TOWN OF WILTON REQUEST FOR QUALIFICATIONS AND PROPOSALS PENSION INVESTMENT CONSULTANT TABLE OF CONTENTS I. LEGAL NOTICE. 2 II. GENERAL SPECIFICATIONS. 3 III. SUBMISSION OF QUALIFICATION STATEMENT/FEE PROPOSALS. 5 IV. METHOD OF SELECTION/CRITERIA FOR AWARD.. 9 V. TIMELINE OF THE RFQ PROCESS... 10 VI. GENERAL TERMS AND CONDITIONS 10 VII. NON-COLLUSION / NON-CONFLICT AFFIDAVIT 14 VIII. FEE PROPOSAL FORM. 15-16 Page 1 of 17
I. LEGAL NOTICE TOWN OF WILTON REQUEST FOR QUALIFICATIONS AND PROPOSALS PENSION INVESTMENT CONSULTANT The Town of Wilton is seeking statements of qualifications and fee proposals for a qualified firm to provide pension investment consulting services. Respondents are required to submit five (5) copies of their qualification statements and fee proposals in sealed envelopes by no later than Friday, January 11 th, 2019 at 2:00 p.m. in the office of the Chief Financial Officer, Town of Wilton, 238 Danbury Road, Wilton, CT 06897. Late submittals will be rejected. The fee proposal should be submitted in a separate sealed envelope. All submittals should be labeled with the RFQ title. Questions regarding the RFQ should be directed, only in writing, to Anne Kelly-Lenz, Chief Financial Officer at anne.kelly-lenz@wiltonct.org. Each respondent shall honor its fee proposal for ninety (90) business days from the date of proposal opening, without modification. The Town reserves the right to reject any, or any part of or all proposals received in response to this RFQ for any reason; to waive informalities and technicalities; and to accept the proposal which the Town deems to be in its best interest, whether or not it is the lowest cost proposal. The Town reserves the right to review the proposals and reject all proposals or take no action or elect not to select any proposal. The Town also reserves the right to cancel this RFQ at any time and to reissue this or a substitute RFQ at a later date. In its sole discretion and without prejudice, the Town will award the contract to the respondent that the Town believes is best suited to complete the scope of services. The RFQ does not constitute a contract or offer of employment. Anne Kelly-Lenz, Chief Financial Officer Page 2 of 17
II. GENERAL SPECIFICATIONS A. OVERVIEW The Town of Wilton (the Town ), on behalf of its single employer defined benefit pension plan known as the Wilton Employees Retirement Plan (the Plan ) intends to enter into a contract for pension investment consulting and fiduciary support services. The purpose of this RFQ is to define the scope of services, solicit statements of qualifications and fee proposals, and gather information from which the Town may evaluate interested service providers. B. BACKGROUND INFORMATION The Town of Wilton currently sponsors the Plan to provide retirement benefits to many of its full-time employees, except for certified personnel of the Board of Education, who are covered under the State of Connecticut Teachers Retirement System. The Plan was closed to new hires as of April 15 th, 2015, except for firefighters. Employee contributions to the Plan vary by individual and collective bargaining agreements. Currently, the Town s pension assets are administered by FIA and actuarial valuations are performed each year by Hooker and Holcombe. As of July 1, 2018 the market value of assets of the Plan was $117,356,130. Current membership in the Plan is as follows: 282 active members, 210 retirees or beneficiaries receiving benefits, and 53 terminated vested members. Administration of the Plan rests with Board of Selectmen. C. WORK STATEMENT The primary role of the Town s pension investment consultant will be to provide objective, third-party advice and counsel that will enable the appropriate boards, committees and officials of the Town to make well-informed and well-educated decisions regarding management of the Plan and investment of the Plan s assets. The selected firm will attend Investment Committee meetings at least quarterly, or as required by the Investment Committee, and will demonstrate extensive successful experience and superior capability for providing advisory services. Meetings are currently held quarterly. In general, the selected firm will assist the Town in the on-going process of investment policy development and implementation. In all cases, the consultant will offer advice to the Town that is in the best interest of the Town, Plan participants and Plan beneficiaries. D. MINIMUM QUALIFICATIONS The respondent must be a registered investment advisor under the Investment Advisors Act of 1940, and shall have any other required licenses and registrations as required by law, if any. The successful respondent will be expected to share fiduciary responsibility for the Plan with the Town. Page 3 of 17
Respondents must meet the mandatory minimum qualifications in order to be considered and should have over $50 billion in assets under advisement. Key professionals must have a minimum of five (5) years experience in the following areas. 1. Management and investment consulting services to pension funds in the municipal sector that include investment policy, development and asset allocation. clients. 2. Identifying, evaluating and selecting money managers for municipal pension fund 3. Monitoring money managers in various asset classes and styles for municipal pension fund clients. The key professionals and organization must not have, nor could they potentially have, a material conflict of interest with the Town or the Investment Committee. E. SPECIFIC SERVICES Contractual services for pension investment consulting will include, but not be limited to the following. 1. Development of Investment Policy Objectives and Guidelines Assist the Town in the development and periodic review of policy statements that properly reflect the Town s tolerance for risk and that best help the Town meet its rate-of-return, funded status and administrative expense objectives. 2. Asset Allocation Studies Evaluate the Plan s current asset allocation and asset allocation guidelines to determine whether or not they are consistent with the Town s investment objectives and guidelines, as outlined by the Town s Investment Policy Statement (the IPS ). 3. Investment Manager Search/Recommendation When deemed necessary or appropriate, assist the Town in its due diligence and search for an investment manager or investment managers that conform to the investing objectives and guidelines, as outlined in the IPS. 4. Development of Investment Manager Performance Standards/Guidelines Assist the Town in the development and review of performance with which the Town can measure each investment manager. Page 4 of 17
5. Performance Measurement and Monitoring Assist the Town in developing and implementing appropriate benchmarks so that the Town can determine and evaluate investment management performance, overall progress toward meeting the Plan s investment objectives, and fees charged by service providers. 6. Monitor Compliance Provide written quarterly reports to the Investment Committee. Advise the Town of municipal pension best practices and make appropriate suggestions for adopting pertinent practices in line with current regulations. 7. Assist in Fund Diversification Assist the Town in the development of an investment management structure that provides adequate diversification with respect to the number and types of investment vehicles and managers to be utilized by the Plan. 8. Compliance Advise the Town on all federal and state law compliance requirements for the Plan. III. SUBMISSION OF QUALIFICATION STATEMENTS /FEE PROPOSALS A. Submission Requirements To achieve a uniform review process and obtain the maximum degree of comparability, it is required that the proposal be organized in the following manner. 1. Title Page. Please indicate the RFQ subject, the name of your organization, address, telephone number, name of contact person and date. 2. Table of Contents. Clearly identify the material by section and page number. 3. Letter of Interest. B. General 1. Briefly describe your organization s history, including information on year formed, assets under advisement, and ownership structure; include any parent, affiliates, or subsidiaries, and any business partners or joint ventures. Please note the location of the organization s headquarters and offices and provide an organizational chart. 2. Provide the address of your main corporate office and for any office(s) that will service the Town. Page 5 of 17
3. Is your organization a registered investment advisor with the SEC under the Investment Advisers Act of 1940? If so, include a copy of your Form ADV Parts 2A Brochure. 4. Provide a breakdown of organization s professional staff (i.e., consultants, research, investment analysts, etc.). 5. Provide a breakdown of your client base by type of institution (i.e., pension funds, endowments, and high net worth, and etc.). Provide by number and name. 6. Within the past three years, have there been any significant developments in your organization such as changes in ownership, restructuring, personnel reorganizations, terminations or investigations? 7. To the best of your knowledge, is the organization currently engaged in, or the subject of, discussions to change its ownership structure, organizational affiliation, or organizational placement? If yes, explain. 8. State what you believe distinguishes your organization from its competitors. C. Consultants 9. Describe your consulting philosophy ; that is, how you view your role as a consultant. 10. Please describe the role of the consultant(s) and support staff for this assignment. How are they organized to support the Plan? Provide a brief biography for the consultant(s) to include years of industry experience and years with your organization. 11. How are consultants compensated? D. Standards of Conduct and Ethics 12. Does your organization have a code of ethics or a set of standards for professional behavior? If so, how are they monitored and enforced? Please provide a copy. 13. For the past ten years, has the organization, its officers or principals or any affiliate ever been the focus of a non-routine Securities and Exchange Commission (SEC) inquiry or investigation or a similar inquiry or investigation from any similar federal, state or self-regulatory body or organization? If yes, please provide details and the current status of proceedings. Page 6 of 17
E. Conflicts of Interest 14. Does your organization offer or sell any services or products to investment managers? If so, identify these in detail and name every manager who purchased any such services or products (with hard or soft dollars) over the last five fiscal years. 15. Are there any potential conflict of interest issues your organization would have in servicing the Town? If so, describe them. 16. How does your organization identify and manage conflicts of interest? 17. Please confirm that your organization will not accept any commissions or other remuneration from any service providers in exchange for placing or renewing Town business with the service provider. 18. Does your organization solicit or accept any form of compensation (direct or indirect) from investment managers, custodial banks, or other service providers that are under contract with the foundations for whom you perform investment consulting services? If so, please explain. 19. Does your organization, affiliates, or parent company have any associations with investment management or other organizations that could present a conflict of interest and possibly compromise the objectivity of its advice to the Town? If so, please explain. F. Asset Allocation 20. Describe your organization s asset allocation process. 21. Describe how your organization develops asset class assumptions? 22. Explain your organization s position/approach on the use of active versus passive management in the major asset classes. 23. Describe your views on the use of alternative asset classes. How long have you been recommending alternatives? G. Investment Philosophy and Policy 24. Describe your organization s investment philosophy. 25. Describe your approach to the development of an investment policy statement. 26. Describe your rebalancing philosophy. 27. Describe your process for maintaining a continuous review of investment policies. Page 7 of 17
H. Investment Manager Searches / Database 28. Describe your organization s process for the evaluation and recommendation of investment managers. 29. Does your manager search include on-site due diligence? 30. Give an overview of your organization s approach and criteria for placing a manager on a watch list/probation. Under what conditions would you recommend the manager be removed from the watch list/probation or terminated? 31. Describe your ongoing manager monitoring. 32. Provide a breakdown of the number of funds and the amount of capital your organization has invested for clients in private equity, venture capital, private real estate, private credit, and hedge funds. 33. Does your organization maintain an in-house database of investment managers? If yes: (a) Describe how your organization gathers, verifies, updates, and maintains the data collected on managers for the database? (b) Do you use surveys or meetings with managers? (c) How many products are contained in the database(s) that you use? Provide a breakdown by asset class. (d) How often do you meet with the managers that are included in your database? What is the nature of those visits? (e) Do you charge investment managers direct or indirect fees to be included in your organization s database? If so, describe the fees. (f) Do you sell it to third parties? If so, how do you receive compensation for selling it? (g) If you use an outside vendor, please name and describe their database? Page 8 of 17
I. Performance Measurement, Evaluation, and Reporting 34. Please describe the organization s process for monitoring manager performance. 35. Discuss the performance attribution your organization is capable of providing. 36. Describe how benchmarks are chosen or developed. Describe your custom benchmark capabilities. 37. How often are performance reports produced and delivered? What is included in the report? Include a sample performance evaluation report. 38. Are reports customizable and available on-line? Is there any additional cost? J. Research 39. Describe the internal structure and organization of your research department. If no separate department exists, describe how this function is performed. How many professionals are dedicated to research? How does it interact with your consulting staff and our decision makers? 40. Describe the subject matter and frequency of research provided to clients. Provide a sample of any routine research you provide to clients. 41. Do you sell your research? K. References 1. List three similar clients to be used as references. For each reference, include name, contact person and title, address, telephone number, and the number of years the client has been with your organization. Name Contact information Yrs. w/ Firm L. Fees Page 9 of 17
1. Describe the proposed fee structure for all services described in this RFQ. Please note any minimum fee. If you also provide services a la carte (unbundled), please provide fee for the unbundled services you provide (i.e. manager searches, reports). 2. Describe any and all other fees or expenses, including, but not limited to, administration, reports, mailing, travel, and any other fee not previously mentioned. 3. If hired, will your organization receive any other form of compensation related to this account that has not yet been disclosed? If yes, explain. M. Form of Contract. Please include a proposed form of professional consulting services contract. The proposed form will be subject to review and approval by the Town s legal counsel. The proposed form shall not include a clause limiting the respondent s liability for negligent or willful acts or omissions or requiring the Town to indemnify the respondent. IV. METHOD OF SELECTION/CRITERIA FOR AWARD A. METHOD OF SELECTION The evaluation will be completed by a Selection Committee appointed by the First Selectwoman. The members of the Selection Committee shall, individually and collectively, evaluate each properly submitted qualification statement and proposal, and shall select a group of finalists. The Selection Committee may conduct initial interviews. Each finalist will be interviewed by the Selection Committee to determine, all factors considered, the most qualified and capable pension investment consulting firm with which to contract. While fee schedules will be discussed and considered during these interviews, fees alone will not drive the Selection Committee s decision. The Selection Committee s recommendation for the most qualified and capable respondent shall be presented to the Board of Selectmen for approval and for final negotiations by Board of Selectmen designated representatives to finalize the contract in conformance with the Town s requirements and subject to Town approvals and review by the Town attorney. The contract will not be deemed to be awarded until a written contract, in a form acceptable to the Town, has been fully executed by both parties. The Town reserves the right to reject any or all of the proposals, or parts thereof, and/or to waive any informality in any of the proposals if such rejection or waiver is deemed in the best interest of the Town. Neither the Selection Committee, nor the Town, nor any of their respective officers, directors, employees or authorized agents, as applicable, shall be liable for any claims or damages resulting from the evaluation, selection, non-selection or rejection of any proposal submitted in response to this RFQ. B. CRITERIA FOR AWARD Page 10 of 17
The following factors will be considered, but are not limited to, the following. 1. Accuracy, overall quality, thoroughness and responsiveness. 2. Municipal public sector experience of the firm and the key personnel to be assigned to the account. 3. Demonstrated long term consistent successful performance on other municipal and institutional accounts including flexibility, efficiency and timeliness in providing day to day service to municipal clients, implementation of initiatives, and cost saving measures as applicable. 4. Familiarity and experience with the management of investments for municipal and public pension plans along with overall service package. 5. Fee schedule. Page 11 of 17
V. TENTATIVE TIMELINE OF THE RFQ PROCESS RFQ and separate fee proposal envelopes due: Friday, January 11 th, 2019 Selection Committee review or proposals: Completed by February 8 th, 2019 Selection Committee interviews of finalists: Completed by March 1 st, 2019 Board of Selectmen award and notice to all firms: Monday, March 18 th, 2019 (Subject to successful contract negotiation) If any prospective respondent is in doubt as to the meaning of any portion of this RFQ, or finds any ambiguity, inconsistency, or omission in this RFQ, the prospective respondent shall make a written request for an official interpretation or correction. All inquiries relative to the specifications must be made in writing to Anne Kelly-Lenz, Chief Financial Officer at anne.kellylenz@wiltonct.org on or before Friday January 4 th, 2019. Answers to questions will be addressed in an addendum which will be issued by the Town and posted on the Town website as well as the State Department of Administrative Services procurement website. It shall be the responsibility of the respondent to download each addendum. The Town has no obligation to mail addenda to prospective respondents. Respondents are directed not to contact individual Town officials regarding this RFQ. All correspondence and communications regarding this RFQ must be directed to the Chief Financial Officer. VI. GENERAL TERMS AND CONDITIONS A. TERMS AND CONDITIONS A prospective respondent must be willing to adhere to the terms and conditions of this request, including the following. 1. Ownership of Documents. All qualification statements submitted in response to this RFQ are to be the sole property of the Town and subject to the provisions of Section 1-200 et seq. of the Connecticut General Statutes (re: Freedom of Information). 2. Ownership of Subsequent Products. Any product, whether acceptable or unacceptable, developed under a contract awarded as a result of this RFQ is to be the sole property of the Town unless stated otherwise in the RFQ or contract. 3. Timing and Sequence. Timing and sequence of events resulting from this RFQ will ultimately be determined by the Town and the Selection Committee. 4. Oral Agreements. The Selection Committee and the Town will not be responsible for any alleged oral agreement or arrangement made by a respondent with any agency or employee. Page 12 of 17
5. Amending or Canceling Requests. The Town reserves the right to amend or cancel this RFQ prior to the due date and time, if it is in the best interest of the Town to do so. 6. Rejection for Default or Misrepresentation. The Town reserves the right to reject the proposal of any respondent that is in default of any prior contract or for misrepresentation. 7. Clerical Error. The Town reserves the right to correct inaccurate awards resulting from its clerical error. 8. Rejection of Qualification Statements. Qualification statements are subject to rejection in whole or in part if they limit or modify any of the terms and conditions and/or specifications of the RFQ. 9. Changes to Qualification Statements. No additions or changes to the original qualification statement will be allowed after submittal. 10. No Improper Benefit. No member, officer or employee of the Town, or member of a local public agency having jurisdiction within the Town, during his or her tenure or one year thereafter, shall be permitted to share in, have interest in or benefit from, directly or indirectly, any contract or agreement resulting from this RFQ. 11. Rights Reserved to the Town. The Town reserves the right to award in part, to reject any and all qualification statements in whole or in part, to waive technical defects, irregularities and omissions if, in its judgment, the best interests of the Town will be served. 12. Withdrawal of Qualification Statements. Negligence on the part of the respondent in preparing the qualification statement confers no right of withdrawal after the time fixed for the acceptance of the qualification statement. 13. Cost of Preparing Qualification/Proposal Statements. The Town shall not be responsible for any expenses incurred by the organization in preparing and submitting a qualification statement. All qualification statements shall provide a straightforward, concise delineation of the firm s capabilities to satisfy the requirements of this request. Emphasis should be on completeness and clarity of content. B. INSURANCE REQUIREMENTS 1. General Requirements The awarded respondent shall be responsible for maintaining insurance coverage in force for the duration of the contract of the kinds and amounts listed below, with an insurance company with an AM Best Rating of A-, VIII or better licensed to write such insurance in the State of Connecticut and acceptable to the Town. The insurer shall provide the Town with a Certificate of Insurance, on a form acceptable to the Town, signed by an authorized representative of the insurance company prior to the commencement of performance of this contract describing the coverage and providing that the Page 13 of 17
insurer shall give the Town written notice of at least thirty (30) days in advance of any termination, expiration, or any and all changes in coverage. Such insurance or renewals or replacements thereof shall remain in force during the respondent s responsibility under the contract. The respondent, at the respondent s own cost and expense, shall procure and maintain all insurances required and shall include the Town as Additional Insured s on all insurance coverage, except Workers Compensation coverage. The Certificate of Insurance shall evidence all required insurance, including Additional Insured and Waivers of Subrogation. 2. Specific Requirements a) Workers Compensation Insurance. The awarded respondent shall carry workers compensation insurance in accordance with the requirements of the laws of the State of Connecticut, and employer s liability limits of Five Hundred Thousand Dollars ($500,000.00) coverage for each accident, Five Hundred Thousand Dollars ($500,000.00) coverage for each employee by disease, Five Hundred Thousand ($500,000.00) policy limit coverage for disease. b) Commercial General Liability. With respect to all operations which awarded respondent performs, it shall carry Commercial General Liability insurance providing for a total limit of One Million Dollars ($1,000,000.00) per occurrence for all damages arising out of bodily injury, personal injury, property damage, products/completed operations, and contractual liability coverage for the indemnification obligations arising under the contract. The aggregate limit shall not be less than Two Million Dollars ($2,000,000.00). The limit may be provided through a combination of primary and umbrella/excess liability policies acceptable to the Town. Blanket Contractual Liability for liability assumed under this Agreement and all other Contracts relative to the Project. c) Automobile Liability. With respect to each owned, non-owned, or hired vehicles, the awarded Respondent shall carry Automobile Liability insurance providing One Million Dollars ($1,000,000.00). d) Excess Liability Coverage. Excess liability insurance will be provided in an amount not less than Five Million Dollars ($5,000,000.00) per occurrence and annual aggregate basis. e) Deductibles and Self-Insured Retentions. Any deductible or self-insured retention must be declared to and approved by the Town. f) Errors and Omissions Insurance The awarded respondent shall provide and maintain Errors and Omissions Insurance with minimum limits of $2,000,000 per occurrence/annual aggregate. The policy shall not have a deductible greater than $50,000.00. Coverage shall be maintained in effect continuously for a period of at least six (6) years from the date of conclusion of the respondent s services under the contract. Page 14 of 17
NON-COLLUSION / NON-CONFLICT AFFIDAVIT PENSION INVESTMENT CONSULTANT The undersigned, having fully informed him/herself regarding the accuracy of the statements made herein certifies as follows. 1. The qualification statement and fee proposal have been arrived at by the respondent independently and have been submitted without collusion with, and without any agreement, understanding, or planned common course of action with any other vendor of materials, supplies, equipment, or services described in the RFQ, designed to limit independent bidding or competition. 2. The contents of the qualification statement and fee proposal have not been communicated by the respondent and its employees or agents to any person not an employee or agent of the respondent and will not be communicated to any such person prior to the official opening of the proposals. 3. No Selectman or other officer or employee or person whose salary is payable in whole or in part from the Town of Wilton, nor any immediate family member thereof, is directly or indirectly interested in the proposal, or in the supplies, materials, equipment, work or labor to which it relates, or in any profits thereof. The undersigned further certifies that this statement is executed for the purpose of inducing the Town of Wilton to consider the proposal and make an award in accordance therewith. Legal Name of Respondent: Business Name: Business Address: Signature and Title of Person Subscribed and sworn to me, 20. this day of Notary Public My Commission Expires Date Page 15 of 17
III. FEE PROPOSAL FORM PENSION INVESTMENT CONSULTANT RFQ DUE: Friday, January 11 th, 2019 by 2:00 p.m. To: Chief Financial Officer Town of Wilton 238 Danbury Road Wilton, CT 06897 RESPONDENT Company Name: Address: Telephone: E-mail: Contact Person: Fax: Title: We submit for your consideration our RFQ #. We have read the RFQ documents and are submitting our bid in full compliance with all terms and conditions except as noted below under Exceptions. We acknowledge receipt of all addendums to the bid documents and assume full responsibility to access those addendums from the Town website and/or DAS website, as applicable. Upon notification of the award, we will provide the following within five (5) business days after receipt of such notice: (i) the requested Certificate of Insurance from the following company: ; and (ii) two original contracts, in a form provided by the Town, executed by authorized officer of awarded respondent. Page 16 of 17
FEE PROPOSAL FORM CONTINUED PENSION INVESTMENT CONSULTANT 1. Please indicate your fee schedule for investment performance analysis services, asset allocation, investment policy, manager search, custodial search, custodial services, etc. 2. Would you charge separately for travel expenses? If so, explain in detail your policy. 3. What other costs or expenses might we incur with your firm? 4. Please describe how you determine consulting fees due, how such payments are made and the periodicity thereof. Exceptions: The undersigned authorized representative hereby submits the above fee proposal to the Town of Wilton. Name of Entity: By Print Name and Title: Duly authorized Page 17 of 17