRS agrees that qualified personnel will be made available periodically to discuss the Plan with individual employees of EMPLOYER. B. DEFERRALS The minimum participant deferral per pay period shall be not less than $10.00. C. EMPLOYER agrees to: 1. Cause appropriate deductions to be made from such payroll(s) as may be applicable and send the funds representing the total participant deferrals to NRS. 2. Provide to NRS in such electronic or magnetic media designated by NRS, a deferral listing with respect to participant sub-accounts to include not less than the following: Name of participant Socia'l security number of participant Amount to be credited to participant's sub-account(s) 3, Funds may be sent by wire transfer, through an automated clearinghouse or by check in accordance with written instructions provided by NRS. Failure to follow the written instructions provided by NRS may result in delay of posting to Participant accounts. 4. Funds will be posted no later than the business day following the day on which the funds and the deferral listing are received by NRS. NRS will not be liable for any delay in posting if EMPLOYER fails to send either the funds representing deferral amounts or deferral information in accordance with NRS's instructions to the central processing site designated by NRS. 5. Authorize NRS to act upon instruction given by Participants pursuant to their personal identification number (PIN), such PINs can be used to obtain certain services as designated by NRS. D. NRS agrees to 1. Establish a sub-account for each participant. 2. Post and credit the amounts sent by EMPLOYER to the sub-account(s) of Participants in accordance with the latest written instructions on file with NRS. 7. PARTICIPANT SERVICES A. NRS will provide a dedicated toll free telephone number which shall be operative 24 hours per day, 7 days per week (less normal maintenance time) for the Interactive Voice Page 3 of 11 e Response (IVR), and for live Participant Service Representatives, Monday through Friday, 8 a.m. - 8 p.m. Eastem time, each business day. Using this number, participants may obtain information about participant accounts. EMPLOYER authorizes NRS to honor instructions, which may be submitted by participants using this number, either via the interactive voice response system (IVR), or to a live representative. Participant instructions may be in such form and content as may be mutually agreed to by NRS and EMPLOYER. B. NRS will provide Plan participants unlimited opportunities to increase (within limitations of Sec. 457) or decrease deferral amounts. All requests to increase or decrease deferral amounts will be processed by NRS within five (5) business days of receipt of the request and will be effective as soon as administratively practical by EMPLOYER. C. NRS will provide Plan participants unlimited opportunities to redirect future deferral amounts to any other investment option offered by the Plan. All requests will be processed within five (5) business days of receipt and will be effective with the next pay period deferral. D. NRS will provide participants the daily ability to exchange existing account balances from one investment option offered by the Plan to another (except for the limitation described in Section 4 above). Exchange requests will be processed with the investment option being "sold" by the next business day NRS receives such instructions and will be effective in the new investment not later than the day following NRS's receipt of funds from the "sold" investment. e E. NRS will provide participants, if they request, a fund prospectus (or other informational brochure as applicable) and an annual report for each investment option offered by the Plan. Specific mutual fund prospectuses and other relevant information are to be provided by each respective mutual fund or other investment provider upon request by NRS or a participant. F. NRS will provide participants consolidated quarterly statements detailing participant's year-to-date deferral amounts, account balance information that includes changes in account value since the previous report date and any fees or charges assessed against the Participant account. Participants shall be informed that they must notify NRS within ninety (90) days of receipt of their statements or confirmation of their investments, to report any errors to NRS. NRS will not be liable for any errors not reported within this time frame. G. NRS agrees to mail 90% of these statements to participants within twenty (20) business days after the end of each calendar quarter. NRS will have no responsibility to report, or account for the accuracy of information applicable to periods prior to the effective date such Plan was administered by NRS. H. NRS will provide certain standard reports quarterly to EMPLOYER to enable EMPLOYER to effectively monitor all accounting and record-keeping processes. These reports will include combined data for an entire Plan. (Fees and charges assessed will be disclosed in these reports.) In addition, all services will be provided in accordance with these reports. Copies are available upon request. e I. NRS agrees to maintain, for a reasonable time, the records necessary to produce the above mentioned reports, and agrees that all records shall be the property of e e e EMPLOYER. EMPLOYER agrees that all related computer tapes, disks and programs shall remain the property of NRS. J. NRS agrees to review submitted unforeseeable emergency withdrawal applications and make a determination regarding approval or denial based upon its interpretation of the Plan document and the requirements of the Intemal Revenue Code. 8. DISTRIBUTIONS A. NRS will assist the participant in preparing the necessary forms to select his/her distribution option. B. All lump sum distributions from participant accounts shall be made within five (5) business days of the earliest day permitted by the Plan. C. For emergency/hardship withdrawal requests, NRS shall process or reject applications within five (5) business days. D. NRS will provide necessary forms and process payments from the participant's account, to the company selected by the Plan to provide annuity options to participants. Participant will be required to submit properly completed forms to NRS in a time frame necessary to effectuate the "payment begin date" requested by participant. E. NRS shall offer to participants for distribution of their account a designated amount payment option. Payments shall be made on a monthly, quarterly, semi-annual or annual basis as specified by the participant, in equal installments (not less than $25.00 per payment) until the amount applied, adjusted each business day for investment results, is exhausted. The final installment will be the sum remaining at the time such payment is due. F. NRS shall offer to Plan participants a designated period payment option with a variable payment. Payments shall be made monthly, quarterly or annually for any specified number of years as permitted by the Plan, at the discretion of the Plan participant. The amount of each variable payment shall be determined by dividing the Participant's current portfolio balance by the number of remaining payments. G. NRS shall offer to Plan participants the ability to request a "Priority Distribution" option. This option allows participants to designate a specific investment option from which their distributions will be made. Processing of priority distributions will continue until such time that the balance in the selected investment option is no longer adequate to make the elected distribution. At that time, additional distributions will be made on a pro-rata basis from all investment options. H. All payment options are available for all investment options. Participants selecting the options in E, F, or G above shall be subject to the same fees and charges, and permitted the same exchange opportunities, as an active or inactive participant as defined by the Plan. Processing of these options will be completed by NRS upon receipt of properly completed forms, in a time frame necessary to effectuate the "payment begin date" on the third Monday of each month. Processing of the distribution option will be completed within three (3) business days of the payment begin date. All distributions will be made pro-rata from each of the Participant's investment options. Page5of11 e e e I. NRS will be responsible for preparing and filing all reports required by federal and state taxing authorities through the effective date of the termination of the contract. EMPLOYER shall be responsible for all reporting requirements for periods prior to the effective date of this contract, or after the termination date of this contract. NRS will be responsible for the annual filing of individual 1 099 or W-2 forms, unless by contract between EMPLOYER and an Investment Provider, the forms are prepared by the Investment Provider that provides annuity payments to participants. NRS shall withhold income taxes from distributions as required, and remit said taxes to appropriate regulatory authorities. NRS shall also prepare and file periodic and annual tax returns for said amounts withheld. J. NRS agrees to provide plan participants anticipating retirement or other separation from service with illustrations indicating monthly benefit payments at an assumed interest rate for savings accounts or an assumed rate of earnings for mutual fund investments. Such assumed interest rate or rate of earnings shall be for illustration purposes only. The actual interest rate/yield paid on saving products during distribution shall change quarterly. For mutual funds, earnings will be those actually earned. 9. TERMINATION Upon the effective date of termination of this Agreement, the following shall occur. A. NRS will no longer accept deferrals. In addition, upon notification of termination, NRS will cease opening certificate of deposits, if applicable. B. NRS will provide EMPLOYER a copy of all records relating to participant sub-accounts, in hard copy or such other form as mutually agreed upon between NRS and EMPLOYER, within ninety (90) days after the effective date oftermination. C. If termination is due to either party exercising the right of termination described in Section 3 above, within 45 days of the effective date of termination, NRS will transfer savings account balances (less any early withdrawal penalty imposed) to EMPLOYER, or to such other entity as EMPLOYER may designate in writing. Mutual funds will be transferred to EMPLOYER or to such other entity as EMPLOYER may designate in writing. D. Accounts in distribution will be transferred to EMPLOYER or its designee in accordance with the time frame described above. 10. FEES AND EXPENSES The fee for the investment options shall be 0.00% except as noted on Exhibit B. Exhibit B contains the terms and conditions under which a fee will be applied to specified investment options under the Plan. 11. CONFIDENTIALITY NRS agrees that all information supplied to and all work processed or completed by NRS shall be kept confidential and will not be disclosed except as required by law. Page60f11 e e e 12. PRIVITY OF CONTRACT NRS and Plan Participants shall have no privity of contract with each other. 13. TITLE AND OWNERSHIP In accordance with the provisions of Internal Revenue Code Section 457, all account(s) established under this Agreement shall be held in the name of EMPLOYER, or by a Trustee/Custodian with a multi-employer 'omnibus account' for the benefit of participants, in accordance with the Plan. 14. CIRCUMSTANCES EXCUSING PERFORMANCE Neither party to the Contract shall be in default by reason of failure to perform in accordance with its terms if such failure arises out of causes beyond reasonable control and without fault or negligence on their part. Such causes may include, but are not limited to, acts of God or public enemy, acts of the government in either its sovereign or contractual capacity, fires, floods, epidemics, quarantine or restrictions, freight embargoes, and unusually severe weather. 15. INDEMNIFICATION NRS agrees to defend, indemnify, and hold harmless the EMPLOYER, its officials, employees, and agents from all loss, cost, and expense arising out of any loss or injury sustained by anyone in connection with NRS's acts, errors, or omissions, or any of those of its officers, agents, or employees, whether such act is authorized by this agreement or not; and shall pay for any and all damages to EMPLOYER's property and funds of the EMPLOYER, or loss or theft of such property or funds. The Provisions of this Article do not apply to any damage or loss caused solely by the acts, errors, or omissions of the EMPLOYER, its officials, employees, or agents. EMPLOYER agrees to defend, indemnify, and hold harmless NRS, its officials, employees, and agents from all loss, cost, and expense arising out of any loss or injury sustained by anyone in connection with the EMPLOYER's acts, errors, or omissions, or any of those of its officers, agents, or employees, whether such act is authorized by this agreement or not; and shall pay for any and all damages to NRS's property and funds of NRS, or loss or theft of such property or funds. The Provisions of this Article do not apply to any damage or loss caused solely by the acts, errors, or omissions of NRS, its officials, employees, or agents. 16. ATTORNEYS' FEES Each party agrees that in the event of a claim, arbitration, or lawsuit filed by a party to this Agreement, each party shall be responsible for its own attorneys' fees and/or any costs or expenses related to the bringing or defense of any such claim, arbitration, or lawsuit. 17. ASSIGNABILITY No party to this Agreement shall assign the same without the express written consent of the other party, which consent shall not to be unreasonably withheld. This provision shall not restrict NRS's right to delegate certain services to an agent, including any affiliate. Unless agreed to by the parties, no such assignment shall relieve any party to this Agreement of any duties or responsibilities herein. Page 7 of 11 1____ , . e 18. PARTIES BOUND This Agreement and the provisions thereof shall be binding upon and shall inure to the benefit of the successors and assigns of the respective parties. 19. APPLICABLE LAW This Agreement shall be construed in accordance with the laws operating within the State of California. 20. UNLAWFUL PROVISIONS In the event any provisions of this Agreement shall be held illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining parts of the Agreement, but the same shall be construed and enforced as if said illegal or invalid provisions had never been inserted herein. Notwithstanding anything contained herein to the contrary, no party to this Agreement will be required to perform or render any services hereunder, the performance or rendition of which would be in violation of any laws relating thereto. 21. MODIFICATION This writing is intended both as the final expression of the Agreement between the parties and as a complete statement of the terms of the Agreement. No modification of this Agreement shall be effective unless and until such modification is evidenced by a writing signed by both parties. e 22. NO WAIVER The failure of either party to enforce any provision of this Agreement shall not be construed as a waiver of that provision or of any other provision in the Agreement and neither party may, at any time, enforce the provision previously waived, unless a modification to this Agreement has been executed. e 23. SEVERABILITY The provisions of this Contract are severable, and, if for any reason a clause, sentence, paragraph, or other part of this Contract shall be determined to be invalid by a court or federal or state EMPLOYER, board, or commission having jurisdiction over the subject matter thereof, such invalidity shall not affect other provisions of this Contract which can be given effect without the invalid provision. 24. NOTICES All notices and demands to be given under this Agreement by one party to another shall be given by certified or United States mail, addressed to the party to be notified or upon whom a demand is being made, at the addresses set forth in this Agreement or such other place as either party may, from time to time, designate in writing to the other party. Notice shall be deemed received on the earlier of, 3 days from the date of mailing, or the day the notice is actually received by the party to whom the notice was sent. PageBof11 e e e If to NRS: Nationwide Retirement Solutions, Inc. Attention: Lance Kesterson 5900 Parkwood Drive Dublin, Ohio 43016 If to EMPLOYER: City of San Bernardino Attn: Georgia Chamberlain, Deferred Compensation Liaison 300 North "D" Street San Bernardino, California 92418-0001 25. ENTIRE AGREEMENT This Agreement, along with any other investment product contracts necessitated by Exhibit A, constitutes the entire agreement between the EMPLOYER and NRS, its affiliates, successors, or assigns. The Parties warrant that this Agreement replaces and supercedes any prior agreement between the Parties or their affiliates. IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective on the date first written above. EMPLOYER Nationwide Retirement Solutions, Inc. By: By: Date: Date: Page90f11 e e e Exhibit A This Exhibit is hereby made part of the Deferred Compensation Plan Administration Agreement between NRS, and EMPLOYER. These investment options, or those added through subsequent amendment or exhibit are the current investment options available under the deferred compensation plan. Further: A. EMPLOYER and NRS agree that the following investment options in this Exhibit, or those added through subsequent amendment or exhibit are the onlv investment options available under the deferred compensation plan. B. EMPLOYER and NRS agree that EMPLOYER must agree to all changes in the investment options made available to the Plan, except those changes required directly by the investment provider. C. EMPLOYER agrees the effective date for offering new investment options will be the first day of the month at least one month subsequent to the month an Amended Exhibit A may be executed, or such other date upon which the parties mutually agree. List of Investment Options American Funds Income Fund of America American Funds EuroPacific Growth Fund Putnam International Growth fund - Class A Dreyfus International Stock Fund Janus Worldwide Fund PIMCO High-Yield Fund - Administrative Shares PIMCO Total Retum Fund - Administrative Shares Vanguard Total Bond market Index Fund Fidelity Magellan Fund Gartmore Total Return - Class A Putnam Research Fund - Class A Vanguard Institutional Index Fund American Funds Growth Fund of America Dreyfus Premier Third Century Fund - Class Z Fidelity Contra Fund Janus Fund MFS Massachusetts Investors Growth Stock Fund - Class A American Funds Investment Company of America Fidelity Equity -Income Fund Vanguard Windsor II Fund Dreyfus MidCap Index Fund INVESCO Dynamics Fund - Investor Shares EMPLOYER: By: Date: Mutual Beacon Fund - Class A American Century Equity Income Inv DFA U.S. 9-10 Small Company Portfolio Neuberger Berman Genesis Trust Brown Capital Management Small Company Fund - Inst~utional Shares INVESCO Small Company Growth Fund - Investor Shares Franklin Balance Sheet Investment Adv Shares INVESCO Technology Fund - Insmutional Shares Investor Destinations Aggressive Fund - Service Class Investor Destinations Conservative Fund - Service Class Investor Destinations Moderately Fund - Service Class Investor Destinations Moderately Aggressive Fund - Service Class Investor Destinations Moderately Conservative Fund - Service Class Washington Mutual Uquid Savings Accounts Washington Mutual Certificates of Depos~ Nationwide Ufe Insurance Company Group Fixed Annuity Contract TSP-557 Nationwide Retirement Solutions, Inc. By: Date: Page 10 of 11 Exhibit B e Effective . this Exhibit B becomes part of the Deferred Compensation Plan Administration Agreement (hereinafter "Agreement") between Nationwide Retirement Solutions. Inc. (hereinafter "NRS") and the City of San Bernardino, California (hereinafter "EMPLOYER") and is designed to memorialize the following additional terms that will apply to the offering of various investment options under the Agreement. Galliard Stable Value Fund: 1. NRS will provide administration and recordkeeping services as described in the Agreement for the Stable Value Fund (hereinafter "SVF") offered through Galliard Capital Management. Inc. 2. The SVF is not a mutual fund, but rather a collective investment trust or a pooled fund. Charges and reimbursements for this investment option are different from those of traditional mutual funds. 3. The fee for the SVF includes a Galliard Management Fee of .15% as well as a Plan Administration fee. The total of these fees will be included daily in the unit value calculation of the participant's value in the SVF, and will not be reflected as a charge on the account. 4. The Plan Administration Fee shall be the difference between the .59% and the Galliard Management Fee, which represents the total fee on an annualized basis. e Self Directed Brokerage Option: 1. NRS will provide administration and record keeping services as described in the Agreement for a Self Directed Brokerage Option (hereinafter "SDBO") offered through Charles Schwab and Co. 2. The fee for the SDBO shall be as follows: Initial Enrollment Fee: Annual Fee: $50.00 per participant $50.00 per participant These fees are in addition to any other product fees imposed directly by the SDBO provider. EMPLOYER: Nationwide Retirement Solutions, Inc. By: By: e Date: Date: Page 11 of 11 e e e Part-time, Seasonal, and Temporary Employee Plan (FICA - SUBSTITUTE) DEFERRED COMPENSATION PLAN AGREEMENT This Agreement is effective this _ day of , by and between Nationwide Retirement Solutions, Inc., a wholly owned subsidiary of NFS Distributors., a wholly owned subsidiary of Nationwide Financial Services, Inc. and an Ohio corporation (hereinafter "NRS"), and the City of San Bernardino, California (hereinafter "EMPLOYER"). WHEREAS, EMPLOYER, pursuant to and in compliance with Sections 3121 (b)(7)(F) and 457(b) of the Internal Revenue Code of 1986, has established a Deferred Compensation Plan (hereinafter "PLAN"); and WHEREAS, EMPLOYER desires to utilize NRS in connection with the administration of the assets of the part-time, seasonal, and temporary employees of the PLAN to be held in trust and/or a custodial account for the exclusive benefit of the participants or their beneficiaries prior to the satisfaction of all liabilities with respect to participants and their beneficiaries; and WHEREAS, EMPLOYER acknowledges that all part-time, seasonal, and temporary employees shall be required to become participants under the PLAN, and shall contribute funds to the PLAN so that the annual deferral shall not be less than 7.5% of wages as defined in Section 3121(a) and 3121(v) of the Internal Revenue Code; and WHEREAS, NRS desires to provide such services subject to the terms and conditions set forth herein: NOW THEREFORE, EMPLOYER and NRS agree as follows: 1. DESIGNATION. EMPLOYER hereby designates NRS as Administrator of deferred compensation funds. It is recognized and agreed that NRS will only maintain a FICA substitute plan if NRS is administrator for EMPLOYER's 9457 Plan. 2. TERM This Agreement shall remain in effect until it is terminated by one or both parties in accordance with the provisions of the agreement. This Agreement may be terminated by either party, with or without "Cause" as that term may by defined herein, and without obligation, upon the giving of one hundred twenty (120) days' written notice by the party terminating the Agreement to the other party. 3. DEFAULT e In the event the Agreement is terminated for "Cause" (which shall mean the failure of either party to perform any or all of its obligations as defined herein); the non-defaulting party shall give the defaulting party written notice, specifying the particulars of the default. If such default is not cured within sixty (60) days from the date in which notice of default is given, the non-defaulting party may terminate the Agreement effective thirty (30) days after the end of the sixty (60) day period. 4. INVESTMENT OPTIONS NRS agrees to accept deferred compensation plan funds for investment in the investment option of the Plan. These assets will be invested in the savings product offered through the Nationwide Life Insurance Company Group Fixed Annuity Contract TSP-557. 5. ESTABLISHMENT OF ACCOUNTS A. ENROLLMENT SERVICES: NRS agrees to process, or arrange to have processed, the enrollment of eligible employees who elect to participate in the PLAN. NRS agrees to provide informational and promotional material pursuant to the PLAN for distribution to employees of EMPLOYER, subject to approval of such material by EMPLOYER, such approval not to be unreasonably withheld. EMPLOYER agrees to allow and facilitate the periodic distribution of such material to employees. B. DEFERRAL: The minimum participant deferral per pay period shall be not less than $1.00. e C. EMPLOYER agrees to: 1. Cause appropriate deductions to be made from such payroll(s) as may be applicable and send the funds representing the total participant deferrals to NRS 2. Provide to NRS in such electronic or magnetic media designated by NRS, a deferral listing with respect to participant sub-accounts to include not less than the following: a. Name of Participant b. Social Security Number of participant c. Amount to be credited to participant's sUb-account(s) 3. Funds may be sent by wire transfer, through an automated clearinghouse or by check in accordance with written instructions provided by NRS. Failure to follow the written instructions provided by NRS may result in delay of posting to Participant accounts. 4. Funds will be posted no later than the business day following the day on which the funds and the deferral listing are received by NRS. NRS will not be liable for any delay in posting if EMPLOYER fails to send either the funds representing deferral amounts or deferral information in accordance with NRS's instructions to the central processing site designated by NRS. e 2 ,- e e e 5. Authorize NRS to establish personal identification number ("PINs"), for each participant and shall require participants to use such PINs to obtain certain services as designated by NRS. D. NRS agrees to: 1. Establish a sub-account for each participant; and 2. Credit the amounts sent by EMPLOYER to the various participant accounts in accordance with the latest written instructions on file with NRS. 6. PARTICIPANT SERVICES A. NRS will provide a dedicated toll free telephone number, which shall be operative Monday through Friday 9 a.m. - 5 p.m. Pacific time, each business day. Using this number, participants may process changes to deferrals and obtain information about participant accounts. EMPLOYER authorizes NRS to honor actions described herein (and in B. below) may be effectuated by telephone, facsimile transmission or mail. If such service is requested by telephone, Participant shall use his/her PIN. Telephone conversations may be recorded to provide confirmation and verification of transactions. B. NRS will provide participants consolidated quarterly statements detailing participant's year-to-date deferral amounts, account balance information that includes changes in account value since the previous report date and any fees or charges assessed against the Participant account. Participants shall be informed that they must notify NRS within ninety (90) days of receipt of their statements or confirmation of their investments, to report any errors to NRS. NRS will not be liable for any errors not reported within this time frame. C. NRS agrees to mail 90% of these statements to participants within twenty (20) business days after the end of each calendar quarter, and 100% of the statements to participants within twenty-five (25) business days after the end of each calendar quarter. NRS will have no responsibility to report, or account for the accuracy of information applicable to periods prior to the effective date such Plan was administered by NRS. D. NRS will provide certain standard reports quarterly to the EMPLOYER to enable the EMPLOYER to effectively monitor all accounting and record-keeping processes. These reports will include combined data for the entire Plan. E. NRS agrees to maintain, for a reasonable time, the records necessary to produce the above mentioned reports, and agrees that all records shall be the property of EMPLOYER. EMPLOYER agrees that all related computer tapes, disks and programs shall remain the property of NRS. 7. DISTRIBUTIONS: A. NRS will assist the EMPLOYER in locating participants eligible for distribution under the Plan. B. NRS will assist the participant in preparing the necessary forms to effectuate distribution from the Plan or issue distributions from the Plan according to the instructions of the EMPLOYER. 3 e e e G. Participants will receive a lump sum distribution of their account within ten (10) business days of the earliest day permitted by the Plan. D. NRS will be responsible for preparing and filling all reports required by federal and state taxing authorities through the effective date of the termination of the contract. EMPLOYER shall be responsible for all reporting requirements for periods prior to the effective date of this contract, or after the termination date of this contract. NRS will be responsible for the annual filling of individual 1 099 or W-2 form, unless by contract between EMPLOYER and an Investment Provider that provides annuity payments to participant. NRS shall withhold income taxes from distributions as required, and remit said taxes to appropriate regulatory authorities. 8. TERMINATION Upon the effective date of termination of this Agreement, the following shall occur: A. NRS will no longer accept deferrals. B. NRS will provide EMPLOYER a copy of all records relating to participant sub-accounts, in hard copy or such other form as mutually agreed upon between NRS and EMPLOYER, within ninety (90) days after the effective date of termination. C. If termination is due 10 either party exercising the right of termination described in Section 2 above, within ninety (90) days of the effective date of termination, NRS shall transfer savings account to EMPLOYER, or to such other entity as EMPLOYER may designate in writing. D. Notwithstanding any provision to the contrary, if termination is for cause (as that term is herein defined), the disbursement of funds shall occur within forty-five (45) days of the effective date of termination. E. There shall be a transfer/termination fee imposed on each participant account only when either the Participant or EMPLOYER elects a total Plan transfer or termination from the NRS Plan. The fee shall not exceed the lesser of $25.00 per participant, or the amount permitted by applicable law or regulation. 9. FEES AND EXPENSES The administrative fee for the investment option shall be zero percent (0.00%). 10. CONFIDENTIALITY NRS agrees that all information supplied to and all work processed or completed by NRS shall be kept confidential and will not be disclosed except as required by law. 11. PRIVITY OF CONTRACT NRS and Plan Participants shall have no privity of contract with each other. 4 e e e 12. TITLE AND OWNERSHIP In accordance with the provisions of Internal Revenue Code Section 457 and 3121 (b)(7)(F) , all account(s) established under this Agreement shall be held in trust, or in custodial accounts or contract in accordance with Section 457(g) for the exclusive benefit of Participants and their Beneficiaries. 13. CIRCUMSTANCES EXCUSING PERFORMANCE Neither party to this Agreement shall be in default by reason of failure to perform in accordance with its terms if such failure arises out of causes beyond reasonable control and without fault or negligence on their part. Such causes may include, but are not limited to, acts of God or public enemy, acts of the government in either its sovereign or contractual capacity, fires, floods, epidemics, quarantine or restrictions, freight embargoes, and unusually severe weather. 13. INDEMNIFICATION NRS agrees to defend, indemnify, and hold harmless the EMPLOYER, its officials, employees, and agents from all loss, cost, and expense arising out of any loss or injury sustained by anyone in connection with NRS's acts, errors, or omissions, or any of those of its officers, agents, or employees, whether such act is authorized by this agreement or not; and shall pay for any aDd all damages to EMPLOYER's property and funds of the EMPLOYER, or loss or theft of such property or funds. The Provisions of this Article do not apply to any damage or loss caused solely by the acts, errors, or omissions of the EMPLOYER, its officials, employees, or agents. EMPLOYER agrees to defend, indemnify, and hold harmless NRS, its officials, employees, and agents from all loss, cost, and expense arising out of any loss or injury sustained by anyone in connection with the EMPLOYER's acts, errors, or omissions, or any of those of its officers, agents, or employees, whether such act is authorized by this agreement or not; and shall pay for any and all damages to NRS's property and funds of NRS, or loss or theft of such property or funds. The Provisions of this Article do not apply to any damage or loss caused solely by the acts, errors, or omissions of NRS, its officials, employees, or agents. 14. ATTORNEYS' FEES Each party agrees that in the event of a claim, arbitration, or lawsuit filed by a party to this Agreement, each party shall be responsible for its own attorneys' fees and/or any costs or expenses related to the bringing or defense of any such claim, arbitration, or lawsuit. 15. ASSIGNABILITY: No party to this Agreement shall assign the same without the express written consent of the other party, which consent shall not to be unreasonably withheld. This provision shall not restrict NRS's right to delegate certain services to an agent. Unless agreed to by the parties, no such assignment shall relieve any party to this Agreement of any duties or responsibilities herein. 16. PARTIES BOUND This Agreement and the provisions thereof shall be binding upon and shall inure to the benefit of the successors and assigns of the respective parties. 5 17. APPLICABLE LAW e This Agreement shall be construed in accordance with the laws operating within the State of California. 18. UNLAWFUL PROVISIONS In the event any provisions of this Agreement shall be held illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining parts of the Agreement, but the same shall be construed and enforced as if said illegal or invalid provisions had never been inserted herein. Notwithstanding anything contained herein to the contrary, no party to this Agreement will be required to perform or render any services hereunder, the performance or rendition of which would be in violation of any laws relating thereto. 19. MODIFICATION This writing is intended both as the final expression of the Agreement between the parties and as a complete statement of the terms of the Agreement, pursuant to California Code of Civil Procedure Section 1856 or its successor(s). No modification of this Agreement shall be effective unless and until such modification is evidenced by a writing signed by both parties. 20. NO WAIVER e The failure of either party to enforce any provision of this Agreement shall not be construed as a waiver of that provision or of any other provision in the Agreement and either party may, at any time, enforce the provision previously waived, unless a modification to this Agreement has been executed. 21. SEVERABILITY The provisions of this Contract are severable, and, if for any reason a clause, sentence, paragraph, or other part of this Contract shall be determined to be invalid by a court or federal or state agency, board, or commission having jurisdiction over the subject matter thereof, such invalidity shall not affect other provisions of this Contract which can be given effect without the invalid provision. 22. NOTICES All notices and demands to be given under this Agreement by one party to another shall be given by certified or United States mail, addressed to the party to be notified or upon whom a demand is being made, at the respective addresses set forth in this Agreement or such other place as either party may, from time to time, designate in writing to the other party. Notice shall be deemed received by the party to whom the notice was sent. e 6 .' e e e If to NRS: Nationwide Retirement Solutions, Inc. Attention: Lance Kesterson 5900 Parkwood Drive Dublin, Ohio 43016 If to EMPLOYER: City of San Bemardino Attn: Georgia Chamberlain, Deferred Compensation Liaison 300 North "D" Street San Bernardino, California 92418-0001 23. ENTIRE AGREEMENT This Agreement, along with any other investment product contracts, constitutes the entire agreement between the EMPLOYER and NRS, its affiliates, successors, or assigns. The Parties warrant that this Agreement replaces and supercedes any prior agreement between the Parties or their affiliates. IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective on the date first written above. City of San Bernardino Nationwide Retirement Solutions, Inc. By: By: Date: Date: 7 OFFICE OF THE CITY CLERK RACHEL G. CuRK, CM.C. - CITY CLERK '" P.O. Box 1318. San Bernardino' CA 92402 300 North "D" Street. San Bernardino' CA 92418-0001 909.384.5002' Fax: 909.384.5158 Business Registration Division: 909.384.5302 Passport Acceptance Facility: 909.384.5128 www.cLsan-bernardino.ca.us September 7, 2001 Lance Kesterson Nationwide Retirement Solutions. Inc. 5900 Parkwood Drive Dublin, Ohio 43016 Dear Mr. Kesterson, At the Mayor and Common Council meeting of September 4, 200 I, the City of San Bernardino adopted Resolution 2001-277 - Resolution authorizing the execution of an agreement with Nationwide Retirement Solutions, Inc., for services as administrator of the City's full-time employee 457 Deferred Compensation Plan and the City's part-time, seasonal, and temporary employee (PST) 3121 Deferred Compensation Plan. Enclosed is one (1) original agreement. Please sign in the appropriate location and return the original agreement to the City Clerk's Office, Attn: Michelle Taylor, P.O. Box 1318, San Bernardino, CA 92402, as soon as possible. Please retain a copy of the agreementfor your files. If you have any questions, please do not hesitate to contact me at (909)384-5002. Sincerely, \' / '1 c/ I/."~ 1;;- (_t' '. Michelle Taylor Senior Secretary Enclosure cc: Georgia Chamberlain, Deferred Compensation Liaison, City of San BernardiJ;lo CITY OF SAN BERNARDINO ADOPTED SHARED VALUES: Integrity' Accountability' Respect for Human Dignity' Honesty ** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT ** RESOLUTION AGENDA ITEM TRACKING FORM Meeting Date (Date Adopted): 9'--<q -D\ Item # <1 Vote: Ayes l-, Nays-e- Change to motion to amend original documents: Resolution # Lea l - '2 f) 'I Abstain -e- Absent-B- Reso. # On Attachments: ~ Contract term: 5 'I reA e.. <; Note on Resolution of Attachment stored separately: -=- Direct City Clerk to (circle I): PUBLISH, POST, RECORD W/COUNTY NullNoid After: ""- By: - Date Sent to Mayor: q - S -(J \ Date of Mayor's Signature: q- Go -0\ Date ofC~CDC Signature: q - Go -0\ Reso. Log Updated: ,,-/ Seal Impressed: V" Date MemolLetter Sent for Signature: 60 Day Reminder Letter Sent on 30th day: 90 Day Reminder Letter Sent on 45th day: 9-[-0 I See Attached: ./ Date Returned: <f- d.b -{) \ See Attached: See Attached: Request for Council Action & Staff Report Attached: Yes ----.L No By Updated Prior Resolutions (Other Than Below): Yes No-L By Updated CITY Personnel Folders (6413, 6429, 6433, 10584, 10585, 12634): Yes No ,/ By - Updated CDC Personnel Folders (5557): Yes No ,/ By Updated Traffic Folders (3985, 8234,655,92-389): Yes No/ By Copies Distributed to: City Attorney V Parks & Rec. Water Others: Finance V MIS C l"<j N'Jm \(\ I <:i"i2~ Code Compliance Dev. Services EDA Police Public Services Notes: BEFORE FILING. REVIEW FORM TO ENSURE ANY NOTATIONS MADE HERE ARE TRANSFERRED TO THE YEARLY RESOLUTION CHRONOLOGICAL LOG FOR FUTURE REFERENCE (Contract Term. etc.) Ready to File: <<I-( Date: ~o, Revised 01/12/01