HomeMy WebLinkAboutOCSD 16-18 RESOLUTION NO. OCSD 16-18
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ORANGE
COUNTY SANITATION DISTRICT ACKNOWLEDGING THE CHANGE IN
TITLE OF THE CURRENT DEFERRED COMPENSATION PLAN
ADMINISTRATOR TO VOYA FINANCIAL SERVICES AND AUTHORIZING
VOYA FINANCIAL SERVICES TO CONTINUE SERVING AS PLAN
ADMINISTRATOR OF THE DEFERRED COMPENSATION PLAN FOR
OFFICERS AND EMPLOYEES OF THE ORANGE COUNTY SANITATION
DISTRICT; AND, REPEALING RESOLUTION NO. OCSD 09-02.
WHEREAS, the Orange County Sanitation District Deferred Compensation Plan
was most recently amended by Resolution No. OCSD 09-02, adopted by the District's
Board of Directors on March 25, 2009, and which repealed prior Resolution Nos. 03-27
and 05-27;
WHEREAS, as the result of numerous legislative and regulatory changes
increasing the scope of the District's fiduciary responsibilities as an employer in the
administration of deferred compensation plans, OCSD requested proposals in 2008, for
plan administrators to act as agents or advisors for the purpose of implementing and
administering the District's Deferred Compensation Plan; and
WHEREAS, the Board of Directors appointed ING Financial Services in 2009 to
act as agents or advisors for the purpose of implementing and administering the District's
Deferred Compensation Plan; and
WHEREAS, ING Financial Services changed its name to Voya Financial Services
in 2014 without affecting any substantive changes to the scope of services it provided as
plan administrator for the District's Deferred Compensation Plan; and
WHEREAS, the assets in the Existing Plan, as amended, are currently held with
Voya Financial Services.
NOW, THEREFORE, the Board of Directors of the Orange County Sanitation
District DOES HEREBY RESOLVE, DETERMINE AND ORDER:
Section 1. All of the recitals herein contained are true and correct and the Board
of Directors of the District so finds.
Section 2. The Orange County Sanitation District Deferred Compensation Plan,
as set forth in Exhibit'A,"attached hereto and incorporated herein by reference as though
set forth herein at length, is hereby adopted, as the new Deferred Compensation Plan of
the District, superseding all previous plans and amendments of the District, and shall
remain in effect until amended or terminated by Resolution of the Board of Directors.
1194905.1 OCSD 16-18-1
Section 3. The District's General Manager, or his designee, is hereby
authorized to appoint or employ the services of Voya Financial Services to continue acting
as agents or advisors for the purpose of implementing and administering the District's
Deferred Compensation Plan.
Section 4. The District's General Manager, or his designee, is hereby
authorized to execute, on behalf of the District, any and all documents necessary to effect
the new Deferred Compensation Plan, with the approval as to form by the District's
General Counsel.
Section 5. Resolution No. OCSD 09-02 is hereby repealed.
Section 6. This Resolution shall take effect immediately upon its adoption.
PASSED AND ADOPTED at a regular meeting of the Board of Directors held on
October 26, 2016.
4
4ard
Nielsen
g-Chairman
jell
ST:
Clerard
APPROVED:
f ,
Brad ey R. Hogin
General Counsel
1194905.1 OCSD 16-18-2
Not included in Resolution
approval. Finance provided
after the fact.
ORANGE COUNTY SANITATION DISTRICT
457(b) DEFERRED COMPENSATION PLAN
ADMINISTRATIVE SERVICES AGREEMENT
FINAL OCSD ASA 9-14-16.doc
Orange County Sanitation District 457(b)Deferred Compensation Plan
ADMINISTRATIVE SERVICES AGREEMENT
This Agreement is made and entered into this First day of September, 2016, by and
between Orange County Sanitation District, (the "Plan Sponsor") on behalf of the
Orange County Sanitation District 457(b) Deferred Compensation Plan (the "457
Plan"), (unless specified otherwise, referred to herein as the "Plan"). Voya Retirement
Insurance and Annuity Company("VRIAC"), a corporation organized and existing
under the laws of the State of Connecticut and Voya Financial Partners,LLC a limited
liability company organized and existing under the laws of the State of Delaware and
registered as a broker-dealer under the federal securities laws (the "Broker-Dealer").
VRIAC and the Broker-Dealer are hereinafter collectively called the "Contractor". This
Agreement is separate and apart from any other contract issued to the Plan, including any
group annuity contract or funding agreement issued to the Plan Sponsor by VRIAC.
RECITALS
WHEREAS, the 457 Plan has been established as an"eligible deferred
compensation plan"pursuant to Section 457(b) of the Internal Revenue Code (the "Code")
and the laws of the State of California; and
WHEREAS, the Plan Sponsor has selected certain investment products offered or
otherwise made available by or through VRIAC or the Broker-Dealer, respectively, for the
investment of the Plan's assets (the"Program"); and
WHEREAS, the Plan Sponsor further wishes to engage the Contractor as an
administrative service provider to facilitate the administration of the Plan by providing
services that shall include without limitation, accounting for deferrals or contributions,
disbursement of funds, withholding of taxes, investment education, retirement counseling,
investment of assets in the appropriate Plan investment options and proper recordkeeping
of participant accounts; and
WHEREAS, the Contractor wishes to provide such administrative services to the
Plan.
NOW, THEREFORE, in consideration of the mutual promises contained herein,
the parties do hereby agree as follows:
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Section 1. Services
1.01 Good Order: The Contractor and the Plan Sponsor acknowledge that for purposes of this
Agreement"Good Order"is defined as the receipt at the Contractor's designated location
of a transaction request,instructions or data that is complete, accurate and in an acceptable
format, and which do not require the Contractor to apply any research or discretionary
judgment. To qualify as current business day instructions, a transaction request,
instructions or data sent electronically,by telephone, facsimile or mail must be received by
us no later than the close of the New York Stock Exchange("NYSE")(typically 4:00 p.m.
ET). If the Contractor receives a transaction request, instructions or data in Good Order
after the close of the NYSE,the Contractor will process the data or request on the next
business day that the NYSE is open.
1.02 Allocation of Contractor Responsibilities: The Broker-Dealer or other broker-
dealers with which Voya Financial Partners, LLC has a selling agreement shall
service or perform all marketing communications, enrollment and securities
transactions settlement and processing functions assigned to the Contractor.
VRIAC shall perform all other responsibilities assigned to the Contractor, including
Plan and participant recordkeeping.
1.03 Scone of Services: The Contractor agrees to provide the Plan with the services
listed on Schedule A for the term of this Agreement. Services offered pursuant to
the Plan's loan program will be subject to the terms specified in Schedule B.
1.04 Administrative Requirements: The Contractor agrees to comply with the
requirements set forth on Schedule C in the performance of this Agreement. The
Contractor and the Plan Sponsor will review these administrative requirements
periodically and make adjustments as necessary and mutually agreed.
1.05 Performance Standards: The Contractor agrees to comply with the standards set
forth on Schedule D in the performance of this Agreement. At the Plan Sponsor's
request, the Contractor shall report to the Plan Sponsor how it measures compared
to these performance standards. Any non-performance fee payable pursuant to the
terms of Schedule D shall be in addition to any damages or other remedies
available to the Plan,participants or the Plan Sponsor hereunder. The Contractor
and the Plan Sponsor will review these performance standards at the Plan
Sponsor's request and make adjustments as necessary and mutually agreed.
1.06 Selection of Investment Options: The Plan Sponsor acknowledges that it is
responsible for choosing the investment options to be made available to participants
under the Plan. The Contractor agrees to provide Plan participants with a selection
of investment options as specified in Schedule E. All contributions are to be invested
as the Participant directs.
1.07 Investment Provider Minimum Standards: Subject to the minimum standards set
forth in Schedule F, the Contractor will provide its administrative services in
connection with the Plan Sponsor's selection of investment products to fund the
Plan's non-stable value investment options.
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1.08 Modification to Investment Options: The addition or removal of any investment
option to the Plan must be mutually agreed to by the Contractor and the Plan
Sponsor and will be made in accordance with a mutually agreed upon schedule for
implementing the change.
(1) Subject to mutual agreement between the parties to add an investment
option;
(i) The Plan Sponsor may direct the Contractor to add an investment
option from the range of investment products the Contract currently
offers, and that are currently available in the Program, upon forty-
five (45) days written notice of the proposed change.
(ii) The Plan Sponsor may direct the Contractor to add an investment
option that the Contract does not currently offer or an investment
option that the Contractor currently offers but is not currently
available in the Program, upon at least ninety(90) days written
notice of the proposed change. Any investment option additions
made pursuant to this Subsection 1.07(1)(ii) will be made in
accordance with the Contractor's scheduled quarterly fund updates.
(2) The Contractor reserves the right to reject any new investment option that
imposes short-term trading (redemption) fees on participant accounts.
(3) To the extent an existing investment option imposes short-term trading
(redemption) fees on Participant accounts, the Contractor reserves the right
to discontinue offering the investment option or to deduct any such short-
term trading(redemption) fees from participant accounts.
1.09 Limits Imposed by UnderlyingFunds:unds: The Plan Sponsor understands and
acknowledges that orders for the purchase of fund shares may be subject to
acceptance by the fund. The Contractor reserves the right to reject, without prior
notice, any allocation of payments to the variable investment products, including
the NAV Funds, if the Contractor's purchase order for the corresponding fund is
not acceptable by the fund for any reason.
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1.10 Limits Imposed by Contractor on Frequent Transfers: The Plan Sponsor
understands and acknowledges that the investment products offered or otherwise
made available by or through the Contractor are not designed to serve as vehicles
for frequent trading in response to short-term fluctuations in the market. Such
frequent trading can disrupt management of a fund and raise its expenses. This in
turn can have an adverse effect on fund performance. Accordingly, the Plan
Sponsor agrees to adhere to the Contractor's current Excessive Trading Policy, as
set forth in Schedule G (the "Excessive Trading Policy"). The Contractor reserves
the right to modify the Excessive Trading Policy in whole or in part at any time and
without prior notice, depending on the needs of the underlying fund(s), the best
interest of contract owners and fund investors, and/or state or federal regulatory
requirements.
1.11 RestrictingPrticipant Accounts: The Plan Sponsor directs the Contractor to place
an administrative hold on a participant's account upon receipt of a draft domestic
relations order, or upon the receipt of other types of court orders that assert a claim
to plan benefits. Refer to APPENDIX V to SCHEDULE A of this agreement,
"DOMESTIC RELATIONS ORDER REVIEW AND APPROVAL
REQUIREMENTS" for specifics regarding account restrictions as a result of a
draft domestic relations order. Placing a restriction on the participant's account
will prevent the participant from taking a distribution, including loans. The
participant will continue to have the ability to make allocation changes and fund
transfers. The restriction will remain on the participant's account until such time
that the Contractor is advised to remove the administrative hold either by the Plan
Sponsor, or upon a receipt of a court order indicating that that the matter has been
resolved and the hold is no longer needed.
1.12 Access to Investment Advice: The Contractor agrees to make available to Plan
participants, an independent third party online investment advisory service, as
specified in separately signed agreements.
1.13 Access to Self Directed Brokerage Account: The Contractor agrees to make
available to Plan participants, a self directed brokerage account option ("SDBO"),
as specified in a separately signed agreement.
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Section 2. Participant Information
2.01 Provision of Certain Participant Information: The Plan Sponsor or its authorized
representative shall facilitate the transmission to the Contractor of all current Plan
participant level records including,but not limited to: name; address; social
security number; active or terminated employment status; loan information; and
deferral amount information. The Contractor shall be able to rely on the
information provided by the Plan Sponsor. We are not responsible for any errors,
omissions or other inaccuracies in the data you or an unaffiliated third party,
including without limitation,prior service providers furnish us. Over the term of
this Agreement,the Contractor and the Plan Sponsor will develop procedures for
the Plan Sponsor to notify the Contractor of changes in employment status and, to
the extent the Plan Sponsor has knowledge of the death of any participant, the Plan
Sponsor will notify the Contractor of such death. The Plan Sponsor shall provide
such information on a timely basis and use its best efforts to assure the accuracy
and completeness of all information provided to the Contractor.
2.02 Changes in Deferral or Contribution Information;New Participant Deferral or
Contribution Information: The Contractor and the Plan Sponsor will develop
procedures to coordinate the processing of(i) changes in deferral or contribution
amount information and(ii) initial deferral or contribution information pertaining
to participants joining the Plan on or after the date the Contractor commences the
provision of services under this Agreement.
Section 3. Compensation
3.01 Contractor's Compensation: The Contractor's services under the Agreement are
rendered in connection with the Plan Sponsor's selection of certain investment
products offered by or through the Contractor. The revenues paid to the Contractor
from such investment products shall not constitute a source of compensation for the
services rendered under this Agreement. An administrative service fee will be
assessed quarterly and calculated across all funds, including the Stable Value
Option. This fee is not assessed on assets held in the Self Directed Brokerage
Account. The fee will be deducted from the participant's money sources in the
sequence elected by the Plan Sponsor for participant-initiated withdrawals in
Schedule A. The Contractor's overall revenue requirement is 0.16% ("revenue
required"). Therefore, the Contractor will assess an asset based fee of 0.16%,
assuming the Contractor does not retain the revenue derived from the investment
products offered by or through the Contractor. The Contractor reserves the right to
increase the asset based fee if plan characteristics change from what was originally
assumed. Additional transactional fees and charges may apply for optional services
such as loans, investment advisory services and Self Directed Brokerage Account.
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3.02 Assumptions RegardingPg: Any fees, reimbursements,products and services
rendered in connection with this Agreement are contingent on the Contractor being
the exclusive provider of investment products and administrative services to the
Plan during the Term of this Agreement and any subsequent renewal periods (as
described in Section 4.01). The addition of any other provider or providers to the
Plan during the Term of this Agreement and any subsequent renewal periods or
changes in the Plan document may impact any fees, reimbursements,products and
services under this Agreement. The Plan Sponsor will notify Contractor of any such
changes in a timely manner.
This Agreement and fees are contingent on the Plan provisions in effect on the date
of this Agreement. Any amendment to the Plan may impact this Agreement and
fees.
The Plan Sponsor understands and acknowledges that the compensation to the
Contractor is subject to the certain general provisions, as set forth in Schedule H
(the "General Compensation Provisions"). The Contractor reserves the right to
modify the General Compensation Provisions in whole or in part at any time and
without prior notice, depending on the needs of the underlying fund(s), the best
interest of contract owners and fund investors, and/or state or federal regulatory
requirements. If such modification of the General Compensation Provisions
increase the amounts that would be paid to the Contractor, the Plan Sponsor shall
have the option to operate under the old fee regime for 180 days, after which this
Agreement shall terminate.
3.03 Reimbursement of Plan Expenses: The Contractor shall reimburse the Plan for
reasonable administrative expenses as set forth in Schedule I as directed by the Plan
Sponsor.
3.04 Compensation Paid to Sales Professionals: The Contractor shall pay sales
professionals a fixed salary. The compensation paid to sales professionals will be
derived exclusively from the Contractor's revenue, defined in Schedule H. Sales
professionals may also be eligible for additional expense reimbursement.
Compensation may also be paid at the time of participant election of an
annuitization distribution option and will be disclosed to the participant at the time
the distribution option is elected.
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3.05 Float: Voyarm and its affiliated companies (collectively referred to as "Voya" for
purposes of this Section 3.05) earn income in the form of bank service credits on
contributions awaiting investment and on payments awaiting distribution from the
bank accounts that Voya maintains (or"float"). The bank service credits are
applied against the bank service fees that apply to the bank accounts that Voya
maintains and may not be redeemed for cash. Specifically, the bank accounts have
been established to receive and hold for a reasonable time:
• contributions or other amounts to be invested in your retirement Plan,or
• amounts redeemed to pay a distribution or disbursement from your Plan.
Voya will receive income in the form of bank service credits (as described below)
and offset such credits against bank service fees that are charged to Voya for the
use of such bank accounts and for services provided by the banks for processing
receipts or disbursements.
Float Generated by Contributions:
Voya uses a bank account to receive and hold contributions or other Plan deposit
amounts to be invested. Contributions or other deposit amounts are held until
authorized instructions are received in Good Order. Income in the form of bank
service credits are earned on the bank account during any waiting period for
authorized instructions. For authorized instructions received in Good Order,
contributions or other deposit amounts will be invested on that business day. For
authorized instructions received in Good Order after the close of the New York
Stock Exchange, contributions or other deposit amounts will be processed on the
next business day.
Float Generated by Distributions:
Voya receives income in the form of bank service credits in connection with
distributions or disbursements that Voya pays on the Plan's behalf. The bank service
credits accrue during the period beginning when an amount is redeemed from the
Plan's investment to fund a distribution or disbursement check and ending when the
check is presented for payment.
Additionally, from time to time, Voya may receive money market like rates of
return on other deposit or short term investment products in which distributions
may be held until such time as the check is presented for payment.
3.06 Transaction Processing: VRIAC seeks to avoid transaction processing errors to the
greatest extent possible, but inadvertent errors do occur from time to time. When a
transaction processing error for which VRIAC is directly responsible occurs,
VRIAC will attempt to correct the error as soon as reasonably practicable after
identification of the error. Once all necessary information has been gathered,
VRIAC will promptly take corrective action to put the Plan and its Participants in a
position financially equivalent to the position they would have been in if the
VRIAC processing error had not occurred at no additional cost to the Plan or its
Participants.
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VRIAC processes your Plan's investment instructions on an"omnibus" or
aggregated basis. If VRIAC's correction of a VRIAC processing error results in a
loss to your Plan or its Participants, VRIAC will absorb the loss. If any gain results
in connection with the correction of a VRIAC processing error, VRIAC will net
any such gain against other losses absorbed by VRIAC and retain any resulting net
gain as a component of its compensation for transaction processing services,
including its agreement to make Plan and Participant accounts whole for losses
resulting from VRIAC processing errors. For more information on our error
correction policy, please refer to Voya Retirement Insurance and Annuity
Company's Policy for Correction of Processing Errors ("VRIAC Policy"),which is
included in Schedule J. The VRIAC Policy and any updates to the VRIAC Policy
are posted in the Sponsor Disclosure section of Sponsor Web.
3.07 Fund Management Fees: Fund management fees and other fund operating
expenses will also apply to the mutual fund investment options under the Plan.
Fees depend on the investment options chosen.
Section 4. Term
4.01 Term: This Agreement shall commence on the Effective Date and continue for an
initial term of 5 years. Unless either Plan Sponsor or Contractor provides written
notice of intent to terminate this Agreement at least ninety(90) calendar days
before the end of the initial term, the Agreement shall automatically renew
thereafter for subsequent one-year terms; provided, however, that either Plan
Sponsor or Contractor may terminate the Agreement as of the last day of any such
one-year term by providing written notice of such termination at ninety (90)
calendar days prior to the effective date of the termination. The Plan Sponsor and
Contractor may mutually agree in writing to an earlier termination. This
Agreement may be amended in writing if agreed to by both parties.
4.02 Termination: Notwithstanding Section 4.01, either party may terminate this
Agreement at any time upon written notice"for cause". For this purpose, "for
cause" shall mean: (1) failure of the other party to comply substantially with this
Agreement and attached schedules hereto which, when called to the attention of the
other party in writing has not been corrected within thirty(30) days; (2)the fraud or
embezzlement on the part of the other party or provider of investment advice; (3) if
the other party ceases to conduct business in the normal course,becomes insolvent,
makes a general assignment for the benefit of creditors, suffers or permits the
appointment of a receiver for its business or assets, or avails itself of, or becomes
subject to any proceeding under the Federal Bankruptcy Act or any other statute of
any state relating to insolvency or the protection of the rights of creditors; (4)
failure of the other party to pay any fees under this Agreement; or(5) if pursuant to
Section 1.07 the Plan Sponsor requests the addition or removal of an investment
option under the Plans, that is reasonably anticipated by the Contractor to result in a
reduction in revenues under the Plans and no mutual agreement is reached between
the parties on the recoupment of such lost revenues, the Contractor shall have the
right to terminate this Agreement.
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Section 5. General
5.01 Circumstances Excusing Performance: Neither the Plan Sponsor nor the
Contractor shall be liable to the other for any delays or damages or any failure to
act due, occasioned, or caused by reason of restrictions imposed by any
government or government agency, acts of God, strikes, labor disputes, action of
the elements, or causes beyond the control of the parties affected thereby.
5.02 Business Recovery Plan: The Contractor acknowledges that it has a Business
Recovery Plan in place for its computer environment, specifying steps to be taken
in the event of a disaster. The plan is built around a worst-case scenario involving
loss of the facility or loss of access to the facility. It is also adaptable to less severe
disasters. Generally, there are three phases to the Contractor's Business Recovery
Plan:
• Immediate response, damage assessment and critical notifications
• Environmental and operation restoration
• Operational readiness, testing and business resumption.
A critical part of this plan is the Contractor's System Recovery Plan, which itself
has three components:
Hardware: the Contractor maintains a primary data center to support it mainframe
applications and a portion of its mid-range and Intel based distributed environment.
The Contractor has contracted with an outside vendor to provide hot site recovery
capabilities for the primary data center in case of a site level disaster. The vendor
maintains equipment that the Contractor will use to restore its applications in case
of emergency. In addition, the Contractor has several data centers located
throughout the U.S. with mid-range and distributed equipment to lessen the risk
from any one site.
On-site generators and UPS systems provide continuous power to the Contractor's
facilities. A fully redundant wide area network connects all of the data centers in
the U.S. as well as to the hot site vendor facility.
Application software: the Contractor secures program libraries, to tape cartridges
weekly, storing them in both on-site and off-site vaults.
Production data: the Contractor's system and database files are backed up
periodically, many on a daily basis, to tape cartridges stored in both on-site and off-
site vaults.
The Contractor's internal auditors have reviewed its disaster recovery procedures.
Portions of the plan are tested on an annual basis.
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5.03 Ownership of Records: The Contractor agrees that all computer tapes, discs,
programs and any records generated by the Contractor under this Agreement shall
be the property of the Plan. In the event of the termination of this Agreement, the
Contractor shall provide all electronic and/or written data records to the Plan's
designated representative or to a new contractor in an agreed upon format at no cost
and within 180 days of written notice of intent to terminate this Agreement.
5.04 Parties Bound: This Agreement and the provisions thereof shall be binding upon
the respective parties and shall inure to the benefit of the same.
5.05 Applicable Law: This Agreement shall be construed in accordance with the laws of
the State of California. The Contractor and the Plan Sponsor shall comply with all
state and federal laws and regulations applicable to the services to be performed.
5.06 Severability: If any provision of this Agreement shall be found to be illegal or
invalid for any reason, the illegality or invalidity shall not affect the remaining
parts of this Agreement and the remainder of this Agreement shall be construed and
enforced as if said illegal or invalid provision had never been inserted herein.
Neither party shall be required to perform any services under this Agreement which
would violate any law, regulation or ruling.
5.07 Acknowledgment: The Plan Sponsor acknowledges that:
(a) the Contractor is performing non-discretionary, ministerial administrative
services at the direction of the Plan and it's authorized representatives;
(b) the Plan Sponsor and its authorized representatives have sole authority for
making all benefit determinations. The Plan Sponsor may delegate the day-
to-day administration of initial benefit determinations to the Contractor as
indicated in Schedule A;
(c) the Plan Sponsor and its authorized representative have the sole authority
for the review and final disposition of a Plan Participant's appeal of any
benefit determination made by the Contractor under the Plan;
(d) the Contractor does not directly provide any investment advice to the Plan
Sponsor with respect to the Plan's assets.
(e) in performing services under this Agreement, the Contractor is entitled to
rely on any information the Plan Sponsor, or its authorized representatives
identified in Schedule K or the Plan participants provide. The Contractor
has a reasonable duty to inquire as to the authenticity or the accuracy of
such information or the actual authority of such person to provide it; and
(f) The Plan Sponsor will promptly provide to the Contractor any proposed
amendments to the Plan for review and comment by the Contractor at least
90 days prior to the proposed amendment effective date.
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(g) VRIAC Error. VRIAC's responsibility with respect to providing the
services is limited to correcting errors,within a reasonable time, which
result from its computer system malfunctions, its staff errors or are
otherwise caused by VRIAC's negligent acts. VRIAC shall make a good
faith effort to correct any such error as soon as reasonably practicable after
identification of the error when such correction is reasonably necessary and
practical under the circumstances. For more information on our error
correction policy,please refer to Voya Retirement Insurance and Annuity
Company's policy for Correction of Processing Errors ("VRIAC Policy"),
which is included in Schedule J. The VRIAC Policy and any updates to the
VRIAC Policy are also posted in the Sponsor Disclosure section of Sponsor
Web.
(h) Plan Sponsor Error. VRIAC will attempt to correct, at Plan Sponsor's
expense,processing errors resulting from Plan Sponsor, or Plan Sponsor's
representative, or otherwise caused by the negligent acts of Plan Sponsor;
provided that Plan Sponsor promptly notifies VRIAC of such error and
furnishes all data to VRIAC reasonably necessary to make such corrections.
Plan Sponsor shall pay VRIAC its reasonable expenses incurred in making
such corrections
5.08 Notices: Each party will promptly provide the other with notice and copy of any
attempts to levy or attach amounts held under the Plan and/or any litigation
affecting the Plan of which it becomes aware and/or any notices or demands to be
given under this Agreement. All such notices, demands or other communications
hereunder shall be in writing and duly provided if sent certified mail, return receipt
requested, addressed to the parry to be notified or upon whom a demand is being
made, at the addresses set forth in this Agreement or such other place as either
party shall from time to time designate in writing. The date of service of a notice
or demand shall be the receipt date on any certified mail receipt
Notices to the Contractor shall be sent to:
Voya Retirement Insurance and Annuity Company
Attn: Associate General Counsel
Legal Department, C IS
One Orange Way
Windsor, CT 06095
Notices to the Plan Sponsor shall be sent to:
Human Resources Representative
Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley, CA 92708-7018
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5.09 Copies of Agreement: This Agreement may be executed in any number of
counterpart copies, each of which when fully executed shall be considered as an
original.
5.10 Headings: Headings are for convenience of reference only. Headings do not limit
or expand the scope of the text and are not intended to emphasize any portion
thereof.
5.11 Independent Contractor: The Contractor is associated with the Plan Sponsor only
for the purposes and to the extent specified in this Agreement, with respect to the
performance of the contracted services pursuant to this Agreement, the Contractor
shall have the sole right to supervise, manage, operate, control and direct
performance of the details incident to its duties under this Agreement.
5.12 Contractor Primary Contact: The Contractor designates certain individual(s)to
serve as the primary point of contact for the Agreement. These individuals are
identified in Schedule L.
5.13 Licensed Representative: The Contractor agrees to provide licensed representatives
to perform enrollment and education services, and to assist participants with
account balance inquiries, investment selection changes, interfund transfers or
exchanges, and transaction initiation. These individuals are identified in Schedule
M.
5.14 Subcontracting: The Contractor may enter into subcontracting agreements for
work contemplated under the Agreement. Any subcontractor shall be subject to the
same terms and conditions as the Contractor. The Contractor shall be fully
responsible for the performance of any subcontractor.
5.15 Contract Assi ng abilitX: Without the prior written consent of the Plan Sponsor, the
Agreement is not assignable by the Contractor either in whole or in part.
5.16 Licenses and Permits: The Contractor shall ensure that it has all necessary licenses
and permits required by the laws of federal, state, and municipal laws, ordinances,
rules and regulations. The Contractor shall maintain these licenses and permits in
effect for the duration of this Agreement. The Contractor will notify the Plan
Sponsor immediately of loss or suspension of any such licenses and permits.
Failure to maintain a required license or permit may result in immediate
termination of this Agreement.
5.17 Conflict of Interest: The Contractor shall make all reasonable efforts to ensure that
no conflict of interest exists between its officers, employees, agents or
subcontractors and the Plan Sponsor. The Contractor shall make a reasonable
effort to prevent employees, consultants, or members of governing bodies from
using their positions for purposes that are, or give the appearance of being,
motivated by a desire for private gain for themselves or others such as those with
whom they have family, business, or other ties.
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5.18 Improper Consideration: The Contractor shall not offer or be forced to provide
(either directly or through an intermediary) any improper consideration such as, but
not limited to, cash, discounts, services, the provision of travel or entertainment, or
any items of value to any officer, employee, group of employees, or agent of the
Plan Sponsor in an attempt to secure favorable treatment or consideration.
5.19 Indemnification: The Contractor agrees to indemnify and hold the Plan Sponsor, its
officers, employees and agents harmless from any loss, liability, claim, suit or
judgment resulting from work or acts done or omitted by the Contractor's officers,
employees or agents in carrying out the Contractor's responsibilities as set forth in
this Agreement to the proportionate extent that it results from the negligence or
wrongdoing of the Contractor or any of its officers, employees or agents. The
Contractor agreements to indemnify shall not extend to any injury or damage which
results from the Contractor's reliance on information transmitted by the Plan
Sponsor.
The Plan Sponsor agrees to indemnify and hold the Contractor, its officers,
employees and agents harmless from any loss, liability, claim, suit or judgment
resulting from work or acts done or omitted by the Plan Sponsor's officers,
employees or agents in carrying out the Plan Sponsor's responsibilities as set forth
in this Agreement to the proportionate extent that it results from the negligence or
wrongdoing of the Plan Sponsor or any of its officers, employees or agents.
5.20 Insurance: During the term of this Agreement, the Contractor shall maintain
Comprehensive General Liability insurance with limits of not less than one million
dollars, as well as automotive and Workers' Compensation insurance policies.
Also, the Contractor shall maintain Professional Liability in the amount of not less
than five million dollars. A Certificate of Insurance evidencing said coverage shall
be provided prior to commencement of performance of this Agreement.
Throughout the term of this Agreement, the Contractor shall provide upon request
an updated Certificate of Insurance upon expiration of the current Certificate.
5.21 Right to Monitor: The Plan Sponsor or any appointee thereof, shall have the right
to review and audit all records, books, documents, and other pertinent items as
requested, and shall have the right to monitor the performance of the Contractor in
the delivery of services provided under this Agreement. Full cooperation shall be
given by the Contractor in the implementation, and in any auditing or monitoring
conducted.
5.22 Confidentiality: The Contractor acknowledges that all information made available
by the Plan Sponsor about its employees shall be considered confidential. The
Contractor agrees that it will not distribute, disclose or release to any third party
any such confidential information except as may be necessary to the performance
of services hereunder either during or at any time after the term of the Agreement,
upon the prior written approval of the Plan Sponsor or as otherwise required by
law.
14
Section 6. RFP and RFP Response
6.01 RFP and RFP Response: Incorporation by Reference: Orange County Sanitation
District Request for Proposal and VRIAC's responsive proposal date August 4,
2008 (collectively the "RFP Response") are hereby incorporated by reference and
made a part of this Agreement. VRIAC agrees that it will comply with all
obligations undertaken in the RFP Response.
15
IN WITNESS WHEREOF,the parties hereto have caused this Agreement (including all
referenced and attached Schedules and Appendices)to be executed by their respective
officers thereunto duly authorized as of the day and year first above written.
ORANGE COUNTY SANITATION VOYA RETIREMENT
DISTRICT INSURANCE AND ANNUITY COMPANY
By: By:
Printed Name: LU,,rc,n-Zu N Printed Name: Melissa McAuliffe
Title: F'k N -., n c-.-- b J -,' Title: Vice President
VOYA FINANCIAL PARTNERS, LLC
By:
Printed Name: Dianne Bogoian
Title: Senior Vice President
16
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule A: Scope of Contractor Services
The Contractor agrees to provide the Plan with the services listed within this Schedule for
the term of this Agreement. For purposes of this Schedule, all references to "participant"
are intended to apply equally to all account holders under the Plan. This includes
participants, beneficiaries and alternate payees.
1. The one-time preparation and implementation of a Plan-specific product and service
conversion or transition schedule which shall include notice to all Plan participants.
2. The initial installation of overall Plan records and individual Plan participant records.
3. To assist the Plan Sponsor and its legal counsel, the Contractor will provide a
specimen governmental 457(b) and/or 401(a)plan document upon your request. As a
specimen plan,you and your legal counsel may modify the document(s) to reflect
your Plan design needs.
4. The development of Plan enrollment materials.
5. Conducting introductory on-site education and enrollment meetings for employees.
6. Ongoing allocation of Plan contributions to individual participant accounts, and
reconciliation of Plan and participant activity on a daily basis.
7. Contractor will perform one test per month beginning in October through December
on each participant account per Plan covered by this Agreement for the limit on
elective deferrals pursuant to Code section 457(e)(15). If the Plan Sponsor sponsors
more than one plan, the Contractor will not aggregate the plans for testing purposes,
unless specifically agreed to within this Agreement.
8. Ongoing maintenance of participant beneficiary designations under the Plan based
upon mutually agreed upon procedures which shall be reflected in the Plan
document. Participants may designate a beneficiary via the Contractor's participant
internet site or by speaking with a customer service representative via a toll free
telephone line.
17
Community Property
This optional feature of the online beneficiary maintenance service will take into
account community property laws applicable in the Participant's resident state at the
time that he or she is making a beneficiary designation. When this service has been
elected, the Contractor's online beneficiary maintenance service will require any
participant who has identified themselves as being married or in a registered
domestic partnership or a civil union and who does not designate a person identified
as his or her spouse or domestic partner as a primary beneficiary for at least the
percentage prescribed under the community property laws to complete and submit a
paper beneficiary designation form.
® The Plan Sponsor elects to utilize the Contractor's Community Property Edit
feature as described above.
9. Ongoing maintenance, recordkeeping of individual participant account records and
processing in a timely manner of all transactions permitted under the Plan as
authorized or approved by the Plan Sponsor. Any delegation of the Plan Sponsor's
role of authorizing or approving transactions under the Plan to the Contractor will be
as directed later within this Schedule or other written instrument between the parties.
Such direction shall not be construed as delegating Contractor discretion with respect
to such decision.
10. Ongoing generation of periodic Plan activity reports for Plan Sponsor use, as
mutually agreed upon, to be made available through a secure website.
11. Ongoing provision of necessary tax forms on a timely basis to participants who
received taxable distributions during the previous year.
12. Ongoing provision of employee enrollment and education services, including the
provision of communication packages which includes the necessary information for
employees to enroll and make investment choices.
13. Establish and maintain an electronic interface with the Plan Sponsor for participant
enrollment information (including automatic enrollments) and changes to the
participant's contribution amount or rate, as provided in Appendix I, II and III to
Schedule A.
14. Access to customer service representatives via a toll free telephone line to respond to
Plan participant inquiries,provide information about participants' accounts and
investment options and to distribute administrative forms.
15. Access to an automated voice response system via toll free telephone lines, through
which participants may obtain updated account and investment information and
initiate transactions permitted under the Plan.
18
16. Access to a customized internet site,through which participants may obtain updated
account and investment information, and initiate transactions permitted under the
Plan including electing a new contribution amount or rate and designating a
beneficiary(ies)under the Plan.
17. Money Source Withdrawal Sequence
A withdrawal or liquidation sequence for money sources available to fund a
withdrawal from the Plan must be identified. The default sequence for a
governmental 457(b)plan is shown below—if no change is made, this is the
withdrawal sequence that will apply to participant withdrawals under the Plan.
2"d Employee Elective Deferrals
9th Rollovers from another 457 Plan
8th Rollovers from a 401 or 403(b) Plan or IRA
1st Designated Roth
4th Roth Rollovers from another 457 Plan
5th Roth Rollovers from a 401 or 403(b) Plan
6th In Plan Roth Rollover
7th Rollover of In Plan Roth Rollover from a 401 or 403(b) Plan
3rd Other(Please specify) Employer Contributions
18. Incoming Rollovers/Transfers Authorization
Ongoing review and processing of participant-initiated incoming rollover or transfer
requests, on behalf of the Plan Sponsor, shall be based on mutually acceptable
procedures for the review, and processing of these types of requests. Incoming
rollover and transfer requests determined to be in Good Order will be processed on
the same business day as the assets are received by the Contractor.
At the Plan Sponsor's direction,participants who have had a request denied shall be
given the opportunity to appeal to the Plan Sponsor for review and final disposition
of the determination.
19. Unforeseeable Emergency Withdrawal Authorization
Ongoing review and processing of participant unforeseeable emergency withdrawal
requests on behalf of the Plan Sponsor, based on the standard for the review,
qualification and processing of these withdrawals as provided in Appendix IV to
Schedule A.
The Contractor will make a determination(approval and/or denial)within 5 business
days of receipt of the request, and supporting documentation, in Good Order. If the
request approved, the request will be processed as of the date of favorable
determination; with payment being mailed or made available electronically through
ACH no later than 3 calendar days following the date of favorable determination.
19
21. Permissible Withdrawal Authorization
This paragraph pertains to the following participant-initiated withdrawals and/or
transfers from a Participant account as permitted under the Plan (check all that
apply):
® In-Service Withdrawal for Governmental 457(b)Plans (aka deminimus withdrawal)
® Purchase of Governmental Defined Benefit Plan Service Credit
❑ Normal Retirement Age—identify the age level to allow withdrawal_
❑ Age Based Withdrawal—identify the age level to allow withdrawal_
Ongoing review and processing of participant-initiated withdrawal or transfer
requests, on behalf of the Plan Sponsor, shall be based on mutually acceptable
procedures for the review and processing of these types of requests. Withdrawal or
transfer requests are processed as of the date received in Good Order, with payment
being mailed or made available electronically through ACH.
At the Plan Sponsor's direction, participants who have had a request denied shall be
given the opportunity to appeal to the Plan Sponsor for a review and final disposition
of the determination.
22. Domestic Relations Order Administration
Ongoing review and processing of Domestic Relations Orders (DRO) on behalf of
the Plan Sponsor, based on the standard for the review, qualification and processing
of DROs as provided in Appendix V to Schedule A.
The Contractor will make a determination within 5 business days of receipt of the
domestic relations order in Good Order. If the request approved, the request will be
processed as of the date of favorable determination; with confirmation being mailed
as of the date of favorable determination.
If the domestic relations order is not received in good order, the Contractor will work
with the respective parties until the order is presented in Good Order.
23. Benefit Payment Authorization
Ongoing review and processing of participant-initiated benefit payment requests
(including annuity payments and death benefits) due to participant's separation from
service or death, on behalf of the Plan Sponsor, based on mutually acceptable
procedures for the review, qualification and processing of these requests. The Plan
Sponsor is responsible for providing the Contractor with any and all participant
termination data in the mutually agreed upon electronic format,within a reasonable
time period following the participant's separation from service or death. The
Contractor may not make the applicable benefit payment request transaction and/or
paperwork available to the participant until the termination data is received from the
Plan Sponsor in Good Order.
Benefit payment requests are processed as of the date received in Good Order; with
payment being mailed or made available electronically through ACH.
20
At the Plan Sponsor's direction, participants who have had a request denied shall be
given the opportunity to appeal to the Plan Sponsor for a review and final disposition
of the determination.
24. Access to counseling by licensed agents or representatives for Plan participants, who
are retiring or otherwise requesting a benefit payment from the Plan, based on
mutually acceptable standards.
25. Ongoing processing of Required Minimum Distributions ("RMD") in accordance
with the rules of Code Section 401(a)(9) for eligible Plan participants and their
beneficiaries as follows:
a. Participants: In the absence of an affirmative election or instructions received
in Good Order from the Participant on an annual basis for receiving the RMD,
the Contractor is directed by the Plan Sponsor, to calculate and distribute the
RMD amount. The Contractor shall calculate the RMD in the following
manner.
i. For Participants with either(1)no beneficiary, (2) a non-spouse
beneficiary, (3) a spouse beneficiary without a date of birth, or(4) a
non-individual beneficiary(e.g., charitable organization), calculate
the current year RMD by dividing the account balance on 12/31 of
the prior year by the distribution period under the Uniform Lifetime
Table using the Participant's age on 12/31 of the current year.
ii. For Participants with a spouse beneficiary more than 10 years
younger than the Participant, calculate the current year RMD by
dividing the account balance on 12/31 of the prior year by the
combined life expectancy factor under the Joint and Last Survivor
Table using the ages of the Participant and the spouse beneficiary on
12/31 of the current year.
iii. For Participants who are at least 70-1/2 years of age in a calendar
year and have separated from service with their employer, any
distribution requested will first be reduced by the applicable RMD
for the distribution calendar year.
21
b. Beneficiary(ies): In the absence of an affirmative election or instructions
received in Good Order from the beneficiary(ies), the Plan Sponsor directs
the Contractor to calculate the RMD amount in accordance with Code
Section 401(a)(9)provided the Contractor has received in Good Order
proper notification of the Participant's death and complete beneficiary(ies)
information(including the complete name and address of the
beneficiary(ies)). In situations where the life expectancy rules are not
available for the calculation of the RMD either because the Contractor has
not received the requisite information by the date for issuing RMD
payments or the beneficiary is not entitled to receive RMD under the life
expectancy rules, the Plan Sponsor directs the Contractor to apply the five-
year payout rule and force out a lump sum by December 31St of the fifth
year following the year of the Participant's death.
The Plan Sponsor acknowledges that the Contractor shall not be responsible for any
tax penalties or excise taxes the Plan Sponsor, Plan Participants, or beneficiaries may
incur as a result of the Contractor's failure to calculate and distribute the RMD
amount where the failure is due to the Plan Sponsor's, the Plan Participant's or the
beneficiaries' failure to provide the required information in a timely manner.
26. Ongoing facilitation of communications between the Contractor, the Plan Sponsor
and the Plan participants based on mutually acceptable guidelines.
22
Orange County Sanitation District 457(b)Deferred Compensation Plan
Appendix I to Schedule A:
Contribution Rate Services
Contribution Rate Change Service:
This service allows participants to make contribution rate changes via the Contractor's
Participant internet site or by speaking with a customer service representative of the
Contractor. Please note it is your responsibility to notify the Contractor of terminated
employees. Contribution rate changes are allowed in fractional percentages. This service
supports the older worker catch-up contribution elections (if available under the Plan). No
other types of catch-up or make-up contribution options available under the Plan are
supported by the service.
Plan Sponsor acknowledges that it is its responsibility for ensuring that the Contribution
Rate Change Service complies with their state laws in regards to wage withholding. The
payroll withholding laws of the Plan Sponsor's state should be reviewed prior to
implementation of this program to determine if deductions, and/or contribution rate
changes, without an employee's written consent are permitted. The service includes
increases, decreases, stops and restarts, either based on participant direction, or as directed
by the Plan as a result of loans or unforeseeable emergency withdrawals.
® The Plan Sponsor elects to utilize the Contactor's Contribution Rate Change
service and Participant Directed Contribution Rate Escalator service (described
below) in accordance with the following criteria (please check).
Minimum and Maximum Contribution Schedule:
Pursuant to the Plan document, indicate the minimum and maximum contribution amount
or rate a participant can elect.
® Percentage-based
Employee elective deferral contributions Minimum 0% Maximum IRS Limit
Roth Contributions Minimum 0% Maximum IRS Limit
® Dollar-based
Employee elective deferral contributions Minimum $25 Maximum $ IRS Limit
Roth Contributions Minimum $25 Maximum $ IRS Limit
Participant Directed Contribution Rate Escalator Service
This service allows participants to elect automatic increases in deferral rates via the
Contractor's Participant internet site or by speaking with a customer service representative
of the Contractor. Participant will indicate the frequency and amount of the contribution
rate increase. The Contractor will send a reminder to the Participant 30 days prior to the
automatic increase.
23
Restrictions and Limitations:
• This service is only available if the Plan Sponsor elects to utilize the Contractor's
Contribution Rate Change Service.
• This service does not apply to catch-up contribution elections.
If there is a conflict between a Participant's Contribution Rate Escalator service and the
contribution limits applicable to the Plan, the Participant's contribution rate escalator
election will be cancelled.
The Participant's contribution rate escalator election will be cancelled if participant
submits a contribution rate change election pursuant to the Contribution Rate Change
Service above.
24
Orange County Sanitation District 457(b)Deferred Compensation Plan
Appendix II to Schedule A:
Payroll Feedback File
If the Plan Sponsor has elected the Eligibility Tracking service, Automatic Enrollment
service, the Contribution Rate Change service or offers loans,the Contractor will provide a
periodic payroll feedback file through an automated process. It is the responsibility of the
Plan Sponsor to update its payroll system based upon the data contained in the payroll
feedback file in accordance with applicable Code requirements and regulations governing
the effective date of deferral elections to the Plan.
The payroll feedback file is a .csv format file which can be uploaded to most payroll
systems. As an alternative, a payroll feedback report in a .pdf format can be printed and
used for manual entry into a payroll system.
Electronic File Delivery:
Please select one of the following delivery types (required):
❑ Email: Contractor will send files in an encrypted format(access information will
be provided). Please provide one or more email addresses:
❑ FTP (File Transfer Protocol): Contractor will send files via FTP. Please provide
the FTP delivery address, ID and password:
FTP Delivery Address: ftp://
FTP ID:
FTP Password:
® Sponsor Web/Archive: Plan Sponsor will obtain reporting data through the
Contractor's plan sponsor internet site.
The Contractor will send the periodic electronic payroll feedback file based on the
information selected above until a change is provided, in writing, by the Plan Sponsor.
Reporting Frequency:
The Contractor will provide the automated contribution rate reporting data on the
frequency that best meets the needs of the Plan Sponsor.
Notification of Report Availability:
The Plan Sponsor must identify an individual to receive notification of when the payroll
feedback file is available. It is understood and acknowledged by the Plan Sponsor and
Contractor that the individual designated below is responsible for accessing the file when
notified of its availability.
Name: Lourdes Luna
Telephone: 714-593-7373
E-mail: lluna@ocsd.com
In the event that any identified individual is removed or replaced, the Plan Sponsor is
responsible for notifying the Contractor immediately in writing.
25
Orange County Sanitation District 457(b)Deferred Compensation Plan
Appendix III to Schedule A:
Unforeseeable Emergency Withdrawal
Review and Approval Requirements
The Contractor is responsible for the ongoing review and processing of participant
unforeseeable emergency withdrawal requests on behalf of the Plan Sponsor. The
Contractor's process is based on the following procedures for the review, qualification and
processing of these withdrawals under 457(b) deferred compensation plans.
To request an unforeseeable emergency withdrawal, a participant must complete the
relevant paperwork and provide the appropriate documentation to support the request.
The Contractor will review the request to determine whether it satisfies the IRS and Plan
requirements for an unforeseeable emergency. Specifically, an unforeseeable emergency
means extraordinary and unforeseeable circumstances arising as a result of events beyond
the control of the participant including:
• severe financial hardship of the participant resulting from an illness or accident of a
participant, the participant's spouse or of a participant's dependent(as defined in Code
Section 152(a))*;
• loss of the participant's property due to casualty(including the need to rebuild a home
following damage to a home not otherwise covered by homeowner's insurance); or
• other similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the participant.
*Effective in 2007,the Pension Protection Act of 2006 expanded this definition to include the participant's
designated primary beneficiary.
In its evaluation, The Contractor will limit the withdrawal to the amount reasonably
necessary to satisfy the emergency need, which may include any amounts necessary to pay
Federal, state, or local income taxes or penalties reasonably anticipated to result from the
distribution. In addition, a withdrawal shall be allowed only to the extent that such
emergency is or may not be relieved through: 1)reimbursement or compensation from
insurance or otherwise; 2) liquidation of the participant's assets, to the extent the
liquidation of such assets would not itself cause severe financial hardship; or 3) cessation
of the participant's deferrals under the Plan.
The determination of whether a request qualifies as an unforeseeable emergency will be
based on all the facts and circumstances of the participant's specific situation. While it is a
subjective decision, the Contractor's process incorporates three underlying principles:
consistent application of the IRS rules to similar situations; decisions must be reasonable
and not arbitrary; and when there is a close call,we err on the conservative side.
26
The Contractor takes this review process very seriously and understands the importance of
consistently administering the IRS and Plan requirements. The Contractor recognizes that
failure to do so, and thus treating the Plan like a savings account, can result in adverse tax
consequences to the participant and to the Plan.
Withdrawal requests will be reviewed in a timely manner. For requests which are
approved, The Contractor will process the withdrawal as of the date of the approval. A
participant, who has had a withdrawal request denied because of insufficient
documentation, can resubmit his or her request to the Contractor for re-review with all
applicable documentation.
A participant whose request has been denied after submission of all relevant
documentation has the opportunity to appeal the decision to the Plan Sponsor.
Appeals of Denied Requests
The Plan Sponsor is the final authority for review of any withdrawal requests which have
been denied by the Contractor.
• A participant desiring to appeal the Contractor's decision must submit the appeal to the
Plan Sponsor or its designee within 30 days of receipt of the denied request. The
participant must document in a letter the reason he or she feels the request should be
reevaluated and why the circumstances quality as an unforeseeable emergency.
• Appeals must include all documentation submitted with the original request to the
Contractor; the Contractor's determination letter and any additional supporting
documentation not previously submitted.
• The Plan Sponsor will review a participant's request within 30 business days of the
date of receipt of an appeal request.
• In reviewing the original decision, the Plan Sponsor will review the specific facts and
circumstances of the participant's situation, the Contractor's analysis and the
applicable IRS and Plan requirements. The Plan Sponsor's focus is on ensuring that
the Contractor's decision was made in accordance with all of the IRS and Plan
guidelines, as summarized above. In its appeal review, the intent of the Plan Sponsor
is not to be more lenient than the law requires as this would jeopardize the favorable
tax treatment for the participant and the Plan.
• The Plan Sponsor or its designee shall provide written notification to the participant,
with a copy to the Contractor, as to whether its decision is to affirm the Contractor's
original decision to deny the request, or reverse that decision and approve the
participant's request.
• The Plan Sponsor's decision shall be binding on the participant, and he or she shall
have no further ability to have the Plan Sponsor's decision overturned.
27
Orange County Sanitation District 457(b)Deferred Compensation Plan
Appendix IV to Schedule A:
Domestic Relation Order
Review and Approval Requirements
The Contractor is responsible for the ongoing review and processing of Domestic
Relations Orders (DRO) on behalf of the Plan Sponsor. The Contractor's process is based
on the following procedures for the review, qualification and processing of DROs which if
followed as specified below shall constitute a valid Plan Sponsor direction to process the
DRO.
Definition of a Domestic Relations Order
A Domestic Relations Order("DRO" or"Order") is a court order,judgment, or decree
issued under a state's domestic relations law that recognizes the right of a spouse, former
spouse, child, or other dependent of a Participant in an employee benefit plan to receive all
or part of the Participant's benefit in the plan.
A Qualified Domestic Relations Order("QDRO") is a DRO that has met the specific
requirements mandated by federal law and the provisions of the Plan as determined by the
Plan Administrator or its designee. A QDRO requires a qualified plan to pay all or any part
of a Participant's benefits to an Alternate Payee. An Alternate Payee is a spouse, former
spouse, or dependent of the Participant who is entitled to a portion of the Participant's
benefits.
Requirements for QDRO
For a domestic relations order to meet the Contractor's good order processing standards
and for the DRO to be qualified and considered a QDRO, the order must comply with the
following requirements. In addition, certain state rules may be imposed on domestic
relations orders by statute.
1. The order must be an original or a court-certified copy of the original, signed by the
judge or clerk of the court. A fax or a photocopy cannot be accepted as they are not
in compliance with the Contractor's good order standards.
2. The order must create or recognize the existence of an alternate payee's right to, or
assign to an alternate payee the right to, receive all or a portion of the benefits
payable with respect to a participant under the plan.
3. The order must constitute a judgment, decree or order(including approval of a
property settlement agreement)that relates to provisions of child support, alimony
payments or marital property rights to a spouse, former spouse, child or other
dependent of a participant, and is made pursuant to a state domestic relations law
(including a community property law).
4. The order must clearly and unambiguously name each plan to which the order
applies.
28
5. The order must clearly specify the name and last known mailing address of the
participant and each alternate payee covered by the order. (If the alternate payee is
a minor or is legally incompetent, the order must include the name and address of
the alternate payee's legal representative.)
The order should identify the social security number(or tax identification number)
and date of birth of the participant and each alternate payee covered by the order. If
State or local law prevents the inclusion of such information in the court order, this
data must be provided to the Contractor, in writing, by the party that drafts the court
order, in order for good order processing standards to be met.
6. The order must be specific with respect to the dollar amount or percentage of the
participant's benefits to be paid by the plan to each alternate payee or the manner in
which the amount or percentage is to be determined. The calculation of this
amount must be very clear and not subject to interpretation. If the amount ordered
to be paid to the alternate payee's account is at all ambiguous, then the order cannot
be accepted.
7. The order must specify the exact date when the account should be valued which
should be a day the New York Stock Exchange (NYSE) is open. If the date
provided is a date when the NYSE was not open, the Contractor will process the
request, if received in good order, as of the preceding business date the NYSE is
open.
8. The order must provide that the calculation of the amount of the participant's
benefit to which the alternate payee is entitled to be readily calculable and
according to records currently available to the Contractor. Pursuant to this
requirement, the Contractor will not accept any order that requires calculations
prior to the time the Contractor began providing services to the plan,unless the
actual financial records necessary to make such calculation on a non-discretionary
basis are provided to the Contractor.
9. If earnings prior to the effective date are also to be segregated on behalf of the
alternate payee, the attorney representing the participant must provide the actual
financial records necessary to make such calculation on a non-discretionary basis, if
such records are not available to the Contractor.
10. If the order specifies a dollar amount to be paid to the alternate payee, such amount
may not exceed the participant's vested balance in the plan.
29
Amounts payable to an alternate payee shall be distributed proportionately from
the participant's account with the Contractor. Account values fluctuate with market
conditions. If the dollar amount specified is above the current balance, the request
may be rejected. When establishing the alternate payee's account, the Contractor
shall first redeem amounts pro rata from all investment options other than non-core
investment options (e.g., life insurance, self directed brokerage account, certificate
of deposit, etc.), if applicable, held in the participant's account, and shall redeem
amounts from non-core investment options, if applicable, only if necessary to
obtain the amount consistent with this Order.
11. A plan may specify a date as of which QDROs are allowed under the plan (such as
orders dated after a specified date, e.g., January 1, 2002). Court orders which pre-
date the allowance of QDROs under the plan may not be accepted.
12. The order must not require the plan to provide any type or form of benefit or any
option, not otherwise provided under the plan.
13. The order must not require the plan to provide increased benefits (determined on
the basis of actuarial value).
14. The order must not require any payment of benefits to an alternate payee that are
required to be paid to another alternate payee under another order previously
determined to be a QDRO.
15. The order must not require the plan to pay benefits in the form of a qualified joint
and survivor annuity for the lives of the alternate payee or his/her subsequent
spouse.
16. The order must not provide for tax treatment of the account other than as required
under federal law and regulations.
If the order meets all of the approval requirements listed above, it will be given effect and
the Contractor will send notification of approval to the involved parties and their counsel.
If the order fails to meet one or more of the approval requirements listed above, it will be
rejected. A letter notifying the involved parties of the rejection will be mailed, together
with an explanation.
30
Administrative Hold to Participant Accounts
Plan Sponsor directs Contractor to place an administrative hold on the participant's
account upon receipt of: (1) a signed DRO; (2) a draft DRO or joinder; or (3) a draft
court order that reflects a claim for plan benefits is being sought. The Contractor will
place an administrative hold on the participant's account for a period of up to 18
months (the "Period") from the date of notification, or, if earlier, until the date that
the QDRO is processed. If a subsequent order is received a new 18-month period will
be activated. During this Period,the participant will not be able to take a distribution
or loan from the impacted plan account until the restriction has been removed.
Notwithstanding the foregoing,with respect to joinders issued pursuant to California
Family Code, Section 2060,the restriction will not be removed until the Contractor
receives either: (1) a QDRO; (2) a court order vacating/dismissing the joinder; or (3)
or a final judgment that awards the participant all of the plan benefits.
31
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule B: Loan Program
Terms of Contractor's Loan Program("Loan Program"):
Types of Loans Permitted—select all that apply.
® General Purpose
® Residential
• Maximum number of loans that may be outstanding at any time.
2 General Purpose
1 Residential
3 Total (regardless of type of loan)
• Minimum Loan Amount- Indicate the minimum loan amount pursuant to this Loan
Program$1000.
• Maximum Loan Amount-the maximum amount of a loan made pursuant to this
Loan Program shall be an amount which, when added to the outstanding balance of any
other loans to the participant from the Plan and any other qualified plan of the
Employer, does not exceed the lesser of-
(i) $50,000 reduced by the excess (if any) of
a) the highest outstanding balance of loans from the Plan to the participant
during the one year period ending on the day before the date on which
such loan is made, less
b) the outstanding balance of loans from the Plan to the participant on the
date on which such loan was made, or
(ii) one-half(1/2) of the present value of the non-forfeitable accrued benefit of
the participant under the Plan.
• For purposes of this limit, all plans of the Employer shall be considered one
plan, to the extent required by Section 72 of the Internal Revenue Code, and the
balance of all loans under any plan of the Employer under which the individual
participates must be aggregated in determining the maximum loan available
from the Plan. The Employer will be responsible for confirming the accuracy
of the loan amount available for participant and has an outstanding loan balance
with an Employer sponsored plan that is not administered by the Contractor.
• All assets under the participant's Account with the Contractor will be
considered in determining the maximum loan amount available.
• Loan fee shall be deducted from the participant's total account balance before
determining the maximum loan amount available.
32
• Loan Interest Rate—the interest rate used for loans from your Plan must be
commensurate with interest rates currently charged by persons in the business of
lending money for loans which would be made under similar circumstances.
The Contractor will set the loan interest rate on the first business day of each calendar
month following the month in which a change in the loan interest rate index occurs.
Changes to the loan rate will be applicable to loans issued on or after the first business
day of the month following the month in which the rate is changed. The index for
establishing the loan interest rate for the Plan is as follows. Select one of the following
options:
® The Prime Interest Rate published in the Wall Street Journal on the last
business day of each month.
❑ Moody's Corporate Bond Yield Average—Monthly Average Corporates, as
published by Moody's Investors Service, Inc. on the last business day of each
month.
The following adjustment factor is to be added to the indexed interest rate for loans
issued under the Plan. Select one of the following options.
❑ No adjustment
❑ 0.5% (one-half percent)
® 1.0% (one percent)
❑ 1.5% (one and one-half percent)
❑ 2% (two percent)
❑ Other(specify)*
* Subject to the Contractor's underwriting review and approval.
Loan Repayment Frequency- The loan repayment frequency will be used to
amortize the loan and calculate loan repayments. The loan repayment frequency
will be determined by the payroll frequency. Check all that apply. If more than
one frequency is checked, indicate the payroll location name or number to which
the frequency applies.
Frequency Location Name or Number(list all that apply)
0 Weekly
Bi-weekly
Semi-Monthly
0 Monthly
0 Annually
• Loan Repayment Method—Select one of the following options.
❑ Payroll deduction, subject to the Loan Repayment Following Separation from
Service option shown below.
® ACH debit to the participant's bank account
• Loan Repayment Following Separation from Service—Are participants that have
separated from service permitted to continue loan repayments?
® Yes—Plan Sponsor understands and agrees to the conditions noted below.
❑ No
33
Conditions:
1. Must be permitted under the Plan document.
2. Plan Sponsor is responsible for providing the Contractor with any and all
participant termination data in a mutually agreed upon electronic format.
3. Loan repayments for participants that have separated from service will be made via
ACH Debit to the participant's bank account.
4. Should the participant take a full distribution of his or her account balance, the
outstanding loan will be automatically defaulted.
• Prepayment-Prepayment of the full loan amount will be allowed at any time, without
penalty. Partial loan prepayments are not permitted.
• Maximum loan repayment period—Internal Revenue Code section 72(p)requires a
plan loan be repaid in full no later than 5 years from the date of the loan(except for a
loan used to acquire a principal residence of the plan participant). Accordingly, it may
be necessary to provide for a loan repayment term that is less than 60 months in order
to meet the Code section 72(p) requirement(e.g., 57 or 58 months, etc.).
General Purpose 57 (maximum of 57 months.)
Residential 240 (maximum of 360 months.)
• Investment of Loan Repayments -Loan repayments will be allocated in accordance
with the participant's current contribution investment allocation instructions on the
date a loan repayment is received in good order.
• Loan Default Restrictions -If the participant defaults on any loan under the Plan, the
participant shall not be allowed to initiate another loan of that type under the Plan until
the defaulted amount is repaid.
• Loan Fee -The Contractor shall charge a one-time fee to the Participant at the time of
loan for services rendered under this Loan Program, in the amount of$100 per loan.
• Money Source Withdrawal Sequence—A withdrawal or liquidation sequence for
money sources available to fund a loan from the Plan must be identified. Omit from
the sequence the money-source(s)not available to fund a loan. The default sequence
for a governmental 457(b)plan is shown below—if no change is made, this is the
withdrawal sequence that will apply to loans issued under the Plan.
1 st Employee Elective Deferrals
4th Rollovers from another 457 Plan
2nd Rollovers from a 401 or 403(b) Plan or IRA
3rd Other(Please specify) Employer Contribution
• Fund Withdrawal Sequence—money will be withdrawn from participant investment
options on a pro-rata basis.
• Spousal Consent—indicate if spousal consent is required for loans from the Plan
❑ Yes
® No
34
• Loan Authorization—indicate who will be responsible for authorizing loan
disbursements. Select one of the following options:
❑ Authorized Plan Sponsor representative
® the Contractor, based on the loan provisions of the Internal Revenue Code Section
72(p), corresponding regulations and terms of the Loan Program as identified in this
Schedule.
• Paperless Loan Processing—This service allows Plan participants to initiate general
purpose loans online through a secure website or through a toll-free customer service
line and receive a check directly from the Contractor without completing loan request
paperwork. The loan provisions (Promissory Note and Truth and Lending Disclosure)
are included on the check remittance. By endorsing the check, the participant accepts
the terms of the loan.
Paperless loan processing service is not available if the Plan requires additional
qualifying criteria for loans (e.g., hardships or unforeseeable emergency) or if the Plan
requires spousal consent for loan requests. This service is not available for residential
loan requests.
® Plan Sponsor elects to utilize the Contractor's paperless loan processing service.
• Loan Default Monitoring—Where the Contractor is recordkeeping loans under the
Plan, the Contractor will perform loan default monitoring as described herein. The
loan default process will occur on the next to last business day of each month. This
schedule allows us to effectively monitor and take action on loans that risk default. The
Plan Sponsor agrees that the Plan document shall identify the Grace Period as the last
business day of the calendar quarter following the calendar quarter in which the loan
repayment was due. You also agree to have the Contractor actively monitor and alert
participants of potential loan defaults and defaulted loans.
Trust Requirement-Loans extended under this Loan Program will be held in trust by
Voya Institutional Trust Company.
Plan Sponsor Responsibilities:
• Ensure the Plan document and any applicable state/local law allows for loans to be
administered in accordance with the terms of this Loan Program.
• The Plan Sponsor will inform the Contractor of the any change to the provisions of the
Loan Program(and thus the criteria for approving loans under the Plan) as identified in
this Schedule.
• Notify the Contractor via the payroll submission tool being utilized by the Plan
Sponsor of any participant with an outstanding loan who begins a leave of absence,
either bona fide (for a period of not more than one year) or due to uniformed service
(military duty) and for whom suspension of loan repayments will apply. The data
provided is to include the type of leave, the start date and the end date.
35
Contractor Responsibilities:
• The Contractor will set the interest rate to apply to loans issued under the Plan. Such
rate will be determined monthly for new loans. A loan will be processed using the rate
in effect when the loan request package is sent to the Participant. The loan request
package and interest rate will be valid for a maximum of 30 days. The Contractor will
reset the loan interest rate as indicated in the Loan Interest Rate section above. The rate
will apply for the duration of the loan.
• Process loans from a participant's account in accordance with the terms of the Loan
Program and the loan request package.
• Deduct the loan amount from the participant's account based on the Money Source
Withdrawal Sequence selected above, on a pro-rata basis across all current investment
options within the participants account or such other method as agreed upon between
Contractor and the participant.
• Generate reports, including a Loan Amortization Report, to be made available to the
Plan Sponsor through a secure website. Furnish participants with quarterly account
statements, reflecting loan activity since the prior statement date.
• Provide the Plan Sponsor with the loan repayment amount for each participant loan as
determined by the level amortization calculation applicable to the amount of the loan,
the repayment frequency, and selected repayment period. Loan repayment amounts
will be provided through an automated periodic payroll feedback file as described in
Appendix III to Schedule A.
Loans can be re-amortized only upon written direction from the Plan Sponsor and only
if there has been a change in the borrower's payroll frequency or status. Outstanding
loans cannot be refinanced.
• Upon notice from Plan Sponsor that a participant with an outstanding loan is on a
qualifying leave of absence, loan repayments may be suspended for the maximum
period permitted under IRS rules. Currently, IRS rules permit loan repayments to be
suspended in the following circumstances:
• A participant on a bona fide leave may suspend payments for up to one year if the
pay received by the participant during this period is less than the amount of the
installment payments required under the terms of the loan. However, the loan
must still be repaid by the end of the loan term (i.e., the period of suspension will
be less than one year if the loan was within one year of the final payment due date
when the leave began).
• A participant on a leave of absence due to performance of the uniformed services
(as described under Internal Revenue Code Section 414(u)), may elect to suspend
loan repayments for the period of uniformed service. In this situation, upon the
participant's return from uniformed service, the loan repayment period will be
extended by a period equal to the length of the uniformed service.
36
• The Contractor will monitor loan repayments and perform default processing if there is
an outstanding balance after the scheduled loan maturity date or there is more than one
scheduled loan repayment not received by the end of the Grace Period. Should this
occur, the entire loan will be in default. Each month, we will generate a warning
notification to any participant who has missed more than one loan repayment during
the previous quarter or has an outstanding balance after the scheduled loan maturity
date. The notification will describe the implications of missing a loan repayment and
the date on which the loan will be defaulted unless a repayment is promptly received.
At the same time,we will generate a series of loan reports as noted below to be made
available to the Plan Sponsor through a secure website.
1. Missed First Loan Payment Report—reflects loans with a first payment due during
the current or previous month and have not had any loan payments applied.
2. Delinquent Loans Report—reflects loans that had any missing payments during the
current month.
3. Loans Past Maturity Report—reflects loans that had a loan payoff/maturity date
during the current month but have an outstanding loan balance.
4. Deemed/Offset Loans Report—reflects loans that were deemed or offset due to not
being paid by the grace period applicable to the Plan.
On the last business day of the calendar quarter we will default any loan in which the
grace period expires that day. A confirmation statement will be sent to participants for
whom a loan default is processed.
• Compute and withhold federal and state income taxes, as required by law, for loan
defaults or withdrawals from the Plan in order to repay outstanding loan amounts in
full, in accordance with the Internal Revenue Code and applicable guidance. The
Contractor will forward, within the applicable time limit, the appropriate information
return reflecting the amount of the defaulted loan disbursement and taxes withheld to
the appropriate taxing authority and to the participant.
37
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule C: Administrative Requirements
For purposes of this Schedule, all references to "participant" are intended to apply equally
to all account holders under the Plan. This includes participants,beneficiaries and
alternate payees.
1. Participant account statements and Plan Sponsor reports shall reflect accurate
information with regard to contributions, allocations, earnings and withdrawals.
2. Under normal circumstances and unless otherwise authorized by the Plan Sponsor;
participant quarterly statements shall be mailed within 10 days of the end of a
calendar quarter.
3. Information on payout options, including a notice which satisfies the requirements of
Internal Revenue Code Section 402(f), will be made available to participants through
the internet or a toll free telephone number. Additionally, upon a terminated
Participant's request, a licensed representative will provide to the Participant
education and assistance on the available payout options.
4. Contributions determined to be in Good Order on any day that the New York Stock
Exchange is open(a "Business Day"), and prior to the close of the exchange, shall be
applied to the appropriate account on that day's close of business of the New York
Stock Exchange. Contributions received at any other time will be applied to the
appropriate account on the next succeeding Business Day. Written confirmation of
receipt and deposit will be provided to the Plan Sponsor or its designee by mail. The
Contractor shall notify the Plan Sponsor or its designee by telephone within two
business days of discovery of transactions received not in Good Order. If after 5
business days, transactions remain not in Good Order, the Contractor will require the
Plan Sponsor to provide written consent for the Contractor to continue holding the
amount of the contributions related to the not in Good Order transactions in a non-
interest bearing suspense account. If after 14 business days, the transactions remain
not in Good Order, the amount of the contributions received not in Good Order will
be refunded to the Plan Sponsor.
5. All correspondence and marketing materials written specifically for the Plan
Sponsor, the Plan participants and the Plan Sponsor's employees shall be provided to
the Plan Sponsor or its designee for approval prior to the scheduled date of
publication or distribution.
6. A calendar year-end report shall be delivered to the Plan Sponsor shall be delivered
to the Plan Sponsor at least annually. The custom Plan Review book includes Plan-
specific data on plan assets, participant counts and average balances, contribution and
distribution activities, service utilization along with investment performance.
Industry benchmarking is available to help you compare your Plan to other
comparable plans in the industry.
38
Orange County Sanitation District 457(b) Deferred Compensation Plan
Schedule D: Performance Standards
9.1.Transition Services(period from formal approval to fund transition
A.Pre-Transition Services Standard:Assure attendance at finalist meetin ®Will meet
by representatives who will provide direct transition and ongoing services. ❑Unable to meet
Date:Finalist Meeting ❑Will exceed
Guarantee:N/A
B.Standard:Answer phone calls from employer contact designee within ®Will meet
24 hours and propose method of measuring standard. ❑ Unable to meet
Date:Transition Period. ❑Will exceed
Guarantee: $100 per incident for failure to return phone calls
from employer contact designee within 24 hours.
C.Standard:Provide draft,customized contract(incorporating agreed- ®Will meet
upon,proposed services). ❑Unable to meet
Date: 30 Days after formal approval by County. ❑Will exceed
Guarantee: $1,000.
D.Standard:Respond,in writing with a copy to the employer,to phone ®Will meet
or in-person complaints within 5 business days. ❑Unable to meet
Date:Transition Period. ❑Will exceed
Guarantee: $100 per incident of failure to respond to complaint
within specified time.
E.Standard: Comply with Sarbanes-Oxley Act requirements regarding ®Will meet
notification of blackout period. ❑ Unable to meet
Date:Transition period. ❑Will exceed
Guarantee: $1,000 plus the equivalent of any penalties that would
be assessed.
F.Standard:Finalize and publish performance standards and guarantees. ®Will meet
Date:Provide final copy to employer within 30 days of being selected by ❑ Unable to meet
employer. ❑Will exceed
Guarantee: $500
G.Standard:Provided agreed upon training to employees and retirees ®Will meet
within transition period. ❑ Unable to meet
Date:Transition period. ❑Will exceed
Guarantee: $1,000
9.2.Transition Exit(period from notification of non-renewal to fund transition
A.Standard:Upon termination,provide: 1)last four quarters of ®Will meet
transaction reports,2)current account balances,3)past 12 months ❑Unable to meet
distribution and deferral information and 4)loan or other outstanding ❑Will exceed
payment amounts.
Date:Within 30 business days after termination,provide report on
secured disk,tape or internet.
Guarantee: $1,000 for initial failure to provide and$500 per day
thereafter.
B.Standard:Upon termination,provide information as described in ®Will meet
Section 8 on disk,tape or internet. ❑Unable to meet
Date:Within 30 days of request. ❑Will exceed
Guarantee: $1,000 on failure to provide information within timeframe.
C.Standard:Upon termination,any solicitation and/or sale of any ®Will meet
product to plan participants will be strictly prohibited. ❑Unable to meet
Date:Upon notice of termination ❑Will exceed
Guarantee: $5,000 per occurrence.
39
9.3.Customer Services
A.Standard: Telephone calls to service center(s)will be answered within ®Will meet
90 seconds 90%of the time. (Propose method of measuring standard). ❑ Unable to meet
Date:Transition Period. ❑Will exceed
Date: Quarterly summary/review due before the end of the month
following the quarter.
Guarantee: $1,000 per year for failure to meet annual,calendar year
average.
B.Standard:Participant statements will be mailed within 10 business ®Will meet
days after quarter-end. ❑Unable to meet
Date: Quarterly. ❑Will exceed
Guarantee: $5 per participant per quarter for each statement postmarked
after 10 business days.
C.Standard:Finalize customized web providing hot link between ®Will meet
employer and provider websites and draft participant communication ❑ Unable to meet
advertising site content and way to access. ❑Will exceed
Date:Due 60 days after implementation.
Guarantee: $500 for failure to provide live web site and participant
announcement by end of 3`1 month after implementation.
D.Standard:Process investment fund transfers,contribution ®Will meet
reconciliation and posting within one business day and propose method of ❑ Unable to meet
measuring standard. ❑Will exceed
Date:Annual report due 31 days after each 12 month period from fund
transition.
Guarantee:Maximum$1,000 for failure to meet agreed-upon standard.
E.Standard:Process hardship distributions,rollover requests,in-service ®Will meet
distributions,retiree distribution requests within 5 working days of ❑Unable to meet
acceptable documentation and propose method of measuring standard. ❑Will exceed
Date:Annual summary of performance by provider.
Guarantee: $1,000 annually for failure to meet standard in 90%of
actions.
F.Standard:Review plan documents for legal,legislative compliance, ®Will meet
identify policy issues between employer and provider and summarize,in ❑Unable to meet
writing,any recommended changes to documents. ❑Will exceed
Date:Within 180 days of fund transition and annually thereafter.
Guarantee: $500 for failure to provide each written summary.
G.Standard:Review investment policy and summarize,in writing,any ®Will meet
recommended changes. ❑Unable to meet
Date:Annually at the quarterly meeting prior to the fund evaluation ❑Will exceed
results.
Guarantee: $500 for failure to provide review/summary within specified
timeframe.
H.Standard:Review education policy and summarize,in writing,any ®Will meet
recommended changes. ❑Unable to meet
Date:Annually at the quarterly meeting prior to the year end. ❑Will exceed
Guarantee: $500 for failure to provide review/summary within specified
timeframe.
I.Standard:Provide written proposal of services and draft plan for ®Will meet
ongoing participant communication utilizing internet educational resources ❑ Unable to meet
(e.g. internet or computer based training). ❑Will exceed
Date:Within 180 days of fund transition.
Guarantee: $500 for failure to provide proposal within timeframe.
40
9.4 Reports
A.Standard:Provide written summary of Quarterly Reports(as described ®Will meet
in Section 6.2)to employer. ❑ Unable to meet
Date:Mailed within 30 days of quarter-end. ❑Will exceed
Guarantee: $500 per failure to provide reports by specified date.
B.Standard:Provide written draft proposal for recommended reports that ®Will meet
will be available to employer online(internet)including proposed access ❑ Unable to meet
protocols. ❑Will exceed
Date:Within 90 days of fund transition.
Guarantee: $500 for failure to provide written draft proposal within
specified time.
C.Standard:Provide written Plan/Participant Enhancement Services(as ®Will meet
described in Section 6.5)to employer. ❑Unable to meet
Date:Annual Summary at time of Investment Review. ❑Will exceed
Guarantee: $1,000 per month for failure to provide written report within
specified time.
D.Standard: Conduct training of employer-designated personnel on ®Will meet
access to online reports and use of reporting capability. ❑Unable to meet
Date:Within 120 days of fund transition ❑Will exceed
Guarantee: $500 for failure to provide training within specified time.
9.5.Surveys
A.Standard:Draft survey. ®Will meet
Date:Draft due by end of 4th month after implementation. ❑ Unable to meet
Guarantee: $500 if failure to provide draft survey. ❑Will exceed
B.Standard:Distribute survey to all plan participants. ®Will meet
Date:Distribution by end of 6tb month after implementation. ❑Unable to meet
Guarantee: $500 if failure to mail 30 days from date of final agreed upon ❑Will exceed
survey content.
C.Standard:Analyze survey results,provide executive summary and ®Will meet
recommended actions. ❑Unable to meet
Date: Complete by end of 8th month after implementation. ❑Will exceed
Guarantee: $1,000 if Executive Summary and Recommended Actions are
not provided within timeframe.
D.Standard:In the event that the survey results are considered by the ®Will meet
County to be below standard,repeat the satisfaction survey at 6 month ❑Unable to meet
intervals until adequate satisfaction is reported. ❑Will exceed
Date: At 6 month intervals if necessary
Guarantee: $1,000 if Executive Summary and Recommended Actions
are not provided within timeframe.
E.Standard:Repeat survey process steps described above for surveys at ®Will meet
24,36 and 48 months after implementation. ❑ Unable to meet
Date:Executive Summary and Recommended Actions due by end of 261h, ❑Will exceed
38th and 50th month after implementation.
Guarantee: $1,000 for failure to provide Executive Summary and
Recommended Actions by 26th,38th and 50th month.
F.Standard: Survey results will average Satisfactory or Above and will ® Will meet
be incorporated into Executive Summary and Recommended Actions ❑ Unable to meet
document. ❑Will exceed
Date:Due by 8th,26th 38th and 50th month after implementation
Guarantee: $1,000 for any survey results that fail to meet Satisfactory or
Above
41
9.6.Educational Services
A.Standard:Provide training to all decision-makers and administrative ®Will meet
staff on 404(c)requirements. ❑ Unable to meet
Date: 90 days after fund transition. ❑Will exceed
Guarantee: $500 for failure to provide on-site training within timeframe.
B.Standard:Propose and schedule first year on-site training sessions and ®Will meet
content of training for decision-makers and administrative personnel. ❑ Unable to meet
Date:Proposal within 90 days after fund transition and educational ❑Will exceed
programs quarterly thereafter.
Guarantee: $500 for failure to provide proposed training and$500 for
failure to provide four training sessions in any year of contract.
C.Standard:Develop and schedule new decision-maker training for ®Will meet
employer identified new Committee members or administrative staff. ❑Unable to meet
Date:Provide half-day on-site training for identified new personnel within ❑Will exceed
30 days of notification by County.
Guarantee: $500 for failure to provide training within specified
timeframe.
D.Standard:After implementation,provide mutually agreeable number ®Will meet
of educational seminars annually to participants. ❑Unable to meet
Date:Within 90 days after fund transition. ❑Will exceed
Guarantee: $1,000 for failure to provide agreed-upon number of onsite
group seminars.
E.Standard:After implementation,provide newsletters to plan ®Will meet
participants regarding plan benefits/issues. ❑ Unable to meet
Date: Quarterly. ❑Will exceed
Guarantee:Annual$500 penalty for failure to provider quarterly
newsletters
F.Standard:Provide representative on site for mutually agreeable ®Will meet
number of days per month to meet with plan participants. ❑ Unable to meet
Date:No later than 20 days after transition. ❑Will exceed
Guarantee: $1,000 per year if agreed-upon number of days is not
provided for 3 or more months.
G.Standard:Provide draft PowerPoint and/or other communication ®Will meet
material for transition specifically proposed for group meetings separated ❑Unable to meet
for employees/retirees. ❑Will exceed
Date: 30 Days after formal approval.
Guarantee: $500 for initial failure to provide within 30 days after formal
approval and$500 per da thereafter.
H.Standard:Draft communication to plan participants describing ®Will meet
investment advice and managed account services and access. ❑ Unable to meet
Date:Within 60 days of fund transition. ❑Will exceed
Guarantee: $500 for initial failure to provide within 60 days after formal
approval and$500 per da thereafter.
I.Standard:Recommend,in writing,steps provider and employer may ®Will meet
take to communicate and coordinate information on how participants can ❑Unable to meet
coordinate the benefits of a 457b savings plan with the County defined ❑Will exceed
benefit plan to access their retirement needs.
Date:Within 180 days of fund transition.
Guarantee: $1,000 for failure to provide within specified time.
I Standard:Provide one half-day session per quarter to employer ®Will meet
decision-making and administrative personnel on mutually agreeable ❑ Unable to meet
topics. ❑Will exceed
Date: Quarterly.
Guarantee: $250 per quarter if education sessions are not provided.
42
9.7 Self Directed Brokerage Accounts
A.Standard: Process all SDBA transfers within three(3)business days. ®Will meet
Date: On-going ❑Unable to meet
Guarantee: $100 for each participant information compromised ❑Will exceed
9.8.Miscellaneous Performance Standards/Guarantees
A.Standard:Provide web site copy listing final agreed-upon ®Will meet
Performance Standards/Guarantees. ❑Unable to meet
Date:Implementation Date and 30 days after any mutually agreed-upon ❑Will exceed
revisions.
Guarantee: $500 for each failure to provide web-ready document to
employer.
B.Standard:Provide agreed upon number of written copies of final ®Will meet
agreed-upon Performance Standards/Guarantees to employer for ❑Unable to meet
distribution. ❑Will exceed
Date:Implementation Date and 30 days after any mutually agreed-upon
revisions.
Guarantee: $500 for each failure to provide specified number of copies of
final agreed-upon Performance Standards/Guarantees.
C.Standard:Provide annual written summary report of all Performance ®Will meet
Standards/Guarantees categories and present the results to the ❑ Unable to meet
Committee. Post the report as a web document for communication to plan ❑Will exceed
participants.
Date: 30 days after annual anniversary of implementation.
Guarantee: $1,000 for failure to provide web-ready document within
specified timeframe.
D.Standard:Include in the annual report above any modifications/ ®Will meet
enhancements to Performance Standards/Guarantees. ❑Unable to meet
Date: 30 days after annual anniversary of implementation. ❑Will exceed
Guarantee: $1,000 for failure to provide written recommendations.
E.Standard:Encrypt all laptops and remote computers carrying County ®Will meet
participant information and provide written quarterly reports on any ❑Unable to meet
compromise of data that occurs. ❑Will exceed
Date:Immediate notification of any data compromise(within 24 hours of
provider knowledge of compromise)and quarterly written reports.
Guarantee: $100 for each participant information compromised and/or
$1,000 for each quarter in which report not provided.
43
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule E: Plan Investment Options
The Contractor agrees to provide Plan participants with a selection of investment options
as shown below. The Plan Sponsor acknowledges that it has chosen these investment
options to be made available to participants under the Plan. The Plan Sponsor
acknowledges receipt and has reviewed the prospectuses for each identified investment
option.
Fund Number Fund Name Fund Legal
Structure
9958 Stable Value Option Pooled Stable
Value Group
Annuity Contract
0167 Vo a Money Market Fund-Class I Mutual Fund
2078 Loomis Sa les Investment Grade Bond Fund-Class Y Mutual Fund
1959 American Funds Capital World Bond Fund-R6 Mutual Fund
1500 Pioneer Global High Yield Fund-Class Y Shares Mutual Fund
9419 American Century One ChoicesM Income Portfolio-Inst Class Mutual Fund
9418 American Century One ChoicesM 2025 Portfolio-Inst Class Mutual Fund
9416 American Century One ChoicesM 2035 Portfolio-Inst Class Mutual Fund
9420 American Century One ChoicesM 2045 Portfolio-Inst Class Mutual Fund
1257 VY T.Rowe Price Capital Appreciation Portfolio-Inst Mutual Fund
1963 American Funds Investment Company of America-R6 Mutual Fund
0899 Vanguard®500 Index Fund-AdmiralTM Shares Mutual Fund
1990 American Funds Washington Mutual Investors-R6 Mutual Fund
1355 AllianzGI NFJ Dividend Value Fund-Class A Mutual Fund
0572 American Funds Growth Fund of America-R4 Mutual Fund
2469 T.Rowe Price New America Growth Fund Mutual Fund
0756 Vanguard®Mid-Cap Index Fund-AdmiralTM Shares Mutual Fund
2224 Vo a MidCap Opportunities Fund-Class I Mutual Fund
9321 Vanguard Selected Value Fund-Investor Shares Mutual Fund
1599 Fidelity®Advisor Leveraged Company Stock Fund-Instl Class Mutual Fund
0757 Vanguard®Small-Cap Index Fund-AdmiralTM Shares Mutual Fund
3156 Loomis Sa les Small Cap Growth Fund-Institutional Class Mutual Fund
8036 AllianzGI NFJ Small-Cap Value Fund-Administrative Class Mutual Fund
1308 Vo a Global Real Estate Fund-Class I Mutual Fund
2538 AllianzGI NFJ International Value Fund-Class A Mutual Fund
1004 American Funds Capital World Growth&Income-R4 Mutual Fund
7751 Lazard Emerging Markets Equity Portfolio-Inst Shares Mutual Fund
Plan Sponsor should consider the investment objectives, risks, and charges and expenses
of the investment options carefully before choosing to make these options available to
participants under the Plan. Fund prospectuses containing this and other information
can be obtained by contacting your local representative. Please read the information
carefully before signing this Agreement. You may also visit our website at
www.voyaretirementplans.com/sponsor to view your Plan on-line.
44
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule F: Investment Provider Minimum Standards Disclosure Statement
The following items summarize the minimum administrative requirements
required in order for the Contractor to transact with an investment provider on
the Plan's behalf-
1. Pricing Deadlines: The investment provider must furnish the Contractor
with confirmed net asset value information as of the close of trading
(generally 4:00 p.m., Eastern Time) on the New York Stock Exchange
("Close of Trading") on each business day that the New York Stock
Exchange is open for business ("Business Day") or at such other time as
the net asset value of the fund is calculated as disclosed in the relevant
then current prospectus(es) in a format that includes (i)the fund's name
and the change from the last calculated net asset value, (ii) dividend and
capital gains information as it arises. Such information shall be
provided to the Contractor by 6:30 p.m. Eastern Time. "Net"means
after all management, service and administrative expenses are deducted.
In the case of a Stable Value Option that is providing a current credited
interest rate,which is used to compute the daily applicable unit value, it
will be provided on a quarterly basis (or earlier if applicable).
2. Pricing Error Reimbursements: The investment provider shall agree to
hold the Plan harmless for any amounts erroneously credited to
participant accounts due to (i) an incorrect calculation of the fund's
daily net asset value ("NAV"), dividend rate, or capital gains
distribution rate or(ii) incorrect or late reporting of the daily net asset
value, dividend rate, or capital gains distribution rate of a fund, by
reimbursing the Contractor, on the Plan's behalf. In addition, the fund
shall be liable to the Contractor for systems and out of pocket costs
incurred by the Contractor in making the Plan's or the participant's
account whole, if such costs or expenses are a result of the fund's failure
to provide timely or correct net asset values, dividend and capital gains
or financial information and if such information is not corrected by 4:00
p.m. Eastern Time of the next Business Day after releasing such
incorrect information provided the incorrect NAV as well as the correct
NAV for each day that the error occurred is provided. If a mistake is
caused in supplying such information, which results in a reconciliation
with incorrect information, the amount required to make a Plan's or a
Participant's account whole shall be borne by the investment provider
providing the incorrect information, regardless of when the error is
corrected.
45
3. Sales Literature: The investment provider will provide to the Contractor
at least one complete copy of all prospectuses, statements of additional
information, annual and semiannual reports and proxy statements, other
related documents, and all amendments or supplements to any of the
above documents that relate to the fund promptly after the filing of such
document with the SEC or other regulatory authorities. The investment
provider agrees to provide to the Contractor, in electronic format,
performance updates and portfolio updates for the fund within 10
business days after the end of each calendar quarter.
4. Advertising: Advertising and literature with respect to the fund
prepared by the Contractor for use in marketing shares of the fund to the
Plan shall be submitted to the investment provider for review and
approval before such material is used with the Plan. The investment
provider shall advise the Contractor in writing within three (3) Business
Days of receipt of such materials of its approval or disapproval of such
materials.
5. Expense Reimbursement: The investment provider shall make available
for reimbursement certain out-of-pocket expenses the Contractor incurs
in connection with providing shareholder services to the Plan. These
expenses include actual postage paid by the Contractor in connection
with mailing updated prospectuses, supplements and financial reports to
participants, and all costs incurred by the Contractor associated with
proxies for the fund, including proxy preparation, group authorization
letters, programming for tabulation and necessary materials (including
postage).
6. Excessive Trading: The investment provider shall use its best efforts
and shall reasonably cooperate with the Contractor to generally prevent
any market timing and frequent trading activity under the Plan. See the
Contractor's "Excessive Trading"Policy, Schedule G.
46
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule G: Voya FinancialTM"Excessive Trading" Policy
The Voya FinancialTM family of insurance companies ("VoyaTM"), as providers of multi-
fund variable insurance and retirement products, has adopted this Excessive Trading Policy
to respond to the demands of the various fund families which make their funds available
through our variable insurance and retirement products to restrict excessive fund trading
activity and to ensure compliance with Section 22c-2 of the Investment Company Act of
1940, as amended. Voya's current definition of Excessive Trading and our policy with
respect to such trading activity is as follows.
1. Voya actively monitors fund transfer and reallocation activity within its variable
insurance and retirement products to identify Excessive Trading.
Voya currently defines Excessive Trading as:
a. More than one purchase and sale of the same fund (including money market
funds)within a 60 calendar day period(hereinafter, a purchase and sale of the
same fund is referred to as a"round-trip"). This means two or more round-trips
involving the same fund within a 60 calendar day period would meet Voya's
definition of Excessive Trading; or
b. Six round-trips within a 12 month period.
The following transactions are excluded when determining whether trading
activity is excessive:
a. Purchases or sales of shares related to non-fund transfers (for example, new
purchase payments, withdrawals and loans);
b. Transfers associated with scheduled dollar cost averaging, scheduled
rebalancing or scheduled asset allocation programs;
c. Purchases and sales of fund shares in the amount of$5,000 or less;
d. Purchases and sales of funds that affirmatively permit short-term trading in
their fund shares, and movement between such funds and a money market fund;
and
e. Transactions initiated by a member of the Voya family of insurance companies.
2. If Voya determines that an individual has made a purchase of a fund within 60 days of
a prior round-trip involving the same fund, Voya will send them a letter warning that
another sale of that same fund within 60 days of the beginning of the prior round-trip
will be deemed to be Excessive Trading and result in a six month suspension of their
ability to initiate fund transfers or reallocations through the Internet, facsimile, Voice
Response Unit (VRU), telephone calls to Customer Service, or other electronic trading
medium that Voya may make available from time to time (`Electronic Trading
Privileges"). Likewise, if Voya determines that an individual has made five round-
trips within a 12 month period, Voya will send them a letter warning that another
purchase and sale of that same fund within 12 months of the initial purchase in the first
round-trip in the prior twelve month period will be deemed to be Excessive Trading
and result in a six month suspension of their Electronic Trading Privileges. According
to the needs of the various business units, a copy of the warning letters may also be
47
sent, as applicable, to the person(s) or entity authorized to initiate fund transfers or
reallocations, the agent/registered representative or investment adviser for that
individual. A copy of the warning letters and details of the individual's trading activity
may also be sent to the fund whose shares were involved in the trading activity.
3. If Voya determines that an individual has used one or more of its products to engage in
Excessive Trading, Voya will send a second letter to the individual. This letter will
state that the individual's Electronic Trading Privileges have been suspended for a
period of six months. Consequently, all fund transfers or reallocations, not just those
which involve the fund whose shares were involved in the Excessive Trading activity,
will then have to be initiated by providing written instructions to Voya via regular U.S.
mail. During the six month suspension period, electronic "inquiry only"privileges will
be permitted where and when possible. A copy of the letter restricting future transfer
and reallocation activity to regular U.S. mail and details of the individual's trading
activity may also be sent to the fund whose shares were involved in the Excessive
Trading activity.
4. Following the six month suspension period during which no additional Excessive
Trading is identified, Electronic Trading Privileges may again be restored. Voya will
continue to monitor the fund transfer and reallocation activity, and any future
Excessive Trading will result in an indefinite suspension of the Electronic Trading
Privileges. Excessive Trading activity during the six month suspension period will also
result in an indefinite suspension of the Electronic Trading Privileges.
5. Voya reserves the right to limit fund trading or reallocation privileges with respect to
any individual, with or without prior notice, if Voya determines that the individual's
trading activity is disruptive, regardless of whether the individual's trading activity
falls within the definition of Excessive Trading set forth above. Also, Voya's failure to
send or an individual's failure to receive any warning letter or other notice
contemplated under this Policy will not prevent Voya from suspending that
individual's Electronic Trading Privileges or taking any other action provided for in
this Policy.
6. Each fund available through Voya's variable insurance and retirement products, either
by prospectus or stated policy, has adopted or may adopt its own excessive/frequent
trading policy. Voya reserves the right, without prior notice,to implement restrictions
and/or block future purchases of a fund by an individual who the fund has identified as
violating its excessive/frequent trading policy. All such restrictions and/or blocking of
future fund purchases will be done in accordance with the directions Voya receives
from the fund.
48
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule H: General Compensation Provisions
1. Direct and Indirect Compensation:
This Schedule describes compensation received by the Contractor for services
rendered to the Plan and Plan participants, including fees and revenue derived
from both direct and indirect sources.
Direct Compensation includes compensation paid directly by Plan Sponsor or
the Plan to the Contractor for plan recordkeeping and administrative services
including certain transaction fees that are charged directly to participant
accounts.
Indirect Compensation includes compensation from sources other than direct
fees that the Contractor may collect from third parties, including revenue
derived from service arrangements with mutual funds, revenue sharing and
other indirect compensation that may be generated in servicing the Plan.
2. Assumptions:
As provided in Section 1 of the Agreement, the Contractor has agreed to
perform certain services. Based on the assumptions outlined in the Agreement,
the Contractor agrees to supply the Services for the compensation specified in
Section 3.01 of the Agreement, as supplemented by any additional
compensation or transaction fees as specified within Schedule B with respect to
administration of loans under the Plan and with respect to Investment Advisory
Services and/or Self Directed Brokerage Account, as specified in a separately
executed agreement(s).
3. Fund Specific Revenue:
Indirect compensation received by the Contractor represents revenue from
investment companies based on the investment of assets held in the Plan
pursuant to agreements between the applicable investment companies and the
Contractor. They represent fees payable from such investment companies for
shareholder services, sub-transfer agency services, or pursuant to a 12b-1 plan
adopted by such investment companies.
In the case of investment options of VRIAC affiliates or former affiliates,
Contractor compensation represents revenue assumptions made by the
Contractor's defined contribution business for purposes of product pricing.
Gross revenues from such investment options generally include payments for
investment management and for certain administrative services. Pricing
assumptions are derived from gross fund revenues, less the internally
transferred costs of fund management and administration. The pricing
assumptions for certain investment options of VRIAC affiliates or former
affiliates reflect the approximate weighted average of the net fund revenues of
each portfolio within a given VRIAC fund complex.
49
In the case of the Stable Value Option, the estimated fund revenue is derived by
subtracting the Contractor's standard fee for management of a comparable
portfolio and the estimated value of interest guarantees from the overall fund
contract charges.
4. Changes in Investment Options:
To the extent the Contractor's compensation is derived in whole or in part from
revenue from the Plan Sponsor's selection of certain investment products
offered by or through the Contractor, the Contractor reserves the right to amend
the Agreement, including this Schedule, in the event such revenue is reduced
by a change in the investment products or options available under the Plan.
50
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule I: Reimbursement of Plan Expenses and Mutual Fund Revenue
The Contractor shall reimburse the Plan Sponsor annually for the Plan's reasonable and
necessary administrative expenses as set forth below. The annual reimbursement will be
paid by the Contractor no later than December 3 1"of each contract year.
2016 $24,000 (and each subsequent full calendar year the contract is renewed)
The Plan Sponsor represents that any amounts reimbursed to the Plan pursuant to this
Agreement shall be for expenses that are both reasonable and necessary to the
administration of the Plan.
Reimbursement of Mutual Fund Revenue
On a quarterly basis, the Contractor will calculate any revenue generated by the Plan's
investment options and attributable to the Plan("Revenue Sharing")using a mutually
agreeable method. The Plan Sponsor hereby directs the Contractor to allocate the
applicable Revenue Sharing to each participant based upon his or her Future Contribution
allocations on a quarterly basis. This allocation of Revenue Sharing assumes that the
Plan's investment menu does not contain any investment options which prohibit this type
or arrangement. In addition, if this process is called into question, subject to scrutiny, or
deemed to be in violation of applicable law or regulation, the Contractor reserves the right
to discontinue this arrangement. In the event of a discontinuation, the Contractor shall
remit the Revenue Sharing amount back to the Plan on an omnibus basis.
51
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule J: VRIAC's Policy For Correction of Inadvertent Processing Errors
As your Plan's administrative service provider, Voya Retirement Insurance and
Annuity Company ("VRIAC")has agreed to process transaction orders received in good
order prior to market close from the plan and plan participants accurately and on a timely
basis. We seek to avoid transaction processing errors to the greatest extent possible,but
inadvertent errors do occur from time to time. Inadvertent processing errors are
exclusively defined as incorrect or untimely processing by VRIAC employees of
transactions that are received in good order. Inadvertent processing errors do not include
errors made by plan sponsors or third parties.
VRIAC will correct any identified inadvertent processing error caused by VRIAC
(a"VRIAC inadvertent processing error") as soon as practicable, typically no later than
five (5)business days after VRIAC has identified sufficient information to correct the
error. VRIAC represents that in no event will VRIAC exercise discretionary authority or
control over the correction of inadvertent processing errors in order to maximize gain or
correct such error for VRIAC's own benefit or interest.
Once a VRIAC inadvertent processing error has been identified, we promptly
take corrective action to put the plan and its participants in a position financially
equivalent to the position they would have been in if the processing error had not
occurred. This means that VRIAC will make the plan whole for any loss to a plan
resulting from correcting a VRIAC processing error. If any gain to a plan results in
connection with a corrected transaction, VRIAC will keep that gain. The following
examples illustrate the effect of the policy:
• When a plan participant directs that a certain dollar amount be contributed to
his or her plan account, VRIAC credits the number of investment units that
dollar amount will purchase to the participant's account on Day 1, the day the
contribution is processed.
The number of units is based on the unit's dollar value on Day 1, as set by the
investment fund and communicated to VRIAC after market close. If an
inadvertent error occurs, and VRIAC does not process the contribution until Day
2, VRIAC will determine the number of units that should have been credited on
Day 1, using Day I's unit price. If, on Day 2, the unit price has gone up, the
dollar amount of the contribution will not be enough to cover the number of units
the participant should have received. VRIAC will make up the difference such
that the participant receives the number of units he or she would have received on
Day 1 and VRIAC will absorb the loss. The participant is not charged for any
additional cost.
52
However, if, on Day 2, the unit price has gone down, the amount of the
contribution would purchase more units on Day 2 than it would have
purchased on Day 1. In that circumstance, the participant will receive the
number of units he or she would have received on Day 1 had the transaction
been processed and VRIAC will keep the excess as part of its overall fee for
services under the contract.
Regardless of whether there is a gain or a loss, the participant receives the
benefit of what he or she requested.
When a plan participant makes a withdrawal request of a certain dollar amount
from his or her account, VRIAC liquidates or sells the number of investment
units needed in order to make the distribution. Thus, on Day 1, VRIAC typically
would sell or liquidate investment units in the participant's investment fund at
Day l's price to make the distribution. If, due to a VRIAC inadvertent
processing Error, VRIAC processes the instructions a day late, VRIAC will
make sure that the participant receives the dollar amount he/she requested.
VRIAC will sell or liquidate the same number of units that would have been sold
on Day 1 had the transaction been accomplished on Day 1. If the unit price has
declined, liquidated units will have a lower value on Day 2 than they had on Day
1,which means that VRIAC must make up the difference so that the participant
receives the requested amount in full. In doing so, VRIAC will incur a loss,
which it absorbs. On the other hand, if the market has gone up and the units
have increased in value, VRIAC will sell the same number of units as it would
have sold on Day 1,but the sales amount will be higher than the requested
withdrawal. VRIAC will keep the excess as part of its overall fee. In either
circumstance, the participant receives the benefit of what he or she requested and
bears no additional cost.
VRIAC tracks the net financial experience of VRIAC's Correction Account and the effect
of the corrections for each affected plan on an annual basis and will make that
information available in accordance with ERISA Section 408(b)(2). Any gains kept by
VRIAC constitutes additional compensation for the services provided by VRIAC under
its contract and VRIAC will report it in accordance with ERISA Section 408(b)(2).
By executing an administrative services agreement with VRIAC, you are
authorizing VRIAC's application of the error correction policy as described above to
your Plan in connection with the plan administrative services that VRIAC will provide.
You have the right to terminate VRIAC's services in accordance with the terms of the
administrative services agreement.
53
Orange County Sanitation District 457(b) Deferred Compensation Plan
Schedule K: Authorized Plan Sponsor Representative
The Contractor is hereby authorized to act upon the directions, instructions, and any
information provided by any of the Authorized Plan Sponsor Representatives listed below.
These signatures will be accepted until the Contractor is notified of a change in writing.
The following person(s) have the authority under the Plan to provide direction to the
Contractor with respect to administration of the Plan including any benefit sensitive
financial transactions permitted under the Plan and requests for contribution refunds. In
the event that a Plan Sponsor Representative is removed or replaced,the Contractor must
be notified immediately in writing - please contact the Contractor's designated Plan
Manager to request the applicable administrative form to complete.
1. Name(please type or print) Title
U,el Cie
1`1
Agency, Division or Location Name and Code(if applicable)
Auth rized Plan Sponsor R
epresentatives Signature
2. Name lease type or print) Title
Agency, Division or Location Name and Code(if applicable)
Authorized Plan Sponsor Representatives Signature
I Name(please type or print) Title
Agency, Division or Location Name and Code(if applicable)
Authorized Plan Sponsor Representatives Signature
4. Name(please type or print) Title
Agency, Division or Location Name and Code(if applicable)
Authorized Plan Sponsor Representatives Signature
54
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule L: Contractor's Primary Contact
The Contractor designates the following individual(s)to serve as its primary point of
contact to the Plan Sponsor with respect to this Agreement.
Sue Silva
Plan Manager
Voya Retirement Insurance and Annuity Company
One Orange Way
Windsor, CT 06095
55
Orange County Sanitation District 457(b)Deferred Compensation Plan
Schedule M: Licensed Representatives
The Contractor designates the following individual(s) to serve as its licensed
representatives with respect to this Agreement. Licensed representatives are designated as
one of the following:
Agent, including Career Agent—Appointed with Voya Retirement Insurance and
Annuity Company, registered representative of Voya Financial Advisors, Inc. and receives
commission based compensation.
Broker—(Non Voya FA Only)—Appointed with Voya Retirement Insurance and Annuity
Company, but affiliated with a broker-dealer other than Voya Financial Advisors, Inc . and
receives commission based compensation.
Salaried Enroller—Voya Retirement Insurance and Annuity Company employees who
will not receive commission based salary and are registered representatives of Voya
Financial Advisors, Inc .
® Agent ❑ Broker ❑ Salaried Enroller
Representative Name: Kristina Bell-Tam Last 4 Digits SSN: 9900
Broker Dealer Affiliation: Voya Financial Advisors
Office Code: 114 Rep#: 020 % Participation: 100% (Loc. Code)
56
STATE OF CALIFORNIA )
ss
COUNTY OF ORANGE )
I, Kelly A. Lore, Clerk of the Board of Directors of the Orange County Sanitation
District, do hereby certify that the foregoing Resolution No. OCSD 16-18 was passed and
adopted at a regular meeting of said Board on the 26t1i day of October, 2016, by the
following vote, to wit:
AYES: Beamish; Beard (Alternate); Choi; Curry; Deaton; Ferryman;
Katapodis; Kiley; Kim; Kring; Mills; R. Murphy; Nagel;
Neugebauer; Nielsen; Parker; Sebourn; Shawver; F. Smith;
T. Smith; Steel; Tinajero; Wanke; and Yarc
NOES: None
ABSTENTIONS: None
ABSENT: Withers
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal
of Orange County Sanitation District this 26t" day of October, 2016.
Kel y A. r
Cl k of Ve Board of Directors
Orange County Sanitation District
1194905.1 OCSD 16-18-3
California Consumer Notice
Important Information to Contract Holders
When you have any questions or problems concerning your insurance,or want to make any changes, your Voya
representative or agent will be glad to help you. You may contact the insurance company issuing this contract at the
following address and telephone number:
Voya Retirement Insurance and Annuity Company
One Orange Way
Windsor, CT 06095-4774
Telephone: 1-800-654-8065
If you have contacted you agent or representative and for some reason, a satisfactory solution to the problem has not
been reached, you may seek assistance from the California Department of Insurance. Please write or call:
1-800-927-HELP
Consumer Affairs
Department of Insurance
300 South Spring Street
Los Angeles,CA 90013
CA-NOT(11-00)
NOTICE OF PROTECTION PROVIDED BY
CALIFORNIA LIFE AND HEALTH INSURANCE GUARANTEE ASSOCIATION
This notice provides a brief summary regarding the protections provided to policyholders by the California Life and
Health Insurance Guarantee Association("the Association").The purpose of the Association is to assure that
policyholders will be protected,within certain limits, in the unlikely event that a member insurer of the Association
becomes financially unable to meet its obligations. Insurance companies licensed in California to sell life insurance,
health insurance,annuities and structured settlement annuities are members of the Association.The protection
provided by the Association is not unlimited and is not a substitute for consumers'care in selecting insurers.This
protection was created under California law,which determines who and what is covered and the amounts of coverage.
Below is a brief summary of the coverages,exclusions and limits provided by the Association.This summary does not
cover all provisions of the law; nor does it in any way change anyone's rights or obligations or the rights or obligations of
the Association.
COVERAGE
Persons Covered
Generally,an individual is covered by the Association if the insurer was a member of the Association and the individual
lives in California at the time the insurer is determined by a court to be insolvent. Coverage is also provided to policy
beneficiaries, payees or assignees,whether or not they live in California.
Amounts of Coverage
The basic coverage protections provided by the Association are as follows.
Life Insurance.Annuities and Structured Settlement Annuities
For life insurance policies,annuities and structured settlement annuities,the Association will provide the
following:
Life Insurance
80%of death benefits but not to exceed$300,000
80%of cash surrender or withdrawal values but not to exceed$100,000
Annuities and Structured Settlement Annuities
80%of the present value of annuity benefits, including net cash withdrawal and net cash surrender values
but not to exceed$250,000
The maximum amount of protection provided by the Association to an individual,for all insurance,annuities
and structured settlement annuities is$300,000, regardless of the number of policies or contracts covering the
individual.
Health Insurance
The maximum amount of protection provided by the Association to an individual, as of April 1,2011,is
$470,125.This amount will increase or decrease based upon changes in the health care cost component of
the consumer price index to the date on which an insurer becomes an insolvent insurer.
115586-CA(9-11)
COVERAGE LIMITATIONS AND EXCLUSIONS FROM COVERAGE
The Association may not provide coverage for this policy. Coverage by the Association generally requires residency in
California. You should not rely on coverage by the Association in selecting an insurance company or in selecting an
insurance policy.
The following policies and persons are among those that are excluded from Association coverage:
A policy or contract issued by an insurer that was not authorized to do business in California when it issued the
policy or contract.
A policy issued by a health care service plan(HMO),a hospital or medical service organization,a charitable
organization, a fraternal benefit society, a mandatory state pooling plan,a mutual assessment company, an
insurance exchange, or a grants and annuities society.
If the person is provided coverage by the guaranty association of another state.
Unallocated annuity contracts; that is, contracts which are not issued to and owned by an individual and which do
not guaranty annuity benefits to an individual.
Employer and association plans,to the extent they are self-funded or uninsured.
A policy or contract providing any health care benefits under Medicare Part C or Part D.
An annuity issued by an organization that is only licensed to issue charitable gift annuities.
Any policy or portion of a policy which is not guaranteed by the insurer or for which the individual has assumed the
risk, spch as certain investment elements of a variable life insurance policy or a variable annuity contract.
Any policy of reinsurance unless an assumption certificate was issued.
Interest rate yields(including implied yields)that exceed limits that are specified in Insurance Code Section
1607.02(b)(2)(C).
NOTICES
Insurance companies or their agents are required by law to give or send you this notice. Policyholders with additional
questions snouid first contact their insurer or agent.To learn more about coverages provided by the Association, please
visit the Association's website at www.califega.org.or contact either of the following:
California Life and Health Insurance California Department of Insurance
Guarantee Association Consumer Communications Bureau
P.O. Box 16860 300 South Spring Street
Beverly Hills, CA 90209-3319 Los Angeles, CA 90013
(323)782-0182 (800)927-4357
insurance companies and agents are not allowed by California law to use the existence of the Association or its
coverage to solicit,induce or encourage you to purchase any form of insurance.When selecting an insurance
company, you should not rely on Association coverage. If there is any inconsistency between this notice and
California law, then California law will control.
115586-CA(9-11)
This contract is amended and restated effective as of
Contract Amendment 2 May 1,2016. When you sign this restatement,it will
Contractholder: replace all prior versions of your contract.
ING NATIONAL TRUST AS TRUSTEE OF THE All references to the name of the Contractholder are
ORANGE COUNTY SANITATION DISTRICT changed from ING NATIONAL TRUST AS
457(b)DEFERRED COMPENSATION PLAN TRUSTEE OF THE ORANGE COUNTY
SANITATION DISTRICT 457(b)DEFERRED
Contract Document Number: COMPENSATION PLAN to VOYA
ST-60284 INSTITUTIONAL TRUST COMPANY AS
TRUSTEE OF THE ORANGE COUNTY
SANITATION DISTRICT 457(b)DEFERRED
COMPENSATION PLAN.
THE VALUE OF THE SEPARATE ACCOUNT(S)
DESCRIBED IN THIS CONTRACT,AS
AMENDED,IS SUBJECT TO CHANGE AND WILL
VARY BOTH UP AND DOWN IN ACCORDANCE
WITH THE INVESTMENT RESULTS OF THE
ACCOUNT(S)AND IS NOT GUARANTEED AS
TO FDMD DOLLAR AMOUNTS.
Voya Retirement Insurance and Annuity Company has
signed this restatement at its Home Office,One
Orange Way,Windsor,Connecticut 06095,on April
21,2016.
U4'
Charles P.Nelson,President
5Z4 A. d1U4.-
Jennifer M.Ogren,Secretary
Restatement Accepted:
VOYA INSTITUTWNA I/TRUST COMPANY
Date: 172 ti/a vt 6
By:
Name: 1#hceW F
Title: k ce Irw
ORANGE COUNTY SANITATION DISTRICT
Date: n CN,4 vV
By: 'LIV4My
Name: L io 4- e.,%z v `�y N t=_4*?—
VOYA. Title: 0•�reC�wr or— �•.hgrc�
ST-,AR(5102) ST-60284
This page,the following pages and the application are
Stabilizersm Contract the entire contract.
A group annuity contract issued by Voya Retirement You acknowledge that you have read and understand
Insurance and Annuity Company to: this contract and that,by completing an application,
VOYA INSTITUTIONAL TRUST COMPANY AS you have agreed to make deposits to this contract.
TRUSTEE OF THE ORANGE COUNTY Your application and any other writings acceptable to
SANITATION DISTRICT 457(b)DEFERRED us,in which you agree to make deposits,are part of
COMPENSATION PLAN this contract.
Contract Effective Date: This contract is delivered in California.
July 16,2009 THE VALUE OF THE SEPARATE ACCOUNT(S)
Contract Document Number: DESCRIBED IN THIS CONTRACT IS SUBJECT
ST-60284 TO CHANGE AND WILL VARY BOTH UP AND
DOWN IN ACCORDANCE WITH THE
INVESTMENT RESULTS OF THE ACCOUNT(S)
AND IS NOT GUARANTEED AS TO FIXED
DOLLAR AMOUNTS.
Voya Retirement Insurance and Annuity Company has
signed this contract at its Home Office,One Orange
Way,Windsor,Connecticut 06095 on April 21,2016.
0�14
Charles P.Nelson,President
944 74. o
Jennifer M.Ogren, Secretary
voYA.
ST(502) ST-602Ba
Table of Contents 1. Definitions
Definitions...................................................................2 Parties to this Contract
Operation of the Contract............................................4 1.1. Voya is Voya Retirement Insurance and
Annuity Company. Wherever"we," "us"or
Discontinuance............................................................7 "our"is used in this contract,it means Voya.
Amendments................................................................8 1.2. Contractholder is the holder of this contract
Annuities.....................................................................9 named on the face page. Wherever"you"or
Fees.................. "your" is used in this contract,it means the
Contractholder. When this contract provides
General Matters.........................................................10 that we will make a payment to you,the
payment will be made to you if you are a
trustee of the Plan;otherwise,we will pay the
Term Schedule(s)/Exhibit(s) Plan funding agent you designate.
Other Defined Terms
1.3. Annuity is a Member's periodic benefit that
you may direct us to purchase under this
contract.
1.4. Benefit Withdrawals are withdrawals(other
than Contractholder Withdrawals as described
in the Operation of the Contract section of this
contract)made in accordance with your Plan
and this contract for:
(a)Member-initiated withdrawals;
(b)Member-directed transfers of their account
balances between Investment Options;
(c)loans to Members;or
(d)Annuity purchases.
Benefit Withdrawals must meet the conditions
in the Operation of the Contract section.
1.5. Book Value Settlement Phase is the phase this
contract enters following its total
discontinuance if you elect to receive the
balance of the Interest Accumulation Fund
subject to the terms described in the attached
Book Value Settlement Exhibit.
1.6. Business Day is any day both we and the
financial markets are open for business.
1.7. Code is the Internal Revenue Code of 1986,as
amended,or any successor to it.
Page 2 ST-602&4
1.8. Competing Investment Option is any 1.15. Immediate Credited Rate is our calculation of
Investment Option(other than the one using what the effective annual rate of interest
this contract or such other Investment Options determined according to the Credited Rate
as we may from time to time designate as Determination Exhibit would be,assuming the
competing in accordance with our next Credited Rate Period were to commence
underwriting standards)which is invested in immediately.
money market instruments,repurchase 1.16. Interest Accumulation Fund is an accounting
agreements,guaranteed investment contracts,
or investments offering a fixed rate of return, record we maintain under this contract for
or any investment Option having a targeted amounts allocated to a Separate Account,
duration of less than three(3)years. reflecting deposits received,withdrawals you
make,fees charged,plus interest at the
1.9. Contractholder Withdrawals are any Credited Rate and other adjustments. This
withdrawals you make which are not Benefit account may be used by you for Plan
Withdrawals. recordkeeping and communications.
1.10. Credited Rate is the effective annual rate of 1.17. Investment Option is any facility used for
interest we periodically announce for this Member-directed investment of account
contract and which is credited to the Interest balances. If the Plan does not have
Accumulation Fund. Unless we agree Investment Options,then a reference to an
otherwise,it is effective as of the first day of a Investment Option means all Plan funds.
Credited Rate Period. 1.18. Member is a participant in the Plan,or any
1.11. Credited Rate Period is the period of time for person deriving his rights from such
which the Credited Rate is applicable. It is an participant. A Member has no rights or
annual,semiannual or quarterly period as obligations under this contract,except as
directed by you or such shorter period as may specifically stated.
be required during the Book Value Settlement 1.19. Plan is the Orange County Sanitation District
Phase. 457(b)Deferred Compensation Plan. You
1.12. Deposit Agreement is your written must give us a copy of the Plan upon entering
commitment,on a form acceptable to us,to into this contract. We are not a party to the
make deposits. The Deposit Agreement is a Plan.
part of the contract. 1.20. A Separate Account is a segregated asset
1.13. Eligible Assets are all Plan assets if Members account we established under Connecticut
do not have the option to direct investment of law. A Separate Account may have amounts
their account balances among various Plan allocated to it on a pooled basis.
investment facilities. If Members have such 1.21. Separate Account Balance is an accounting
an option,Eligible Assets are all Plan record we maintain to reflect the fair market
investments allocated to the Investment value of your pro rata share of a Separate
Option which includes amounts held under Account.
this contract.
1.14. Employer is any corporation,partnership, 1.22. Term Schedule is an attachment to this
proprietorship or other entity whose contract describing the terms applicable to a
employees may participate in the Plan. Separate Account you use to support the
Interest Accumulation Fund.
Page 3 ST-60284
2. Operation of the Contract
Deposits 2.5. The balance of the Interest Accumulation
2.1. You agree to make deposits to this contract at Fund is an amount equal to the termination
such times,in such amounts and under such value of the predecessor investment vehicle
conditions as mutually agreed to in the from which deposits to this contract were paid
Deposit Agreement. We are obligated to as proceeds,plus any additional Plan deposits
accept only those deposits you are committed plus interest,less any withdrawals,less any
to make,except as follows: adjustment made in connection with an
Contractholder Withdrawal,and less any fees
(a)We may stop accepting deposits under the or expenses that are deducted from time to
current Deposit Agreement if an action you time.
take causes a reason for discontinuance to 2.6. If you request,we can establish multiple
arise under the Discontinuance Section. accounts for Plan recordkee P� g m purposes. If
(b)We may refuse to accept deposits under an additional account has its own Credited
any renewal Deposit Agreement. If we refuse Rate,it is treated as a distinct Interest
to accept deposits under a renewal Deposit Accumulation Fund.
Agreement,we will give you 30 days advance
written notice. 2.7. Amounts in a Separate Account are invested
consistent with the investment objectives we
2.2. Deposits received by us are allocated to the set for that Separate Account. The
Separate Account(s)in which you choose to investments and operation of a Separate
participate. Deposits are subject to any Account are also subject to any rules and
conditions or limitations in the Term Schedule limitations established by our Board of
for that Separate Account. Unless otherwise Directors or its duly authorized committee.
agreed,deposits are made by wire transfer. 2.8. The value of a Separate Account is the fair
Operation of the Fund market value of investments in the Separate
2.3. As of the contract effective date and at least Account plus cash balances and accruals,less
30 days prior to each Credited Rate Period,or liabilities,in accordance with such methods as
such shorter period as may be required during are described in the Term Schedule or as we
the Book Value Settlement Phase, we will may adopt from time to time. Income and
notify you of the rate to be credited to the gains or losses,realized or unrealized,are
Interest Accumulation Fund for that period. credited or charged directly to a Separate
Interest is credited on a daily basis. Account. The values determined may
decrease or increase according to such
2.4. The Credited Rate is determined by us. It procedure. A Separate Account is charged
reflects our assumptions as to your deposits with expenses arising from the operation of
and withdrawals to this contract and the the account,including taxes,brokerage
investment results of the Separate Account. It commissions and other costs.
also reflects an adjustment for differences
between the balance of the Interest 2.9. Your pro rata share of a Separate Account
increases when you make a deposit or when
Accumulation Fund and the Separate Account
others participating in the Separate Account
Balance. The formula we currently use to
make withdrawals. Your share decreases
determine this contract's Credited Rate is
described in the attached Credited Rate when you make a withdrawal or when others
participating make deposits.
Determination Exhibit.
Page4 Sri
2.10. The assets in a Separate Account are not 2.15. This contract follows a LIFO/pro rata
chargeable with liabilities arising out of any of withdrawal order. If all Eligible Assets are
our other business. We own the investments being held under this contract,the Plan
held in a Separate Account. We are not a agrees to pay all amounts needed for Benefit
trustee of such assets. Withdrawals from this contract. If all
2.11. Unless the Term Schedule specifies otherwise, Eligible Assets are not being held under this
we may discontinue the use or availability of contract,the Plan agrees to pay all amounts
any Separate Account(other than any needed for Benefit Withdrawals from the
Separate Account you use during the Book investment vehicle receiving then current
Value Settlement Phase). At your direction, Plan fixed fund deposits as long as that
we will transfer your Separate Account investment vehicle has Eligible Assets. The
Balance to another of our investment facilities term"Plan fixed fund deposits"includes
or pay such value to you as a Contractholder amounts received by the Plan in the form of
Withdrawal. interest payments and proceeds resulting
from the maturity or termination of other
2.12. At least annually,we will send you financial Plan investment vehicles that are reinvested
statements. by the Plan. If more than one investment
Benefit Withdrawals vehicle is receiving then current Plan fixed
fund deposits,the Plan agrees to make
2.13. If the Plan has a Competing Investment withdrawals from such investment vehicles
Option,Benefit Withdrawals to effect according to their pro rata share of Benefit
Member-directed transfers of their account Withdrawals(pro rata share,for this purpose,
balances between Investment Options may be equals the total amount needed for Benefit
made only if: Withdrawals times the percentage of current
(a) the transfers are not made from the fixed fund deposits being directed to each
Investment Option that includes amounts held contract from which Benefit Withdrawals are
under this contract and to any Competing to be paid). If the investment vehicle(s)
Investment Option;or receiving then current Plan fixed fund
deposits has no Eligible Assets,the Plan
(b) the Plan requires that the amount agrees to make withdrawals from this
transferred from the Investment Option that contract equal to this contract's pro rata share
includes amounts held under this contract of Benefit Withdrawals(pro rata share,for
remain invested in non-Competing Investment this purpose,equals the total amount needed
Options for 90 days before being eligible for PmP q
OP Y g in by the Plan for Benefit Withdrawals times
transfer to a Competing Investment Option. the ratio of the Interest Accumulation Fund
2.14. If the Plan permits loans,amounts needed to to the total amount of Eligible Assets).
meet Member loan requests are considered 2.16. We can require reasonable proof that Benefit
Benefit Withdrawals. The loan must meet the Withdrawals are being made in accordance
requirements of section 72(p)(2)of the Code with the Plan and this contract.
and,if applicable,section 4975(d)of the Code
and section 408(b)(1)of the Employee 2.17. Subject to the withdrawal deferral provision in
Retirement Income Security Act of 1974,as the General Matters section of this contract,
amended(ERISA}. payments are normally made within 30
Business Days after our receipt of all
necessary information or proofs.
Page 5 Sri}
2.18. Benefit Withdrawals are not subject to any 2.24. Subject to the withdrawal deferral provision in
market value adjustment. They are deducted the General Matters section of this contract,
from the balance of the Interest Accumulation Contractholder Withdrawal requests are
Fund and the Separate Account Balance. normally honored promptly,taking into
2.19. Benefit Withdrawals may not exceed the account the character of the investments in the
balance in the Interest Accumulation Fund. Separate Account and reasonable business and
settlement practices.
2.20. Any withdrawal not eligible for treatment as a
2
Benefit Withdrawal must be withdrawn as a .25. In connection with any Contractholder
Contractholder Withdrawal. Withdrawal,the balance of the Interest
Accumulation Fund is reduced by an amount
2.21. You must promptly give us a description of equal to the payment made times the ratio of
any proposed amendment to the Plan. You the balance of the Interest Accumulation Fund
must also give us a copy of all Plan to the Separate Account Balance.
amendments actually adopted. We will add
these amendments to our copy of the Plan,but 2.26. Member-initiated withdrawal or transfer
requests,directly or indirectly arising out of
we can advise you that we will not alter our
administration of this contract to comply with corporate actions such as bankruptcies,
any Plan amendment which we determine may spinoffs,divestitures,corporate relocations,
otherwise directly or indirectly have a layoffs,retirement incentive programs,the
material adverse effect on our obligations to creation of a Competing Investment Option,
partial or total Plan terminations,or the
YOU. liberalization of Plan withdrawal or transfer
2.22. If,at any time(including any notice period rules,are all Contractholder Withdrawals.
preceding a discontinuance of the contract). Such payments are not treated as Benefit
we calculate the Immediate Credited Rate to Withdrawals,but as a partial discontinuance
be 3%or less and the ratio of the contract's of this contract.
Separate Account Balance divided by the 2.27. With our consent,you may elect to treat a
Interest Accumulation Fund is less than 95o,
then Benefit Withdrawals are not available to Contractholder Withdrawal as a Benefit
effect either loans to Members or Member- Withdrawal if the total amount withdrawn
directed transfers between Investment under this section and the Benefit
Options. We will notify you promptly that Withdrawals section over any continuous 12-
/o
such action has occurred. month period is less than 20 of the Interest
Accumulation Fund balance at the start of that
Contractholder Withdrawals period.
2.23. You may withdraw all or a part of your 2.28. Subject to our underwriting requirements and
Separate Account Balance. Your Separate approval,we may allow you to transfer your
Account Balance is determined as of the Separate Account Balance to another Separate
payment date if there is cash available in the Account. This transfer may affect the
Separate Account. If no cash is available this Credited Rate.
value is determined on the date we make any
transactions necessary to raise cash to pay
your withdrawal request. In no event may you
withdraw more than the value of your
Separate Account Balance. The Term
Schedule for a Separate Account may limit the
timing of receipt of amounts from the account.
Pages ST-e0284
3. Discontinuance
3.1. You may discontinue this contract by giving (i)We elect to discontinue accepting deposits
us 30 days written notice. A discontinuance for all contracts of this class.
may be total or may be for a group of 0)Employees of an Employer are no longer
Members(a"partial discontinuance"). The eligible to participate in the Plan. (Any such
discontinuance is effective on the later of: discontinuance affects only those ineligible
(a)the date specified in your notice,or employees.)
(b)30 days after we receive your notice. (k)A change in applicable laws and
3.2. We may discontinue this contract,either regulations(including tax laws and
totally or partially,by giving you 90 days regulations)which materially affects the
notice. taxation of this contract or Separate Account,
or otherwise materially affects our obligations
3.3. We may discontinue this contract,either hereunder.
totally or partially,after a reason for
discontinuance occurs. We will give you 45 3.5. The contract automatically discontinues if,at
days written notice. any time,we calculate the Immediate Credited
Rate to be 3%or less and the ratio of the
3.4. Reasons for our discontinuance are: contract's Separate Account Balance divided
(a)You fail to meet any of your obligations by the Interest Accumulation Fund is less than
under this contract or under any related 95%. We give you at least 30 days notice of
agreement. such a discontinuance.
(b)All amounts under this contract are 3.6. We will pay all available funds to you as
withdrawn. follows:
(c)The Plan is no longer a qualified plan (a)In the case of a total discontinuance,you
under the Code. will direct us to pay you:
(d)The Plan is terminated. (i)your Separate Account Balance; or
(e)You no longer have any obligations under (ii)the balance of the Interest
the Plan. Accumulation Fund,subject to the terms
described in the attached Book Value
(f)Any action is taken by you,the plan Settlement Exhibit.
sponsor,or other plan official,which:
(b)In the case of a partial discontinuance,you
(i)creates a Competing Investment Option; will:
or
(i)direct us under item(a)to pay the
(ii)significantly liberalizes,as determined appropriate portion of this contract's value
by us,the Plan withdrawal or transfer to Members or the funding agent of a
rights of Members; or successor plan;or
(iii)materially affects our rights and (ii)request us to issue a new contract to
obligations under this contract. the plan sponsor or funding agent of a
(g)You,without our written agreement, successor plan.
attempt to assign your interest in this contract.
(h)You reject an amendment to this contract
proposed by us under the Amendments
section.
Page 7 sr
4. Amendments
(c)If you do not give us a direction under item
(a)within 30 days following the date the 4.1. This contract may be amended by mutual
discontinuance is effective,we may pay you agreement.
the balance of the Interest Accumulation
Fund,subject to the terms described in the 4.2. We may amend any provision of this contract
attached Book Value Settlement Exhibit. to comply with applicable laws or regulations
Payment under this item fully discharges all of without your consent.
our obligations under this contract with 4.3. We may propose other amendments that are
respect to both the Interest Accumulation effective 30 days after we give you written
Fund and the Separate Account Balance. notice of the change. You may reject our
(d)Any contract issued upon a partial proposed change by giving us written notice
discontinuance of this contract is subject to before it becomes effective.
any terms and conditions mutually agreed to 4.4. No amendment to this contract may:
and is conditioned upon satisfaction of our
reasonable underwriting rules and the securing (a)revoke your right to withdraw amounts
of any necessary regulatory approvals. held under this contract. All withdrawals
3.7. Unless you elect to directly pay any due or follow the rules in effect when we receive
accrued expense fee at discontinuance,we your request.
may deduct the appropriate amount from (b)reduce the amount or change the terms of
amounts paid or transferred out of the any Annuity you have purchased,unless
Separate Account. required by applicable laws.
3.8. Payments or transfers upon discontinuance are 4.5. Unless otherwise provided in the Term
subject to any limitations or restrictions that Schedule,we may modify any Term Schedule
appear elsewhere in this contract. by giving you 30 days notice. We may also
3.9. You may not make deposits to this contract modify the exhibits. The exhibit states
after discontinuance. requirements for making such changes.
3.10. Annuities purchased prior to discontinuance
are not affected by discontinuance.
3.11. We will continue to provide any services
necessary to fulfill our obligations or to
transfer such responsibility to a successor.
You agree to pay us for such services.
Page 8 STD
5. Annuities
Annuity Purchase Rules annuitant's adjusted age is his or her age as of
5.1. You may direct us to purchase Annuities with the birthday closest to the Annuity effective
amounts held under this contract at any time. date reduced by two years for Annuity
effective dates occurring during the period of
Any Annuities you purchase are subject to our regular practices. You agree to provide us time from January 1,2000 through December31,2009.The annuitant's and second
with whatever information or application we annuitant's age will be reduced by one
require. additional year for Annuity effective dates
5.2. You may specify the requested Annuity occurring in each succeeding decade.
effective date and any form of Annuity we Interest: 1.50%
regularly offer under contracts of this class.
The Annuity form determines payments to be 5.10. If,when you purchase an Annuity,a more
made upon death. favorable premium rate basis is in effect for
5.3. The Annuity effective date is usually the first the Annuity you are purchasing,we use the
more favorable basis.
day of the month coinciding with or next
following the date you request. 5.11. We guarantee your initial minimum annuity
5.4. The minimum amount of Annuity you may premium rate basis through December 31,
purchase is$75 per month. We may change 2009. Unless,prior to a guarantee expiration
this amount by notifying you. date,we notify you in writing of a new
guarantee basis,the current guarantee basis is
5.5. An Annuity may not be revoked,and the automatically extended for an additional three
premium,form or joint annuitant may not be years.
changed,after the Annuity effective date. If
the Member or his joint annuitant dies before General Annuity Provisions
the Annuity effective date,the Annuity is not 5.12. If we are uncertain whether a payee of a life
purchased. Any premium we receive is contingent Annuity is alive,we have no
returned as you direct. obligation to make any Annuity payment
5.6. Annuities are subject to any limitations in the unless,within seven years after the payment
Plan required by applicable laws or due date,we receive proof from you or the
regulations. Plan administrator that the payee was living
on that date. If we do not receive proof,our
Annuity Purchase Rates obligations pertaining to that payment and
5.7. If you specify the gross premium,we later payments are the same as if the payee
determine the Annuity amount using the had died immediately before that payment due
Annuity net premium rate then in effect. date.
5.8. The Annuity purchase rate is based on a net 5.13. Annuity payments are made to the Member. If
premium. The net premium equals the gross we have reason to believe a payee is legally
premium,less any applicable premium tax. incapable of giving a valid receipt for any
Annuity payment,we may make the payment to
5.9. The initial minimum premium rate basis in any payee permissible under the Plan. Such
effect for this contract is: payment discharges our obligation for the
Mortality: 1983 Table a. For purposes of Annuity payment.
calculating the initial minimum premium rate, 5.14. Certificates we issue include the terms and
the annuitant's and second annuitant's adjusted restrictions we believe are in compliance with
age will be used.The annuitant's and second applicable laws or regulations.
Page9 STD
6. Fees 7. General Matters
6.1. Fees are payable as described in the Fee Exhibit 7.1. All agreements,notices or other communication
or as otherwise agreed. required by this contract must be in writing.
6.2. Any fee we bill you is payable within 31 days of Notices to us are effective when we receive them
the billing date. If we do not receive prompt at the address designated by us. Notices to you
payment,we may deduct the unpaid fees plus are effective when sent. One of our duly
reasonable interest from the contract or from authorized officers must sign all our agreements.
payments due you. 7.2. Any error in making payments or keeping any
records pertaining to this contract may be
corrected by us.
7.3. Any provision of this contract which we may
have waived on one occasion may continue to be
enforced by us.
7.4. No interest in this contract may be assigned
without our prior written consent.
7.5. You may name,by notice to us,an agent to act
for you in matters concerning this contract. The
agent will have all your rights,powers and duties
in such matters.
7.6. You are responsible for determining the proper
accounting for this contract by the Plan.
7.7. You will provide us with satisfactory evidence
that the Plan is a qualified plan under the Code.
You will notify us promptly if the Plan fails to
meet these requirements.
7.8. You(and any person you name responsible for
directing Plan investments)are solely
responsible for determining whether this contract
is a suitable Plan funding vehicle and in making
that determination have taken into consideration
the Plan investment objectives,including its
liquidity and diversification needs.
7.9. We may take any reasonable action,as permitted
by this contract,that we determine is appropriate
to assure that any of our contractual obligations
are adequately supported.
7.10. We are not chargeable with knowledge of the
terms of any trust agreement.
7.11. We are not responsible for reconciling Member
statements to the contract.
Page10 STD
7.12. We acknowledge that,if the Plan is subject to
the Employee Retirement Income Security Act
of 1974,as amended (ERISA),we are acting as
an investment manager and are a fiduciary,as
defined in section 3(38)of ERISA,solely with
respect to the management of Plan funds held in
a Separate Account. In all other respects,in
exercising our rights,we represent ourselves and
not the Plan.
7.13. We may defer honoring any withdrawal request
or other payment obligation if,due to the closing
or other disruption of financial markets or
exchanges,we are unable to prudently execute
or settle transactions on behalf of a Separate
Account.Such deferral generally will be limited
to the period of the market disruption. We may
also defer honoring any withdrawal request for
the period of time necessary to prudently
liquidate assets to satisfy such request.
Withdrawals may be subject to any other
limitations described in the Term Schedules.
7.14. We are not obligated to determine whether any
payment is made in accordance with the terms of
the Plan or any applicable law or regulation.
7.15. If you use more than one Separate Account
under this contract,we will normally establish a
distinct Interest Accumulation Fund with respect
to each account used. Unless we agree
otherwise,this contract's terms,including those
pertaining to the Credited Rate,apply separately
to each Separate Account and its associated
Interest Accumulation Fund.
Page 11 ST-602B4
Term Schedule
Quality Fund 11 Quality Fund u is a pooled long-term public bond
SA-392 Separate Account. Account investments consist
primarily of a diversified portfolio of United States
Treasury and agency securities,mortgage pass-
ST—60284
Stabilizer Contract: through and other asset backed securities and other
publicly traded investment grade debt securities.The
portfolio is managed to match the investment duration
of the Barclays Capital U.S.A or Better Aggregate
Bond Index,plus or minus 0.50 years. The portfolio
may also include cash,forward contracts, financial
futures and options(including options on futures)or
such other instruments and investments as we believe
appropriate for the proper management of the
Account.
Expenses charged to the Account include,but are not
limited to,brokerage commissions,transfer taxes and
other direct charges arising from the purchase,sale or
management of account investments and such other
taxes or charges attributable to the assets or operation
of the Account,including audit fees.
Deposits and Withdrawals
Subject to the contract's terms,deposits to and
withdrawals from the Account may normally be made
on any Business Day.
Valuation
The value of the Separate Account is the fair market
value of all investments held in the Separate Account
plus accounts receivable less accounts payable.
Market value for publicly traded securities is based on
closing sales prices as reported on national securities
exchanges,or closing bid prices as reported by
investment dealers. Securities purchased but not yet
paid for are carried as securities owned at the current
market value with the total cost thereof,including
commissions and taxes,being an account payable.
Securities sold but not yet paid for are carried at their
sale price less commissions and taxes.
Page 12 ST-60M4
Credited Rate Determination
Credited Rate Under your contract we announce a new Credited Rate
for each Credited Rate Period,which is credited to
Determination Exhibit
your contract's Interest Accumulation Fund. The
Contractholder: formula we use is based on the relationship:
VOYA INSTITUTIONAL TRUST COMPANY AS
TRUSTEE OF THE ORANGE COUNTY MV(1+I)d=IAF(1 +G)d
SANITATION DISTRICT 457(b)DEFERRED
COMPENSATION PLAN The equivalent formula,expressed in terms of G is:
Contract Document Number: G=[(MV/IAF)1/d x(1+I)] -1
ST—60284 Where:
G= Your new Credited Rate.
MV= Your projected Separate Account Balance on
the date the new Credited Rate is first
effective,plus our projection of anticipated
net deposits,withdrawals and expense charge
deductions in the next Credited Rate Pcricd.
IAF= The projected balance of the Interest
Accumulation Fund on the date the new
Credited Rate is first effective,plus our
projection of anticipated net deposits,
withdrawals and expense charge deductions in
the next Credited Rate Period.
d= The target investment duration of the Separate
Account your contract uses.
I= The net effective yield available,on the date
we determine the new Credited Rate,on assets
similar to those in the Separate Account.
SW Om Contra&Niibit Page 13 ST-6M4
Any projections are based on current balances or
values available on the date we determine the new
Credited Rate,and reasonable assumptions as to cash
flows,earnings and other occurrences between that
date and the date the new Credited Rate is first
effective,or during the next Credited Rate Period,as
appropriate.
The new Credited Rate we announce for any Credited
Rate Period will never be less than 0%.
We may change this Exhibit by 30 days notice to you.
Any change will not apply if you give us a
discontinuance notice before the change is effective.
Stabilim Ca ftW E)hbit Page U ST-60284
Fee Description
2016 Stabilizer The asset fee is guaranteed for 2016. If this fee
Contract Fee Exhibit changes,you will receive 30 days written notice.
Other fees may be changed at any time. The fees are
Contractholder: as follows:
VOYA INSTITUTIONAL TRUST COMPANY AS Asset Fee
TRUSTEE OF THE ORANGE COUNTY The asset fee is deducted or billed. It equals the
SANITATION DISTRICT 457(b)DEFERRED amount determined by applying the following table to
COMPENSATION PLAN the mean assets of the Interest Accumulation Fund
Contract Document Number: associated with Quality Fund 11,prorated for periods
ST—60284 other than 12 months.
Mean Assets Percentaee Charge
First$25,000,000 0.50%
Over$25,000,000 0.40%
Extra Reporting Account Fee
If you require separate financial information for
various groups,a fee of$0 is charged for each such
group in excess of one. This fee is prorated for
periods other than 12 months.
Miscellaneous Fees
Additional fees apply for any non-standard service we
provide at your request. We will notify you of the
applicable fees,if any.
Sta6iliaa Caitrad Eibit Page 15 STD
Book Value Settlement Description
Stabilizer Contract
If,at contract discontinuance,you elect to receive
Book Value Settlement the balance of the Interest Accumulation Fund,your
contract will enter into its Book Value Settlement
Exhibit Phase. Over the Book Value Settlement Phase,we
will pay you the balance of the Interest
Accumulation Fund. The Book Value Settlement
Contractholder:VOYA INSTITUTIONAL TRUST COMPANY AS terms.
Phase will operate on the following
TRUSTEE OF THE ORANGE COUNTY Within 30 days of the date your contract's
SANITATION DISTRICT 457(b)DEFERRED discontinuance is effective,we will establish an
COMPENSATION PLAN initial installment payment schedule for your
contract. The initial installment payment schedule
Contract Document Number: will establish three target dates for the payment to
ST—60284 you of the balance of the Interest Accumulation
Fund in installments. The target dates will be
established in relation to the target duration of the
Separate Account. The first target date will be six
months prior to a date(the"Central Maturity Date")
that is established by adding a period of time equal
to the target duration of the Separate Account to the
date your contract's discontinuance is effective.
The second target date will be the Central Maturity
Date. The third and final target date will be six
months after the Central Maturity Date.
The amount that is scheduled to be paid on each
target payment date is as follows:
6 months prior to 1/3 Remaining Interest
Central Maturity Date Accumulation Fund
Central Maturity Date 1/2 Remaining Interest
Accumulation Fund
6 Months following Remaining Interest
Central Maturity Date Accumulation Fund
If you desire an alternative initial installment
payment schedule or alternative payment amounts
we may propose differing schedules and amounts to
you. The use of an alternative payment schedule or
amounts may be conditioned upon the securing of
any necessary regulatory approvals. Unless the
parties agree to an alternative,the initial installment
payment schedule and payment amounts will be
determined as described above.
SWroa Ca*act U ibit Page 16 ST-602&1
Upon commencement of the Book Value Settlement (d) Withdrawals may continue to be made in
Phase,we will adjust the target duration of the assets accordance with the Benefit Withdrawals and
in the Separate Account to equal the average of the Contractholder Withdrawals section of your contract.
times remaining to each of the outstanding The portfolio may increase its investment in Treasury
installment payments,and we will strive to maintain securities and short term securities in anticipation of
the duration of the Separate Account's investments to any approaching installment payment.
plus or minus 10/o of this target duration. During the
final six months of the Separate Account's operation, On the final installment payment date,we will
the Separate Account's target duration will be increase the payment to you by the amount, if any,of
adjusted to reflect anticipated withdrawals. the excess of the Separate Account Balance as of that
In connection with any installment payment that is date over the Interest Accumulation Fund balance as
made,we will reduce your Separate Account Balance
of that date.
and the balance of the Interest Accumulation Fund by If we calculate the Credited Rate to be 3%or less,
an amount equal to the payment that is made. and the ratio of the contract's Separate Account
Balance divided by the Interest Accumulation Fund
During your contract's Book Value Settlement Phase: is less than 95%,for any Credited Rate Period during
(a) We will accept only those deposits that you are the Book Value Settlement Phase,we will establish a
committed to make under the current Deposit new target installment payment schedule by
Agreement and that we are obligated to accept under extending the Central Maturity Date as far as
the Deposits section of the contract. No additional necessary to support a Credited Rate of 3%.
deposits will be accepted. We will not enter into any However,in no event may we extend the Central
renewal Deposit Agreement. Maturity Date more than ten years from the date your
(b) We will continue to renew your Credited Rate as contract's discontinuance is effective.
provided under the Operation of the Fund section of Upon any such extension of the Central Maturity
the contract and the Credited Rate Determination Date,we will similarly extend the target investment
Exhibit. In establishing the variables for purposes of duration of the assets in the Separate Account.
the Credited Rate Determination Exhibit,we may If the Central Maturity Date is extended after any
take into account our projection of anticipated installment has been made,the new
withdrawals,scheduled installment payments,and payment(s)
schedule will exclude the payment(s)that have
expense charge deductions over the time remaining
until the final target installment payment date. The already been made.
lowest Credited Rate we will announce for any At any time after your contract has entered its Book
Credited Rate Period while your contract is in its Value Settlement Phase,but before the final
Book Value Settlement Phase is 0%. installment payment has been made,you may elect
(c) Your Credited Rate Period will be quarterly until an early termination of your contract by directing us
three months prior to the final scheduled installment to pay you your Separate Account Balance.
payment. Credited Rate Periods may,at our Following such an election by you,our payment of
discretion,be monthly periods during the three- your Separate Account Balance will terminate your
month period prior to the final scheduled installment contract and fully discharge our obligations to you.
payment. If we choose to provide monthly Credited We may change this exhibit upon 90 days advance
Rate Periods,we will notify you of the rate to be notice to you. Any change will not apply if you give
credited for that period concurrently with the start of or have given us a discontinuance notice before the
that period. change is effective.
Stabiliaa Contract N ibit Page 17 STD
Interest Rate
2016 Stabilizer
Contract Interest The net effective annual interest rate credited to your
Interest Accumulation Fund from May 1,2016
Exhibit through June 30,2016 is 2.58%.
We may change this rate at the beginning of each
Contractholder: Credited Rate Period upon 30 days advance written
VOYA INSTITUTIONAL TRUST COMPANY AS notice to you.
TRUSTEE OF THE ORANGE COUNTY
SANITATION DISTRICT 457(b)DEFERRED
COMPENSATION PLAN
Contract Document Number:
ST—60284
SW1iw 0x*ad Ffibit Page 18 ST-602B4