NOTICE OF SEARCH FOR MORTGAGE FIXED INCOME INVESTMENT MANAGERS PIN: FM I. INTRODUCTION AND INFORMATION ON THE SEARCH PROCESS

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1 NOTICE OF SEARCH FOR MORTGAGE FIXED INCOME INVESTMENT MANAGERS PIN: FM I. INTRODUCTION AND INFORMATION ON THE SEARCH PROCESS Background: The Comptroller of the City of New York (the Comptroller ), acting on behalf of the New York City Retirement Systems, and specifically the Teachers Retirement System of the City of New York ( TRS ), the New York City Employees Retirement System ( NYCERS ), the New York City Police Pension Fund, Subchapter Two ( Police ), the New York City Fire Department Pension Fund, Subchapter Two ( Fire ), and the New York City Board of Education Retirement System ( BERS ) (collectively NYCRS or the Systems 1 ), is conducting this investment manager search (this Search ) to identify and select investment management firms, or a pool of investment management firms, to create and manage one or more Mortgage Fixed Income portfolios ( Mortgage ) for the System(s). The Board of Trustees of each of the Systems (each, a Board and collectively, the Boards ), subject to applicable law, have exclusive control of all assets of its respective System. The Boards have full power to hold, purchase, sell, assign, transfer, or dispose of the Systems assets, including securities and other investments in which its funds have been invested, as well as the proceeds of such investments. Each Board has retained a general investment consultant ( Investment Consultant ) 2 to assist the respective Board in fulfilling its fiduciary duties with respect to the investment of the Systems assets. As investment advisor and custodian for the Systems, the Comptroller s asset management and custodian functions are executed by the Bureau of Asset Management ( BAM ) under the Comptroller s Chief Investment Officer ( CIO ). The CIO supervises BAM s development of investment policies, standards and investment guidelines ( Investment Guidelines ), and oversees BAM's evaluation, selection and monitoring of investment managers. The word Comptroller when used herein, shall also refer to the Comptroller s Office and staff. Search Process: The Comptroller s Office is conducting this Search as permitted by, and in accordance with, the Procurement Policy Board Rules of the City of New York ( PPB Rules ). This Search permits BAM and the Systems to review a broad universe of investment managers. Specifically, BAM and the Systems Investment Consultants will use industry databases to identify the universe of Mortgage Fixed Income investment management firms that the Systems could engage to provide investment management services. The Investment Consultants will review information posted in the databases to identify firms that meet the Minimum Requirements, 1 There are ten (10) New York City Retirement Systems and related Funds that are government plans under IRC Section 414(d), consisting of NYCERS, TRS, Police, Fire, BERS, and five (5) Variable Supplements Funds. The Comptroller is one of the Trustees for each System except BERS. Any of these aforementioned Systems may select one or more investment management firms as a result of this Notice of Search. 2 The Systems Investment Consultants are Callan Associates (NYCERS), Rocaton Investment Advisors (TRS), Wilshire Associates (Police), NEPC (Fire) and Segal Marco Advisors (BERS).

2 followed by further evaluation. Please see Sections C and E for a description of the evaluation process and evaluation criteria. How to Participate in this Search: To be considered, investment management firms must comply with the requirements (1) (3) listed below: 1) All firms shall carefully review this Notice of Search and the Minimum Requirements (as defined herein) described in Section B below. Interested firms that meet the Minimum Requirements must enter their information in the following databases to be considered by each of the Investment Consultants. The Investment Consultants will review the databases and provide BAM with a written report identifying the investment managers that meet the Minimum Requirements. a. For Callan, investment firms must submit their information directly to the Investment Consultant. Information on requirements for entering information into these databases can be found at: (click on Manager Questionnaire ). b. For Wilshire, investment firms must submit their information directly to the Investment Consultant (Wilshire Compass). Information on requirements for entering information into these databases can be found at: compassportal.wilshire.com. c. For Rocaton, NEPC and Segal Marco Advisors, investment firms must enter their information into evestment Alliance s database. Information on requirements for entering information into these databases can be found at (click on Submit My Data ). 2) All firms must ensure that they completely identify their firm and product information in the aforementioned databases. Additionally, firms must ensure that the information is current and accurate as of December 31, 2017 (information such as organization, product, returns, portfolio characteristics and AUM data). 3) There is no fee for entering information into the aforementioned databases. Investment managers are advised that information in the database may become part of any pool contract that results from this Search. Current and accurate data must be in the aforementioned databases no later than February 23, 2018, at which time the respective Investment Consultant shall commence its review of the database. Investment managers that meet the Minimum Requirements will be evaluated in accordance with the evaluation process and evaluation criteria set forth in Sections C, D and E below. Any of the Systems may select one or more investment managers through this Search process. The Comptroller, acting on behalf of the Systems, reserves the right to reject as non-responsive any firm that is determined to have a conflict of interest in connection with the investment management services specified in this Search. 2

3 A. SCOPE OF SEARCH This Search is open to all managers with long-only styles of management of Mortgage strategies. As of September 30, 2017, approximately $6 billion of the Systems assets are managed through the Mortgage strategies. The actual amount invested in such strategies may increase or may decrease after this Search. All of the Systems current Mortgage securities managers must participate in this procurement process if they wish to be considered for award of a contract pursuant to this Search. The purpose of this Search is to identify highly qualified investment firms to manage Mortgage portfolios on behalf of the Systems. Managers may be selected to execute their investments consistent with the investment policies and asset allocation of the respective System. Managers may be required to manage against a custom benchmark for some of the Systems. Managers are expected to manage portfolios as separate accounts or in commingled vehicles comprised of only the Systems. For purposes of calculating fees, all assets of all Systems managed by the firm in the same asset class and style will be aggregated for determining breakpoints, etc. The maximum allocation to any manager selected through this Search will not exceed twenty-five percent of firm-wide Mortgage portfolios managed at the time of award exclusive of the allocation pursuant to this Search. E.g. if the total AUM of a selected manager s mortgage portfolio, excluding NYC award, is $1 billion, the maximum allocation to be awarded by NYC will be no more than $250 million. The total dollar amount to be allocated to managers selected through this Search has not been determined. Individual portfolios currently range in value from approximately $100 million to $1.2 billion most portfolios awarded as a result of this Search are expected to fall within this range, but may be smaller or larger. Current managers aggregate assets under management for the Systems range from $800 million to $3.3 billion. Final aggregate assets awarded to any one manager as a result of this Search are expected to fall within this range, but may be smaller or larger. It is anticipated that the contracts resulting from this Search will be for an initial term of three (3) years with one or more renewal options up to an aggregate of an additional six (6) years. In addition to selecting managers that may receive an immediate allocation of assets, this Search may be used to select pool managers that will be eligible to compete for future allocations to Mortgage strategies in the event the Systems and Comptroller determine there is need for new or additional managers such as when a current manager is terminated. To be eligible to receive a subsequent allocation, the pool manager must still meet the Minimum Requirements described in Section B herein. Managers will not be permitted to increase their fee proposal in any subsequent selection from the pool. 3

4 Your participation in this process should not be impacted by the pool concept. The Comptroller, acting on behalf of the Systems, reserves the right not to implement the pool structure. Each selected vendor will provide services as defined in this Search and as set forth in the resultant contract. The portfolios must adhere to Investment Guidelines issued by the Comptroller. The Systems Mortgage portfolios must be fully invested at all times. Custody and securities lending are not included in this Search. Derivatives are not currently permitted except for Mortgage derivatives such as IOs and POs. All current Investment Guidelines and the benchmarks will be reviewed in conjunction with this Search. Changes to the Investment Guidelines and the use of additional benchmarks may be considered as part of this Search. By soliciting proposals, the Systems are not obligated to award any contracts or to allocate assets to any proposer. Consistent with the policies expressed by the City of New York, participation by minorityowned and women-owned businesses or partnering arrangements with minority-owned and women-owned investment firms are encouraged. Additionally, participation by small and New York City-based businesses is also encouraged. Investment managers are also advised that the Comptroller s Office, on behalf of the Systems, has implemented a minority- and women-owned brokerage initiative. As part of this initiative, the Comptroller s Office maintains a list of qualified brokerage firms. Subject to the investment manager s obligations to obtain best execution, the System s investment managers are expected to use firms on this list to execute trades for the Systems portfolios and to make every effort to achieve a utilization goal of 10% on trades. The Comptroller s Office also requires regular written reporting from investment managers on their progress in achieving this goal. B. MINIMUM REQUIREMENTS Minimum Requirements are set forth below. Firms, strategies and products that do not meet the following Minimum Requirements shall be considered non-responsive and shall be rejected. 1) Investment Approach a. The firm must offer a long-only Mortgage Fixed Income product that can be benchmarked to one of the following major market indexes: Bloomberg Barclays U.S. Mortgage-Backed Securities Index The Citigroup U.S. BIG Mortgage-Backed Securities Index Bank of America Merrill Lynch U.S. Mortgage-Backed Securities Index J.P. Morgan Mortgage-Backed Securities Agency Index 2) Assets Under Management 4

5 As of December 31, 2017, at a minimum, the investment management firm must: a. Have proven ability in managing institutional-sized portfolios, including at least one nonaffiliated client for whom the firm currently manages $50 million or more in the proposed product. b. Have at least $500 million under management in the proposed product; c. Have at least $1 billion under management at the firm-wide level. Note: Distinct mortgage products with carve-outs of mortgage securities from other products can be combined for the purpose of calculating the minimum total assets under management in the proposed product. E.g. a firm with $250 million in the proposed institutional mortgage fixed income product plus $250 million in institutional mortgage fixed income assets extracted from a Multi-Asset Strategy does meet the $500 million minimum requirement. 3) Performance Track Record At a minimum, as of December 31, 2017, the manager: a. Must have, at a minimum, a live five-year track record managing the proposed mortgage product. It is preferred that the composite is calculated in accordance with CFA Institute Global Investment Performance Standards ( GIPS )-required methodologies or other appropriate methodologies. Note that GIPS-required methodologies refer to both the calculation of returns and the creation and maintenance of the composite. The following track records will be considered acceptable: A live five-year track record, at a minimum, of the proposed institutional mortgage fixed income product A live five-year track record, at a minimum, of carve-outs of the mortgage securities from other products b. Only investment management firms that demonstrate a continuous track record for the entire minimum period will be considered. The following track records will be considered non-responsive: Linked performance of two or more different products, even when they both use a similar approach and the same personnel. Back tested or otherwise simulated track record. Performance records that include securities lending, derivatives other than mortgage derivatives, or other unrelated income. Proposers may link track records from two firms if they meet CFA Institute standards for portability. The products offered by the two firms must be substantially the same in style and use a similar benchmark. 5

6 4) Linked Performance Track Record, if applicable Investment management firms will be considered based on the performance record achieved at a predecessor firm by key senior staff of the investment management firm, provided the linked performance record is for a product that exhibits continuity of investment philosophy and portfolio management processes from one firm to the other. Additionally, during the evaluation process, the investment management firm must: a. Answer all performance questions. b. Provide a thorough explanation of the performance composites and linking methodology, including whether or not the composites and linking are consistent with CFA Institute standards, and if not consistent, the reasons for the linked performance track records to be considered. c. Meet all Minimum Requirements. 5) Regulatory, Ethics and Compliance The firm must be a registered investment adviser under the Investment Advisors Act of 1940 or must be a bank or insurance company and must also be registered with the appropriate local regulatory authority (e.g., Financial Services Authority), as applicable. Although the Systems are not subject to ERISA, firms must also agree to perform as a fiduciary to the Systems, consistent with ERISA standards. Selected firms will be required to comply with the NYCRS Ethics and Compliance Policy (the Policy ) attached hereto Exhibit 1. The firm must provide written certification on a quarterly basis that the assets in the portfolio have been managed in accordance with the resulting contract and the Investment Guidelines. Should any issue be out of compliance, an explanation must be included. C. EVALUATION PROCESS An evaluation committee made up of BAM staff, working with the Investment Consultants, will evaluate firms that meet the Minimum Requirements. Evaluation will be done as a multi-stage process, as follows: 1) The Investment Consultants will review information posted in their respective databases to identify firms that meet the Minimum Requirements. 2) Each Investment Consultant will then conduct further quantitative and qualitative reviews, using a range of sources. Reviews will initially focus primarily on quantitative factors, such as benchmark fit, consistency of benchmark-relative rolling out-performance and tracking error 6

7 of the product on a stand-alone basis, as well as manager team analysis regarding programmatic benefits of the product relative to a team of managers. Investment managers with strong quantitative records will also be reviewed on qualitative criteria such as strength of the organization and quality of the investment research and investment decision-making processes. Based on these reviews, each Investment Consultant will provide a written report to BAM with the recommended investment management firm and product(s) and the basis for the recommendation. 3) The evaluation committee will review the Investment Consultants reports and the recommended lists of investment management firms and product(s). The evaluation committee will develop a shortlist of investment managers ( Shortlist of Investment Managers ) for further review that received multiple recommendations from the Investment Consultants. Firms on the Shortlist will be contacted to confirm the firm s interest in participating in the Search. Investment management firms on the Shortlist of Investment Managers will be required to provide fee proposals, Form ADV Parts 1 and 2 (2A & 2B) and other disclosure forms. Based on additional in-depth review, which may include site visits, a due diligence questionnaire, in-person and/or telephone interviews, best and final fee offers, and review of other relevant information, the evaluation committee will rate the remaining firms in accordance with the evaluation criteria specified in Section E below and will identify a list of finalists. 4) The Comptroller s Office shall rank investment managers by technical merit, and will consider price by negotiating a fair and reasonable price with the highest technically ranked investment managers. Investment managers with the highest ratings will be submitted to the Board for each respective System for consideration/selection. Firms may be requested to make a presentation before each Board. The evaluation committee will evaluate and rate all proposals based on the evaluation criteria prescribed below in Section E to determine whether a proposal represents the best value to the City taking into consideration price and such other factors or criteria set forth in this Search and is therefore the most advantageous proposal. The Comptroller s Office may request best and final offers and will then consider price by negotiating a fair and reasonable price with the highest technically ranked proposer. Firms may be requested to provide clarifications or additional information regarding their proposal(s) at any time during the evaluation process. The Comptroller s Office will seek to execute contracts with firms selected by the Boards. Should any contract negotiations fail to result in agreement within two weeks of their commencement, the Comptroller shall have the right to terminate negotiations. The Boards may select another qualified firm or take other action consistent with the best interests of the Systems. D. CONTRACT AWARD Any contract award shall be made to the responsible Investment Manager(s) whose product is determined to be the most advantageous to the New York City Retirement Systems, taking into consideration the price and such other factors or criteria that are set forth in this Notice of Search. 7

8 E. BAM S EVALUATION CRITERIA The criteria for evaluation and relative weight assigned to each are summarized below: 1) Organizational Characteristics 40 percent a. Organizational structure and stability b. Team structure and stability c. Client service d. Operations e. Nature and size of assets managed f. Ethics, compliance, litigation, and conflicts of interest g. Diversity of team and organization 2) Investment Management and Decision Making 60 percent a. Philosophy and investment process b. Research resources c. Trading capabilities d. Risk management e. Performance relative to risk taken to achieve returns f. Portfolio return attribution g. Portfolio characteristics and related data 3) Fees Fees will be a material factor in evaluating firms. 4) Portfolio Optimization A product s compatibility within a team of managers will be a material factor in evaluating firms. Note: All information submitted in the proposal is subject to verification by the Systems Investment Consultants and the Comptroller s staff. 8

9 II. PROJECTED TIMETABLE The following is the estimated timetable for awarding contracts: Event Release Notice of Search February 2, 2018 Date Deadline to submit questions Response to questions submitted Deadline to submit information to databases As soon as possible; no later than February 12, 2018 As soon as possible February 23, 2018 Evaluation/interviews/selections April June 2018 Contract funding and start September

10 III. AGENCY CONTACT A. Communication with Agency 1. Agency Contact The Comptroller's exclusive agency contact for this procurement is: Noreen Pye City of New York Office of the Comptroller The Municipal Building 1 Centre Street, 8th Floor South New York, New York Phone: (212) MortgageSearch2018@comptroller.nyc.gov The Comptroller's Office shall not be bound by, and firms may not rely on, information regarding this process obtained from any other person. From the issue date of this Notice and Solicitation until firms are selected, all contact with City employees concerning this solicitation must be cleared through the agency contact. 2. Questions Questions concerning the solicitation should be submitted in writing to the Agency Contact by the due date for questions indicated on the project timetable. Firms should submit questions as soon as they arise after receipt of this Search. Answers to questions (unidentified as to source) will be responded to in writing and distributed by to all firms who downloaded the solicitation from the Comptroller's Website and/or posted on the Comptroller s Website as appropriate. Only written responses from the agency contact should be considered official responses of the Comptroller. See Section II, Projected Timetable, for applicable dates. IV. GENERAL SERVICE REQUIREMENTS A. Meetings The Bureau of Asset Management will schedule periodic meetings in New York City (approximately twice yearly) to review the portfolio holdings, performance and organization. In addition, firms may be requested to make presentations to the Boards in New York City. The firms should be available for annual on-site visits by BAM and/or the Investment Consultants as well as discussions with respect to the portfolio at such times as the CIO or Boards may require. Costs to attend such meetings are to be borne by the firm at its own expense. 10

11 B. Reports Firms will be required to provide monthly, quarterly and annual portfolio reports as well as such other reports as may be requested by the Comptroller. Reports must be provided within the timeframes specified by the Comptroller. In addition to the portfolio reports, or funds held by other than the System s custodian bank, the Comptroller requires an annual audit report of each of the components of the fund. The annual audit must be submitted by an external CPA with a management audit opinion letter on internal control procedures. C. Corporate Actions The Comptroller and the Systems are active participants in proxy issues for corporate actions which require shareholder proxy voting. The Manager is not responsible for casting votes on proxy issues. However, corporate actions, other than those effectuated via a proxy vote, shall be handled by managers. D. Research Assistance From time to time the Comptroller and the Systems conduct various research projects. Research may also include such items as custodial issues, proxy voting, tax treatment by country, benchmark analysis, etc. 11

12 V. GENERAL INFORMATION A. Time of Payments Fee payments will be made quarterly in arrears upon submission and review of an invoice based on the daily net asset values of securities at the close of each business day as determined by the Systems custodian bank. B. Amendments to This Notice Any substantial clarification or change to this Search shall be by written amendment and shall be provided to all firms that were sent a copy of this Notice or that downloaded a copy from the Comptroller's website. It is the firm s responsibility to assure receipt of all addenda. C. Disclosure Firms shall disclose publicly available developments that may materially affect its ability to perform the services requested in this solicitation or to fulfill its obligations under a contract that results from this Search. D. Work Products Materials and working papers developed during the engagement will become the property of the City of New York or the System(s). All original information and all data files derived from the custody services provided to the Comptroller, if applicable, will be the property of the Comptroller. E. Allocation Procedures 1. The contract will incorporate business terms included in this Search and additional City requirements delineated in this solicitation and the City s required Appendix A, which will be provided to firms during the search process. After all required City contract procurement requirements have been met, assets, which may be in the form of cash or securities, will be allocated to the firm. 2. A manager shall invest allocated funds within the Investment Guidelines developed by BAM in consultation with the manager at the time funds are allocated to a manager, and as such guidelines may be amended from time to time thereafter. Timing of the initial portfolio purchases should be discussed with the BAM CIO at the time of account funding. 3. Additions or reductions in assets under management by a firm shall be at the discretion of the Comptroller, but shall be timed to minimize the impact on the performance measurement process. 12

13 4. The Comptroller reserves the right to re-allocate assets assigned to, or withdraw assets from a firm without fee or penalty. VI. ADDITIONAL GENERAL INFORMATION A. Complaints The New York City Comptroller is charged with the audit of contracts in New York City. Any firm that believes that there has been unfairness, favoritism or impropriety in the proposal process should inform the Comptroller, Office of Contract Administration, 1 Centre Street, Room 727, New York, NY 10007; the telephone number is (212) B. Applicable Laws and Policies i. This solicitation and the resulting contract award(s), if any, unless otherwise stated, are subject to all applicable provisions of New York State Law, the New York City Administrative Code, New York City Charter and New York City Procurement Policy Board (PPB) Rules. The PPB Rules are available at ii. Supplemental Diligence Questionnaire and No Gift Policy Firms are further advised that the Comptroller s Office, together with NYCERS, Teachers and BERS, has implemented additional policies and procedures for investment managers seeking to do business with these Systems. Specifically, any manager proposed to be hired by one of these Systems will be required to complete a supplemental diligence questionnaire ( SDQ ) regarding gifts and contacts. The Comptroller s Office will notify managers if and when they are required to provide an SDQ. Regarding gifts, the Comptroller has adopted a No Gift policy for all employees of the Comptroller s Office. Further, the New York City Charter, Chapter 68, Section 2604(b)(5) prohibits public servants from accepting any valuable gift. To complete the SDQ, managers and consultants must disclose any gifts given to employees of the Comptroller s Office or valuable gifts given to any employee or Trustee or his or her representative or delegate of NYCERS, TRS or BERS. Regarding contacts, the Comptroller, NYCERS, TRS and BERS have adopted a policy whereby managers and consultants must include with the SDQ a schedule of all contacts with any employee of the Comptroller s Office or the System, a Trustee of NYCERS, TRS or BERS or his or her representative or delegate. 13

14 iii. Fee Disclosure Certificate for Investment Managers The New York City Retirement Systems prohibit the use of placement agents. Each prospective investment manager be required to certify that no placement agent fees or any other fees, bonuses, compensation or benefit of any type have been paid, given or promised by or on behalf of an investment manager, in connection with soliciting and investment management agreement or managing investments under the investment management agreement. C. General Contract Provisions Contracts shall be subject to New York City s general contract provisions, Appendix A, which will be provided to firms during the search process. D. Contract Award Contract award is subject to each of the following applicable conditions and any others that may apply: New York City MacBride Principles Law; submission of the requisite New York City Department of Business Services/Division of Labor Services Employment Report and certification by that office; creation of online accounts and submission of the requisite business entity and principal disclosure information on the City s online Procurement and Sourcing Solutions Portal (PASSPort) and review of the information contained therein by the New York City Department of Investigation; all other required oversight approvals; and, applicable provisions of federal, state and local laws and executive orders requiring affirmative action and equal employment opportunity. E. Appeal Rights Pursuant to the PPB Rules, firms have the right to protest an agency s determination regarding the solicitation or award of a contract. F. Multi-Year Contracts Multi-year contracts are subject to modification or cancellation if adequate funds are not appropriated to support continuation of performance in any City fiscal year succeeding the first fiscal year and/or if the contractor s performance is not satisfactory. The Comptroller s Office will notify the contractor as soon as is practicable that the funds are, or are not, available for the continuation of the multiyear contract for each succeeding City fiscal year. In the event of cancellation, the contractor will be reimbursed for those costs, if any, which are so provided for in the contract. G. Prompt Payment Policy 14

15 Pursuant to the PPB Rules, it is the policy of the City to process contract payments efficiently and expeditiously, upon receipt of a proper invoice. H. Prices Irrevocable Prices shall be irrevocable until contract award. This shall not limit the discretion of the Comptroller s Office to request firms to revise proposed prices through the submission of best and final offers and/or the conduct of negotiations. I. Confidential, Proprietary Information or Trade Secrets Firms should give specific attention to the identification of any information that they deem to be confidential, proprietary information or trade secrets and provide any justification of why such materials, upon request, should not be disclosed by the City. All information not so identified may be disclosed by the City. The Comptroller s Office will attempt to keep such information confidential, but no assurances can be given. J. Postponement/Cancellation K. Costs The Comptroller s Office reserves the right to postpone or cancel this solicitation, in whole or in part, and to reject all proposals. Firms will not be reimbursed for any costs incurred to participate in this solicitation or for any work performed in connection therewith, or during any negotiations on proposed contracts. L. Solicitation May Not Result in Award This solicitation does not commit the Comptroller s Office or the Systems to award a contract or to engage any firm to perform services of any kind. M. Charter 312(a) Certification (i.e. Local Law 35) The Comptroller has determined that the contract(s) to be awarded through this solicitation will not directly result in the displacement of any New York City employee. N. Compliance with Local Law 34 of 2007 Pursuant to Local Law 34 of 2007, amending the City's Campaign Finance Law, the City is required to establish a computerized database containing the names of any person that has business dealings with the City as such terms are defined in the Local Law. In order for the City to obtain necessary information to establish 15

16 the required database, managers that are under consideration for hiring by the Systems will be required to complete a Doing Business Data Form. The Doing Business Data Form will be provided to firms during the search process. The submission of a Doing Business Data Form that is not accurate and complete may result in appropriate sanctions. O. PASSPort and Vendor Name Check Fees Pursuant to Procurement Policy Board Rule 2-08(f)(2), the contractor will be charged a fee for the administration of the PASSPort system, including the Vendor Name Check process, if a Vendor Name Check review is required to be conducted by the Department of Investigation. The contractor shall also be required to pay the applicable required fees for any of its subcontractors for which Vendor Name Check reviews are required. The fee(s) will be deducted from payments made to the contractor under the contract. For contracts with an estimated value of less than or equal to $1,000,000, the fee will be $175. For contracts with an estimated value of greater than $1,000,000, the fee will be $350. The estimated value for each contract resulting from this solicitation is estimated to be above $1 million. P. Whistleblower Protection Expansion Act Rider Local Law Nos. 30 and 33 of 2012, codified at sections and of the New York City Administrative Code, the Whistleblower Protection Expansion Act, protect employees of certain City contractors from adverse personnel action based on whistleblower activity relating to a City contract and require contractors to post a notice informing employees of their rights. A copy of the Whistleblower Protection Expansion Act Rider will be provided to firms during the search process. Q. Compliance with the Iran Divestment Act Pursuant to State Finance Law Section 165a and General Municipal Law Section 103-g, the City is prohibited from entering into contracts with persons engaged in investment activities in the energy sector of Iran. A contractor is required to complete a Bidders Certification of Compliance with the Iran Divestment Act, certifying that it is not on a list of entities engaged in investments activities in Iran created by the Commissioner of the NYS Office of General Services. If a contractor appears on that list, the Comptroller s Office will be able to award a contract to such contractor only in situations where the contractor is takings steps to cease its investments in Iran or where the contractor is a necessary sole source. Please refer to for additional information concerning the list of entities. R. Subcontractor Tracking Notice The Firm will be required to utilize the City s web based system to identify all subcontractors in order to obtain subcontractor approval pursuant to PPB Rule 16

17 Section 4-13, and will also be required to enter all subcontractor payment information and other related information in such system during the contract term. A copy of a Subcontractor Tracking Notice as it relates to competitive solicitations will be provided to firms during the search process. S. Paid Sick Leave Law The Earned Sick Time Act, also known as the Paid Sick Leave Law ( PSSL ), requires covered employees who annually perform more than 80 hours of work in New York City (the City ) to be provided with paid sick time. Contractors of the City or other governmental entities may be provided to provide sick time pursuant to the PSSL. A copy of the Paid Sick Leave Law Rider will be provided to firms during the search process. T. HireNYC The HireNYC Rider applies to contracts with a value of one million dollars ($1,000,000) or more provided, however, that certain requirements of the Rider shall only apply under certain conditions. The Rider addresses the HireNYC process, including reporting requirements. In general, the HireNYC process requires the contractor to enroll with the HireNYC portal for the City to disclose all entry to Small-level job opportunities described in the Rider arising from a contract and located in the City and agree to interview qualified candidates from HireNYC for those opportunities. A copy of the HireNYC Rider will be provided to firms during the search process. 17

18 Exhibit 1 NYC Retirement Systems: Ethics and Compliance Policy (An enclosure with this Notice of Search) 18