DATE: June 15, 2018
TO: Board of Mayor and Aldermen
FROM: Eric Stuckey, City Administrator
Kristine Tallent, Assistant City Administrator/CFO
SUBJECT:
title
*Consideration of Contract No. 2018-0014 Between the City Of Franklin and the Tennessee Consolidated Retirement System (TCRS) for Provision of Pension Services.
body
Purpose
The purpose of this memorandum is to provide information to the Franklin Board of Mayor and Aldermen (BOMA) concerning an agreement between the City of Franklin and TCRS regarding investment management of plan assets, basic payroll services and benefit calculation services.
Background
In December 2016, the City entered into an agreement with TCRS by which investment management of the City's pension plan asset was administered by TCRS. The proposed 2018, Contract No. 2018-0014, restates terms of asset management (no changes) and adds basic payroll services, including monthly payments to retirees, and benefit calculation services. Effective date for TCRS to begin providing payment and benefit services to the City's retirees is January 2019. The Employee Pension Committee recommended consideration of the agreement to the Board of Mayor and Aldermen at their meeting on June 4, 2018.
Financial Impact
There is no change to the fee structure for pension plan investment management. In calendar year 2017, the City reduced its investment management fees by $500,000 from the previous year due to the more favorable fee structure. For additional administrative services, there is a set up/technology fee of $40,080.96, to be paid in installments over a three year period. There is also a payroll services fee of $17.64 per recipient per quarter. On an annual basis, the payroll services fee of $12,700 is slightly less than the current fee of $13,980 paid to the City's custodial bank.
There may be costs associated with transition of the monthly payment date from first business day of the month to the last business day of th...
Click here for full text