Item Description:
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Negotiate Agmt A2512840 with Voya Retirement Insurance and Annuity Company for the provision of deferred compensation plan services for county employees, 04/01/25-03/31/32, with the option to extend for three (3) additional one-year periods
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Resolution:
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BE IT RESOLVED, that the Hennepin County Board authorizes the County Administrator to negotiate Agreement A2512840 and all necessary related documents with Voya Retirement Insurance and Annuity Company to provide deferred compensation recordkeeping services for county employees, consistent with the direction of the county’s Deferred Compensation Committee, during the period April 1, 2025 through March 31, 2032, with the option to extend for three (3) additional one-year periods; that following review and approval by the County Attorney's Office, the Chair of the Board be authorized to execute the Agreement on behalf of the county; and that the Controller be authorized to disburse funds as directed.
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Background:
Hennepin County has established a Deferred Compensation Plan for the benefit of its employees, to permit employees to defer a portion of their income that can supplement their other retirement benefits. Employees choosing to participate, elect to save by designating a portion of their paycheck for their deferred compensation account. The county has contracted with Voya Retirement Insurance and Annuity Company and Fidelity Investments Tax Exempt Services Company to act as recordkeepers and maintain investment accounts for those employees participating in the Plan.
The county’s Deferred Compensation Committee oversees the county’s Plan. The committee oversees the investment strategy and objectives of the Plan; the investment portfolio; administration of the Plan by the Human Resources Benefits Division; and continually evaluates the Plan considering the many competing and valid interests of Hennepin County and its diverse employee population.
An investment consultant advises the committee and reviews the performance of funds that are available to Plan participants for investment. The committee has a duty, with the assistance of its investment consultant, to select and monitor the funds that are available pursuant to the Plan, and to monitor investment expenses. The committee negotiated reduced fees for participants in both the Voya and Fidelity accounts. This will result in significantly lower fees for Hennepin County employees.
Hennepin County continuously seeks to optimize services and the cost of participation for its valued retirement plan participants. Based on a recent review, we are pleased to announce the following enhancements.
• Lower Recordkeeping Fee - Starting April 2025, Voya’s annual service fee decreased from 14.5 to 11 basis points. An overall fee reduction of 24%. Lower fees mean more of participants’ money is invested and working for them on their journey to a financially secure retirement.
• Revenue Sharing Credits - certain investment options generate revenue to Voya. Revenue sharing proceeds, if any, will continue to be credited to the accounts of participants in revenue sharing funds monthly.
• Online statement delivery - Starting third quarter 2025, quarterly account statements will be posted online exclusively. For added account security and expedited delivery of account related documents, PIN resents, and correspondence, participants are encouraged to go completely green by enrolling in e-delivery. Participants can opt out of online statement delivery at any time.
• Seven-year extension of contract with optional one-year extensions up to ten years.
The committee has recommended a new contract with Voya be finalized and approved, consistent with these terms.
Current Request: This request seeks authorization to negotiate Agreement A2512840 and all necessary related documents with Voya Retirement Insurance and Annuity Company for the provision of deferred compensation plan services for county employees from April 1, 2025, through March 31, 2032, with the option to extend for three (3) additional one-year periods.
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Recommendation from County Administrator: Recommend Approval