CC - Item 5K - ICMA Deferred Compensation Program•
E
ROSEMEAD CITY COUNCIL
STAFF REPORT
TO: THE HONORABLE MAYOR AND CITY COUNCIL
FROM: OLIVER CHI, CITY MANAGER
DATE: MARCH 25, 2008
SUBJECT: ICMA DEFERRED COMPENSATION 401(a) PROGRAM
SUMMARY
The City currently offers an employer funded deferred compensation program as part of
the Memorandum of Understanding (MOU) that was approved for the fiscal year 2007-
08, however, the City does not currently have a deferred compensation plan for such
contributions. The approval of a 401(a) plan would allow for such contributions without
affecting each employee's ability to voluntarily contribute to the existing 457 plan.
Staff Recommendation
Staff recommends that the City Council adopt the resolution (Attachment A)
implementing an ICMA 401(a) Retirement Plan, approve the Administrative Services
Agreement with ICMA (Attachment B), and authorize the City Manager to execute any
additional document involved with the plan implementation.
ANALYSIS
In compliance with the Internal Revenue Code, ICMA offers a 401(a) Deferred
Compensation Profit-Sharing program for eligible entities. Under the rules of the
Internal Revenue Code, a 401(a) Profit-Sharing program may be established with
mandatory contributions. Since the City benefits include a fixed rate contribution based
upon longevity, contributions to this plan may be made on a tax-exempt basis. The
proposed 401(a) plan is slightly more restrictive than the existing 457 plan and
participants must be at least 59 years of age prior to requesting a distribution of funds
to avoid early withdrawal penalties. The key benefit to having this plan is that it has
separate annual contributions limits from the 457 plan. Therefore, the City can
contribute the funds to the 401(a) program without affecting an employee's contribution
or limit for the existing 457 Plan.
FINANCIAL REVIEW
There is no new financial impact to the City through the implementation of the ICMA
401(a) program. Funds have been budgeted for the benefits currently approved in the
MOU.
APPROVED FOR CITY COUNCIL AGENDA: 11) • 1/47
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City Council Meeting
March 25, 2008
Page 2 of 2
PUBLIC NOTICE PROCESS
This item has been noticed through the regular agenda notification process.
Submitted by:
Matthew E. Hawkesworth
Assistant City Manager
Attachment A: Resolution to include ICMA Profit Sharing Plan
Attachment B: Administrative Services Agreement
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ATTACHMENT A
RESOLUTION: 2008-16
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ROSEMEAD,
COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, IN THE MATTER OF
AMENDING THE ICMA-RC RETIREMENT PLAN TO INCLUDE THE PROFIT-
SHARING PLAN.
WHEREAS, the City of Rosemead has employees rendering valuable services;
and
WHEREAS, the establishment of a Profit-Sharing retirement plan benefits
employees by providing funds for retirement and funds for their beneficiaries in the event
of death; and
WHEREAS, the City of Rosemead desires that its Profit-Sharing retirement plan
be administered by ICMA-RC and that the funds held in such plan be invested in the
VantageTrust, a trust established by public employers for the collective investment of
funds held under their retirement and deferred compensation plans:
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF ROSEMEAD
HEREBY RESOLVES AS FOLLOWS:
The City of Rosemead hereby establishes or has established a Profit-Sharing
retirement plan (the "Plan") in the form of the ICMA Retirement Corporation
Governmental Profit-Sharing Plan & Trust, pursuant to the specific provisions of
the Adoption Agreement (executed copy attached hereto).
The Plan shall be maintained for the exclusive benefit of eligible employees and
their beneficiaries; and
BE IT FUTHER RESOLVED that the City of Rosemead hereby executes the
Declaration of Trust of VantageTrust, (executed copy attached hereto), intending this
execution to be operative with respect to any retirement or deferred compensation plan
subsequently established by the City of Rosemead, if the assets of the plan are to be
invested in the VantageTrust.
BE IT FURTHER RESOLVED that the City of Rosemead here by agrees to serve
as trustee under the Plan and to invest funds held under the Plan in the VantageTrust;
and
BE IT FURTHER RESOLVED that the City Manager shall be the coordinator for
the Plan; shall receive reports, notices, etc., from the ICMA Retirement Corporation or
the VantageTrust; shall cast, on behalf of the City of Rosemead, any required votes
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under the VantageTrust; may delegate any administrative duties relating to the Plan to
appropriate departments; and
BE IT FURTHER RESOLVED that the City of Rosemead hereby authorizes the
City Manager to execute all necessary agreements with the ICMA Retirement
Corporation incidental to the administration of the plan.
PASSED, APPROVED AND ADOPTED this 8th day of January 2008.
John Tran
MAYOR
ATTEST:
Gloria Molleda
City Clerk
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ATTACHMENT B
ADMINISTRATIVE SERVICES AGREEMENT
Between
ICNIA. Retirement Corporation
and
City of Rosemead
Type: 401
Account 106564
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Plan number 106564
ADMINISTRATIVE SERVICES AGREEMENT
This Administrative Services Agreement ("Agreement"), made as of the 25 day
of March, 2008 (herein referred to as the "Inception Date"), between the International
City/County Management Association Retirement Corporation ("ICMA-RC"), a
nonprofit corporation organized and existing under the laws of the State of Delaware, and
the City of Rosemead ("Employer"), a City organized and existing under the laws of the
State of California with an office at 8838 East Valley Boulevard, Rosemead, California
91770-1714.
RECITALS
Employer acts as a public plan sponsor for a retirement plan ("Plan") with
responsibility to obtain investment alternatives and services for employees participating
in that Plan;
VantageTrust (the "Trust") is a common law trust governed by an elected Board
of Trustees for the commingled investment of retirement funds held by various state and
local governmental units for their employees;
ICMA-RC acts as investment adviser to the Trust; ICMA-RC has designed, and
the Trust offers, a series of separate funds (the "Funds") for the investment of plan assets
as referenced in the Trust's principal disclosure document, "Making Sound Investment
Decisions: A Retirement Investment Guide." ("Retirement Investment Guide").
The Funds are available only to public employers and only through the Trust and
ICMA-RC.
In addition to serving as investment adviser to the Trust, ICMA-RC provides a
complete offering of services to public employers for the operation of employee
retirement plans including, but not limited to, communications concerning investment
alternatives, account maintenance, account record-keeping, investment and tax reporting,
transaction processing, benefit disbursement, and asset management.
AGREEMENTS
Appointment of ICMA-RC
Employer hereby appoints ICMA-RC as Administrator of the Plan to perform all
nondiscretionary functions necessary for the administration of the Plan with respect to
assets in the Plan deposited with the Trust. The functions to be performed by ICMA-RC
shall be those set forth in Exhibit A to this Agreement.
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2. Adoption of Trust
J
Plan number 106564
Employer has adopted the Declaration of Trust of VantageTrust and agrees to the
commingled investment of assets of the Plan within the Trust. Employer agrees that
operation of the Plan and the investment, management, and distribution of amounts
deposited in the Trust shall be subject to the Declaration of Trust, as it may be amended
from time to time and shall also be subject to terms and conditions set forth in disclosure
documents (such as the Retirement Investment Guide or Employer Bulletins) as those
terms and conditions may be adjusted from time to time. It is understood that the term
"Employer Trust' as it is used in the Declaration of Trust shall mean this Administrative
Services Agreement.
Employer Duty to Furnish Information
Employer agrees to furnish to ICMA-RC on a timely basis such information as is
necessary for ICMA-RC to carry out its responsibilities as Administrator of the Plan,
including information needed to allocate individual participant accounts to Funds in the
Trust, and information as to the employment status of participants, and participant ages,
addresses, and other identifying information (including tax identification numbers).
ICMA-RC shall be entitled to rely upon the accuracy of any information that is furnished
to it by a responsible official of the Employer or any information relating to an individual
participant or beneficiary that is furnished by such participant or beneficiary, and ICMA-
RC shall not be responsible for any error arising from its reliance on such information.
ICMA-RC will provide account information in reports, statements or accountings.
4. Certain Representations and Warranties
ICMA-RC represents and warrants to Employer that:
(a) ICMA-RC is a non-profit corporation with full power and authority to
enter into this Agreement and to perform its obligations under this
Agreement. The ability of ICMA-RC to serve as investment adviser to the
Trust is dependent upon the continued willingness of the Trust for ICMA-
RC to serve in that capacity.
(b) ICMA-RC is an investment adviser registered as such with the U.S.
Securities and Exchange Commission under the Investment Advisers Act
of 1940, as amended. ICMA-RC Services, LLC (a wholly owned
subsidiary of ICMA-RC) is registered as a broker-dealer with the U.S.
Securities and Exchange Commission ("SEC") and is a member in good
standing with Financial Industry Regulatory Authority ("FINRA") and the
Securities Investor Protection Corporation ("SIPC").
(c) ICMA-RC shall maintain and administer the Plan in compliance with the
requirements for plans which satisfy the qualification requirements of
Section 401 of the Internal Revenue Code and other applicable federal
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Plan number 106564
law; provided, however, ICMA-RC shall not be responsible for the
qualified status of the Plan in the event that the Employer directs ICMA-
RC to administer the Plan or disburse assets in a manner inconsistent with
the requirements of Section 401 or otherwise causes the Plan not to be
carried out in accordance with its terms; provided, further, that if the plan
document used by the Employer contains terms that differ from the terms
of ICMA-RC's standardized plan document, ICMA-RC shall not be
responsible for the qualified status of the Plan to the extent affected by the
differing terms in the Employer's plan document.
Employer represents and warrants to ICMA-RC that:
(d) Employer is organized in the form and manner recited in the opening
paragraph of this Agreement with full power and authority to enter into
and perform its obligations under this Agreement and to act for the Plan
and participants in the manner contemplated in this Agreement. Execution,
delivery, and performance of this Agreement will not conflict with any
law, rule, regulation or contract by which the Employer is bound or to
which it is a party.
(e) Employer understands and agrees that ICMA-RC's sole function under
this Agreement is to act as recordkeeper and to provide administrative,
investment or other services at the direction of Plan participants, the
Employer, its agents or designees in accordance with the terms of this
Agreement. Under the terms of this Agreement, ICMA-RC does not
render investment advice, is not the Plan Administrator or Plan Sponsor as
those terms are defined under applicable federal, state, or local law, and
does not provide legal, tax or accounting advice with respect to the
creation, adoption or operation of the Plan and the Trust.
(f) Employer acknowledges that certain such services to be performed by
ICMA-RC under this Agreement may be performed by an affiliate or
agent of ICMA-RC pursuant to one or more other contractual
arrangements or relationships, and that ICMA-RC reserves the right to
change vendors with which it has contracted to provide services in
connection with this Agreement without prior notice to Employer.
Participation in Certain Proceedings
The Employer hereby authorizes ICMA-RC to act as agent, to appear on its behalf, and to
join the Employer as a necessary party in all legal proceedings involving the garnishment
of benefits or the transfer of benefits pursuant to the divorce or separation of participants
in the Employer Plan. Unless Employer notifies ICMA-RC otherwise, Employer consents
to the disbursement by ICMA-RC of benefits that have been garnished or transferred to a
former spouse, current spouse, or child pursuant to a domestic relations order or child
support order.
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6. Compensation and Payment
is
Plan number 106564
(a) Plan Administration Fee. The amount to be paid for plan administration
services under this Agreement shall be 0.55% per annum of the amount of
Plan assets invested in the Trust. Such fee shall be computed based on
average daily net Plan assets in the Trust.
(b) Mutual Fund Services Fee. There is an annual charge of 0.15% assessed
against average daily net Plan assets invested in the Trust's non-
proprietary funds of VantageTrust.
(c) Compensation for Management Services to the Trust, Compensation for
Advisory and other Services to The Vantagepoint Funds and Payments
from Third-Party Mutual Funds. Employer acknowledges that in addition
to amounts payable under this Agreement, ICMA-RC receives fees from
the Trust for investment management services furnished to the Trust.
Employer further acknowledges that certain wholly owned subsidiaries of
ICMA-RC receive compensation for advisory and other services furnished
to The Vantagepoint Funds, which serve as the underlying portfolios of a
number of Funds offered through the Trust. The fees referred to in this
subsection are disclosed in the Retirement Investment Guide. These fees
are not assessed against assets invested in the Trust's Mutual Fund Series.
In addition, to the extent that third party mutual funds are included in the
investment line-up for the Plans, ICMA-RC may receive payments from
such third party mutual funds or their service providers, which may be in
the form of 12b-1 fees, service fees, or compensation for sub-accounting
or other services provided by ICMA-RC on behalf of the funds.
(d) Redemption Fees. Redemption fees imposed by outside mutual funds in
which Plan assets are invested are collected and paid to the mutual fund by
ICMA-RC. ICMA-RC remits 100% of redemption fees back to the
specific mutual fund to which redemption fees apply. These redemption
fees and the individual mutual fund's policy with respect to redemption
fees are specified in the prospectus for the individual mutual fund and
referenced in the Retirement Investment Guide.
(e) Payment Procedures. All payments to ICMA-RC pursuant to this Section
6 shall be paid out of the Plan assets held by the Trust and shall be paid by
the Trust, to the extent not paid by the Employer. The amount of Plan
assets held in the Trust shall be adjusted by the Trust as required to reflect
such payments. In the event that the Employer agrees to pay amounts
owed pursuant to this section 6 directly, any amounts unpaid and
outstanding after 30 days of invoice to the Employer shall be withdrawn
from Plan assets held by the Trust.
The compensation and payment set forth in this section 6 is contingent upon the
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Plan number 106564
Employer's use of ICMA-RC's EZLink system for contribution processing and
submitting contribution funds by ACH or wire transfer on a consistent basis over the
term of this Agreement.
Custody
Employer understands that amounts invested in the Trust are to be remitted directly to the
Trust in accordance with instructions provided to Employer by ICMA-RC and are not to
be remitted to ICMA-RC. In the event that any check or wire transfer is incorrectly
labeled or transferred to ICMA-RC, ICMA-RC may return it to Employer with proper
instructions.
8. Indemnification
ICMA-RC shall not be responsible for any acts or omissions of any person with respect
to the Plan or related Trust, other than ICMA-RC in connection with the administration
or operation of the Plan. Employer shall indemnify ICMA-RC against, and hold ICMA-
RC harmless from, any and all loss, damage, penalty, liability, cost, and expense,
including without limitation, reasonable attorney's fees, that may be incurred by, imposed
upon, or asserted against ICMA-RC by reason of any claim, regulatory proceeding, or
litigation arising from any act done or omitted to be done by any individual or person
with respect to the Plan or related Trust, excepting only any and all loss, damage, penalty,
liability, cost or expense resulting from ICMA-RC's negligence, bad faith, or willful
misconduct.
9. Term
This Agreement may be terminated without penalty by either party on sixty days advance
notice in writing to the other.
10. Amendments and Adiustments
(a) This Agreement may not be amended except by written instrument signed by the
parties.
(b) No failure to exercise and no delay in exercising any right, remedy, power or
privilege hereunder shall operate as a waiver of such right, remedy, power or
privilege.
(c) The parties agree that enhancements may be made to administrative and
operations services under this Agreement. The Employer will be notified of
enhancements through the Employer Bulletin, quarterly statements or special
mailings. Likewise, if there are any reductions in fees, these will be announced
through the Employer Bulletin, quarterly statement or special mailing.
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11. Notices
•
Plan number 106564
All notices required to be delivered under Section 10 of this Agreement shall be delivered
personally or by registered or certified mail, postage prepaid, return receipt requested, to
(i) Legal Department, ICMA Retirement Corporation, 777 North Capitol Street, N.E.,
Suite 600, Washington, D.C., 20002-4240; (ii) Employer at the office set forth in the first
paragraph hereof, or to any other address designated by the party to receive the same by
written notice similarly given.
12. Complete Agreement
This Agreement shall constitute the complete and full understanding and sole agreement
between ICMA-RC and Employer relating to the object of this Agreement and correctly
sets forth the complete rights, duties and obligations of each party to the other as of its
date. This Agreement supersedes all written and oral agreements, communications or
negotiations among the parties. Any prior agreements, promises, negotiations or
representations, verbal or otherwise, not expressly set forth in this Agreement are of no
force and effect.
13. Titles
The headings of Sections of this Agreement and the headings for each of the attached
schedules are for convenience only and do not define or limit the contents thereof.
14. Incorporation of Schedules
All Schedules (and any subsequent amendments thereto), attached hereto, and referenced
herein, are hereby incorporated within this Agreement as if set forth fully herein.
15. Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the
State of California, applicable to contracts made in that jurisdiction without reference to
its conflicts of laws provisions.
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Plan number 106564
In Witness Whereof, the parties hereto certify that they have read and understand this
Agreement and all Schedules attached hereto and have caused this Agreement to be
executed by their duly authorized officers as of the Inception Date first above written.
CITY OF ROSEMEAD
By Date
Signature
Name and Title (Please Print)
INTERNATIONAL CITY/COUNTY MANAGEMENT
ASSOCIATION RETIREMENT CORPORATION
By
Angela C. Montez
Assistant Corporate Secretary
Please return fully executed contract to: New Business Unit
ICMA-RC
777 North Capitol Street NE
Suite 600
Washington, DC 20002-4240
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Plan number 106564
Exhibit A
Administrative Services
The administrative services to be performed by ICMA-RC under this Agreement shall be
as follows:
(a) Participant enrollment services, including providing a welcome package and
enrollment kit containing instructions and notices necessary to implement
the Plan's administration.
(b) Establishment of participant accounts for each employee participating in the
Plan for whom ICMA-RC receives appropriate enrollment forms and
records. ICMA-RC is not responsible for determining if such Plan
participants are eligible under the terms of the Plan.
(c) Allocation in accordance with participant directions received in good
order of individual participant accounts to investment funds offered under
the Trust.
(d) Maintenance of individual accounts for participants reflecting amounts
deferred, income, gain or loss credited, and amounts distributed as
benefits.
(e) Maintenance of records for all participants for whom participant accounts
have been established in paper or electronic format. These files shall include
enrollment instructions, beneficiary designation instructions (to the extent
provided to ICMA-RC) and all other written correspondence and documents
concerning each participant's account, and if applicable, records of any
transaction conducted through the Voice Response Unit ("VRU"), the
Internet or other electronic means.
(f) Provision of periodic reports to the Employer and participants of the status
of Plan investments and individual accounts.
(g) Communication to participants of information regarding their rights and
elections under the Plan.
(h) Making available Investor Services Representatives through a toll-free
telephone number from 8:30 a.m. to 9:00 p.m. Eastern Time, Monday
through Friday (excluding holidays and days on which the securities
markets or ICMA-RC are closed for business (including emergency
closings), to assist participants.
(i) Making available a toll-free number and access to VantageLine, ICMA-
RC's interactive VRU, and ICMA-RC's web site, to allow participants to
access certain account information and initiate plan transactions at any
time.
Q) Distribution of benefits as agent for the Employer in accordance with
terms of the Plan.
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Plan number 106564
(k) Upon approval by the Employer that a domestic relations order is an
acceptable qualified domestic relations order under the terms of the Plan,
ICMA-RC will establish a separate account record for the alternate payee
and provide for the investment and distribution of assets held thereunder.
(1) Loans may be made available on the terms specified in the Loan Guidelines,
if loans are adopted by the Employer.
(m) Online Advice may be made available through a third party vendor on the
terms specified on ICMA-RC's website.
10
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OMB APPROVAL
OMB Number: 3235-0049
FORM ADV Expires: January 31, 2008
Uniform Application for Investment Adviser Registration Estimated average burden
Part II -Page 1 hours er response 9.402
Name of Investment Adviser:
International City Management Association Retirement Corporation ("ICMA-RC")
Address: (Number and Street) (City) (State) (Zip Code)
Area Code: Telephone Number:
777 North Capitol Street, N.W. Washington DC 20002
(202) 962-4600
This part of Form ADV gives information about the investment adviser and its business for the use of clients.
The information has not been approved or verified by any governmental authority.
Table of Contents
Item Number
Item
Page
1
Advisory Services and Fees
................................2
2
Types of Clients
................................2
3
Types of Investments
3
4
Methods of Analysis, Sources of Information, and Investment Strategies
................................3
5
Education and Business Standards
4
6
Education and Business Background
................................4
7
Other Business Activities
.A
8
Other Financial Industry Activities or Affiliations
4
9
Participation or Interest in Client Transactions
................................5
10
Conditions for Managing Accounts
................................5
11
Review of Accounts
................................5
12
Investment or Brokerage Discretion
................................6
13
Additional Compensation
6
14
Balance Sheet
6
Continuation Sheet
Balance Sheet, if required
Schedule F
..........................................Schedule G
(Schedules A, B, C, D, and E are included with Part I of this Form, for the use of regulatory bodies, and are not distributed to clients.)
Potential persons who are to respond to the collection of information contained in this form
are not required to respond unless the form displays a currently valid OMB control number.
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FORM ADV
Applicant:
SEC File Number:
Date:
Part II
- Page 2 1
ICMA-RC
~
801-18273
07/28/06
I. A.
Advisory Services and Fees. (check the applicable boxes) For each type of service provided, state the approximate %of total
advisory billings from that service.
(See instruction below.)
Applicant:
®
(1) Provides investment supervisory services
99%
❑
(2) Manages investment advisory accounts not involving investment supervisory services
%
®
(3) Furnishes investment advice through consultations not included in either service described above
I%
❑
(4) Issues periodicals about securities by subscription,
%
❑
(5) Issues special reports about securities not included in any services described above
%
❑
(6) Issues, not as part of any service described above, any charts, graphs, formulas, or other devices which
clients may use to evaluate securities
%
❑
(7) On more than an occasional basis, furnishes advice to clients on matters not involving securities.......
%
❑
(8) Provides a timing service
%
❑
(9) Furnishes advice about securities in any manner not described above
%
(Percentages should be based on applicant's last fiscal year. If applicant has not completed its first fiscal year, provide
estimates of advisory billings for that year and state that the percentages are estimates.)
Yes
No
B.
Does applicant call any of the services it checked above financial planning or some similar term?
❑
C.
Applicant offers investment advisory services for: (check all that apply)
®
(1) A percentage of assets under management ❑ (4) Subscription fees
❑
(2) Hourly charges ❑ (5) Commissions
®
(3) Fixed fees (not including subscription fees) ❑ (6) Other
D.
For each checked box in A above, describe on Schedule F:
• the services provided, including the name of any publication or report issued by the adviser on a
subscription basis or for a fee ,
applicant's basic fee schedule, how fees are charged and whether its fees are negotiable
• when compensation is payable, and if compensation is payable before service is provided, how a client
may et a refund or may terminate an investment advisory contract before its expiration date
2. Types of Clients Applicant generally provides investment advice to: (check those that apply)
®
A. Individuals ® E. Trusts, estates, or charitable organizations
❑
B. Banks or thrift institutions ❑ F. Corporations or business entities other than those listed abo
ve
❑
C. Investment companies ❑ G. Other (describe on Schedule F)
®
D. Pension and profit sharing plans
Answer all items. Complete amended pages in full, circle amended items and file with execution page (page 1).
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FORM ADV
Applicant:
SEC e Number:
Date: -
ICMA-RC
7
Part
11 - Page 3
73
07/2 8/06
3. Types of Investments. Applicant offers advice on the following: (check those that apply)
A.
Equity Securities ❑ H. United States government securities
❑ (I) exchange-listed securities
❑ (2)
iti
t
th
d
d
t
I, Options contracts on:
over-
secur
es
ra
e
e-coun
er
❑ (1) securities
❑ (3) foreign issuers
❑ (2) commodities
❑ B.
Warrants
❑ C.
Corporate debt securities
J. Futures contracts on:
(other than commercial paper)
❑ (1) tangibles
❑ (2) intangibles
❑ D.
Commercial paper
K.Interests in partnerships investing in:
❑ E.
Certificates of deposit
❑ (1) real estate
❑ (2) oil and gas interests
❑ (3) other (explain on Schedule F)
❑ F.
Municipal securities ® L. Other (explain on Schedule F)
G.
Investment company securities:
❑ (1) variable life insurance
❑ (2) variable annuities
® (3) mutual fund shares
4. M
ethods of Analysis, Sources of Information, and Investment Strategies.
A.
Applicant's security analysis methods include: (check those that
apply)
(1) ❑ Charting
(4) ❑ ' Cyclical
(2) ® Fundamental
(5) ® Other (explain on Schedule F)
(3) ® Technical
B.
The main sources of information applicant uses include: (check
those that apply)
m o Financial newspapers and magazines
(5) ❑ Timing services
(2) ❑ Inspections of corporate activities
(6) ® Annual reports, prospectuses, filings with the Securities and
Exchange Commission
(3) ® Research materials prepared by others
(7) ® Company press releases
(4) ® Corporate rating services
(8) ® Other (explain on Schedule F)
C.
The investment strategies used to implement any investment advice given to clients include: (check those that apply)
(1) ® Long term purchases (securities held at least a year)
(5) ❑ Margin transactions
(2) M Short term purchases (securities sold within a year)
(6) ❑ Option writing, including covered options, uncovered options or
spreading strategies
(3) ❑ Trading (securities sold within 30 days)
(7) ® Other (explain on Schedule F)
(4) ❑ Short Sales
Answer all items. Complete amended pages in full, circle amended items and file with execution page (page 1).
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FORM ADV
Applicant:
SEC File Number:
Date:
Part II - Page 4
ICMA-RC
801-18273
07/28/06
5. Education and Business Standards.
Are there any general standards of education or business experience that applicant requires in deter- Yes No
mining or giving investment advice to clients?...._
❑
(If yes, describe these standards on Schedule F.)
6. Education and Business Background.
For
• each member of the investment committee or group that determines general investment advice to be given to clients, or
• if the applicant has no investment committee or group, each individual who determines general investment advice given to clients (if more than
five, respond only for their supervisors)
• each principal executive officer of applicant or each person with similar status or performing similar functions.
On Schedule F, give the:
• name formal education after high school -
• year of birth business background for the preceding five years
7. Other Business Activities. (check those that apply)
® A. Applicant is actively engaged in a business other than giving investment advice.
® B. Applicant sells products or services other than investment advice to clients.
® C. The principal business of applicant or its principal executive officers involves something other than providing investment advice.
(For each checked box describe the other activities, including the time spent on them, on Schedule F.)
8. Other Financial Industry Activities or Affiliations. (check those that apply)
❑ A. Applicant is registered (or has an application pending) as a securities broker-dealer.
❑ B. Applicant is registered (or has an application pending) as a futures commission merchant, commodity pool operator or commodity
trading adviser.
C. Applicant has arrangements that are material to its advisory business or its clients with a related person who is a:
® (1) broker-dealer ❑ (7) accounting firm
® (2) investment company ❑ (8) law firm
® (3) other investment adviser ❑ (9) insurance company or agency
❑ (4) financial planning firm ❑ (10) pension consultant
❑ (5) commodity pool operator, commodity trading ❑ (11) mat estate broker or dealer
adviser or futures commission merchant
® (6) banking or thrift institution ❑ (12) entity that creates or packages limited partnerships
(For each checked box, on Schedule F identify the related person and describe the relationship and the arrangements.)
D. Is applicant or a related person a general partner in any partnership in which clients are solicited to Yes No
invest? I..................
❑
(If yes, describe on Schedule F the partnerships and what they invest in.)
I Answer all items. Complete amended pages in full, circle amended items and rile with execution page (page 1).
18/47
Q
0
FORM ADV
Applicant:
SEC File Number:
Date:
Part II - Page 5
ICMA-RC
801-18273
07/28/06
9. Participation or Interest in Client Transactions.
Applicant or a related person: (check those that apply)
❑ A. As principal, buys securities for itself from or sells securities it owns to any client.
❑ B. As broker or agent effects securities transactions for compensation for any client.
❑ C. As broker or agent for any person other than a client effects transactions in which client securities are sold to or
bought from a brokerage customer.
® D. Recommends to clients that they buy or sell securities or investment products in which the applicant or a related
person has some financial interest. '
® E. Buys or sells for itself securities that it also recommends to clients.
(For each box checked, describe on Schedule F when the applicant or a related person engages in these transactions and what
restrictions, internal procedures, or disclosures are used for conflicts of interest in those transactions.)
10. Conditions for Managing Accounts. Does the applicant provide investment supervisory services, manage investment advisory accounts or hold
itself out as providing financial planning or some similarly termed services and impose a minimum dollar value of assets or other conditions for
starting or maintaining an account? Yes No
(If yes, describe on Schedule F)
I I . Review of Accounts. If applicant provides investment superv isory services, manages investment advisory accounts, or holds itself out as providing
financial planning or some similar termed services:
A. Describe below the reviews and reviewers of the accounts. For reviews, include their frequency, different levels, and triggering factors. For
reviewers, include the number of reviewers, their titles and functions, instructions they receive from applicant on performing reviews, and
number of accounts assigned each.
See Schedule F, attached.
B. Describe below the nature and frequency of regular reports to clients on their accounts.
See Schedule F, attached.
Answer all items. Complete amended pages in full, circle amended items and file with execution page (page 1).
19/47
O 1
FORM ADV
Applicant:
SEC File Number:
Date:
Part II - Page 6
ICMA-RC
301-18273
07/28/06
12. Investment or Brokerage Discretion.
A. Does applicant or any related person have authority to determine, without obtaining specific client consent, the:
Yes
No
(I ) securities to be bought or sold?
®
❑
Yes
No
(2) amount of the securities to be bought or sold?
®
❑
Yes
No
(3) broker or dealer to be used?
®
❑
Yes
No
(4) commission rates paid?
®
❑
Yes
No
B. Does applicant or a related person suggest brokers to clients?
®
❑
For each yes answer to A describe on Schedule F any limitations on the authority. For each yes toA(3), A(4) or B, describe on Schedule
F the
factors considered in selecting brokers and determining the reasonableness of their commissions. If the value of products,
research and
services given to the applicant or a related person is a factor, describe:
• the products, research and services
• whether clients may pay commissions higher than those obtainable from other brokers in return for those products an
d services
-
• whether research is used to service all of applicant's accounts orjust those accounts paying for it; and
• any procedures the applicant used during the last fiscal year to direct client transactions to a particular broker in retur
n for products and
research services received.
13. Additional Compensation.
Does the applicant or a related person have any arrangements, oral or in writing, where it
A. is paid cash by or receives some economic benefit (including commissions, equipment or non-research
Yes
No
services) from a non-client in connection with giving advice to clients?
❑
Yes
No
B. directly or indirectly compensates any person for client referrals?
❑
(For each yes, describe the arrangements on Schedule F.)
14. Balance Sheet. Applicant must provide a balance sheet for the most recent fiscal year on Schedule G if applicant:
• has custody of client funds or securities (unless applicant is registered or registering only with the Securities and Exchange Commission);
or
• requires prepayment of more than $500 in fees per client and 6 or more months in advance
Yes
No
Has applicant provided a Schedule G balance sheet?
DCD B01 20814533.1 27-Jul-06 1744
Answer all items. Complete amended pages in full, circle amended items and file with execution page (page 1).
20/47
Schedule F of
Form AOV
Continuation Sheet for Form ADV Part II (ICMA-RC - I 801-18273 I 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part 1 or any other schedules.)
1. Full name of applicant exactly as stated in Item I A of Part I of Forth ADV:
International City Management Association Retirement Corporation
BS Empl. [dent. No.:
23-7268394
Item of Form
(identify)
INTRODUCTION
International City Management Association Retirement Corporation ("ICMA-RC")
is a not-for-profit organization established in 1972 to assist state and local
governments and their agencies and instrumentalities ("Public Employers") in the
establishment and maintenance of deferred compensation and qualified retirement
plans ("Plans") for their public sector employees ("Participants"). The Plans are
established and maintained in accordance with either Section 457 or 401 of the
Internal Revenue Code of 1986, as amended. ICMA-RC offers a full range of
retirement plan administration services to Public Employers. These include, but are
not necessarily limited to, plan recordkeeping, tax reporting, and disbursement
services offered directly by ICMA-RC, asset pooling and custody effected through
the VantageTrust ("Trust"), investment advice furnished by ICMA-RC to the
Trust's portfolios, asset allocation of mutual funds and other pooled investments
through Guided Pathways and financial planning through VantagePlanning.
LA.(1)
ADVISORY SERVICES
VantageTrust
ICMA-RC serves as investment adviser to the VantageTrust Company ("VTC"),
which sponsors and maintains the group Trust established for the commingled
investment of assets of Public Employers' Plans. The Trust is exempt from
investment company registration under Section 3(c)(l1) of the Investment
Company Act of 1940, as amended ("Company Act"). The Trust offers Public
Employers three different sets of investment portfolios which include:
1) VantageTrust PLUS Fund ("PLUS Fund"), a stable value fund managed
directly by ICMA-RC consisting of guaranteed investment contracts ("GICs") and
fixed-income securities wrapped by insurance contracts; 2) VantageTrust Total
Return Funds, each of which invests in a series of The Vantagepoint Funds
("Fund"), a Delaware trust and registered open-end investment company consisting
of 27 series advised by Vantagepoint Investment Advisers, LLC ("VIA"), a wholly-
owned subsidiary of ICMA-RC; and 3) VantageTrust Trust Series, each of which
invests in third-party sponsored mutual funds. ICMA-RC advises as to the
investment objectives of each of the portfolios offered by the Trust, assists the Trust
in the selection of each underlying third-party mutual fund and continually
monitors each fund's performance and operations. With the exception of the PLUS
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page I of 21
21/47
o •
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name ofzpplicant exactly as stated in Item IA of Part I of Farm ADV:
International City Management Association Retirement Corporation
IRS Empl. Ident. No.:
23-7268394
Item of Form
(identify)
1.A.(1) (cont.)
Fund, day-to-day investment management of each of the other underlying funds is
provided by unaffiliated subadvisers. This disclosure does not constitute an offer of
the Trust, its underlying portfolios or the Fund, offers of which are made only
pursuant to Trust offering documents or the Fund prospectus, as applicable.
ICMA-RC performs its obligations to the Trust pursuant to an investment
management contract terminable without penalty by either party on 60 days notice
and non-assignable by ICMA-RC without the consent of the Trust. Pursuant to the
contract, ICMA-RC also provides the Trust with office space, executive and other
personnel, facilities and administrative services, and supervises its daily business
affairs, all subject to the supervision of the Trust's Board of Trustees.
Guided Pathways
Guided Pathways is a platform for the delivery of a suite of services which
includes discretionary and nondiscretionary mutual fund asset allocation investment
advice for Participants of Public Employer Plans, including any related IRA
accounts. Services include: (1) Managed Accounts - discretionary, on-going
investment management for asset allocation among mutual funds and other pooled
investment vehicles available within a Participant's Plan; (2) Guidance -
nondiscretionary, point-in-time, asset allocation recommendations for Participants
looking for assistance in selecting retirement plan investments at the asset class
level such as large-cap, small cap or intemational equities; and (3) Advice -
nondiscretionary, point-in-time, individualized investment advice to Participants
looking for help in selecting specific available Plan investments at the fund level.
Services are delivered via a combination of online, in-person, direct mail, and
telephone media. The advisory services that are delivered and/or facilitated by
individuals will be performed by ICMA-RC Associates with NASD Series 6 and
Series 65 Licenses. Advisory services are provided pursuant to the Investment
Advisory Service Agreement ("Agreement"), a written advisory agreement between
ICMA-RC and each Participant which incorporates Participant-specific investment
objectives. Management agreements may be terminated by either party at any time
as specified in the Agreement.
As part of Guided Pathways, ICMA-RC has entered into a contract with Ibbotson
Associates, Inc. ("Ibbotson"), a subsidiary of Morningstar Associates, under which
Ibbotson serves as the Independent Financial Expert "IFE" as that term is used in
Complete amended pages in full, circle amended items and file with execution page (page 1). I
Page 2 o f 27
22/47
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Forth ADV Part I or any other schedules.)
I. Full name ofapplicant exactly as stated in Item IA of Pan I of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. Ident. No.:
23-7268394
Item of Form
(identify)
1.A.(1) (cont.)
the Department of Labor's SunAmerica Advisory Opinion. In its role as IFE,
Ibbotson provides ICMA-RC advice about mutual fund asset allocation models,
which include mutual funds from The Vantagepoint Funds advised by VIA, an
ICMA-RC-affiliated adviser. Ibbotson uses the mutual funds or private funds
included in a Public Employer's Plan to populate model portfolios designed for
Participants at various risk exposure levels. For Participants who select Managed
Accounts' discretionary management, ICMA-RC determines which model
portfolio is most appropriate based on the Participants' financial situation, time
horizon, risk/reward profile and other characteristics relevant to potential
Participant investments. For those opting for the nondiscretionary Advice, the
service suggests appropriate portfolios, but Participants choose their own asset mix
based on the suggested models.
Brokerage account windows are not included in the model portfolios constructed by
Ibbotson for ICMA-RC's Managed Accounts, Guidance or Advice. However,
both ICMA-RC and the IFE take assets in any such window account into
consideration when making risk/reward analyses for portfolio investment..
VantagePlannine
ICMA-RC offers VantagePlanning, retirement and financial planning services
provided by qualified ICMA-RC Associates. These Associates conduct retirement
and financial planning sessions with individual 457/401(a) Plan Participants. These
sessions include a discussion and guidance on various financial planning topics. In
addition, individualized financial plans may be prepared based on information
provided by Participants. 1CN4A-RC Associates may also serve as facilitators to
direct Participants to ICMA-RC products and services. The ICMA-RC Associates
hold the Series 65 license and are registered as Investment Adviser Representatives
("IAR's") where applicable. VantagePlanning offers two levels of planning
services - Deluxe and Premium. Deluxe assists Participants planning now for
future retirement, while Premium is intended for those approaching retirement who
need to make critical financial decisions about how best to plan for retirement.
Separate Accounts with a Stable Value Option
ICMA-RC may also, from time to time, provide separate account management for a
portion of the assets of certain Plans which offer as an investment option a stable
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page 3 of 27
23/47
0
Schedule F of Applicant:
Form ADV
Continuation Sheet for Form ADV Part II CMA-RC
u
SEC File Number: I Date:
801-18273 1 7/28106
(Do not use this Schedule as a continuation sheet for Forth ADV Part I or any other schedules.)
1. Full name of applicant exactly as stated in Item lAof Partlof Form ADV:
International City Management Association Retirement Corporation
IRS Empl. [dent. No.:
23-7268394
Item of Farm
(identify)
1.A.(1) (cont.)
value fund. Given that transfers of such assets may take substantial time to
effectuate, assets to be transferred from an external stable value fund to the PLUS
Fund may require interim investment management services. ICMA-RC will, if
requested by a Plan, assist clients in the creation of a stable value separate account
consisting primarily of the fixed income securities transferred by the client from the
former stable value fund.
Creation of such separate accounts may include selecting the trustee and/or
custodian for the accounts which ICMA-RC may, with written client authorization,
hire as agent on behalf of any Plan. These separate accounts will include an
insurance wrapper from an unaffiliated, internationally recognized insurance
company. In addition, ICMA-RC may, on a discretionary basis, hire a subadviser
to exercise day-to-day investment discretion over the assets in the separate account
until such time as the assets may be invested in the PLUS Fund.
As transferred securities mature or reach their book value, the subadviser will
instruct the custodian to liquidate any such assets and invest the proceeds in the
PLUS Fund. Net daily cash flow into or out of the separate account will be made
into or out of the PLUS Fund. Once all of the assets have been liquidated, the
separate account will be closed. At which time, all assets of the separate account
will be comprised entirely of holdings in the PLUS Fund, the subadvisory
relationship with the account will terminate, and ICMA-RC will cease charging
advisory or subadvisory fees in relation to the separate account other than the
advisory fees embedded in the PLUS Fund. In the event that the client terminates
the separate account agreement prior to all assets becoming eligible for transfer to
the PLUS Fund, responsibility for managing any remaining securities held in the
separate account will revert to the client.
I.D.
ADVISORY FEE SCHEDULES
ICMA-RC believes its fees for advisory services are reasonable in light of the type
of services provided. However, lower fees for comparable services may be
available from other sources. None of the fees charged by ICMA-RC, including
Guided Pathways Fees, are based on a share of capital gains or capital
appreciation of funds of any Fund or Participant account.
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page 4 o f 27
24/47
Q
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
0
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Pan[ of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. [dent. No.'.
23-7268394
Item of Form
(identify)
I.D. (cont.)
Public Employer Advisory Service Fees
ICMA-RC may provide Public Employers who seek investment advisory services
without Plan administration, customized investment services that consist of strategy
planning, portfolio management, portfolio monitoring and performance
measurement pursuant to written contracts. Fees for such services depend upon the
number and extent of services provided to each such Public Employer, which shall
not exceed a maximum of 0.45% of assets under management. Fees are negotiable.
VantageTrust Fees
Trust fees paid to ICMA-RC are described in more detail in "Making Sound
Investment Decisions: A Retirement Investment Guide" ("RIG"). There are
currently three versions of the RIG and the fee schedules set forth in each vary
based on qualifying Plan characteristics such as average account balances or other
features that afford certain economies of scale or other cost savings with respect to
servicing of their accounts. Copies of a relevant version are delivered annually to
all Trust investors. Trust advisory fees are paid monthly and computed on the
average daily net asset value of each Series. Each Series' annual management fee
will be prorated for any month during which the investment advisory agreement is
in effect for only a portion of the month.
Trust investors who select portfolios with underlying series of The Vantagepoint
Funds or third party mutual funds also pay advisory fees to subadvisers, including
ICMA-RC's advisory affiliate, VIA. These advisory and subadvisory fees, as well
as custodial and operating expenses, are included in the expense ratios in the
underlying mutual fund. The expenses of mutual funds that serve as the underlying
portfolios of certain Trust portfolios are described in more detail in the relevant
RIG. Additional information about any underlying mutual fund is available in the
prospectus of each fund.
Guided Pathways Fees
Participants who enroll in Managed Accounts are assessed an asset based fee that
is charged on a monthly basis based on the month-end average daily account
balance in Managed Accounts. Managed Accounts fees are calculated as a
percentage of the account value and applied to the account as a fixed dollar amount.
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page 5 of 27
25/47
o •
Schedule F of I Applicant: I SEC File Number: I Date:
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Fonn ADV Part 1 or any other schedules.)
1. Full name of applicant exactly as stated in Item I A of Pan I of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. (dent. No.:
23-7268394
Item of Form
(identify)
I.D. (cont.)
The standard Managed Accounts Fee Schedule is presented below and is also
detailed in the Agreement. The Schedule applies separately to each account the
Participant elects to enroll in Managed Accounts (e.g., a 401(a) account and a 457
account).
Account Balance Annual Fee
First $25,000 0.60%
Next $25,000 0.55%
Next $50,000 0.45%
Next $150,000 0.35%
Over $250,000 0.25%
The Managed Accounts Fee will be deducted pro-rata against all investments in any
account included in Managed Accounts. If participation in Managed Accounts
terminates before the end of the month, the fee will be prorated based on the
number of days the account was managed during the calendar month, unless
ICMA-RC chooses to waive the fee for that period.
Guided Pathways' Advice is provided to Participants for a fixed annual fee of $20
although Participants who are part of the Premier program may access Advice for
free. There are no advisory fees for Participants using Guidance.
None of the Guided Pathways' fees described above include any fees related to
investments made in any selected mutual fund or other pooled investment vehicle
which may include, for example, fund advisory fees, expenses, brokerage and
redemption charges. All such fees are disclosed in the prospectuses or offering
documents of the underlying funds which are available upon request to Participants
in the Guided Pathways program. VIA, ICMA-RC's affiliated adviser, receives
advisory fees with respect to any investments Participants make in The
Vantagepoint Funds through Guided Pathways.
VantaeePlannine
The maximum fees for VantagePlanning are $200 per year for Deluxe or $480 per
year for Premium. Fees for these services are based on the assets under
consideration and may be discounted or waived based on certain qualifying
characteristics of the Participant, such as achieving a certain qualifying account
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page b o t 2
26/47
Q
Schedule F of Applicant:
Form ADV
Continuation Sheet for Form ADV Part II ICMA-RC
u
SEC File Number: I Date:
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I, Full name of applicant exactly as stated in Item I A of PartI of Farm ADV:
International City Management Association Retirement Corporation
IRS Empl. Ident. No.:
23-7268394
Item of Form
(identify)
I.D. (cont.)
balance level or being an ICMA-RC account member for a certain number of years.
Separate Accounts for Plans with Stable Value Option
Separate accounts managed by ICMA-RC for certain Plans which offer a stable
value fund account option are charged fees which may include: advisory fees, sub-
advisory fees, custody fees and insurance wrapper fees based on a percentage of
certain assets in the private account. The chart below sets forth the maximum fees,
which may be subject to negotiation depending upon account size, complexity or
other relevant factors. The above-described fees relate only to the portion of the
private account assets which are not yet invested in the PLUS Fund. In addition,
the Plan may also be subject to administration fees as more fully described in Item
7, below, which also apply to assets in the separate account. Assets which have
been invested in the PLUS Fund are subject to the fees and expenses embedded in
the PLUS Fund itself, but are not subject to the private account management fees.
Adviser: 0.10%
Subadviser: 0.05%
Custody: 0.03%
Insurance Wrapper: 0.08°/%
Maximum Total: 0.26% (excluding Administrative fees)
3.L.
TYPES OF INVESTMENTS
In addition to providing advice on mutual fund shares, ICMA-RC provides advice
to the PLUS Fund on GICs, unsecured obligations of an institution to pay principal
and interest for the period specified in the contract. Assurance of principal and
interest payment is based solely on the financial strength of the issuing institution.
Similarly, ICMA-RC provides advice to the PLUS Fund on wrapped synthetic
contracts, a marketable fixed income portfolio with a third-party guarantee on the
book value of the portfolio (wrap agreement), and separate account synthetic
portfolios, composed of marketable fixed income securities that are held in an
insurance company separate account controlled by the issuer, to eliminate or reduce
the counterparty risk present in GICs. GICs are not negotiable instruments and
there is no liquid secondary market for them. GICs could have a fixed maturity or a
constant duration. ICMA-RC also provides separate account management for
certain Plans as described in Item 1, above. In such arrangements, assets advised
Complete amended pages in full, circle amended items and file with execution page (page 1).
?age / or 21
27/47
® •
Schedule F of
Date:
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part 1 or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Part[ of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. [dent. No.:
23-7268394
Item of Form
(identify)
by ICMA-RC generally consist of GICs and synthetic contracts as described above,
but are owned directly by the Plans as opposed to being held through VantageTrust.
4.A.(5)
METHODS OF SECURITIES ANALYSIS
For the PLUS Fund, ICMA-RC's Investment Division staff select financial
institutions which issue GICs, separate account contracts and wrapped synthetic
contracts for investment. In selecting particular contracts, the Investment Division
staff considers terms of available contracts, many of which are not standard, but
vary from carrier to carrier, and competitive availabilities at the time funds are
available for placement. With respect to all other VantageTrust portfolios, security
selection is performed by subadvisers or managers of the underlying mutual funds.
In making investment recommendations under Guided Pathways, ICMA-RC relies
on model portfolios constructed by Ibbotson based upon the funds offered through a
Public Employer's Plan or through funds available to a Plan Participant's IRA.
Ibbotson builds long-term asset-level portfolios at a variety of risk or complexity
levels for the Plan; then selects and determines the appropriate weights for the
investment options that best track each of the asset-level portfolios; and finally,
monitors the investment options selected, along with the asset-level portfolios, over
time to make sure they remain appropriate and to make adjustments and re-
allocations to the portfolios if necessary. ICMA-RC uses this information to make
Participant portfolio or asset allocation recommendations based on information
supplied by Participants regarding their own investment characteristics.
4.B.(8)
MAIN SOURCES OF INFORMATION
In researching GICs, separate accounts and wrapped synthetic contracts, ICMA-
RC's Investment Division staff studies available literature, including public reports
of the companies and secondary analytical sources, such as rating services and the
trade press. It also seeks and obtains supplementary information and explanatory
material from the issuers themselves. For Guided Pathways, ICMA-RC also relies
on research and models generated by its IFE, Ibbotson.
4.C.(7)
INVESTMENT STRATEGIES
Selection of mutual funds for the Trust Series is performed by ICNIA-RC's
Complete amended pages in full, circle amended items and file with execution page (page 1).
of27
28/47
Schedule F of I Applicant:
Form ADV
Continuation Sheet for Form ADV Part II
•
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name ofapplicant exactly as stated in Item IA of Part I of Form ADV:
IRS Empl. [dent. No.:
International City Management Association Retirement Corporation
23-7268394
Item of Form
(identify)
Investment Division staff, subject to approval by the Board of Directors of
VantageTrust Company, which govems the operations of the Trust. Among other
things, factors such as appropriateness for retirement investing, how the fund
complements other Trust funds, past performance, investment style and strategy,
and the individual manager are all considered in the selection process. Information
on investment strategies for Trust portfolios can be found in the prospectuses of the
underlying mutual funds.
Guided Pathways starts with the construction of asset class portfolios at different
risk levels, ranging from very conservative to very aggressive. Generally speaking,
seven different risk levels for each Public Employer's Plan will be designed by
Ibbotson. After the asset-level portfolios are created for a Plan, Ibbotson will select
investment options from a Plan's fund menu to construct fund-specific portfolios
for that Plan. Fund-specific portfolios will provide Participants with a pre-
determined solution to implement their asset allocation policy. The objective of
investment option selection is to identify the most appropriate options available to
implement the asset allocation policy. ICMA-RC matches these fund-specific
portfolios to the investment characteristics of specific Plan Participants in order to
render discretionary (i.e., Managed Accounts) and/or nondiscretionary advice (i.e.,
Advice) on Participant-specific investment portfolios.
5.
EDUCATION AND BUSINESS STANDARDS
ICMA-RC's general standard of education and business background required of
persons employed by it in professional and/or management positions is completion
of a college education. ICMA-RC Associates providing portfolio management
and/or advice facilitation services hold Series 65 licenses. ICMA-RC Associates
providing VantagePlanning services generally have also attained the designation
of Certified Financial Planner ("UP").
6.
EDUCATION AND BUSINESS BACKGROUND
Principal Executives
Joan W. McCallen, President and Chief Executive Officer (born 1952)
Education: BS and Master of Science, University of Manitoba (Canada).
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page `1 Or 11
29/47
0 •
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part 1 or any other schedules.)
1. Full name of applicant exactly as stated in Item I A of Pan 1 of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. Ident. No.:
23-7268394
Item of Form
(identify)
6. (cont.)
Business Background/Licenses: President and CEO, ICMA-RC 08/03 to present;
Executive Vice President and COO, ICMA-RC, 01/97 to 08/03; Management,
Great-West Life, 09/75-01/97; NASD Series 6, 26, 63 registered.
Jim Rohrbacher, Senior Vice President and Chief Compliance Officer (born 1957)
Education: BS, Lynchburg College.
Business Background/Licenses: Senior Vice President and CCO, 9/2004 to present;
Director of Compliance and Internal Audit, Frank Russell Company, 6/1996 to
8/2004. NASD Series 7, 24, 63 registered.
Gerard Maus, Senior Vice President and Chief Financial Officer (born 1951)
Education: BA, Rutgers University.
Business Background/Licenses: Chief Financial Officer 11/2004 to present; Chief
Financial Officer, Schwab Soundview Capital 01/04-11/04; Chief Financial
Officer/Chief Administration Officer, Soundview Technology Group, Inc. 11/02 -
01/04; Partner/Chief Financial Officer, Advanced Technology Ventures, 03/01 -
01/02. NASD Series 6, 26, 63 registered.
Paul Gallagher, Senior Vice President, Secretary and General Counsel (born 1959)
Education: J.D. The Pennsylvania State University, Dickinson School of Law; BA,
The Pennsylvania State University.
Business Background: Senior Vice President and General Counsel, ICMA-RC 1998
to present. Principal, Assistant General Counsel and various previous titles, The
Vanguard Group, Inc. 1985-1998.
Wayne Wicker, Senior Vice President and Chief Investment Officer (born 1957)
Education: MBA, Finance and Investments, Michigan State University; BA,
University of Washington School of Business Administration and the School of
Communication and Journalism.
Complete amended pages in full, circle amended items and rile with execution page (page 1).
Page I
30/47
B •
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part 1 or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Part I of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. ]dent. Na.:
23-7268394
Item of Forth
(identify)
6.(cont.)
Business Background/Licenses: Senior Vice President and Chief Investment
Officer, ICMA-RC, 09/04 to present; Management Director and Senior Portfolio
Manager with Cadence Capital Management 12/97 to 02/03; various senior
investment positions with Howard Hughes Medical Institute, Target Corporation
and American Express Financial Services 1984- 1997. Chartered Financial Analyst.
Kristine Heurich, Senior Vice President, Client Services (born 1956)
Education: BS, Mt. St. Mary's University, Emmitsburg, MD.
Business Background: Senior Vice President, ICMA-RC 3/2006 to present.
Managing Vice President, Client Services, ICMA-RC 11/2003 - 3/2006; Vice
President, Operations, ICMA-RC 8/1996 - 11/2003; NASD Series 6, 63, 26
registered; CPA.
Investment Advisory Personnel
Wayne Wicker, see above for details.
Julie H. Dellinger, Managing Vice President, Investments (born 1953)
Education: MBA Finance Investments, George Washington University; BA,
Economics, Duke University
Business Background/Licenses: Acting Chief Investment Officer, 1CMA-RC,
11/03-9/04; Managing Vice President, Investments, ICMA-RC, 10/98-11/03;
Executive Director, Montgomery Cry. Board of Investment Trustees, 05/90-10/98.
Chartered Financial Analyst; NASD Series 6, 26, 63 registered.
Robert Morales, Managing Director, Retirement Services (born 1968)
Education: BA, Finance, California State University San Bernardino.
Business Background/Licenses: Managing Director, Retirement Services, ICMA-
RC, 1/2004 - present; President, Strategic Wealth Management Ins., 09/2000 -
12/2003. Certified Financial Planner; NASD Series 6, 63, 65 and 26 registered,
I Complete amended pages in full, circle amended items and file with execution page (page 1).
Page I I of 2Y
31/47
o
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Part I of Forth ADV:
IRS Empl. Ident. No.:
International City Management Association Retirement Corporation
23-7268394
Item of Fort
(identify)
6. (cont.)
Daryl Dennis, Vice-President, Fixed Income Group (born 1958)
Education: BS, Engineering, US Military Academy; MBA, Finance, Marymount
University.
Business Background: Vice President, Fixed Income Group, ICMA-RC, 2001 -
present; Senior Portfolio Strategist, Domestic Fixed Income Group, SEI
Investments, 2000 - 2001; Managing Director, The Atlantis Group, Inc., 1996 -
2000; President and Chief Investment Officer, Wedgewood Capital Management,
Inc., 1989 - 1996; Senior Portfolio Manager, First American Bank, NA, 1987 -
1989; Portfolio Manager, GEICO Corporation, 1985 - 1987.
Gerald Backenstoe, Vice-President, Investor Services (bom 1962)
Education: BA, Political Science, Dennison University.
Business Background: Vice President, ICMA-RC 2002 - present; various positions
at ICMA-RC since 1987; NASD Series 6, 63, 65 and 26 registered.
7.A., B. & C.
OTHER BUSINESS ACTIVITIES
As noted in the Introduction above, ICMA-RC offers a full range of retirement plan
administration services to Public Employers and Participants, including plan
recordkeeping, tax reporting, and disbursement services. ICMA-RC plan
administration charges include an annual account maintenance fee in a fixed dollar
amount and a plan administration fee of up to 0.55% of daily average assets
invested in the Trust and paid out of Trust assets. These fees are negotiable.
8.C.
OTHER FINANCIAL INDUSTRY AFFILIATIONS
(1) Broker-Dealer
ICMA-RC Services, LLC ("RC Services"), a wholly-owned subsidiary of ICMA-
RC, is a registered broker-dealer and a member of the NASD which serves as the
principal underwriter for The Vantagepoint Funds ("Fund"). RC Services does not
charge separately for its services and does not execute an portfolio brokerage for
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page 12
32/47
o •
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II (ICMA-RC I 801-18273 I 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name ofapplicanl exactly as stated in Item IA of Part I of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. [dent. No.:
23-7268394
Item of Form
'
(identify)
8.C. (cont.)
any portfolio or private client account managed by ICMA-RC. Costs of
RC Services, which primarily include licensing fees for registered representatives,
are reimbursed by entities that benefit from its activities, including ICMA-RC and
its subsidiaries, Vantagepoint Investment Advisors, LLC (investment adviser to the
Fund) and Vantagepoint Transfer Agents, LLC (administrator to the Fund).
(2) Investment Companies
ICMA-RC furnishes investment advice to the Trust and is affiliated with the Fund
(see Item I.A. above for more information on the Trust and the Fund). Additional
portfolios may be added to the Trust or the Fund in the future.
(3) Investment Adviser
As discussed in Item I.A. above, Vantagepoint Investment Advisers, LLC is a
wholly-owned ICMA-RC-affiliated registered investment adviser which provides
investment advice to the Fund. ICMA-RC has business and financial arrangements
with VIA and other affiliated companies, which relate to accounting, finance,
compliance, operations, allocation and payment of expenses and fund transfers
between and among the affiliates.
(9) Trust Company
ICMA-RC is affiliated with The VantageTrust Company, a New Hampshire non-
depository Banking Corporation which sponsors and maintains the VantageTrust, a
group trust that provides for the commingled investment of assets of retirement and
deferred compensation plans. The VantageTrust Company offers units of the
VantageTrust, described in Item I.A. above.
9.
PARTICIPATION OR INTEREST IN CLIENT TRANSACTIONS
Mission Statement
ICMA-RC's mission is to be the most trusted provider of financial services to state
and local governments. In addition to the fiduciary duty which accompanies our
status as a registered investment adviser, this mission creates a heightened
responsibility. These fiduciary obligations are shared b all ICMA-RC Associates
Complete amended pages in full, circle amended items and file with execution page (page 1).
33/47
0 •
Schedule F of
SEC File Number: I Date:
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part 1 or any other schedules.)
I. Full name of applicant exactly as stated in Item I A of Part I of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. [dent. No.:
23-7268394
Item of Form
(identify)
9. (cont.)
and ICMA-RC Associates are required to act in each client's best interests,
subordinate their own interests to the interests of clients and avoid conflicts with
client interests.
ICMA-RC requires its Associates to take a proactive approach to ensuring not only
a high quality of service, but also a high degree of confidentiality and
professionalism in dealing with our clients and their interests. Associates of
ICMA-RC shall promote the corporate mission while fostering an environment of
professional courtesy and growth. This means diligently complying with the rules
and regulations governing a financial services corporation, but it means more than
technical compliance. It also means being careful, conscientious and clearly
focused on the long-term interests of our clients.
Conflicts of Interest
ICMA-RC recommends investment in shares of the Trust directly to Plans,
recommends investment in shares of the Trust or the Fund by Plan Participants
through Guided Pathways and may recommend investments in the Trust or the
Fund through VantagePlanning. ICMA-RC is affiliated with both the Trust and
the Fund. When ICMA-RC recommends investment in the Trust or the Fund to
Plans or Participants, a conflict of interest may exist because either ICMA-RC or
VIA, its advisory affiliate, receives asset-based advisory fees from affiliated funds
as long as the advisory client remains invested in Fund shares. However, Funds of
the Trust are chosen by Plan Sponsors for inclusion in the investment offerings of
the Plan.
Participants who use the Managed Accounts version of Guided Pathways will
pay both the asset-based asset allocation program fee, described in Item I.D. above,
as well as the fees of any funds in which they are invested, some of which are
affiliated with ICMA-RC and may pay advisory fees to VIA, ICMA-RC's affiliated
adviser. Participants who use the Advice version of Guided Pathways may pay
the fixed fee described in Item I.D. above, unless exempt, as well as the fund fees
as discussed above. ICMA-RC believes Guided Pathways is a value-added
service which helps Participants, on a discretionary or nondiscretionary basis, to
determine how best to allocate their Plan investments among the options offered by
their Plans. Similarly, VantagePlanning assists Participants in considering their
investment options. ICMA-RC's advisory fees may be higher or lower than those
Complete amended pages in full, circle amended items and file with execution page (page 1).
Pagc 14
34/47
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Part I of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. Ideal. No.:
23-7268394
Item of Form
(identify)
.
9. (cont.)
charged by other investment advisers.
Although RC Services, ICMA-RC's affiliated broker-dealer, effects sales of
interests in the Trust advised by ICMA-RC and the Fund advised by VIA, the sales
result in no additional compensation to the affiliated broker-dealer because it
receives no commission or other remuneration as a distributor of the affiliated
funds.
All fees received by ICMA-RC and expenses associated with investment in the
Trust, and potential conflicts of interest, are also disclosed in the relevant version of
the RIG, the Trust's disclosure document described in Item I.D. above. Although
not required to be published, the RIG is an extensive disclosure document that is
modeled on the requirements of Form N1-A relating to investment companies
registered under the Company Act. The appropriate version of RIG is given to all
Public Employers prior to their contracting for any ICMA-RC service, and to
Participants on an annual basis. An updated version is also mailed to all
participating Public Employers and Participants annually.
For purposes of this ADV brochure, ICMA-RC and VIA may be referred to
collectively as the "Advisers". The Advisers may serve as investment manager to
numerous client accounts as well as registered or exempt investment companies.
The Advisers may give advice and take action with respect to any funds or accounts
they manage, or for their own account, that may differ from action taken by them
on behalf of other funds or accounts. The Advisers are not obligated to
recommend, buy or sell, or to refrain from recommending, buying or selling any
security that the Advisers, their affiliates or their respective Access Persons, as
defined by the Company Act and by the Investment Advisers Act of 1940, as
amended ("Advisers Act"), may buy or sell for their own accounts or for the
accounts of any other client. The Advisers are not obligated to refrain from
investing in securities held by funds or accounts that they manage except to the
extent that such investments violate the "Code of Ethics and Standards of
Professional Conduct" ("Code") adopted by the Advisers and the "Policy on
Personal Investment Activity and Prevention of the Misuse of Inside Information"
("Policy") adopted by, among others, the Advisers, VantageTrust Company, the
Trust, and the Fund.
From time to time, employees and principals of the Advisers or an other related
Complete amended pages in full, circle amended items and file with execution page (page 1).
35/47
,J
I'l
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II IICMA-RC 801-18273 I 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Part 1 of Forth ADV:
IRS Empl. Ident. No.:
International City Management Association Retirement Corporation
23-7268394
Item of Forth
(identify)
9. (cont.)
persons may have interests in securities owned by or recommended to the Advisers'
clients. As these situations may represent a potential conflict of interest, the
Advisers have adopted procedures relating to personal securities transactions and
insider trading that are designed to prevent actual conflicts of interest.
Code of Ethics and Standards of Professional Conduct
The Code was adopted pursuant to Advisers Act Rule 204A-1 to ensure that the
interests of Access Persons and Supervised Persons of the Advisers do not conflict
with the interests of the Advisers' clients, including registered investment
companies and their shareholders. It incorporates by reference the Policy which
was adopted pursuant to Company Act Rule 17j-1 and Advisers Act Rule 204A-1.
The Code also requires all ICMA-RC Associates to comply with ethical restraints
relating to clients, including restrictions on giving gifts to, and receiving gifts from,
clients in violation of the Advisers' gift policy and restraints on certain political
activities relating to clients or prospects. A copy of the Advisers' Code is available
to any client or prospective client upon request.
The Policy governs the personal investing activities of "access persons" as that term
is used in Rules 17j-1 and 204A-1, and is designed to prevent unlawful practices in
connection with the purchase and sale of securities by access persons. Under the
Policy, access persons are permitted to engage in personal securities transactions,
but are required to report their personal securities transactions for monitoring
purposes. The Policy restricts the purchase and sale of nonexempt Covered
Securities by portfolio managers within five [5] days before or after execution of a
transaction in any such security for the accounts of clients they manage other than
the Vantagepoint Index Funds. Access Persons also may not engage in a personal
transaction in any nonexempt Covered Security which they have actual knowledge
is being purchased or sold, or recommended or considered for purchase or sale until
five 5 days after the transaction is completed or the recommendation is withdrawn.
All Access Persons are required to notify the CCO or the CCO's designee in order
to pre-clear nonexempt personal securities transactions in nonexempt Covered
Securities. All Access Persons must provide quarterly reports of their personal
transactions within 30 days of the end of each calendar quarter which may consist
of monthly brokerage statements for all accounts in which they have a beneficial
interest timely submitted to the CCO or the CCO's designee. In addition, Access
Persons must direct their brokers to provide Compliance with copies of all
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page to of Z/
36/47
o •
Schedule F of I Applicant:
Form ADV
Continuation Sheet for Form ADV Part II IICMA-RC 1 801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name ofapplicant exactly as stated in Item 1 A of Part I of Forrn ADV:
International City Management Association Retirement Corporation
IRS Empl. Ideal. No.:
23-7268394
Item of Form
(identify)
9. (cont.)
brokerage confirmations relating to all personal securities transactions in which
they have a beneficial ownership interest. A copy of the Policy is on file with the
SEC and available to the public.
Insider Tradinl> Policy
The Advisers, and their related persons may, from time to time, come into
possession of material nonpublic and other confidential information which, if
disclosed, might affect an investor's decision to buy, sell or hold a security. Under
applicable law, the Advisers and their related persons may be prohibited from
improperly disclosing or using such information for their personal benefit or for the
benefit of any other person, regardless of whether such other person is a client of
the Advisers. Accordingly, should such persons come into possession of material
nonpublic or other confidential information with respect to any company, they may
be prohibited from communicating such information to, or using such information
for the benefit of, their respective clients, and have no obligation or responsibility
to disclose such information to, nor responsibility to use such information for the
benefit of, their clients when following policies and procedures designed to comply
with law.
The Policy includes provisions for Prevention of the Misuse of Inside Information
by the Advisers' Supervised Persons as required by Advisers Act Section 204A.
Among other things, these provisions include procedures for protecting and
maintaining confidential information.
Any Associate of the Advisers as defined in the Code or Access Person as used in
the Policy who fails to observe the above-described policies and procedures risks
serious sanctions, including dismissal and personal liability.
11.
ACCOUNT REVIEWS AND REPORTING
11.A.
Account Reviews
All discretionary private accounts and/or mutual funds are reviewed on an ongoing
basis. The Advisers assign a portfolio manager to each client account, subject to
continuous review and monitoring by the portfolio management team. Senior
management reviews transactions periodically, as deemed necessary.
Complete amended pages in full, circle amended items and file with execution page (page 1). I
Page 17 of 27
37/47
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II ICMA-RC 1 801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Farm ADV Part I or any other schedules.)
I. Full name ofapplicant exactly as stated in item IA of Part I of Form ADV:
IRS Empl. [dent. No.:
International City Management Association Retirement Corporation
23-7268394
Item of Forth
(identify)
For Managed Accounts, ICMA-RC receives portfolio reviews at least quarterly
from its IFE, and account rebalancing recommendations at least annually. ICMA-
RC's Portfolio Compliance Committee reviews the reports and recommendations
provided by the IFE as well as applicable securities laws and regulations. Portfolio
performance is monitored at least quarterly by ICMA-RC.
11.B
Account Reoortina
Formal reports outlining portfolio holdings and account performance are provided
for Managed Accounts by ICMA-RC at least quarterly. These statements are
mailed to all Participants in Managed Accounts and are also available on-line at
the request of the Participant.
12.A. & B.
INVESTMENT OR BROKERAGE DISCRETION
Generally, ICMA-RC does not have discretionary authority with respect to its
retirement and financial planning services. However, ICMA-RC does exercise
discretion over the PLUS Fund, certain separate accounts with a stable value fund
option and Managed Accounts portfolios to make the following determinations
without client consultation or consent prior to effecting each transaction:
❑ which Plan-eligible mutual fund or private fund securities are to be bought or
sold (for the PLUS Fund this is pursuant to previously disclosed investment
parameters).
❑ the total amount of such securities to be bought or sold
❑ the issuer, broker or dealer through whom securities are to be bought or sold
❑ the commission rates at which such transactions are effected, to the extent that
commissions are applicable.
However, with respect to each discretionary account, ICMA-RC's authority is
subject to various limits, including Plan-eligible funds and client investment
objectives, policies and restrictions. These limitations may be based on a variety of
factors, including regulatory constraints and policies imposed by a Plan or its
trustees. Moreover, with respect to the separate accounts with a stable value fund
option, ICMA-RC delegates all day-to-day discretionary management responsibility
to a subadviser, who makes these discretionary decisions.
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page 18 of 27
38/47
0 •
Schedule F of
Form ADV
Date:
Continuation Sheet for Form ADV Part II (ICMA-RC I 801-18273 I _ 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
1. Full name ofapplicant exactly as stated in Item IA of Part I of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. [dent, No.:
23-7268394
Item of Form
(identify)
12.A. & B. (cont.)
With respect to investment company clients, applicable investment policies and
limitations are generally set forth in the fund's registration statement and other
governing documents.
Selection Criteria for Brokers and Dealers
In arranging for the purchase and sale of clients' portfolio securities, ICMA-RC
take into consideration any legal restrictions, such as those imposed under the
securities laws, and client objectives. Within these constraints, ICMA-RC may deal
with fund issuers, members of securities exchanges and other brokers and dealers
which, in its judgment, implement the policy of seeking best execution of portfolio
transactions.
ICMA-RC's overriding objective in selecting brokers and dealers and in effecting
portfolio transactions is to seek to obtain the best combination of price and
execution with respect to clients' portfolio transactions. The best net price, giving
effect to brokerage commissions or spreads, if any, and other transaction costs, is
normally an important factor in this decision, but a number of other judgmental
factors may be considered when relevant. With respect to the purchase or sale of
Plan-eligible open-end mutual funds, shares are sold at Net Asset Value on a no
load basis which eliminates the search for lowest commission rates. Since
commissions are rarely, if ever, a factor in the purchase of Plan-eligible
investments, ICMA-RC does not generally look to the usual panoply of factors
relating to best execution and does not generally take brokerage research into
consideration when making investment decisions for its discretionary client
accounts.
Commission Rates or Equivalents Policy
ICMA-RC endeavors to be aware of current charges of eligible broker-dealers and
to minimize the expenses incurred for effecting portfolio transactions to the extent
consistent with the interests and policies of their accounts. However, ICMA-RC
will not select broker-dealers solely on the basis of "posted" commission rates nor
always seek in advance competitive bidding for the most favorable commission rate
applicable to any particular portfolio transaction. Although ICMA-RC generally
seeks competitive commission rates, it will not necessarily a the lowest
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page 19
39/47
® •
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Part I of Form ADV.
International City Management Association Retirement Corporation
IRS Hmpl. [dent. No.:
23-7268394
Item of Form
(identify)
12.A. & B. (cont.)
commission or commission equivalent. Transactions may involve specialized
services on the part of the broker-dealer involved resulting in higher commissions
or their equivalents than would be the case with transactions requiring more routine
services.
The reasonableness of commissions is based on the broker's ability to provide
professional services, competitive commission rates, research, and other services,
which will help ICMA-RC in providing investment management services to clients.
ICMA-RC reserves the right to, and may, use a broker who provides useful
research and securities transaction services even though a lower commission may
be charged by a broker who offers no research services and minimal securities
transaction assistance.
Cross Tradine Policy
To the extent that ICMA-RC crosses transactions for any U.S. registered
investment company with any other discretionary client account, ICMA-RC will
comply with the requirements of 1940 Act Rule 17a-7. ICMA-RC does not
currently engage in Principal or Agency Cross Transactions.
Batch Transaction and Allocation Policy
ICMA-RC is not required to engage in batch transactions. However, ICMA-RC
may batch purchase and sale transactions. To the extent that a batch order is placed
for shares of mutual funds, such transactions are completely filled for all
participating accounts on the date of the transaction. In addition, since the mutual
funds included in the Plans are no-load funds, ICMA-RC is not required to pro rate
commissions across accounts participating in a batch transaction.
Client-Directed Brokeraae Transactions
Clients are not permitted to direct ICMA-RC to use specified brokers in performing
portfolio transactions. Client direction may result in higher commissions, greater
spreads, or less favorable net prices than might be the case if ICMA-RC negotiates
commission rates or spreads freely, or selects brokers or dealers based on best
execution.
Complete amended pages in full, circle amended items and file with execution page (page 1). I
Page 20
40/47
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part 11
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part 1 or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Part I of Form AD V:
International City Management Association Retirement Corporation
IRS Empi. Ideni. No.:
23-7268394
Item of Form
(identify)
12.A. & B. (cont.)
Research/Execution Policy
Although transactions executed on behalf of ICMA-RC client accounts rarely, if
ever, result in commissions, ICMA-RC has the right, consistent with the duty to
seek best execution, to direct brokerage commissions on accounts' portfolio
transactions to broker-dealers in recognition of research furnished by them, as well
as for services rendered in the execution of orders by such broker-dealers. The
commissions used to acquire research in these arrangements are known as "soft
dollars." Under an SEC interpretation, the term "commission" includes a markup,
markdown, commission equivalent or other fee paid by a managed account to a
dealer for executing a transaction where the fee and transaction price are fully and
separately disclosed on the confirmation and the transaction is reported under
conditions that provide independent and objective verification of the transaction
price by a self-regulatory organization. As a result, fees charged in relation to
certain NASDAQ-reported riskless principal transactions are eligible for use in soft
dollar arrangements in addition to traditional agency commissions charged on
equity securities transactions.
Broker-dealers typically provide a bundle of services which include research and
execution. The research provided can be either proprietary (created and provided
by the broker-dealer, including tangible research products as well as access to
analysts and traders) or third-party (created by a third party but provided by broker-
dealer). A statutory "safe harbor" allows ICMA-RC to use soft dollars to acquire
either type of research. At this time, ICMA-RC does not use soft dollars to acquire
any research.
H.A.
ADDITIONAL COMPENSATION
ICMA-RC maintains a commission recapture program with certain brokers. Under
the program, a percentage of commissions generated by the Vantagepoint Equity
Funds' portfolio transactions are credited to those funds. These amounts are solely
used to benefit the funds.
Some of the mutual funds that serve as the underlying portfolios of certain Trust
funds pay ICMA-RC for subaccounting and other related services. Those amounts
are used to defray expenses of providing the administrative services to those
articular Trust funds.
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page 21
41/47
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Part I of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. Ident. No.:
23-7268394
Item of Form
(identify)
13.13.
REFERRAL ARRANGEMENTS
ICMA-RC has an arrangement with the Michigan Municipal League ("MML")
under which MML facilitates ICMA-RC's access to MML members and their
employees for the purpose of education and training. ICMA-RC could potentially
garner new business or increased participation in the retirement plans it administers
as a result of these education and training programs, which in turn would result in
increased gross revenue to ICMA-RC. ICMA-RC pays MML, as compensation for
MML's services, a fixed monthly dollar amount, plus expenses, without regard to
any new business or increased participation in ICMA-RC-administered plans that
may have resulted, directly or indirectly from the education and training seminars.
ICMA-RC has established relationships with First USA Bank for its affinity credit
card program and with M&T Bank for enrollment and information services in
connection with ICMA-RC's 457 Deferred Compensation Program. Before any
additional third party relationships are added, they must be approved by the Board
of Directors of ICMA-RC.
ICMA-RC may also compensate Associates who are IARs for investment advisory
client referrals under Guided Pathways. Any such arrangements would conform
to the terms and conditions of Advisers Act Rule 206(4)-3 and will not increase the
service fee assessed to an advisory client.
Notice of Privacy
NOTICE OF PRIVACY POLICY
Policy
Protecting investor's privacy is critically important to ICMA-RC. In providing
financial services and investment products to investors, we collect certain
nonpublic personal information about those investors. Our policy generally is to
keep this information strictly confidential, and to use or disclose it as needed to
provide services to investors, or as permitted or required by law or by the investor.
Our privacy policy applies equally to our former customers and investors, as well as
individuals who simply inquire about the services or investments we offer. We
may change this privacy policy in the future upon notification to investors.
Information We Collect
The nonpublic personal information we have about investors includes information
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page 22
42/47
9 •
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name of applicant exactly as stated in Item I A of Part 1 of Form ADV:
IRS Empl. Ident. No.:
' International City Management Association Retirement Corporation
23-7268394
Item of Form
(identify)
_
investors give us when they open an account, invest in The Vantagepoint Funds, or
write or call us, such as an investors name, address, Social Security Number,
employment, investment objectives and experience, financial circumstances, and
investment transactions and holdings.
Information We Disclose
We disclose nonpublic personal information about investors to our affiliates, and to
outside firms that help us provide services to investors, for use only for that
purpose. We may also disclose nonpublic personal information to nonaffiliated
third party financial institutions with whom we have established relationships, such
as financial institutions that offer our affinity credit card program, or to other
institutions with which we may establish relationships in the future in order to offer
select financial products of interest to our customers. An investor has the right to
stop us from disclosing nonpublic personal information about the investor to these
parties, except as permitted or required by law. To do so, call us toll free at 1-800-
827-2710. If an investor does not notify us that they wish to block disclosure of
this nonpublic personal information, we will allow information to be sent to
investors from all third party financial institutions with which we have established
relationships. Currently, ICMA-RC has established relationships with First USA
Bank for its affinity credit card program and with M&T Bank for enrollment and
information services in connection with ICMA-RC's 457 Deferred Compensation
Program. Before any additional third party relationships are added, they must be
approved by the Board of Directors of ICMA-RC. Once approved, ICMA-RC will
notify investors of any additional third party relationships in future publications of
this privacy policy.
How We Safeguard Your Information
We restrict access to nonpublic personal information about investors to those
persons who need to know it or who are permitted or required by law or by the
investor to receive it. We maintain physical, electronic and procedural safeguards to
protect the confidentiality of investor information.
Summary of Proxy
SUMMARY OF PROXY VOTING POLICIES AND PROCEDURES
Voting Policies and
Procedures
Guiding Principles: It is the policy of ICMA-RC to vote all proxies for the
Complete amended pages in full, circle amended items and file with execution page (page 1).
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Schedule F of
SEC File Number: I Date:
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part 1 or any other schedules.)
1. Full name of applicant exactly as stated in Item IA of Part] of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. Ident. No.:
23-7268394
Item of Form
(identify)
exclusive benefit of and in the best economic interests of its clients, that is, in the
manner that ICMA-RC believes most likely to maximize total return to clients as
investors in the securities being voted.
Scope: The policies cover proxies in respect to securities held by the collective
investment portfolios ("Trust Portfolios") established and maintained by the
VantageTrust Company ("Trust Company") for the investment and reinvestment of
the assets of public sector employee benefit plans and certain other eligible
investors, which ICMA-RC is authorized to vote under the Master Agreement
between ICMA-RC and the Trust Company. The policies also cover the accounts
of Plan Participants which are managed on a discretionary basis in the Managed
Accounts program offered by ICMA-RC through Guided Pathways. Currently, the
only voting securities held by the Trust Portfolios are shares of mutual funds.
Managed Accounts may include both mutual funds and shares of private funds.
ICMA-RC does not have or exercise authority to vote proxies on behalf of advisory
clients other than the Trust Company and Managed Accounts.
Administration of Policies: ICMA-RC has established a Proxy Voting Committee
comprised of members of the staff of its Investment Division and Legal Department
("Committee"). The Committee is responsible for overseeing and updating these
policies as may be appropriate from time to time.
ICMA-RC's Investment Division is responsible for overseeing and administering
the voting of client proxies. The Investment Division's responsibilities include
identifying any material conflicts of interest on the part of ICMA-RC or its
personnel that may affect particular proxy votes and resolving any material
conflicts identified in consultation with ICMA-RC's Legal Department; analyzing
and evaluating particular proposals presented for vote; determining when and how
client proxies should be voted other than in accordance with the general rules and
criteria set forth below under "Proxy Voting Guidelines"; implementing procedures
reasonably designed to ensure that proxies are received and voted in a timely
manner; and making and keeping all required records with respect to proxies voted
by ICMA-RC.
Conflicts of Interest: Both the Trust Portfolios and Managed Accounts may invest
in, among other things, shares of The Vantagepoint Funds, a series fund sponsored
b ICMA-RC and for which wholly-owned subsidiaries of ICMA-RC serve as
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Page
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0 •
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name of applicant exactly as stated in Item IA of Part I of Form ADV:
International City Management Association Retirement Corporation
IRS Empl. Idenl. No.:
23-7268394
Item of Form
(identify)
investment adviser, transfer agent and distributor, and (2) shares of a number of
other mutual funds that are not affiliated with ICMA-RC ("Third-Party Funds").
To avoid conflicts or the appearance of conflicts between the interests of ICMA-RC
and its affiliates and the interests of its client, the Trust Company, and the
beneficial owners of interests in the Trust Portfolios, ICMA-RC will not exercise
its authority to decide how to vote proxies with respect to shares of The
Vantagepoint Funds held by the Trust Portfolios or Managed Accounts. Instead,
ICMA-RC will seek instructions on how to vote those proxies from the Board of
Directors of the Trust Company, and will cast the votes in accordance with the
instructions received. A majority of the members of the Trust Company's Board of
Directors are independent of ICMA-RC. To the extent that Participants in Managed
Accounts object to voting their shares of The Vantagepoint Funds in accordance
with the directions of the Board of Directors of the Trust Company, such
Participants may make arrangements to vote their own proxies.
With respect to proxies relating to shares of Third Party Funds, ICMA-RC's
Investment Division will screen the proxies to seek to identify any material
conflicts of interest on the part of ICMA-RC. Conflicts of interest could arise from
a variety of circumstances, including, but not limited to, significant current or
potential business relationships between ICMA-RC and the sponsor, investment
adviser or distributor of a Third Party Fund or certain personal or business
relationships between ICMA-RC personnel and a Third Party Fund or such fund's
investment adviser, distributor or sponsor. In evaluating the materiality of conflicts
of interest, the Investment Division will consult with the Legal Department.
Generally, a conflict of interest arising as a result of a current or prospective
business relationship between ICMA-RC and another. party with an interest in the
outcome of the proxy vote will not be considered material if ICMA-RC did not
receive more than 1% of its total revenues during its last fiscal year as a direct
result of services provided by ICMA-RC to that party and does not reasonably
expect to receive the same or a higher percentage of its total revenues from that
business relationship in its current fiscal year. In addition, ICMA-RC does not treat
the adviser/subadviser, custodial or other service provider relationships between its
subsidiary, Vantagepoint Investment Advisers, LLC, and/or The Vantagepoint
Funds and the various third party subadvisers or other service providers to The
Vantagepoint Funds that are not part of the ICMA-RC organization as creating a
material conflict of interest in connection with the voting of proxies in respect to
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9 •
Schedule F of I Applicant: I SEC File Number: I Date:
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part I or any other schedules.)
I. Full name ofapplicanI exactly as stated in Item IA of Pan I of Form AD V:
International City Management Association Retirement Corporation
IRS Empl. Ident. No.:
23-7268394
Item of Font
(identify)
the shares of a Third Party Fund that uses one or more of the same service
providers.
In the event the Investment Division determines there is a material conflict of
interest that may affect ICMA-RC's judgment on a particular vote, ICMA-RC may
vote the proxy only if ICMA-RC's Proxy Voting Guidelines specify how such
matters generally will be voted, i.e., the guidelines state that votes generally will be
cast "for," "against" or "abstain" on that type of proposal. If the Guidelines do not
indicate how the vote should be cast, ICMA-RC either will seek voting instructions
or a waiver of the conflict from the Board of Directors of the Trust Company, vote
the Trust Portfolios' shares in the same proportion as the vote of all other holders of
such security (if this option is available to ICMA-RC) or refrain from voting. In
addition to the choices previously identified, Managed Accounts clients may make
arrangements to vote their own shares of any Third Party Fund with respect to
which the Investment Division has identified a material conflict of interest.
When ICMA-RC Will Not Vote Proxies: ICMA-RC may not vote client proxies in
certain circumstances, including situations where (a) the securities are no longer
held in the client's account; (b) the proxy and other relevant materials are not
received in sufficient time to allow adequate analysis or an informed vote by the
voting deadline; or (c) ICMA-RC concludes that the cost of voting the proxy is
likely to exceed the expected benefit to the client.
Maintenance of Proxy Voting Record: As required by Advisers Act Rule 204-2,
ICMA-RC will maintain the following records relating to proxy voting for a period
of at least six years:
(i) a copy of these policies, as they may be amended from time to time;
(ii) copies of proxy statements received regarding client securities, unless these
materials are available electronically through the SEC's EDGAR system;
(iii) a record of each proxy vote cast on behalf of its clients;
(iv) a copy of any internal documents created by ICMA-RC that were material
to making the decision how to vote proxies on behalf of its clients; and
(v) each written client request for information on how ICMA-RC voted proxies
on behalf of the client and all written responses by ICMA-RC to oral or written
client requests for such proxy voting information.
Complete amended pages in full, circle amended items and file with execution page (page 1).
Yage 2b of 2 /
46/47
0 0
Schedule F of
Form ADV
Continuation Sheet for Form ADV Part II
801-18273 1 7/28/06
(Do not use this Schedule as a continuation sheet for Form ADV Part 1 or any other schedules.)
I. Full name of applicant exactly as stated in Item I A of Part I of Farm ADV:
International City Management Association Retirement Corporation
IRS Empl. Ident. No.:
23-7268394
Item of Form
(identify)
Disclosure: ICMA-RC will provide its clients a summary of these policies, either
directly or by delivering to each client of a copy of this ADV brochure summary.
Clients may obtain a copy of the full text of ICMA-RC's Proxy Voting Policies and
a record of how ICMA-RC has voted the client's proxies by calling the number
which appears on the face of this ADV brochure. A copy of these materials will be
provided promptly to clients on request.
Complete amended pages in full, circle amended items and file with execution page (page 1).
Page 27 of 27
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