HomeMy WebLinkAbout457 Deferred Compensation Plan
RECEIVED
APR - 4.2003
INTEROFFICE MEMO
~Meridian
ark Office
DATE:
April 1,2003
TO:
City Council
FROM:
Benefits Committee
RE:
457 Plans
CC:
Keith Bird, Tammy DeWeerd, Cherie McCandless, William Nary, Robert Corrie
The benefits committee has looked into the cost to have a plan administrator manage the
457 deferred compensation program. The City looked at three (3) vendors, one did not
administer governmental plans, one did not respond and one submitted their fees.
After reviewing the information the committee was in agreement that it would not be cost
effective to have a plan administrator and is recommending the following changes.
1. Utilize two investment firms. Revise the current resolution adding Waddell Reed and
Valic as the City's investment firms.
2. Employees in American Funds through Smith Barney would have to roll over their
accounts into Waddell Reeds or V alic' s plan. No penalties are involved.
3. The Mayor would need to sign an adoption agreement with Waddell Reed to bring
their plan in compliance with the IRS regulations. The agreement on file is outdated
and does not include recent law changes. An agreement with Valic is already in place.
4. Have Waddell Reed & Valic meet with those employees's participating in American
Funds to explain the roll over and differences in investments between the two plans.
Employees will then be given the option to participant in Waddell Reed's or Valic's
plan.
5. Have Waddell Reed and Valic give group presentations to City employees who are
interested in participating in a 457 plan.
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FINANCE DIRECTOR
MAYOR
ROBERT D. CORRIE
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JANln SMITH
RET A CUNNINGHAM
CATHY DENNISON
BARBAR.^ IImll.ER
TERRY PATERNOSTER
COUNCIL MEMBERS
WILLIAM LM. NARY
KEITH BIRD
TAMMY DE WEERD
CHERIE MCCANDLESS
lí11411ce 'De]Ja~tment
JJ East Idaho
Meridian, ID 8]642
(208) 888-4433
Fax (208) 887.4813
March 12,2003
To: Deferred Compensation Committee
From: Janice Smith
RE: 457 Plan Service Fees - Pinnacle Pension Services
Pinnacle Pension Services - see attached response to fee charges.
Summary of Fees that would apply to the City
Base fee: $1,400, plus participant fees and hourly fees.
Annual Statements $40
Quarterly Statements $60
Basis Points on Assets: 20 Basis Points if less than $1 Million in assets
Enrollment services: $120 per hour
Rollover accounts: $15/ participant
Individually directed acct. $50/ participant
Benefit Distributions-
Per Terminated Participant $85
Participant Loans Set-up $150
(May be paid by participant)
Miscellaneous:
Response to requests for information from auditors, correspondence with IRS, etc. will be
billed hourly. Minimum audit charge is $500.
If transmittal of employee data to Pinnacle is not in computer entry ready format,
additional charges will be billed on an hourly basis and will be at least $1 per participant.