Exhibit 2 - Investment Lineup Information and Related Fees.xlsx
XLSX spreadsheet 42 KB Posted
- Attached to
- DMS-2425-199, (SUSORP and SMSOAP)
- Solicitation number
- ITN-12499
- Issued by
- Alachua County, Graceville City, Florida
About this file
This is an Exhibit 2 Investment Lineup Information document from the Florida Department of Management Services detailing investment options for state-sponsored retirement plans. The document provides comprehensive instructions for proposing mutual fund and annuity investment lineups, with specific requirements for fund selection, including a maximum of 13 mutual funds (excluding target date funds) and 10 annuity funds. The preferred lineup includes various asset classes such as stable principal, bond indexes, stock indexes, and target date funds, with Vanguard and other recognized fund providers represented.
The document outlines detailed fee and performance criteria, including a requirement that annuity fees must be less than one basis point for Mortality & Expense (M&E) charges, and any revenue sharing must be rebated back to participants. The State Board of Administration (SBA) will review proposed investment products using specific qualifying criteria, including a minimum 3-year historical performance, portfolio manager tenure, total return comparisons, and fee assessments. Vendors proposing substitute funds must provide comprehensive information about fund names, tickers, expense ratios, and revenue sharing amounts, with the understanding that the Department of Management Services will make the final determination on approved investment products.
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Instructions
| Client Name: | Florida Department of Management Services | |
| Vendor Name: | 91 | |
| Instructions for Exhibit 2 - Investment Line-up Information and Investment-Related Fees. Also see ITN Section 3.5.8.2 for additional requirements. | ||
| 1) | Please fill in the appropriate information in the three following tabs: (1) "Mutual Fund line-up", (2) "Annuity line-up", and (3) "Annuity line-up Performance" | |
| Complete Tab 1, Tab 2, and Tab 3 |
| 2) | Tab 1 - Mutual Fund line-up Instructions: |
| The Department expects the preferred line-up to be accommodated; however, substitutes are permitted if a preferred option is not available on the platform. It is expected that the lowest-cost institutionally priced (or lowest available) share class be proposed for any substitute. SEE NOTE BELOW regarding SBA review of proposed options. |
| If proposing a substitute for any of the preferred options, please include all information asked for ((Fund Name, Fund Ticker, Expense Ratio, and Revenue Sharing Amount (if any) on Proposed Platform)) |
| No more than 13 total funds may be proposed, excluding target date funds. |
| For Respondents that are current Contractors: Any mutual fund that has been previously offered and has any balance as of the date of reply submission should be disclosed as a Proposed Substitute on the lines below Target Date Funds. |
| 3) | Tab 2 - Annuity line-up Instructions: |
| Only fill out information in light blue shaded boxes SEE NOTE BELOW regarding SBA review of proposed options. |
| Fill out table with preferred asset classes. Any annuity proposal is not required to be offered in every asset class, however: |
| Must include at least the following four asset classes: (1) Capital Preservation/ Short-term, (2) Fixed Income, (3) US Equity, and (4) Non-US Equity |
| No more than 10 total funds may be proposed. |
| For Respondents that are current Contractors: Any annuity that has been previously offered and has any balance as of the date of reply submission should be disclosed on the lines indicated. |
| 4) | Tab 3 - Annuity Performance Instructions: |
| Please supply monthly returns for the last ten years NET OF ALL FEES (including investment management, M&E charges and any other fees) for each annuity product proposed (variable and fixed account) | |
| Enter fund name in blue shaded box | |
| NOTE: If a Respondent proposes a substitute mutual fund product and/or an annuity product line-up (for the SMSOAP and SUSORP) and has been awarded a contract by the Department, the SBA shall review all substitute investment products before the product may be offered to Member. The review will undertaken utilizing the SBA Criteria contained on Tab 4. and the vendor will incur all costs associated with the SBA’s review, inlcuding but not lmited to $250 for the review of each proposed product. The Department shall make the final determination as to whether an investment product will be approved for the program. |
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TAB 1 - MUTUAL FUND LINE-UP
| Florida Department of Management Services |
| Exhibit 2 - Investment Line-up Information and Investment Related Fees |
| MUTUAL FUND LINE-UP (No Annuity Substitutes Permitted; Substitutes MUST be mutual funds) | |
| The Department expects the preferred line-up to be accommodated; however, substitutes are permitted if a preferred option is not available on the platform. It is expected that the lowest-cost institutionally priced (or lowest available) share class be proposed for any substitute. | |
| Instructions: | |
| (a) | Only fill out information in light blue shaded boxes |
| (b) | Please provide revenue sharing amounts, if any, available on the proposed platform for the Preferred Line-up |
| (c) | If proposing a substitute for any of the preferred options, please include all information asked for (Fund Name, Fund Ticker, Expense Ratio, and Revenue Sharing Amount (if any)). You may propose only one substitution for each asset class, for a maximum of 13 products, not including target date funds. Per Pass/Fail Certification, substitutes MUST be mutual funds (i.e., no fixed interest annuity, or any other annuity product, may be substituted). |
| Asset Class | Preferred Lineup | Vendor Proposed Mutual Fund Substitute or Current | ||||
| Mutual Fund Name | Fund Ticker | Expense Ratio | Mutual Fund Name | Fund Ticker | Expense Ratio | |
| Stable Principal - Money Market | Vanguard Treasury Money Market | VUSXX | 0.07% | |||
| Bond - Index | Vanguard Total Bond Market Index Fund | VBTIX | 0.03% | |||
| Bond - Short Term | Baird Short-Term Bond | BSBIX | 0.30% | |||
| Bond - Government | DFA Inflation-Protected Securities | DIPSX | 0.11% | |||
| Bond - Intermediate | DFA Diversified Fixed Income | DFXIX | 0.15% | |||
| Stock - Index | Vanguard Total Stock Market Index Fund | VITSX | 0.03% | |||
| Stock - Value Index | Vanguard Value Index | VVIAX | 0.05% | |||
| Stock - International Index | Vanguard Total International Stock Index | VTSNX | 0.08% | |||
| Stock - Large Growth | JP Morgan Large Cap Growth Fund | JLGMX | 0.44% | |||
| Stock - Large Blend | State Street U.S. Equity | SUSIX | 0.39% | |||
| Stock - Mid Cap | Vanguard U.S. Multifactor Funds | VFMFX | 0.18% | |||
| Stock - Small Cap | DFA U.S. Small Cap | DFSTX | 0.27% | |||
| Stock - Emerging Markets Equity | DFA Emerging Markets Core Equity | DFCEX | 0.40% | |||
| Stock - Real Estate | DFA Real Estate Securities Portfolio | DFREX | 0.18% | |||
| Target Date Fund | Vanguard Target Retirement Income | VTINX | 0.08% | |||
| Target Date Fund | Vanguard Target Retirement 2030 | VTHRX | 0.08% | |||
| Target Date Fund | Vanguard Target Retirement 2035 | VTTHX | 0.08% | |||
| Target Date Fund | Vanguard Target Retirement 2040 | VFORX | 0.08% | |||
| Target Date Fund | Vanguard Target Retirement 2045 | VTIVX | 0.08% | |||
| Target Date Fund | Vanguard Target Retirement 2050 | VFIFX | 0.08% | |||
| Target Date Fund | Vanguard Target Retirement 2055 | VFFVX | 0.08% | |||
| Target Date Fund | Vanguard Target Retirement 2060 | VTTSX | 0.08% | |||
| Target Date Fund | Vanguard Target Retirement 2065 | VLXVX | 0.08% | |||
| Target Date Fund | Vanguard Target Retirement 2070 | VSVNX | 0.08% | |||
| <Current Contractor fund Asset Class> | ||||||
| <Current Contractor fund Asset Class> | ||||||
| <Current Contractor fund Asset Class> | ||||||
| <Current Contractor fund Asset Class> |
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TAB 2 - ANNUITY LINE-UP
| Florida Department of Management Services |
| Exhibit 2 - Investment Line-up Information and Investment Related Fees |
| Preferred Annuity Asset Classes | Vendor Proposed Annuity Strategies | ||||||
| Proposed Fund Name | Benchmark | Annuity Fee1 | Mortality & Expense Fees (M&E)2 | Total Fee3 | Revenue Sharing Amount (if any) 4 | Total Net of Revenue Sharing Fee5 |
| 1 | Capital Preservation/Short-term | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 2 | Bond - Intermediate Corp/Gov Mix | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 3 | Stock - Large Growth | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 4 | Stock - Large Value | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 5 | Stock - Small/Medium Growth | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 6 | Stock - Small/Medium Value | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 7 | Stock - International Equity | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 8 | Stock - Emerging Markets Equity | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 9 | Bond - TIPS | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 10 | Stock - Socially Responsible Investing | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| 11 | <Current Contractor Annuity> | 0.00% | 0.00% | 0.00% | 100.00% | -100.00% |
| 12 | <Current Contractor Annuity> | 0.00% | 0.00% | 0.00% | 200.00% | -200.00% |
| 13 | <Current Contractor Annuity> | 0.00% | 0.00% | 0.00% | 300.00% | -300.00% |
| 14 | <Current Contractor Annuity> | 0.00% | 0.00% | 0.00% | 400.00% | -400.00% |
| 1 Annuity Fee is the total fee paid by investors in the annuity option less M&E fees (i.e., the equivalent of an expense ratio for a mutual fund). |
| 2 Per Pass/Fail Certification, M&E fees must be less than one (1) basis point. |
| 3 Total Fee is the sum of Annuity Fee and M&E expense. |
| 4 Per Pass/Fail Certification, revenue sharing must be rebated back to participants. Any revenue generated from the annuity fund options used to pay for any recordkeeping, trust/custodial, and administrative services must be rebated back to particpants. |
| 5 Total Net of Revenue Sharing Fee is Total Fee (column H) less Revenue Sharing Amount (Column I). |
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TAB 3 - ANNUITY PERFORMANCE
| Florida Department of Management Services |
| Exhibit 2 - Investment Line-up Information and Investment Related Fees |
| Please supply monthly returns for the last ten years NET OF ALL FEES for each annuity product proposed or offered | ||||||||||||
| Examples | Fund 1 | Fund 2 | Fund 3 | Fund 4 | Fund 5 | Fund 6 | Fund 7 | Fund 8 | Fund 9 | Fund 10 | ||
| Name of Fund 1 | Name of Fund 2 |
| 14.06 | 28.73 |
| 4.87 | 28.73 |
| 4.68 | 31.83 |
| 14.01 | 31.83 |
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TAB 4 - SBA CRITERIA
| Florida Department of Management Services |
| Exhibit 2 - Investment Line-up Information and Investment Related Fees |
| SBA Manager Review Criteria |
| Active investment product minimum qualifying criteria for acceptability: |
| 1. Minimum of 3-years of historical investment returns. |
| 2. Portfolio Manager tenure of at least 3 years, with team portfolio management structures evaluated on a case-by-case basis. |
| 3. Total return exceeds the median within the peer group over the prior 3- and 5-year periods. |
| 4. Total return exceeds a market benchmark index over prior 3-and 5-year periods. |
| 5. Sharpe Ratio exceeds the median within the peer group over prior 3-and 5-year periods. Other risk-adjusted metrics incorporating a market benchmark index may be implemented by the SBA as appropriate and shall be considered in the aggregate. |
| 6. Investment product fees (i.e., excluding distribution and mortality and expense risk charges) must be less than the asset-weighted average within the peer group. |
| Passive (index) investment product minimum qualifying criteria for acceptability: |
| 1. Annualized tracking error below 50 basis points (i.e., standard deviation), gross of fees, over prior 3-year and 5-year periods. |
| 2. Investment product fees (i.e., excluding distribution and mortality and expense risk charges) must be less than the asset-weighted average within the peer group. |
Note: Other quantitative and qualitative factors shall be taken into account, inlcuding but not limted to portfolio turnover rates; style disipline and deveiation from stated investment philosophy;changes to organizational stability, ownership, or stated business plan; growth in assets under management; turnover of key personnel; and material investigation, litigation, or fraud.
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