The vendor required to provide pension and non-pension investment consultant services for manages three separate defined benefit pension plans (general employees, police, and fire) as a single account with differing benefit characteristics, a deferred compensation plan that is open to all employees, and an internal operating account.
- These quarterly performance reports include an overview of the economic and financial results of various asset classes for the recently completed quarter as well as a review of the consolidated performance of the pension fund.
- The report includes an analysis of the investment performance of each manager within the DB plan, the DC plan, and the operating portfolio, including comparisons with appropriate benchmarks for each manager.
- The consultant will also recommend whether a money manager should be replaced and conducts searches for any money manager that is replaced or a money manager for a new investment mandate.
- The city typically undertakes an asset allocation study of the defined benefit plan every three to five years to determine an optimal investment mix given an appropriate level of risk.
- The consultant will provide asset allocation scenario metrics as requested.
- The consultant will conduct investment manager searches to replace any managers or add new managers as needed.
- Pension plan
• The city provides a defined benefit pension plan for its employees, with distinct plans each for general employees, police officers and firefighters.
• To ensure that assets are sufficient to pay current and future benefits, annual required contributions (arc) are made to the plan.
• The one-year assumed rate of return on investments decreased from 7.75% to 7.25% over several years with the 7.25% rate effective for fy2024.
• The overall funding ratio for the city’s pension plan was 89.5 on October 1, 2024.
• The overall ratio reflects funding at 91.9%, 85.2%, and 84.8% for general, police, and fire, respectively.
• The table below illustrates the city’s actual pension returns as of June 30, 2025.
- DC plan
• The DC plan consists of the following sub-plans: matched annuity plan (map, general employees only), Defra match (city’s allocation for funds invested for employee match at retirement), deferred retirement option plan (drop, all employees), and the rsvp plan (all employees).
• The total value of each of the plans as of march 31, 2025, is as follows:
o Map - $825 million
o Defra - $190 million
o Drop - $65 million
o Rsvp (general employees) - $115 million
o 185 plan (police) - $29 million
o 175 plan (fire) - $20 million
- Operating portfolio
• The city’s operating portfolio includes operating funds, reserves (e.g., electric operating and fleet reserves,) and RR&I funds for the various departments.
• Treasury management invests the city’s operating funds in accordance with the city commission non-pension investment policy (cp 234); the policy allows both internal and external management of funds and focuses on the safety of principal as its primary goal with liquidity and return specified as additional objectives.
• To meet these objectives, the division monitors the city’s internally and externally managed accounts to seek market returns, based on a reasonable amount of risk, while prioritizing safety and liquidity.
• The operating portfolio had a market value of $990 million as of June 30, 2025.
• The following two tables detail the breakdown of the internally managed funds and the externally managed funds.
- Budget: $2.4 billion
- Contract Period/Term: 5 years
- Questions/Inquires Deadline: January 21, 2026
