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HomeMy WebLinkAboutItem 06.k Date: Item No. FUNDED HRA SUCCESSOR TRUSTEE CHANGE DOCUMENTS Proposed Action Staff recommends adoption of the following motion: Move to approve the Funded HRA Successor Trustee Change Documents. Overview The City’s Plan Administrator for VEBA and H.S.A. funds, Genesis Employee Benefits, is transferring assets from U.S. Bank to Matrix Trust Company effective April 6, 2016. The attached documents are required to facilitate this change. The asset conversion will begin on Monday, April 4. At that time, participants will be temporarily unable to make investments in order to allow a quick conversion. Assets will once again be available to participants on Wednesday, April 6. Roger Knutson has reviewed the various agreement attached and has approved them for content. Primary Issues to Consider • None. Supporting Information • See attached documents. Financial Impact: $ Budgeted: Y☐ N☐ Source: Related Documents: (CIP, ERP, etc.): Envision Lakeville Community Values: Good Value for Public Services Report Completed by: Cindi Joosten, Human Resources Manager March 21, 2016 0.00 1   AGREEMENT OF RESIGNATION, APPOINTMENT, AND ACCEPTANCE WHEREAS, U.S. Bank National Association (the “Bank”) is the sole trustee of the CITY OF LAKEVILLE VEBA HEALTH SAVINGS TRUST (the “Trust”) maintained under the trust agreement entitled AMERICA'S VEBA SOLUTION BASIC TRUST DOCUMENT - US BANK (NO. 7.0.0.0) between CITY OF LAKEVILLE AND LAKEVILLE ARENAS (the “Plan Sponsor”) and the Bank dated 1/1/2008 (the “Trust Agreement”). WHEREAS, Section § 5.1 of the Trust Agreement provides that the Bank may resign as trustee by providing written notice to the Plan Sponsor; the Plan Sponsor also serves as the “Plan Administrator,” as that term is defined in the Trust Agreement; and the Bank previously provided that notice to the Plan Sponsor. WHEREAS, Section 5.2 of the Trust Agreement provides that the Plan Sponsor shall appoint a successor trustee of the Trust; and the Plan Sponsor wishes to appoint ____________________________________ (the “Successor Trustee”) as successor trustee of the Trust. WHEREAS, Section 5.3 of the Trust Agreement provides that the Bank shall transfer and deliver the residual assets of the Trust to the Successor Trustee, and the Successor Trustee shall succeed to the title of the Trust vested in the Bank and shall have all the powers, rights, and duties conferred by the Trust Agreement as if originally named trustee. WHEREAS, the Successor Trustee is willing to accept its appointment as such. NOW, THEREFORE, the parties hereto agree as follows: 1. Resignation. The Plan Sponsor hereby acknowledges that the Bank has resigned as trustee of the Trust pursuant to the Trust Agreement. 2. Assignment. The Plan Sponsor hereby directs the Bank to, and the Bank hereby does, assign, transfer, and deliver the Bank’s powers, rights, duties, and interest in the Trust to the Successor Trustee pursuant to the Trust Agreement. The Bank covenants to execute all documents and do all other acts necessary to vest title in the Successor Trustee. 3. Acceptance. The Successor Trustee hereby accepts sole trusteeship of the Trust and accepts the powers, rights, duties, and interest in the Trust pursuant to the Trust Agreement, effective upon transfer of Trust assets to the Successor Trustee. 4. Consent. The Plan Sponsor hereby accepts the Bank’s resignation as trustee. The Plan Sponsor hereby appoints the Successor Trustee as successor trustee of the Trust with all the powers, rights, and duties conferred by the Trust Agreement as if the Successor Trustee were originally named as trustee. IN WITNESS WHEREOF, the Bank, the Plan Sponsor, and the Successor Trustee have executed this document. CITY OF LAKEVILLE AND LAKEVILLE ARENAS By: __________________________________ Its: __________________________________ U.S. Bank National Association By: __________________________________ Its: Vice President and Relationship Manager The Successor Trustee By: __________________________________ Its: __________________________________ Matrix Trust Company 20195 Holyoke Avenue, Lakeville, MN 55044 952-985-4400 • 952-985-4499 fax www.lakevillemn.gov March 15, 2016 U.S. Bank National Association c/o Nic Maylone 800 Nicollet Mall | BC-MN-H11T Minneapolis, MN 55402 RE: City of Lakeville VEBA Health Savings Trust Dear Mr. Maylone: Please accept this notification as a formal request to discontinue our VEBA Health Savings Trust with US Bank. This change shall become effective on April 6, 2016. We direct U.S. Bank to transfer all of our assets to Matrix Trust Company as trustee of the City of Lakeville VEBA Health Savings Trust via in-kind transfer on this day and provide Genesis, a TASC Division with the final asset amounts transferred. Transfer Type B-52 Matrix Clearing ID 5954 Trading Level Zero Receiving Fund Account # Will be sent under a separate cover Once the assets have been successfully transferred to Matrix, please close our account with U.S. Bank. Sincerely, City of Lakeville and Lakeville Arenas By: ______________________________ Its: Authorized Officer AMENDMENT TO ADMINISTRATION AGREEMENT WHEREAS, Total Administrative Services Corporation d/b/a Genesis Employee Benefits and City of Lakeville (as Adopting Employer and Plan Administrator) have heretofore entered a Non-ERISA Administration Agreement (the “Agreement”) effective January 1, 2014; and WHEREAS, the Agreement provides that it may be amended by mutual written agreement of the parties; WHEREAS, the parties wish to amend the Agreement as provided herein. NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein and the Agreement, effective April 6, 2016, the parties hereby agree to the following amendments to the Agreement: 1. Section IV.F. of the Agreement is amended by adding the following paragraph: 7. Trustee Fees. Adopting Employer has appointed a trustee of the Trust. To the extent the trustee charges an annual fixed fee for its services as trustee, Plan Supervisor shall pay such fixed fee on Adopting Employer’s behalf and then obtain reimbursement for such payment from Adopting Employer or the Trust as provided in the Adoption Agreement. Adopting Employer agrees to reimburse Plan Supervisor for such fixed fee or authorize reimbursement from the Trust. To the extent the trustee charges an asset based fee for its services as trustee, Plan Supervisor shall pay such asset based fees on Adopting Employer’s behalf. The trustee’s asset based fees are included in the quarterly asset based fee reflected in Exhibit B, which Adopting Employer has agreed to pay to Plan Supervisor pursuant to this Section IV.F. 2. Exhibit B (Administrative Fees) to the Agreement is replaced by the Exhibit B attached to this Amendment. IN WITNESS WHEREOF, the parties have executed this Agreement to be effective as of the effective date indicated above. City of Lakeville By: Title: ___________________________________ TOTAL ADMINISTRATIVE SERVICES CORPORATION By: Title: ____________________________________ EXHIBIT B Administrative Fees The following describes the standard and optional Funded HRA claims administration and recordkeeping services and fees, and the party which will be responsible for paying the fees: STANDARD SERVICES Recordkeeping PPPM1 Fee $2.50 Quarterly Asset Based Fee 0.075% Claims PPPM Fee $5.00 Recordkeeping PPPM Fee for Additional Accounts2 $1.00 Claims PPPM Fee For Additional Accounts3 $1.00 Minimum Monthly Fee (excluding asset based fees or fees charged to Participant accounts): $250 1 “PPPM” means per participant per month. 2 Fee applies for each additional recordkeeping account or sub-account created under the Plan for a Participant in excess of one account. 3 Fee applies for each additional claims account or sub-account created under the Plan for a Participant in excess of one account. OTHER FEES (as applicable) Description of Service Fee Standard communication materials (some materials will reflect actual plan provisions, but no custom fonts, wording, logos, etc.; customization is available – see below for optional services and fees) N/C Annual participant statements mailed to employer for distribution (mailed within 22 business days following plan anniversary) N/C Standard Plan – Plan and Trust documents N/C Preparation of Annual IRS Form 990 N/C Preparation of Summary of Benefits and Coverage (SBC) N/C Check re-issue fee (charged to participant) $25 Fee to correct erroneous data provided by Adopting Employer or Plan Administrator $150/hour Custom file formatting $150/hour Wire transfer fee (ACH deposits, no additional fee) $20 Record review and transfer upon termination $150/hour OPTIONAL SERVICES Initial to Authorize Optional Service Description of Optional Service Fee __________ Custom Plan – Plan and Trust documents, Form 1024 filing* ** __________ Plan amendments/restatements requested by Adopting Employer* $250 __________ Mailing of statements to participants’ homes (fee per participant per statement; includes postage) $1.00 per statement __________ Additional participant statements mailed to employer or participants’ homes (fee per participant per statement; includes postage) $1.00 per statement __________ Discrimination testing (per test) $150/hour __________ Consulting to correct failed discrimination tests $150/hour __________ Employee meetings (per meeting, plus travel expenses) $275 __________ Multi-site billing and accounting (per site) $25 __________ Customized communication materials (e.g., custom fonts, wording, logos, etc.) (annual fee) $150/hr + production costs + .25¢ PPPM * Work may be performed on behalf of Plan Supervisor by Hitesman & Wold, P.A. ** As provided in the Engagement Letter between Hitesman & Wold, P.A. and the Adopting Employer.