Attachment_H_-_City's_Current_Fee_Schedule_for_City_Investment_Portfolio.pdf
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- Attached to
- Investment Advisory Services | Package A: City Investment Portfolio | Package B: Section 115 Trust
- Solicitation number
- 26-262
- Issued by
- Santa Clara County, California
About this file
This is a fee schedule attachment for investment advisory services provided by Chandler Asset Management to the City of Milpitas, California. The City of Milpitas is soliciting comprehensive investment advisory services for two separate packages: the City Investment Portfolio (Package A) and a Section 115 Retirement Trust (Package B), with proposals due September 24, 2026 at 12:00 p.m. Pacific Time and questions due September 3, 2026. Package A covers review, analysis, reporting, and portfolio management of the City's investment portfolio in accordance with the City's Adopted Investment Policy, commencing January 1, 2027 for an initial five-year term with two one-year renewal options available at the City's discretion, potentially extending the contract to seven years. Package B provides Section 115 Trust investment and administrative services with an April 1, 2027 start date under identical terms. The City's current General Portfolio comprises approximately $378.4 million in assets, with the Section 115 Trust Portfolio holding $46.0 million in market value.
The compensation structure is a tiered, all-inclusive fee based on Average Assets Under Management with no separate one-time fees, covering full-time investment management, technological resources, onboarding, reporting, staff education, and treasury management support. The proposed fee schedule applies 8 basis points on the first $50 million, 6 basis points on the next $75 million, 4 basis points on the next $125 million, and 3 basis points on assets exceeding $250 million, with fees calculated monthly in arrears on market value including accrued interest and deducted directly from the City's custodial account. Pricing is firm for the entire five-year term with no increases, no expense ratios, and no termination-related fees. For Year 1 through Year 5, estimated annual contract amounts range from $150,000 to $166,000 based on projected assets under management of $300 million to $354 million, with a total five-year contract value of $790,000. Incumbent Chandler Asset Management currently manages the City Investment Portfolio, while PFM Asset Management currently manages the Section 115 Trust Portfolio. Final contract awards require City Council approval and successful negotiation of terms based on the City's standard agreement form.
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Text version
EXHIBIT B
Schedule of Charges/Payments
Consultant will invoice City on a monthly cycle. Consultant will include with each invoice a detailed progress report that indicates the amount of budget spent on each task. Consultant will inform City regarding any out-of-scope work being performed by Consultant. This is a time-and-materials Agreement.
PROPOSED COMPENSATION
1. There are no separate or one-time fees associated with the investment management and advisory services provided. Consultants proposed fee schedule is all-inclusive for the services to be provided, including:
a. full time investment management,
b. technological resources,
c. onboarding and implementation,
d. online access to the Chandler Client Portal,
e. comprehensive reporting, meetings, personal visits,
f. and educational offerings for City staff,
g. as well as the treasury management support services described in the scope of services.
Consultants fee schedule does not include charges that the City would incur for third party custodial services.
Consultant does not charge fees on funds held in vehicles not directly under their management, including Local
Government Investment Pools and internally managed liquid funds; however, Consultant is able to consolidate these funds in City reports.
2. The fee proposal based on Average Assets Under Management by tiers with a breakdown of fees will be:
Proposed Fee Schedule for City of Milpitas
Assets Under Management Annual Asset Management Fee
First $50 million 0.08 of 1% (8 basis points)
Next $75 million 0.06 of 1% (6 basis points)
Next $125 million 0.04 of 1% (4 basis points)
Assets over $250 million 0.03 of 1% (3 basis points)
The Consultant calculates fees based on the average balance of assets under their direct management (market value including accrued interest), they will fluctuate based on portfolio value. Fees are charged monthly in arrears and can be debited directly from the City’s third-party custody account. Pricing is firm for the entire five-year term of the agreement, and the City will not be subject to any increases during this period.
3. There are no expense ratios of funds/portfolios.
4. There are no fees related to the transfer of assets and restrictions or costs related to termination of this contract.
Contract Year Assets Under Management
Estimated Annual Contract Amount
Year 1 $ 300 million $150,000
DocuSign Envelope ID: 00A72D24-20FA-408B-B1B3-63ECB960C18F
Attachment H - City's Current Fee Schedule for City Investment Portfolio
Year 2 $ 313 million $154,000
Year 3 $ 326 million $158,000
Year 4 $ 340 million $162,000
Year 5 $ 354 million $166,000
Total Five-Year Contract Amount $790,000
DocuSign Envelope ID: 00A72D24-20FA-408B-B1B3-63ECB960C18F
File details come from the government source that posted it. Updated .