RKSDMA_RFI_03_21_17.pdf

Document Revision Record

March 21, 2017

Thrift Savings Plan (TSP) Recordkeeping RFI

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Contents

Thrift Savings Plan (TSP) Recordkeeping RFI

1. Purpose

2. Background

3. TSP Profile

4. Scope of Services

5. Draft Statement of Objectives

6. Constraints

7. Responses Requested

8. Appendix A: FRTIB Aligned Industry Framework Definitions

Figures Figure 1: TSP In-Scope Services

1. Purpose The Federal Retirement Thrift Investment Board (FRTIB) is seeking to further understand the service provider market for Defined Contribution Plan (DCP) services in order to shape an eventual solicitation for proposals.

The purpose of this Market Survey/Request for Information (RFI) is to:

1. Communicate a revision to the scope of services that was formerly referred to as ExPRESS Service Center

2. Collect information about market capabilities for defined contribution recordkeeping services

3. Convey TSP DCP constraints not typically found in requests for commercial DCP service offerings

4. Determine capability of market to support TSP recordkeeping services and the potential pool of bidders

2. Background The FRTIB’s mission is “To administer the TSP solely in the interest of participants and beneficiaries”.

Our vision in carrying out that mission is:

• We achieve flawless operations

• We help participants to make smart choices

• We spend participant money wisely

• We make the FRTIB a great place to work; and a place where great work gets done

• We create excellent relationships with TSP stakeholders

In our continuing drive to deliver on our mission, the FRTIB released the Expanding Participant Retirement Engagement Services and Solutions (ExPRESS) Service Center draft PWS in 2015 and a draft RFP in 2016 for industry comment (See https://www.fbo.gov/index?s=opportunity&mode=form&id=51f6b0e5786a8811001feb7476670dd1&t ab=core&_cview=1).

ExPRESS was intended to improve the participant experience by: modernizing technology, adding additional channels of communication, providing participants with self-service options, and raising the TSP service delivery standards to those commensurate with contemporaries in financial services sector. After careful review and deliberation regarding this feedback, the FRTIB decided to expand the ExPRESS Service Center scope of services to include transactional recordkeeping services as well.

This more comprehensive approach to DCP services comports more closely to a commercial industry model and may be better able to meet the FRTIB’s intended objectives. Currently, the transactional recordkeeping services are provided under a separate contract called Technology and Enterprise Support Services (TESS).

3. TSP Profile The TSP is a defined contribution retirement savings and investment plan for Federal employees and members of the uniformed services. It was authorized by the United States Congress in the Federal Employees’ Retirement System Act of 1986 (FERSA). The TSP provides Federal employees and members of the uniformed services with a savings and tax benefit similar to what many private sector employers offer their employees under 401(k) plans. The TSP serves more than 5 million active and retired participants and beneficiaries, (estimated total of 7.6 million accounts including zero balance and inactive accounts) and will grow significantly over the next 5 years with the creation of the Blended Retirement system which will move military personnel from an opt-in design with no match to an automatically enrolled design with a match. The Blended Retirement System will be implemented in 2018.

The TSP is comprised of the following components:

• Federal Employee Retirement System (FERS) Employees

• Civil Service Retirement System (CSRS) Employees https://www.fbo.gov/index?s=opportunity&mode=form&id=51f6b0e5786a8811001feb7476670dd1&tab=core&_cview=1 https://www.fbo.gov/index?s=opportunity&mode=form&id=51f6b0e5786a8811001feb7476670dd1&tab=core&_cview=1 https://www.tsp.gov/PlanParticipation/EligibilityAndContributions/establishingAccount.html#FERS https://www.tsp.gov/PlanParticipation/EligibilityAndContributions/establishingAccount.html#CSRS

• Members of the Uniformed Services

• Members of the Uniformed Services under the Blended Retirement Systems as of 2018

(http://militarypay.defense.gov/BlendedRetirement/)

• Beneficiary Participants

The TSP interfaces with approximately 100 federal government agency payroll offices. The TSP currently hosts its recordkeeping on the Omni Plus platform.

The plan summary is available at https://www.tsp.gov/PDF/formspubs/tspbk08.pdf and additional information is available at https://www.frtib.gov/ReadingRoom/index.html.

Participants may invest contributions in several TSP funds (see an overview of the available funds at:

https://www.tsp.gov/InvestmentFunds/FundsOverview/comparisonMatrix.html), including one government securities fund that is issued to the TSP by the U.S. Treasury.

4. Scope of Services The following chart provides a high level overview of the scope of services.

Figure 1: TSP In-Scope Services

There are a number of notable differences between the services sought by the TSP and DCP services often sought by other plans:

1. Investment Management Services are not within the scope of this initiative and will be provided under a separate contract which will require building interfaces to the investment manager’s systems and services.

2. Providing the safe holding of the plan’s assets in a trust by a custodial bank are not within the scope of this initiative and will be handled under a separate contract.

3. The U.S. Treasury acts as the TSP’s bank and remits all contributions and payments.

4. Accounting Services are included in the scope of this initiative and will require interfacing and reconciling to U.S. Treasury Systems and FRTIB’s internal accounting systems. Financial processes that are considered inherently governmental will remain with the agency.

5. Legal Advice regarding compliance with legal requirements and level review of benefits is out of scope.

6. The FRTIB will retain all participant communication design, including branding for participant communications and website “look and feel.”

7. The FRTIB will retain educational services to the approximate 100 agencies, including Payroll Outreach (PRO and Training).

8. Congressional inquiries will be handled by FRTIB.

9. The FRTIB will retain responsibility for the creation and amendment of plan documents.

10. Program oversight and contracting requirements will comply with the Federal Acquisition

Regulations (FAR) unless it conflicts with FERSA.

Administrative Services

Record Keeping Transaction Processing

Trustee Services (Custodial Bank)

Participant-Focused Services

Participant Communication

Design

Participant Financial

Education and Advice

Investment Management (C,F,S,I) & G

Mutual Fund Window

Loan Processing Insurance and

Annuity Services

Regulatory and Compliance Services

Plan Document Services Consulting Accounting

Services

Legal Advice Domestic Relation

Orders (Legal Processing)

Participant Correspondence

Agency PRO Outreach &

Training

Plan Amendments

Audit Services

Out of Scope for this initiative https://www.tsp.gov/PlanParticipation/EligibilityAndContributions/establishingAccount.html#US http://militarypay.defense.gov/BlendedRetirement/ https://www.tsp.gov/PlanParticipation/EligibilityAndContributions/establishingAccount.html#bp https://www.tsp.gov/PDF/formspubs/tspbk08.pdf https://www.frtib.gov/ReadingRoom/index.html https://www.tsp.gov/InvestmentFunds/FundsOverview/comparisonMatrix.html

5. Draft Statement of Objectives

1. Provide a services platform and delivery system that is world class, agile, responsive, and secure, that meets agreed-to performance measures and drives better and smarter financial decisions by participants.

2. Provide exceptional participant experience that enables participants to identify and achieve their targeted retirement outcomes.

3. Provide a smooth and seamless conversion and transition with no disruption to participants.

6. Constraints

1. All provider service delivery facilities and personnel shall be located within the U.S. and its territories.

2. Indicative data submitted by federal government agency payroll does not include certain common data elements (e.g. marital status, deferral rate, gender, etc.)

3. FRTIB does not have authority over federal government agency payroll offices and are not coordinated via a centralized human resources authority.

4. The TSP is governed by FERSA as opposed to ERISA.

5. Mandatory interface to U.S. Treasury and FRTIB accounting systems.

6. Required compliance with Federal Information Security Modernization Act (FISMA) 2014 and

National Institute Standards of Technology (NIST) include Privacy Act and Federal Records Act or their equivalents.

7. The service provider must participate in audits of TSP services performed by Employee Benefits Security Administration (EBSA)/Department of Labor, Government Accountability Office (GAO), Financial Statement Auditor, etc.

8. FRTIB will retain plan data ownership and rights.

9. Only authorized FRTIB personnel can move funds in and out of the TSP account maintained by the U.S. Treasury.

7. Responses Requested Please provide your response to the following statements:

1. Describe how your services can accommodate distinctive plan characteristics including separate or distinctive business rules.

2. Describe the largest plan that is on your platform.

3. Describe the largest plan that you have converted.

4. Describe how long it took to convert the large plan.

5. Describe how in-process transactions are managed.

6. Describe your lessons learned on the large plan conversion.

7. Describe how you support data conversions and/or data transfers when transitioning a new large plan.

8. Describe how and whether you transfer and retain participants’ beneficiary designations during conversions.

9. Describe your experience with taking over another recordkeeper’s operations if any (e.g., converting multiple plans simultaneously).

10. Describe the aspects of the TSP Profile and Constraints that might present challenges to your service delivery and why. Can you overcome these challenges?

11. Describe how you ensure security and privacy including compliance with applicable regulatory and security frameworks.

12. Describe how you protect personally identifiable information (PII) and safeguard participant and beneficiary accounts.

13. Describe how you handle transaction exception processing.

14. Describe how you handle participant and beneficiary case management, including how you would determine when a case should be escalated to the FRTIB.

15. Describe how you have addressed challenges with disbursement processing required to be performed by third party disbursement agents.

16. Describe what factors would affect your pricing model based on the in-scope services for this initiative.

17. Describe how your service delivery accommodates globally located participants.

18. Describe how you address quality management and continuous process improvement.

19. Describe what specific additional information about scope requirements are required to provide an informed and competitive solution.

8. Appendix A: FRTIB Aligned Industry Framework Definitions

Note: capabilities in gray are out of scope.

Service Capability Description/Elaboration

Administrative Services

Recordkeeping

Includes maintaining plan records; payroll processing;

processing participants’ investment elections, contributions, and distributions; and issuing account statements to participants.

Transaction Processing Includes purchases and sales of participants’ assets.

Trustee services (Custodial Bank) Provide the safe holding of the plan’s assets in a trust.

Participant- Focused Services

Participant Communication Design

Branding, look and feel, content.

Participant Correspondence

Includes call centers, voice-response systems, Web access, and preparation of the TSP Plan Summary, excludes congressional inquiries and correspondence regarding decisions for which the FRTIB is required by law to retain final authority.

Participant TSP (Financial) Education and Advice

Includes online calculators and face-to-face investment advice.

Agency PRO Outreach and Training

Includes communication, education, and overall awareness training for employing agency employee's.

Investment Management (C,F,S,I, Funds) excludes G

Offered through a variety of professionally managed investment options.

Mutual Fund Window

If offered/applicable, allow for direct purchase of mutual funds by plan participants, in order to allow participants to choose investments other than the TSP.

Loan Processing Process loans and administrative services associated with loans.

Insurance and Annuity Services

Includes offering annuities to satisfy annuity distribution options.

Service Capability Description/Elaboration

Regulatory and Compliance

Services

Plan Document Services

The plan document details the benefits offered to participants and provides guidelines for the plan administrator in decision-making regarding plan operations.

Consulting Includes assistance in selecting the investments offered to participants.

Accounting Services Accounting services for plan.

Audit Services Audit service for plan including preparation of annual report.

Legal Advice Includes advice regarding compliance with legal requirements and second level review of benefits.

Plan Amendments Development and authorization of plan changes.

Processing of Domestic Relations Orders (Legal Processing)

Ensure the split of accounts pursuant to legal processing.