SRA_25-01_RFP_Compensation_Consulting_and_Executive_Search.pdf

Board Compensation Consulting and Executive Search Services Solicitation #: SRA 25-01

RFP Document

RFP for State Retirement Agency Page i of 74

STATE OF MARYLAND

STATE RETIREMENT AGENCY (SRA)

REQUEST FOR PROPOSALS (RFP)

BOARD COMPENSATION CONSULTING AND EXECUTIVE

SEARCH SERVICES

RFP NUMBER: SRA 25-01

ISSUE DATE: JULY 22, 2024

MINORITY BUSINESSES ARE ENCOURAGED TO RESPOND

TO THIS SOLICITATION

NOTICE

A Prospective Offeror that has received this document from a source other than eMarylandMarketplace (eMMA) https://procurement.maryland.gov should register on eMMA. See Section 4.2.

RFP for State Retirement Agency Page ii of 74

VENDOR FEEDBACK FORM

To help us improve the quality of State solicitations, and to make our procurement process more responsive and business friendly, please provide comments and suggestions regarding this solicitation.

Please return your comments with your response. If you have chosen not to respond to this solicitation, please email or fax this completed form to the attention of the Procurement Officer (see Key Information Summary Sheet below for contact information).

Title: Board Compensation Consulting and Executive Search Services Solicitation No: SRA

1. If you have chosen not to respond to this solicitation, please indicate the reason(s) below:

� Other commitments preclude our participation at this time

� The subject of the solicitation is not something we ordinarily provide

� We are inexperienced in the work/commodities required

� Specifications are unclear, too restrictive, etc. (Explain in REMARKS section)

� The scope of work is beyond our present capacity

� Doing business with the State is simply too complicated. (Explain in REMARKS section)

� We cannot be competitive. (Explain in REMARKS section)

� Time allotted for completion of the Proposal is insufficient

� Start-up time is insufficient

� Bonding/Insurance requirements are restrictive (Explain in REMARKS section)

� Proposal requirements (other than specifications) are unreasonable or too risky (Explain in REMARKS section)

� MBE or VSBE requirements (Explain in REMARKS section)

� Prior State of Maryland contract experience was unprofitable or otherwise unsatisfactory.

(Explain in REMARKS section)

� Payment schedule too slow

� Other: __________________________________________________________________

2. If you have submitted a response to this solicitation, but wish to offer suggestions or express concerns, please use the REMARKS section below. (Attach additional pages as needed.)

REMARKS:

Vendor Name: ________________________________ Date: _______________________

Contact Person: _________________________________ Phone (____) _____ - _________________

Address: ______________________________________________________________________

E-mail Address: ________________________________________________________________

RFP for State Retirement Agency Page iii of 74

STATE OF MARYLAND

STATE RETIREMENT AGENCY (SRA)

KEY INFORMATION SUMMARY SHEET

Request for Proposals Services – Board Compensation Consulting and Executive Search

Services

Solicitation Number: SRA 25-01

RFP Issue Date: July 22, 2024

RFP Issuing Office: State Retirement Agency (SRA)

Procurement Officer: Jane Noble 120 East Baltimore Street, Baltimore, MD 21202 e-mail:

Office Phone:

jnoble@sra.state.md.us 410-625-5660

Proposals are to be sent to: Submit Via eMMA

Pre-Proposal Conference: TBA 2024, at Local Time Truist Bank Building, 120 E. Baltimore Street, Baltimore, MD 21202 See Attachment A for directions and instructions.

Questions Due Date and Time August 8, 2024 by 5:00 PM Local Time

Proposal Due (Closing) Date and Time:

August 13, 2024 by 5:00 PM Local Time Offerors are reminded that a completed Feedback Form is requested if a no-bid decision is made (see page iv).

MBE Subcontracting Goal: Executive Search Services 10% with no subgoals

Board Compensation Consulting Services 0%

VSBE Subcontracting Goal: 0%

Contract Type: Executive Search: Fixed Percentage of First Year Base Salary

Board Compensation Consulting: Firm Fixed Price

Contract Duration: Executive Search: Four (4) year base with two one-year option renewals

Board Compensation Consulting: Four (4) year base with two one-year option renewals

Primary Place of Performance:

Truist Building 120 East Baltimore, Street, Baltimore MD 21202

SBR Designation: No

Federal Funding: No

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TABLE OF CONTENTS – RFP

1 Minimum Qualifications

1.1 Offeror Minimum Qualifications

2 Contractor Requirements: Scope of Work

2.1 Summary Statement

2.2 Background and Purpose

2.3 Responsibilities and Tasks

2.4 Service Level Agreement (SLA)

3 Contractor Requirements: General

3.1 Contract Initiation Requirements

3.2 End of Contract Transition

3.3 Invoicing

3.4 Liquidated Damages

3.5 Disaster Recovery and Data

3.6 Security Requirements

3.7 Problem Escalation Procedure

3.8 SOC 2 Type 2 Audit Report

3.9 Experience and Personnel

3.10 Substitution of Personnel

3.11 Minority Business Enterprise (MBE) Reports……………………………………… 19

3.12 Work Orders

3.13 Additional Clauses

4 Procurement Instructions

4.1 Pre-Proposal Conference

4.2 eMaryland Marketplace Advantage (eMMA)

4.3 Questions

4.4 Procurement Method

4.5 Proposal Due (Closing) Date and Time

4.6 Multiple or Alternate Proposals

4.7 Economy of Preparation

4.8 Public Information Act Notice

4.9 Award Basis

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4.10 Oral Presentation

4.11 Duration of Proposal

4.12 Revisions to the RFP

4.13 Cancellations

4.14 Incurred Expenses

4.15 Protest/Disputes

4.16 Offeror Responsibilities

4.17 Acceptance of Terms and Conditions

4.18 Proposal Affidavit

4.19 Contract Affidavit

4.20 Compliance with Laws/Arrearages

4.21 Verification of Registration and Tax Payment

4.22 False Statements

4.23 Payments by Electronic Funds Transfer

4.24 Prompt Payment Policy

4.25 Electronic Procurements Authorized

4.26 MBE Participation Goal

4.27 VSBE Goal

4.28 Living Wage Requirements

4.29 Federal Funding Acknowledgement

4.30 Conflict of Interest Affidavit and Disclosure

4.31 Non-Disclosure Agreement

4.32 HIPAA - Business Associate Agreement

4.33 Nonvisual Access

4.34 Mercury and Products That Contain Mercury

4.35 Location of the Performance of Services Disclosure

4.36 Department of Human Services (DHS) Hiring Agreement

4.37 Small Business Reserve (SBR) Procurement

4.38 Maryland Healthy Working Families Act Requirements

5 Proposal Format

5.1 Two Part Submission

5.2 Proposal Delivery and Packaging

5.3 Volume I - Technical Proposal

5.4 Volume II – Financial Proposal

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6 Evaluation and Selection Process

6.1 Evaluation Committee

6.2 Technical Proposal Evaluation Criteria

6.3 Financial Proposal Evaluation Criteria

6.4 Reciprocal Preference

6.5 Selection Procedures

6.6 Documents Required upon Notice of Recommendation for Contract Award

7 RFP ATTACHMENTS AND APPENDICES

Attachment A. Pre-Proposal Conference Response Form

Attachment B. Financial Proposal Instructions & Forms

Attachment C. Proposal Affidavit

Attachment F. Maryland Living Wage Affidavit of Agreement for Service Contracts

Attachment H. Conflict of Interest Affidavit and Disclosure

Attachment I. Non-Disclosure Agreement (Contractor)

Attachment M. Contract

Attachment N. Contract Affidavit

Appendix 1. Abbreviations and Definitions

Appendix 2. Offeror Information Sheet

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1 Minimum Qualifications

1.1 Offeror Minimum Qualifications

In its technical proposal, each Offeror must meet and demonstrate proof of the following minimum qualifications to be considered for contract award. The Offeror may provide client references for which the same or similar services requested by this RFP were provided, within the last eight (8) years, and which demonstrate that the Offeror has the following minimum qualifications. The offeror must provide a statement or documentation that demonstrates the Offeror meets each of the following requirements:

1.1.1 The Executive Search Offeror should be a national or regional professional executive search firm that specializes in or has at least five (5) recent years’ experience in, recruiting investment professionals for public retirement systems, private pension plans, endowments, foundations, or investment management firms as further described in Section 2, Scope of Work, of this RFP.

The Offeror shall provide a minimum of five (5) references from organizations for whom the Offeror has provided within the last eight (8) years similar executive search services as required by this RFP, including contact names, addresses, telephone numbers, and valid email addresses.

1.1.2 The Executive Search Offeror should have successfully concluded executive search services for Chief Investment Officers, or the equivalent position, for at least five (5) public retirement systems, private pension plans, endowments, foundations, or investment management firms managing over $10 billion in assets.

1.1.3 The Executive Search Offeror should assign at least one (1) executive search professional to this Contract who has a minimum of ten (10) recent years of experience as an executive search professional. The Offeror shall submit resumes for each executive search professional that it will assign to the Contract.

1.1.4 The Board Compensation Consulting Offeror shall provide a minimum of five (5) references from comparable organizations/funds for whom the Offeror has provided within the last eight

(8) years compensation consulting services similar to the scope of services in this RFP.

1.1.5 The Offeror must provide a statement that it is not in bankruptcy, conservatorship, receivership, or in the possession of a regulatory agency.

1.1.6 In the event that an Offeror is submitting a proposal for both assignments, they must satisfy minimum qualifications 1.1.1 through 1.1.5 above.

THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.

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2 Contractor Requirements: Scope of Work

2.1 Summary Statement

2.1.1 The Maryland State Retirement Agency (SRA or the "Agency") is issuing this Request for Proposals (RFP) to obtain board compensation consulting and executive search services as further described in this RFP.

A. The Board compensation consultant will work with the Executive Director to (1) develop and make recommendations to the Board of Trustees for the Maryland State Retirement and Pension System (“Board”) to assist the Board in establishing a salary scale and determining the qualifications and compensation for the Chief Investment Officer and all other positions within the Investment Division of the Agency based upon the objective criteria adopted by the Board; (2) review the existing organizational structure and classification system of the Investment Division and make recommendations for improvements to meet the objectives of the Board; and

(3) conduct comprehensive compensation studies for the Agency.

B. The Agency also desires to obtain a single qualified executive search firm to locate, interview, and assist in presenting candidates to serve in senior executive roles of the Agency, including but not limited to senior roles in the Investment Division of the Agency, such as the Chief Investment Officer (CIO), Deputy Chief Investment Officer (DCIO), Managing Directors, Senior Governance Officer, and other senior staff. The firm may also be asked to conduct a search for a Director of Diversity, Equity, and Inclusion for the Agency.

2.1.2 It is the State’s intention to obtain goods and services, as specified in this RFP, from a Contract between the selected Offeror(s) and the State.

2.1.3 As a result of this RFP, the Agency intends to make either a single award for board compensation consulting and executive search services, or two separate awards---one for board compensation consulting, and the other for executive search services.

2.1.4 An Offeror proposing to provide board compensation consulting services must meet all of the requirements applicable to that service requested in the solicitation.

2.1.5 An Offeror proposing to provide executive search services must meet all of the requirements applicable to that service requested in the solicitation.

2.1.6 A Contract award does not ensure a Contractor will receive all, or any, State business under the Contract.

2.2 Background and Purpose

The Maryland State Retirement Agency is the administrator of the Maryland State Retirement and Pension System (System), a multi-employer public employee retirement system. The System was established under Division II of the State Personnel and Pensions Article of the Annotated Code of Maryland (SPP) and Internal Revenue Code Section 401(a) to provide retirement allowances and other benefits to State employees, teachers, and other State and local employees. The Agency has a two-fold mission: (1) to administer benefits of the System’s participants and (2) to ensure that sufficient assets are available to fund the benefits when due. This entails:

2.2.1 Effectively communicating with all retirement plan participants to inform and educate them about planning and preparing for all aspects of their future retirement;

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2.2.2 Accurately and timely paying retirement allowances to the System’s retirees and their beneficiaries, and refunds to those who withdraw from the programs;

2.2.3 Prudently investing System assets in a well-diversified manner to optimize long-term returns while controlling risk; and,

2.2.4 Efficiently collecting the required employer and member contributions necessary to fund the System.

The Agency has more than 200 employees based at 120 E. Baltimore Street, Baltimore, Maryland. The value of the assets of the System is approximately $65 billion as of June 30, 2023, making it one of the larger public retirement funds in the country.

Responsibility for the System’s administration and operations is vested in a 15-member Board of Trustees (Board). The Executive Director and Chief Investment Officer are appointed by and serve at the pleasure of the Board. The Agency includes the following Divisions:

2.2.5 External Affairs Division – In addition to media relations, the Division provides information about goals and policies of the Board of Trustees, functions and procedures of the Agency, and the rights and benefits of the State Retirement and Pension System.

2.2.6 Finance Division – Under the Division are four main units: Budget, Procurement, and Contracts; Financial Accounting Operations; General Accounting; Records Management. The Division is responsible for monitoring the receipt of employee and employer contributions due from State agencies and universities, local boards of education, and other participating governmental units, in addition to performing more basic Finance functions, such as:

accounting; budgeting; procurement; and accounting for fixed assets.

2.2.7 Information Systems – The Division designs, maintains, and supports automated management information systems, including the Maryland Pension Administration System which calculates and processes retirement and pension benefits for retirees and beneficiaries, as well as contributions from current members.

2.2.8 Investment Division – The Division manages the Pension Trust Fund utilizing financial fund managers in conjunction with internal trading to ensure that sufficient assets are available to fund the pension/retirement benefits when they become due.

2.2.9 Benefits/Retirement Administration – The Division provides retirement counseling, benefits processing, and data control, while also paying benefits to retirees and administering employee contributions.

Other Agency divisions that contribute management oversight, compliance, and expertise include:

Executive Direction; the Business Operations Office, Internal Audit; Legislative Affairs. The Agency’s organizational structure can be viewed at: https://sra.maryland.gov/sites/main/files/file-attachments/org_chart.pdf?1609426604.

The Investment Division is a unit of the Agency, and currently consists of a team of 47, of which 35 are investment professionals. At the direction of the Board, the Investment Division manages the $65 billion in plan assets. Currently, approximately 85% of plan assets are managed externally, and the remainder are managed directly by staff. The System expects that the portion of assets internally will grow the next several years. More information about the System can be found in its Comprehensive Annual Financial Report on the System’s website at http://www.sra.state.md.us. More information regarding the CIO and the Investment Division can also be viewed online at https://law.justia.com/codes/maryland/2022/state-personnel-and-pensions/division-ii/title-21/subtitle-https://sra.maryland.gov/sites/main/files/file-attachments/org_chart.pdf?1609426604 https://sra.maryland.gov/sites/main/files/file-attachments/org_chart.pdf?1609426604 http://www.sra.state.md.us/ https://law.justia.com/codes/maryland/2022/state-personnel-and-pensions/division-ii/title-21/subtitle-1/section-21-118-1/

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1/section-21-118-1/ and https://law.justia.com/codes/maryland/2022/state-personnel-and-pensions/division-ii/title-21/subtitle-1/section-21-122/.

The Board of Trustees is responsible for determining the qualifications and compensation for the CIO and other positions within the Investment Division, subject to certain statutory requirements set forth in Md. Code Ann., State Personnel and Pensions Article (“SPP”), §§ 21-118.1 and 21-122. Among other requirements, the Board is required to adopt objective criteria for setting the qualifications and compensation of the CIO and staff within the Investment Division, including any financial incentives that the Board may elect to provide. SPP § 21-122(g) established an Objective Criteria Committee (“OCC”) to make recommendations to the Board of Trustees regarding objective criteria for the compensation and financial incentive for the CIO and positions within the Investment Division. The Board retained a consultant to assist the OCC in making its recommendations. Following review and recommendation by the OCC in February 2024, the Board of Trustees adopted objective criteria for setting the qualifications and compensation (including financial incentives) for the CIO and staff within the Investment Division. Per SPP § 21-122(g), the consultant retained to advise the OCC may not separately provide consulting services for the Board of Trustees or the staff of the Investment Division.

2.3 Responsibilities and Tasks

Board Compensation Consulting Responsibilities and Tasks

2.3.1 The Contractor will assist the Board in establishing the qualifications and compensation for the CIO and employees of the Investment Division, in accordance with all statutory requirements and based upon the objective criteria that have been adopted by the Board. Consultant will also provide an analysis of the compensation structure of the Agency with a separate analysis of the Investment Division compared to an appropriate peer set and recommend a position structure and compensation ranges for Investment Division staff to the Board.

A. For the Investment Division, the Contractor may incorporate data previously obtained by the Agency to provide the Investment Division compensation study.

For both the Agency and the Investment Division, the Contractor shall incorporate comparative qualifications, compensation, and financial incentives of employees serving in similar positions and discharging similar duties at comparable public pension funds.

B. The Contractor shall apply its established process and criteria in creating a peer group of comparable public pension funds.

C. The Contractor shall provide a preliminary written report to the Agency’s Executive Director and provide a final written report to the Investment Committee, Administrative Committee, and/or Board with its findings and recommendations.

D. During the life of the contract, the Contractor shall recommend annual inflation adjustments to the salary scale for the CIO and staff within the Investment Division.

2.3.2 The Contractor shall assist the Executive Director, in consultation with the Chief Investment Officer, in assessing the current Investment Division organizational structure.

https://law.justia.com/codes/maryland/2022/state-personnel-and-pensions/division-ii/title-21/subtitle-1/section-21-118-1/ https://law.justia.com/codes/maryland/2022/state-personnel-and-pensions/division-ii/title-21/subtitle-1/section-21-122/ https://law.justia.com/codes/maryland/2022/state-personnel-and-pensions/division-ii/title-21/subtitle-1/section-21-122/

RFP for State Retirement Agency Page 5 of 74

A. The Contractor shall review the current organizational structure, classification system, and job descriptions of all positions in the Investment Division and identify possible ways to improve the sustainability of the unit and mitigate human capital risk issues.

2.3.3 The Contractor shall assist the Executive Director in assessing the current non- Investment Division organizational structure.

A. The Contractor shall review the current organizational structure, classification system, and job descriptions of all positions in the Agency, exclusive of the Investment Division, and identify possible ways to improve the sustainability of the Agency and mitigate human capital risk issues.

Executive Search Services

2.3.4 During the duration of the contract, the Contractor shall assist the Search Team, which will consist of the Executive Director of the Agency and the Search Team established for the recruitment, in developing an ideal candidate profile, job description and strategy for carrying out the recruitment process, including outreach to encourage applicants from diverse backgrounds to apply.

2.3.5 Throughout the search process the Contractor shall: (a) on a bi-weekly basis provide written progress reports to the Search Team that detail actions taken and whether Contractor is in compliance with the Contractor’s Work Plan as described in Section 5.3.2.(F). of this RFP, and hold conference calls with the Search Team, and (b) maintain contact with the Executive Director to report progress and to assure the Agency that work required pursuant to this RFP is progressing in a satisfactory manner and direction.

2.3.6 The Contractor shall identify potential contacts and conduct personal outreach recruiting, including posting the position through national channels.

2.3.7 The Contractor shall handle all paperwork and record keeping procedures related to the executive search described in this RFP, including directly receiving and processing candidate applications, resumes, nominations, and other search related paperwork.

2.3.8 With the approval of the Contract Monitor, the Contractor shall prepare and place advertisements for the position in appropriate public/private pension, financial management, and related publications, websites such as Indeed.com, or similar websites and other sources identified by the Contractor. All advertisements must include a statement that “The Maryland State Retirement Agency is an Equal Opportunity Employer.”

2.3.9 The Contractor shall provide procedures, which must be pre-approved by the Contract

Monitor, for conducting semi-finalist interviews. Review resumes for background, credentials, and experience and follow-up with telephone interviews to clarify each candidate’s experience. After the resumes are reviewed and the telephone interviews are

RFP for State Retirement Agency Page 6 of 74 completed, the Contractor shall prepare a written summary of not more than fifteen (15) of the most professionally attractive candidates to submit to the Contract Monitor.

2.3.10 For each search, the Contractor shall valuate the five (5) “finalist” candidates that the

Search Team has chosen by: (a) conducting face-to-face personal interviews; (b) conducting in-depth background checks including, without limitation, verification of education credentials, facts, figures and performance data provided by the candidate, and a National Crime Investigative Center (NCIC) and local background check; and, (c) assessing the candidate’s overall investment and management ability through at least two initial professional reference checks with individuals who are or have been in a position to evaluate the candidate’s performance on the job. Through these interviews and reference checks, the Contractor shall ascertain and report to the Search Team the candidate’s strengths relative to the ideal candidate profile prepared by the Offeror in consultation with the Contract Monitor.

2.3.11 The Contractor shall use a process approved by the Contract Monitor to schedule interviews with the Search Team and the five (5) “finalist” candidates.

2.3.12 The Contractor shall prepare and provide report summaries on the five (5) “finalist” candidates, in a confidential manner, to the Contract Monitor and the Search Team. Such summaries must include an evaluation of candidate credentials, interview feedback, background checks and other relevant information.

2.3.13 The Contractor shall be available for consultation and direction throughout entire confirmation process.

2.3.14 The Contractor shall notify rejected applicants in writing by mailing a rejection letter to each rejected applicant.

2.3.15 The Contractor shall perform an additional one-time search for a replacement candidate (the “Supplemental Search”), if, for any reason, the original candidate proposed by the Offeror and engaged by the Agency or the Board leaves the employment of the Agency within one year after the candidate’s start date with the Agency. No additional compensation will be payable to the Contractor for the performance of the Supplemental Search.

2.4 Service Level Agreement (SLA)

THIS SECTION IS INAPPLICABLE TO THIS RFP.

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3 Contractor Requirements: General

3.1 Contract Initiation Requirements

3.1.1 At the kickoff, the Contractor shall furnish an updated Project Schedule describing the activities for the Contractor, the State, and any third parties.

3.2 End of Contract Transition

3.2.1 Return and Maintenance of State Data

A. Upon termination or the expiration of the Contract Term, the Contractor shall: (a) return to the State all State data in either the form it was provided to the Contractor or in a mutually agreed format along with the schema necessary to read such data; (b) preserve, maintain, and protect all State data until the earlier of a direction by the State to delete such data or the expiration of 90 days (“the retention period”) from the date of termination or expiration of the Contract term; (c) after the retention period, the Contractor shall securely dispose of and permanently delete all State data in all of its forms, such as disk, CD/DVD, backup tape and paper such that it is not recoverable, according to National Institute of Standards and Technology (NIST)-approved methods with certificates of destruction to be provided to the State; and (d) prepare an accurate accounting from which the State may reconcile all outstanding accounts. The final monthly invoice for the services provided hereunder shall include all charges for the 90-day data retention period.

B. During any period of service suspension, the Contractor shall maintain all State data in its then existing form, unless otherwise directed in writing by the Contract Monitor.

C. In addition to the foregoing, the State shall be entitled to any post-termination/expiration assistance generally made available by Contractor with respect to the services.

3.3 Invoicing

3.3.1 General

A. The Contractor shall e-mail the original of each invoice and signed authorization to invoice to the Contract Monitor, Martin Noven at e-mail address:

mnoven@sra.state.md.us.

B. All invoices for services shall be verified by the Contractor as accurate at the time of submission.

C. An invoice not satisfying the requirements of a Proper Invoice (as defined at COMAR

21.06.09.01 and .02) cannot be processed for payment. To be considered a Proper Invoice, invoices must include the following information, without error:

1) Contractor name and address;

2) Remittance address;

3) Federal taxpayer identification (FEIN) number, social security number, as appropriate;

4) Invoice period (i.e. time period during which services covered by invoice were performed);

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5) Invoice date;

6) Invoice number;

7) State assigned Contract number;

8) State assigned (Blanket) Purchase Order number(s);

9) Goods or services provided;

10) Amount due; and

11) Any additional documentation required by regulation or the Contract.

D. Invoices that contain both fixed price and time and material items shall clearly identify each item as either fixed price or time and material billing.

E. The State Retirement Agency reserves the right to reduce or withhold Contract payment in the event the Contractor does not provide the State Retirement Agency with all required deliverables within the time frame specified in the Contract or otherwise breaches the terms and conditions of the Contract until such time as the Contractor brings itself into full compliance with the Contract.

F. Any action on the part of the State Retirement Agency, or dispute of action by the Contractor, shall be in accordance with the provisions of Md. Code Ann., State Finance and Procurement Article §§ 15-215 through 15-223 and with COMAR 21.10.04.

G. The State is generally exempt from federal excise taxes, Maryland sales and use taxes, District of Columbia sales taxes and transportation taxes. The Contractor; however, is not exempt from such sales and use taxes and may be liable for the same.

H. Invoices for final payment shall be clearly marked as “FINAL” and submitted when all work requirements have been completed and no further charges are to be incurred under the Contract. In no event shall any invoice be submitted later than 60 calendar days from the Contract termination date.

3.3.2 Invoice Submission Schedule

The Contractor shall submit invoices in accordance with the following schedule:

A. For items of work for which there is one-time pricing (see Attachment B – Financial Proposal Form) those items shall be billed in the month following the acceptance of the work by the State Retirement Agency.

B. For items of work for which there is annual pricing, see Attachment B– Financial Proposal Form, those items shall be billed in equal monthly installments for the applicable Contract year in the month following the performance of the services.

3.3.3 For the purposes of the Contract an amount will not be deemed due and payable if:

A. The amount invoiced is inconsistent with the Contract;

B. The proper invoice has not been received by the party or office specified in the Contract;

C. The invoice or performance is in dispute or the Contractor has failed to otherwise comply with the provisions of the Contract;

D. The item or services have not been accepted;

E. The quantity of items delivered is less than the quantity ordered;

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F. The items or services do not meet the quality requirements of the Contract;

G. If the Contract provides for progress payments, the proper invoice for the progress payment has not been submitted pursuant to the schedule;

H. If the Contract provides for withholding a retainage and the invoice is for the retainage, all stipulated conditions for release of the retainage have not been met; or

I. The Contractor has not submitted satisfactory documentation or other evidence reasonably required by the Procurement Officer or by the Contract concerning performance under the Contract and compliance with its provisions.

3.3.4 Travel Reimbursement

A There shall be no reimbursement for Routine Travel. Contractor shall not be reimbursed for Non-Routine Travel without prior Contract Monitor approval.

B. Routine Travel is defined as travel within a 50-mile radius of the State Retirement Agency’s base location, as identified in the RFP, or the Contractor’s facility, whichever is closer to the consulting site. There will be no payment for labor hours for travel time or reimbursement for any travel expenses for work performed within these radiuses or at the Contractor’s facility.

C. Non-routine Travel is defined as travel beyond the 50-mile radius of the State Retirement Agency’s base location, as identified in the RFP, or the Contractor’s facility, whichever is closer to the consulting site. Non-routine travel will be reimbursed according to the State’s travel regulations and reimbursement rates, which can be found at:

www.DBM.maryland.gov - search: Fleet Management. If non-routine travel is conducted by automobile, the first 50 miles of such travel will be treated as routine travel and will not be reimbursed. The Contractor may bill for labor hours expended in non-routine traveling beyond the identified 50-mile radius, only if specified in the RFP or Work Order

3.4 Liquidated Damages

3.4.1 MBE Liquidated Damages

THIS SECTION IS INAPPLICABLE TO THIS RFP.

3.4.2 Liquidated Damages other than MBE

THIS SECTION IS INAPPLICABLE TO THIS RFP.

3.5 Disaster Recovery and Data

The following requirements apply to the Contract:

3.5.1 Redundancy, Data Backup and Disaster Recovery

A. Unless specified otherwise in the RFP, Contractor shall maintain or cause to be maintained disaster avoidance procedures designed to safeguard State data and other confidential information, Contractor’s processing capability and the availability of hosted services, in each case throughout the Contract term. Any force majeure provisions of the Contract do not limit the Contractor’s obligations under this provision.

B. The Contractor shall have robust contingency and disaster recovery (DR) plans in place to ensure that the services provided under the Contract will be maintained in the event of

RFP for State Retirement Agency Page 10 of 74 disruption to the Contractor/subcontractor’s operations (including, but not limited to, disruption to information technology systems), however caused.

C. The contingency and DR plans must be designed to ensure that services under the Contract are restored after a disruption within twenty-four (24) hours from notification and a recovery point objective of one (1) hour or less prior to the outage in order to avoid unacceptable consequences due to the unavailability of services.

3.5.2 Data Export/Import

A. The Contractor shall, at no additional cost or charge to the State, in an industry standard/non-proprietary format:

1) perform a full or partial import/export of State data within 24 hours of a request; or

2) provide to the State the ability to import/export data at will and provide the State with any access and instructions which are needed for the State to import or export data.

B. Any import or export shall be in a secure format per the Security Requirements.

3.5.3 Data Ownership and Access

A. Data, databases, and derived data products created, collected, manipulated, or directly purchased as part of a RFP are the property of the State. The purchasing State agency is considered the custodian of the data and shall determine the use, access, distribution, and other conditions based on appropriate State statutes and regulations.

B. Public jurisdiction user accounts and public jurisdiction data shall not be accessed, except

(1) in the course of data center operations, (2) in response to service or technical issues,

(3) as required by the express terms of the Contract, including as necessary to perform the services hereunder or (4) at the State’s written request.

C. The Contractor shall limit access to and possession of State data to only Contractor Personnel whose responsibilities reasonably require such access or possession and shall train such Contractor Personnel on the confidentiality obligations set forth herein.

D. At no time shall any data or processes – that either belong to or are intended for the use of the State or its officers, agents, or employees – be copied, disclosed, or retained by the Contractor or any party related to the Contractor for subsequent use in any transaction that does not include the State.

E. The Contractor shall not use any information collected in connection with the services furnished under the Contract for any purpose other than fulfilling such services.

3.5.4 Provisions in Sections 3.5.1 – 3.5.3 shall survive expiration or termination of the Contract.

Additionally, the Contractor shall flow down the provisions of Sections 3.5.1-3.5.3 (or the substance thereof) in all subcontracts.

3.6 Security Requirements

The following requirements are applicable to the Contract:

3.6.1 Employee Identification

A. Contractor Personnel shall display his or her company ID badge in a visible location at all times while on State premises. Upon request of authorized State personnel, each Contractor Personnel shall provide additional photo identification.

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B. Contractor Personnel shall cooperate with State site requirements, including but not limited to, being prepared to be escorted at all times, and providing information for State badge issuance.

C. Contractor shall remove any Contractor Personnel from working on the Contract where the State determines, in its sole discretion, that Contractor Personnel has not adhered to the Security requirements specified herein.

D. The State reserves the right to request that the Contractor submit proof of employment authorization of non-United States Citizens, prior to commencement of work under the Contract.

3.6.2 Criminal Background Check

A. The Contractor shall obtain at its own expense a Criminal Justice Information System (CJIS) State and federal criminal background check, including fingerprinting, for all Contractor Personnel listed in sub-paragraph A. This check may be performed by a public or private entity.

B. Persons with a criminal record may not perform services under the Contract unless prior written approval is obtained from the Contract Monitor. The Contract Monitor reserves the right to reject any individual based upon the results of the background check.

Decisions of the Contract Monitor as to acceptability of a candidate are final. The State reserves the right to refuse any individual Contractor Personnel to work on State premises, based upon certain specified criminal convictions, as specified by the State.

C. The CJIS criminal record check of each Contractor Personnel who will work on State premises shall be reviewed by the Contractor for convictions of any of the following crimes described in the Annotated Code of Maryland, Criminal Law Article:

1) §§ 6-101 through 6-104, 6-201 through 6-205, 6-409 (various crimes against property);

2) any crime within Title 7, Subtitle 1 (various crimes involving theft);

3) §§ 7-301 through 7-303, 7-313 through 7-317 (various crimes involving telecommunications and electronics);

4) §§ 8-201 through 8-302, 8-501 through 8-523 (various crimes involving fraud);

5) §§9-101 through 9-417, 9-601 through 9-604, 9-701 through 9-706.1 (various crimes against public administration); or

6) a crime of violence as defined in CL § 14-101(a).

D. Contractor Personnel with access to systems supporting the State or to State data who have been convicted of a felony or of a crime involving telecommunications and electronics from the above list of crimes shall not be permitted to work on State premises under the Contract; Contractor Personnel who have been convicted within the past five

(5) years of a misdemeanor from the above list of crimes shall not be permitted to work on State premises.

E. A particular on-site location covered by the Contract may require more restrictive conditions regarding the nature of prior criminal convictions that would result in Contractor Personnel not being permitted to work on those premises. Upon receipt of a location’s more restrictive conditions regarding criminal convictions, the Contractor shall

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3.6.3 On-Site Security Requirement(s)

THIS SECTION IS INAPPLICABLE TO THIS RFP.

3.6.4 Information Technology

(a) Contractors shall comply with and adhere to the State IT Security Policy and Standards.

These policies may be revised from time to time and the Contractor shall comply with all such revisions. Updated and revised versions of the State IT Policy and Standards are available online at: www.doit.maryland.gov – keyword: Security Policy.

(b) The Contractor shall not connect any of its own equipment to a State LAN/WAN without prior written approval by the State. The Contractor shall complete any necessary paperwork as directed and coordinated with the Contract Monitor to obtain approval by the State to connect Contractor-owned equipment to a State LAN/WAN.

The Contractor shall:

1) Implement administrative, physical, and technical safeguards to protect State data that are no less rigorous than accepted industry best practices for information security such as those listed below (see Section 3.6.5);

2) Ensure that all such safeguards, including the manner in which State data is collected, accessed, used, stored, processed, disposed of, and disclosed, comply with applicable data protection and privacy laws as well as the terms and conditions of the Contract; and

3) The Contractor, and Contractor Personnel, shall (i) abide by all applicable federal, State, and local laws, rules and regulations concerning security of Information Systems and Information Technology and (ii) comply with and adhere to the State IT Security Policy and Standards as each may be amended or revised from time to time. Updated and revised versions of the State IT Policy and Standards are available online at:

https://doit.maryland.gov/policies/Pages/default.aspx

3.6.5 Security Plan

A. The Contractor shall protect State data according to a written security policy (“Security Plan”) no less rigorous than that of the State and shall supply a copy of such policy to the State for validation, with any appropriate updates, on an annual basis.

B. The Security Plan shall detail the steps and processes employed by the Contractor as well as the features and characteristics which will ensure compliance with the security requirements of the Contract.

3.6.6 Security Incident Response

A. The Contractor shall notify the State Retirement Agency in accordance with Section

3.6.8 when any Contractor system that may access, process, or store State data or State systems experiences a Security Incident or a Data Breach as follows:

http://www.doit.maryland.gov/ https://doit.maryland.gov/policies/Pages/default.aspx

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1) notify the State Retirement Agency within twenty-four (24) hours of the discovery of a Security Incident by providing notice via written or electronic correspondence to the Contract Monitor, State Retirement Agency chief information officer and State Retirement Agency chief information security officer;

2) notify the State Retirement Agency within two (2) hours if there is a threat to Contractor’s Solution as it pertains to the use, disclosure, and security of State data; and

3) provide written notice to the State Retirement Agency within one (1) Business Day after Contractor’s discovery of unauthorized use or disclosure of State data and thereafter all information the State (or State Retirement Agency) requests concerning such unauthorized use or disclosure.

B. Contractor’s notice shall identify:

1) the nature of the unauthorized use or disclosure;

2) the State data used or disclosed,

3) who made the unauthorized use or received the unauthorized disclosure;

4) what the Contractor has done or shall do to mitigate any deleterious effect of the unauthorized use or disclosure; and

5) what corrective action the Contractor has taken or shall take to prevent future similar unauthorized use or disclosure.

6) The Contractor shall provide such other information, including a written report, as reasonably requested by the State.

C. The Contractor may need to communicate with outside parties regarding a Security Incident, which may include contacting law enforcement, fielding media inquiries and seeking external expertise as mutually agreed upon, defined by law, or contained in the Contract. Discussing Security Incidents with the State should be handled on an urgent as-needed basis, as part of Contractor communication and mitigation processes as mutually agreed upon, defined by law, or contained in the Contract.

D. The Contractor shall comply with all applicable laws that require the notification of individuals in the event of unauthorized release of State data or other event requiring notification, and, where notification is required, assume responsibility for informing all such individuals in accordance with applicable law and to indemnify and hold harmless the State (or State Retirement Agency) and its officials and employees from and against any claims, damages, and actions related to the event requiring notification.

3.6.7 Data Breach Responsibilities

A. If the Contractor reasonably believes or has actual knowledge of a Data Breach, the Contractor shall, unless otherwise directed:

1) Notify the appropriate State-identified contact within 24 hours by telephone in accordance with the agreed upon security plan or security procedures unless a shorter time is required by applicable law;

2) Cooperate with the State to investigate and resolve the data breach;

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3) Promptly implement commercially reasonable remedial measures to remedy the Data Breach; and

4) Document responsive actions taken related to the Data Breach, including any post-incident review of events and actions taken to make changes in business practices in providing the services.

B. If a Data Breach is a direct result of the Contractor’s breach of its Contract obligation to encrypt State data or otherwise prevent its release, the Contractor shall bear the costs associated with (1) the investigation and resolution of the data breach; (2) notifications to individuals, regulators or others required by State law; (3) a credit monitoring service required by State or federal law; (4) a website or a toll-free number and call center for affected individuals required by State law; and (5) complete all corrective actions as reasonably determined by Contractor based on root cause; all [(1) through (5)] subject to the Contract’s limitation of liability.

3.6.8 The State shall, at its discretion, have the right to review and assess the Contractor’s compliance to the security requirements and standards defined in the Contract.

3.6.9 Provisions in Sections 3.7.1 – 3.7.10 shall survive expiration or termination of the Contract.

Additionally, the Contractor shall flow down the provisions of Sections 3.7.4-3.7.10 (or the substance thereof) in all subcontracts.

3.7 Problem Escalation Procedure

3.7.1 The Contractor must provide and maintain a Problem Escalation Procedure (PEP) for both routine and emergency situations. The PEP must state how the Contractor will address problem situations as they occur during the performance of the Contract, especially problems that are not resolved to the satisfaction of the State within appropriate timeframes.

3.7.2 The Contractor shall provide contact information to the Contract Monitor, as well as to other State personnel as directed should the Contract Monitor not be available.

3.7.3 The Contractor must provide the PEP no later than ten (10) Business Days after notice of recommended award. The PEP, including any revisions thereto, must also be provided within ten (10) Business Days after the start of each Contract year and within ten (10) Business Days after any change in circumstance which changes the PEP. The PEP shall detail how problems with work under the Contract will be escalated in order to resolve any issues in a timely manner. The PEP shall include:

A. The process for establishing the existence of a problem;

B. Names, titles, and contact information for progressively higher levels of personnel in the Contractor’s organization who would become involved in resolving a problem;

C. For each individual listed in the Contractor’s PEP, the maximum amount of time a problem will remain unresolved with that individual before the problem escalates to the next contact person listed in the Contractor’s PEP;

D. Expedited escalation procedures and any circumstances that would trigger expediting them;

E. The method of providing feedback on resolution progress, including the frequency of feedback to be provided to the State;

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F. Contact information for persons responsible for resolving issues after normal business hours (e.g., evenings, weekends, holidays) and on an emergency basis; and

G. A process for updating and notifying the Contract Monitor of any changes to the PEP.

3.7.4 Nothing in this section shall be construed to limit any rights of the Contract Monitor or the State which may be allowed by the Contract or applicable law.

3.8 SOC 2 Type 2 Audit Report

A SOC 2 Type 2 Report is not a Contractor requirement for this Contract.

3.9 Experience and Personnel

3.9.1 Preferred Offeror Experience

The following experience is expected with respect to the Board Compensation Consulting Services and will be evaluated as part of the Technical Proposal:

A. At least five years of experience in collecting and maintaining data relating to the qualifications, compensation, and financial incentives of investment employees serving in similar positions and discharging similar duties at comparable public pension funds.

B. At least five years of experience in developing objective benchmarks of investment performance to be met or exceeded by an individual to be eligible for financial incentives.

C. At least five years of experience in assessing best practices in organizational structures, classification systems, job descriptions, and performance evaluation processes of comparable investment divisions.

D. Offeror has performed compensation consulting services similar to the scope of services in this…