Recordkeeping, Administration, and Investment Options for the State of Tennessee's Optional Retirement Program and Public Higher Education 403(b) Plans

STATE OF TENNESSEE TREASURY DEPARTMENT REQUEST FOR PROPOSALS FOR RECORDKEEPING, ADMINISTRATION, AND INVESTMENT OPTIONS FOR THE STATE OF TENNESSEE’S OPTIONAL RETIREMENT PROGRAM AND PUBLIC HIGHER EDUCATION 403(b) PLANS RFP # 30901- 65526 RFP CONTENTS SECTIONS: 1. INTRODUCTION 2. RFP SCHEDULE OF EVENTS 3. RESPONSE REQUIREMENTS 4. GENERAL CONTRACTING INFORMATION & REQUIREMENTS 5. EVALUATION & CONTRACT AWARD ATTACHMENTS: 6.1. Response Statement of Certifications & Assurances 6.2. Technical Response & Evaluation Guide 6.3. Cost Proposal & Scoring Guide 6.4. Reference Questionnaire 6.5. Score Summary Matrix 6.6. Pro Forma Contract 6.7. Number of Employees and ORP Eligibility Summaries for UT 6.8. Number of Employees and ORP Eligibility Summaries for TBR and LGI’s 6.9. Cash Flow, Activity and Participation Details for each Current ORP Vendor 6.10. Cash Flow, Activity and Participation Details for each Current 403(b) Plan Vendor 6.11. Investment Lineups 6.12. Tennessee Treasury Managed Fund Disclosure and Daily Valuation Operating Procedures 6.13. GASB Investment Option Monthly Reporting Template RFP 30901-65526 1 1. INTRODUCTION The State of Tennessee, Treasury Department , hereinafter referred to as “the State,” issues this Request for Proposals (RFP) to define minimum contract requirements; solicit responses; detail response requirements; and, outline the State’s process for evaluating responses and selecting a contractor to provide the needed goods or services. Through this RFP, the State seeks to procure necessary goods or services at the most favorable, competitive prices and to give ALL qualified respondents an opportunity to do business with the state as contractors, subcontractors or suppliers. 1.1. Statement of Procurement Purpose The State is seeking competitive proposals from qualified organization(s) to provide recordkeeping/administration; communication/education; in- person and virtual field education; investment advisory; broad, open- architecture investment platforms; and custo dial trustee services for the State’s Optional Retirement Program (ORP), the University of Tennessee 403(b) Plan, and the Tennessee Board of Regents 403(b) Plan. The State is looking for two (2) service providers for both the ORP and 403(b) Plans. These service providers will provide accurate and timely recordkeeping services for both the ORP and 403(b) Plans (collectively, the Plans or Program), administer the Pl ans within pre- described service standards and assist in the education and retirement security of Program participants . In the event a successful Respondent is an incumbent service provider, the services for the new contract term shall commence on the dat e provided for in Section B of RFP Attachment 6.6., Pro Forma Contract . In the event a successful Respondent is not an incumbent service provider, these services shall begin no later than September 1, 2027 . This RFP will result in the award of two contracts each encompassing the ORP and 403(b) Plans (e.g., Respondent 1 – ORP and 403(b) Plans and Respondent 2 – ORP and 403(b) Plans). Currently, the ORP, Tennessee Board of Regents 403(b) Plan, and University of Tennessee 403(b) Plan maintain separate plan documents. The State may elect to combine the Tennessee Board of Regents 403(b) Plan and University of Tennessee 40 3(b) Plan into a single plan document in the future. The State’s goals and objectives for this RFP include:

• Reducing the current fee structure, by lowering participant and Program expenses, through a

nationwide competitive bidding process;

• Providing a transparent and equitable fee structure in which third- party administrator/recordkeeping

expenses are an explicit charge to participant accounts;

• Enhancing participant support, service, and education;
• Providing participants with the technological and educational tools to set and monitor progress toward

holistic retirement readiness goals;

• Streamlining employer reporting, Program administration, and Program compliance activities.

In pursuing these goals and objectives, the State places a high value on the following service provider qualifications: Experience and Presence in the Higher Education Defined Contribution Market

• Has extensive historical experience, demonstrated expertise, and a significant current presence in the

higher education defined contribution marketplace. Focus on Quality and Consistency of Service Delivery

• Has a customer -focused approach;
• Adheres to successful quality assurance procedures;
• Follows a successful problem resolution methodology;
• Has a history of performing services on a timely basis;
• Performs services correctly and accurately every time;
• Able to receive and process payroll files of multiple frequencies from multiple pay centers;

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• Able to perform an active role in all IRS deferral limit monitoring;
• Has the ability to reconcile participant deferral elections (for 403(b) Plans) and statutory contribution

requirements (for ORP) with contributions received after each payroll file and produce regular reports indicating instances in which contributions do not match deferrals;

• Able to efficiently make corrections in accordance with the IRS Employee Plans Compliance

Resolution System (EPCRS);

• Able to create/disseminate employer education materials, i.e. , (i) How to use reporting portal and (ii)

Employer “manual” for administrative systems;

• Able to process enrollments and deferral changes submitted by paper form, electronically online, or

by telephone;

• Has ample client service staff to support the Plans payroll staff;
• Provides accurate, consistent and timely responses to inquiries;
• Provides reports on quality assurance; and
• Will sign a provider agreement specifying compliance activities to be performed by the service provider .

Proactive Approach to Participant Education and Retirement Readiness

• Provides excellent , comprehensive participant enrollment and onboarding experience that ensures

new participants are well -informed about the Plan(s) and key actions they need to take;

• Provides adequate access to in- state, one on one meetings with credentialed, preferably FINRA -

certified, field representatives at all campuses served within a reasonable amount of time;

• Provides field representatives that:
• Will provide plan information and retirement planning services with the ability to incorporate assets from other plans into retirement planning;
• Will conduct group meetings on the Plans (i.e. plan orientations) as well as general purpose financial education meetings on a variety of topics (budgeting, market volatility, Social Security,

etc.);

• Ability to easily schedule meetings with field representatives and have the meeting occur within a

reasonable amount of time;

• Ability to measure participant satisfaction with field representative services;
• Ability to measure outcomes from field representative meetings;
• Ability to measure “retirement readiness” and specifically target those who are lacking in this area with outreach;
• Ability to create and deploy targeted, personalized communications in a variety of media (emails,

mailers, videos, etc.) that measurably enhance participant engagement;

• Produces easy to understand, participant -friendly communications that are actionable and

informative;

• Provides informed toll -free customer service center and field representatives;
• Provides a user -friendly participant Internet site with evidence- based retirement readiness tools and

information;

• Provides on- going on -site visits to individual Plan groups for individual and group educational

meetings;

• Provides on- going employee training sessions that discuss retirement planning issues, including one-

on-one individual financial advising; and

• Focuses on financial wellness as well as retirement readiness.

Commitment to Technology and Resource Development

• Will interface with the payroll systems of the University of Tennessee System, the Tennessee Board

of Regents, and six locally governed institutions as described below;

• Provides up to date, secure platforms that are easy for participants and the Plans to use;
• Has a defined plan for keeping platforms updated and secure;
• Continuously invests in technology and information/cyber -security;
• Has a participant website that:
• Has ORP and 403(b) account balances visible and manageable in single online account for those

impacted; RFP 30901-65526 3

• Provides the ability for participants to utilize online retirement planning and investment guidance

tools and services;

• Has holistic retirement income projections/goal tracking in an online account that takes into account

not only ORP and 403(b) account and social security information, but the ability to incorporate outside accounts ( e.g., State’s 401(k) and 457(b) plans at a minimum, and TCRS if applicable) and provides analysis of ways for the participant to remedy any estimated shortfall between the goal and projection;

• Is able to perform all account functions – enroll, change deferral, change investment allocation,

update beneficiary, contact info, etc.;

• Allows participants to schedule/request a meeting with field representatives in a timely manner;
• Provides access to all needed Plan forms;
• Has the ability to view investment disclosure and performance documents; and
• Provides access to financial planning tools (budgeting, educational webinars, etc.);
• Demonstrates excellence (accuracy, timeliness, etc.) in client service through technology; and
• Demonstrates dedication to continuously incorporating evidence- based improvements and best

practices, including behavioral finance, into all service offerings. Program Background (ORP) In General . The ORP is a defined contribution 401(a) retirement plan that is available to exempt employees of the University of Tennessee System (UT), the Tennessee Board of Regents (TBR), and six locally governed institutions (LGI’s). Exempt employees are those empl oyees who hold positions that are exempt from the Fair Labor Standards Act (FLSA). The State sponsors the ORP as an alternative to the State’s defined benefit 401(a) plan, known as the Tennessee Consolidated Retirement System (TCRS). Participation in eit her TCRS or the ORP is a condition of full -time employment for individuals who are exempt from the FLSA and who are employed in State supported institutions of higher education. The number of employees and ORP eligibility summaries for UT as of October 2025 are contained in RFP Attachment 6.7. RFP Attachment 6.8 contains the number of employees and ORP eligibility summaries for TBR and the LGI’s as of October 2025 . Authority and Governance . The provisions governing the ORP are codified in Tennessee Code Annotated, Sections 8- 25-201 et seq. and in Sections 8- 36-903 and 8- 36-923 and in the ORP Plan Document, which is attached as Contract Attachment 1 to RFP Attachment 6. 6., Pro Forma Contract . The ORP is a qualified plan under Section 401(a) of the Internal Revenue Code. The State issues this RFP as the ORP Plan sponsor. The ORP is governed by four Trustees designated in state law (T.C.A. § 8- 25-203). The State Treasurer who is also the Chair of the Board of Trustees of the Tennessee Consolidated Retirement System serves as a Trustee for and Plan Administrator of the ORP, and administration of the ORP is housed in the Treasury Department under the Trustees’ purview. Plan Design . The ORP is a defined contribution plan with required employee and employer contributions depending on the participating employee’s date of hire. Employer and employee contribution amounts are set in statute. An ORP participant directs contributions to sp ecific investment products made available by at least one and to as many as two ORP service providers. ORP participants may redirect past and future contributions between and among the service providers each payroll cycle. The vast majority of ORP participants direct contributions to only one service provider. The ORP currently has two active service providers ; namely, TIAA and Voya. Qualifying faculty and staff who became ORP members at any time prior to July 1, 2014 participate in the non-contributory ORP plan. The employer makes a contribution equal to 10% of the employee’s earnable compensation, plus 1% of the part of the employee’s earnable compensation in excess of the employee’s covered compensation to the member’s ORP account. The terms “earnable compensation” and “covered compensation” are defined in Sections 1.6 and 1.4 of the ORP Plan Document (Contract Attachment 1 to RFP Attachment 6.6., Pro Forma Contract ). The member may direct contributions to one or more of the ORP plan service providers. The non- contributory ORP Plan is closed to new members. RFP 30901-65526 4 Qualifying faculty and staff who became ORP members on or after July 1, 2014 are eligible to participate in the contributory ORP Plan. The employer contributes 9% of earnable compensation to the member’s ORP account. The member contributes 5% of the employee’s earnable compensation to the ORP plan. All contributions to the member’s ORP account are made on a pre- tax basis and may not be altered. The member may direct all contributions to one or more of the ORP plan service providers. The current investment lineups for the ORP are provided in RFP Attachment 6.11. UT, TBR, and LGI’s . The UT System consists of six institutions of higher education located throughout the State. The TBR includes thirteen community colleges, and twenty -two colleg es of applied technology (“TCATs”). The six locally governed institutions are: Austin Peay State University, East Tennessee State University, Middle Tennessee State University, Tennessee State University, Tennessee Technological University, and the University of Memphis. The UT, East Tennessee State University, Tennessee Tech University, Austin Peay State University , and the University of Memphis payroll and benefits systems use Oracl