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SURS Hires New SMP Recordkeeper, Investment Provider for Revamp

September 26, 2019 - 11:18
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Champaign, IL - The State Universities Retirement System (SURS) Board of Trustees on Sept. 13 voted to hire Voya as recordkeeper and Alliance Bernstein as an income solution provider for both the Self-Managed Plan (SMP) and a new supplemental 457(b) plan, pending successful contract negotiations.

The selections were made after a thorough search for financial services administrators to help enact a redesign of SURS Self-Managed Plan and to concurrently launch the new supplemental savings plan. Cammack Retirement Group assisted SURS in its competitive bid and evaluation process.

A goal of the SMP redesign is to provide members with an investment option that will enable them to receive replacement income and retain earned retiree health benefits without giving up access to their entire account balance on the date they retire.

A 2018 state law (Public Act 100-769) requires SURS to offer a voluntary defined contribution plan to all active members to supplement their retirement income. The SURS plan will be a payroll-deduction, 457(b) plan offering similar investment options as SURS Self-Managed Plan, including the new custom investment solution.

The new supplemental plan will be beneficial for all active SURS members, but most critical for Tier II members who have reduced retirement benefits compared to Tier I members.

The redesigned SMP and the supplemental plan are anticipated to launch in mid-2020. Members and employers will be provided extensive educational materials and tools prior to the launch date. New tools will also include a plan choice portal to help new SURS members decide whether to choose one of two defined benefit plans or the defined contribution plan and whether to take advantage of the supplemental plan.

Incumbent SMP providers were Fidelity and TIAA. Both were considered in the search.

In other business, the board

  • Approved retaining Aspect Capital, Campbell and Company and LongTail Alpha to provide systematic trend-following investment management services, subject to successful contract negotiations.
  • Approved RhumbLine to manage a passive strategy benchmarked to the Bloomberg Barclays Long US Long Government Index with an initial allocation of 1.75% of the SURS total portfolio, subject to successful contract negotiations.
  • Approved a 25% goal for fiscal year 2020 for contracts and purchases from businesses owned by minorities, female and persons with a disability.
  • Approved revisions to the defined benefit plan Investment Policy.

SURS Hires New SMP Recordkeeper, Investment Provider for Revamp