Presolicitation Notice – Mutual Fund Window (MFW)

Notice Type: Presolicitation Notice

Posted Date: 24-DEC-13

Office Address: Federal Retirement Thrift Investment Board; Office of Financial Service; Office of Financial Service-Procurement and Contracts; 77 K Street NE, Suite 10000 Washington DC 20002</p>

Subject: Mutual Fund Window (MFW)

Classification Code: R - Professional, administrative, and management support services

Solicitation Number: TIB-2014-RFN-0004

Contact: Timothy B. Costas, Phone 2029421689, Email [email protected] - Pamela Davis, Contracting Officer, Phone 2026394434, Email [email protected]

Description: Federal Retirement Thrift Investment Board

Office of Financial Service

Office of Financial Service-Procurement and Contracts

Federal Retirement Thrift Investment Board Request for Information

Mutual Fund Window

A. General

The Federal Retirement Thrift Investment Board (Agency or FRTIB) is using this RFI to solicit information on establishing a Mutual Fund Window (MFW) in the Thrift Savings Plan (TSP).

The work is required to be performed in the continental U.S. This RFI is issued solely for information and planning purposes. It does not constitute a Request for Proposal (RFP) or a promise to issue an RFP in the future. This request for information does not commit the FRTIB to contract whatsoever. Further, the FRTIB is not at this time seeking proposals and will not accept unsolicited proposals. Respondents are advised that the FRTIB will not pay for any information or administrative costs incurred in response to this RFI; all costs associated with responding to this RFI will be solely at the interested party's expense. Not responding to this RFI does not preclude participation in any future RFP. If a solicitation is released, it will be synopsized on the Federal Business Opportunities website. Any information that the respondent considers proprietary should be clearly marked as such. All submissions become Agency property and will not be returned, including any proprietary information.

Following a review of the responses received, FRTIB may elect to request additional information, or schedule one-on-one meetings with some respondents to gain additional information about their proposed solution(s). Respondents will not be notified of the results of the review.

B. Background

The FRTIB is an independent Federal agency in the Executive Branch created by the Federal Employees' Retirement System Act of 1986. The TSP is a retirement savings and investment plan for Federal civilian employees and members of the uniformed ser-vices that offers its participants the same type of savings and tax benefits that many pri-vate corporations offer their employees under I.R.C. [Section]401(k) plans. The mission of the FRTIB is to administer the TSP solely in the interest of participants and beneficiaries. The Federal Acquisition Regulations (FAR) informs the Agency's procurement activities; however, as a non-appropriated fund Agency, it is not bound by the FAR. The TSP is the largest participant-directed defined contribution plan in the world. The TSP's 4.6 million participants can make tax-deferred and Roth contributions to the Plan. Currently, participants can invest their employee and employer contributions in five indexed funds and five lifecycle funds, with current assets worth approximately $375 billion. The TSP is available only to Federal employees of the civilian service and members of the uniformed services; vested participants may leave their funds in the TSP after they leave service.

A mutual fund window option is not currently available to TSP participants. Information obtained from this RFI will allow the FRTIB to identify and assess the costs, risks, re-wards, and other relevant factors associated with a mutual fund window and will inform its decision on whether or not a mutual fund option is offered to TSP participants.

C. RFI Questions

Respondent organizations are requested to provide the following general information and answer all listed questions. Please limit your response to a maximum of 20 pages. This maximum excludes cover and separator pages, and any exhibits.

General Information

1. Provide the following information regarding your company: a. Company name, address, and telephone. b. Name, title, mailing address, telephone number, fax number, and e-mail ad-dress of contact person for this RFI. c. Company website(s) 2. State the number of defined contribution plans with self-directed brokerage ac-counts (SDBA) or mutual fund windows that you currently administer or service in the following categories:

Plan Size Number of Plans (# of participants) Public Sector Private Sector SDBA MFW SDBA MFW 9,999 or less 10,000 - 49,999 50,000 or more Total

3. Provide the average utilization percentage among your clients after the first year of MFW implementation.

MFW Design

4. Describe how the mutual fund window operates. Include settlement timing, broker-dealer relationships, and custodial arrangements in the description. Provide a diagram of data and cash flows. 5. Describe any partnerships you have with other companies in order to operate the MFW. 6. Describe the participant-level account data you can provide to the plan sponsor, the frequency and timing of transmissions, and the methods of transmission avail-able. 7. Can you comment on your experience and cost associated with integrating with SunGard OmniPlus Do you require the establishment of specific fund numbers in OMNI to identify the funds in the MFW

Implementation

8. Describe implementation requirements and processes (including testing). 9. What is the typical timeframe between contract award and implementation of the MFW

Costs

10. Complete the following table with TSP cost estimates for each item. A cost range is acceptable. Base your estimates on utilization by 2% of the 4.6 million TSP participants and on an average account balance of $100,000.

Plan Participant Investment Advice MFW Implementation $ Access fees (include $ Plan Fees $ frequency) MFW Maintenance $ Transaction fees $ Participants $ (include types) Other (describe) $ (Other (describe) $ Other (describe) $

11. Describe any factors that may influence the range of implementation costs. 12. Describe any "per participant" fees you typically charge. Are the fees typically a flat fee per participant, an asset-based fee, or an asset-based fee that is capped 13. Describe how 12b-1 fees, sub-transfer agent fees, etc. are handled at the plan and participant levels 14. Describe any costs associated with the transferring of records if the MFW contract is not re-awarded to the incumbent. 15. Can revenue from the mutual fund window help the Plan offset the costs of the window If yes, what typically occurs

Investment Management

16. Provide the total number of mutual funds on your platform. Describe the variety of funds. 17. Can the plan sponsor select specific funds from the available lineup 18. Can you restrict access to non-mutual fund options, e.g., individual stocks 19. What trading platforms do you use How do you determine which trading platform to use 20. What factors determine the share class you typically propose 21. What are your required minimums for institutional shares 22. What is the minimum dollar amount required for participants to access the MFW 23. Are there limits on the number of participant investment trades 24. Do you offer any funds that are not valued daily How is trading in these funds handled 25. Describe any other restrictions.

Recordkeeping

26. Are employer and employee contributions tracked separately Do you have the ca-pability to provide separate accounting for traditional, Roth, and tax-exempt balanc-es Are catch-up contributions tracked separately Do you track the Roth five-year non-exclusion period 27. Describe how participant-initiated withdrawals and plan-initiated withdrawals are handled. 28. Can retired/separated participants retain funds in the window 29. Do you have a process in place for closing or exchanging accounts with low bal-ances Describe the process, including plan and participant notifications as well as the process timing. 30. Describe how you would address and process administrative errors. How do you handle claims for restitution by participants or the plan sponsor in the event of fraud or error

Participant Services

31. Describe your initial and on-going communication materials (i.e., initial brochures, statements, participant confirmations). Can these materials be tailored to specific plan sponsor needs and brand Please provide samples of 1 printed product and 1 web screen. 32. Do you send marketing materials directly to participants If so, please describe the circumstances and frequency (e.g., when participants are nearing retirement, etc.). Can the plan sponsor prohibit the distribution of these materials 33. Do you offer investment advice 34. Can the MFW site be branded with the plan sponsor's design so that the transition from the sponsor site to the MFW site appears seamless 35. For participant statements, do you typically work with plan sponsor systems to in-tegrate MFW information directly into existing statements, or do you create sepa-rate MFW statements to use as inserts For the latter, can these inserts be brand-ed so that they are similar to a plan's existing materials, and do you mail them di-rectly to participants 36. Do you offer a toll-free voice response system (VRS) and/or customer call center What transactions can participants make over the phone

Legal

37. Describe insurance coverage (e.g., fiduciary, errors and omissions, indemnifica-tion, etc.) you carry for services you deliver to retirement plans. 38. What fiduciary responsibilities does your organization assume 39. How do you ensure that the selection of investment options complies with applicable laws governing employee benefit plans 40. How do you handle fee disclosure requirements

Information Assurance/Risk Management

41. What internal controls do you have in place to ensure transaction and participant account data accuracy and integrity 42. Describe how data is secured within the MFW and during transit between the MFW and the Plan. 43. Do plan sponsors have access to a footprint of participant transactions as a record for any disputed transactions

Other

44. Please describe any factors that should be considered but have not been specifi-cally identified in the RFI.

D. Submission

1. This information is due no later than January 31, 2014, close of business. Please email responses to: [email protected]. In the subject line insert: TIB-2014-RFN-0004, Mutual Fund Window/Attn: Mr. Tim Costas. All questions shall be directed to the primary POC.

Link/URL: https://www.fbo.gov/spg/FRTIB/OA/WashingtonDC/TIB-2014-RFN-0004/listing.html