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Finance and Management Services <br />www.santa-ana.org/finance <br />Item # 19 <br />City of Santa Ana <br />20 Civic Center Plaza, Santa Ana, CA 92701 <br /> Staff Report <br />September 19, 2023 <br />TOPIC: 457 Deferred Compensation Plan <br />AGENDA TITLE <br />Approve an Agreement with Empower Annuity Insurance Company for Administrative, <br />Recordkeeping, and Communication Services Pertaining to the 457 Deferred <br />Compensation Plan <br />RECOMMENDED ACTION <br />Authorize the City Manager to execute a Restated Master Services Agreement with <br />Empower Annuity Insurance Company for the administrative, recordkeeping, and <br />communication services ("services") pertaining to the 457 Deferred Compensation Plan <br />for a three-year term beginning October 1, 2023 through September 30, 2026, with a <br />provision for a single two-year extension, subject to non-substantive changes approved <br />by the City Manager and the City Attorney. <br />DISCUSSION <br />The City of Santa Ana offers full-time employees a 457 Deferred Compensation Plan <br />("plan" or "457 plan"), which was established in 1973, with the adoption of City <br />Resolution 7-21, along with a corresponding US Internal Revenue Service approval. <br />The 457 Deferred Compensation Plan is a voluntary supplemental retirement savings <br />program that allows employees to make contributions on a pre-tax basis. Each calendar <br />year, employees can choose to contribute to the Plan up to an amount established by <br />the Internal Revenue Service. Other than the amounts pursuant to Council-appointee <br />contracts, the City does not contribute any funds to the plan. <br />Currently, the 457 Deferred Compensation Plan is administered through the Finance & <br />Management Services Agency with advisory contributions from Human Resources. <br />Management of the plan includes quarterly performance review of investments, <br />analyzing the Plan's fund options, maintaining and revising the Plan's Investment Policy <br />Statement as necessary, and ensuring the Plan's cost effectiveness. <br />The City utilizes an independent fiduciary firm, Benefits Financial Services Group <br />("BFSG") to assist in reviewing investments, compliance, and fund selection. BFSG <br />assisted the City in the development of the Request for Proposal (RFP) and evaluation <br />of the pricing structure of proposals.