Request for Information for
Investment Consulting
Issued on: February 3, 2017
Responses due: February 13, 2017
I. Purpose
The Ohio Tuition Trust Authority (OTTA) is looking for nationally recognized investment
consulting providers interested in partnering with OTTA to provide investment
philosophy, strategic direction and oversight of program investments, managers,
investment options (including searches and gap analysis), and quarterly performance
reporting to CollegeAdvantage, Ohio’s 529 College Savings Program. Section
3334.08(A)(12) of the Revised Code authorizes OTTA to contract with financial
consultants, actuaries, auditors, and other consultants as necessary to carry out its
statutory responsibilities and functions. Interested firms responding to this Request for
Information (RFI) will be provided a Request for Proposal (RFP), which OTTA may
develop and issue based in part upon the feedback provided in the RFI.
II. Background and Plan Summary
Ohio Tuition Trust Authority Overview
The Ohio Tuition Trust Authority, a state agency within the office of the Chancellor of the
Ohio Department of Higher Education, sponsors and administers the CollegeAdvantage
529 Savings Program (CollegeAdvantage) for the state of Ohio. OTTA was established
as a state agency by the Ohio legislature under Chapter 3334 of the Ohio Revised Code
(ORC) in 1989 to administer Ohio’s college savings program in order to help prepare
families financially for the cost of higher education. The agency receives no General
Revenue Funds from the state. A small fee assessed to College Advantage participants
is used to fund OTTA program administration.
The investments of the program are governed by the Ohio Tuition Trust Authority
Investment Board (Board), which is comprised of 11-members appointed pursuant to
section 3334.03 of the Ohio Revised Code. OTTA staff oversees marketing, customer
service, operations, information systems, administration, investments and all financial
aspects of CollegeAdvantage.
Program Summary
CollegeAdvantage is the program sponsor of three separate plans:
 Direct 529 Savings Plan
 Advisor 529 Savings Plan
 Guaranteed Savings Plan
The Direct Plan, managed by OTTA, has approximately 277,300 accounts and $4.85
billion in assets under management as of December 31, 2016. Direct Plan customers
can select to invest in 24 investment options: Mutual Funds and CDs and savings
accounts. The mutual fund investments are comprised of:
 4 Age-Based Investment Portfolios;
 5 Risk Based/Static Investment Portfolios; and
 13 Individual Investment Options.
In addition, the Direct Plan offers customers the opportunity to invest in both CDs of
various maturity terms and savings accounts both of which carry FDIC insurance.
Current investment managers in the Direct Plan include: The Vanguard Group,
Dimensional Fund Advisors, and Fifth Third Bank.
The Advisor Plan, managed by BlackRock, has approximately 329,900 accounts and
$4.82 billion in assets under management as of December 31, 2016. The 23 investment
options available for participants and their financial advisors to choose from include:
 3 Age-Based Investment Portfolios;
 3 Risk Based/Static Investment Portfolios; and
 17 Individual Investment Options.
Current investment managers in the Advisor Plan include: BlackRock, iShares, Rainier,
Wells Fargo and Voya.
The Guaranteed Savings Plan (GSP), managed by OTTA, has been closed to new funds
since December 31, 2003. The plan continues to service approximately 28,600
accounts as of December 31, 2016. The plan originally sold tuition credits and later sold
tuition units to Ohio residents that wanted to save in advance for college expenses. The
GSP is backed by the full faith and credit of the State of Ohio. Redemption values of the
credits and units are based on the Weighted Average Tuition (WAT) of Ohio’s 13 fouryear public higher education institutions. The investments of the Guaranteed Plan are
managed by seven external investment managers. The OTTA Investment Board sets
tuition inflation and investment return assumptions each year for use by OTTA’s actuary
in its annual actuarial valuation. As of the most recent valuation, June 30, 2016, the
Guaranteed Plan is 114% funded on an actuarial basis. As of December 31, 2016, the
market value of the assets is approximately $304.4 million; the interim present value of
future obligations is $264.0 million; and the cash value of all remaining credits and units
is $244.3 million, which is 125% funded on a cash basis.
III. Objective of Request for Information (RFI)
OTTA is seeking information (RFI) from firms interested in receiving a potential RFP
from OTTA to provide investment consulting services to support all or a portion of the
CollegeAdvantage plans.
OTTA’s goal is to partner with one or more nationally recognized investment consulting
provider(s) experienced in the 529 industry to provide investment consulting services to
OTTA’s CollegeAdvantage plans.
Current services include:
CollegeAdvantage Direct 529 Savings Plan (Direct Plan):
 Provide, within fifteen business days of month end, a monthly flash report to
OTTA summarizing the performance results through the end of the most recent
month end.
 Provide, within six weeks of the end of the previous quarter, and present a
quarterly review on the performance of the options and portfolios within the Direct
Plan, except the Fifth Third Saving Accounts and Certificates of Deposit, to the
staff and the Board. This performance review would be in accordance with the
Investment Policy. It should include, at a minimum, analysis, evaluation and
commentary of the overall and individual performance of each option and
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portfolio as it relates to the benchmark comparison, Lipper peer comparison and
comparison of performance to other 529 programs in the country.
Assist with the evaluation of the relationship with the managers within the Direct
Plan per the terms of their respective contracts. Conduct manager searches, if
necessary, in time to allow for a smooth transition from existing manager to
another manager(s) or the addition of another manager(s) at the end of the
contract period for each manager.
Assist with review of option platform and strategic product direction as needed or
as requested. OTTA looks to all partners to be innovative with the design of the
Direct Plan. We would expect the consultant to provide insight and analysis into
new strategies and/or investment options that are suitable for college savers in a
college-saving environment. Assist staff with evaluation and implementation of
removing, adding or replacing funds in the Direct Plan.
Review Investment Policy annually. Recommend changes and provide advice
on the implementation of changes as necessary.
Quarterly Rate Analysis-Fifth Third 529 Savings & CD Options: Provide and
present to OTTA’s staff and Board a quarterly analysis of the interest rates
offered within the CollegeAdvantage Direct Plan to 1) Fifth Third standard rates
offered in the Cincinnati region and 2) regional banking rates offered in the
Cincinnati area.
CollegeAdvantage Advisor 529 Savings Plan (Advisor Plan):
 Provide, within six weeks of the end of the previous quarter, and present a
quarterly review on the performance of the options and portfolios within the
Advisor Plan to the staff and Board. This performance review would be in
accordance with the Investment Policy. It should include, at a minimum,
analysis, evaluation and commentary of the overall and individual performance of
the each option and portfolio as it relates to the benchmark comparison, Lipper
peer comparison and comparison of performance to other 529 programs in the
country.
 Assist with the evaluations of the relationship with the Advisor Plan provider per
the terms of the contract. Conduct manager searches, if necessary, in time to
allow for a smooth transition from existing manager to another manager(s) or the
addition of another manager(s) at the end of the contract period for each
manager.
 Assist with review of option platform and strategic product direction as needed or
as requested. OTTA looks to all partners to be innovative with the design of the
Advisor Plan. We would expect the consultant to provide insight and analysis
into new strategies and/or investment options that are suitable for college savers
in a college-saving environment. Assist staff with evaluation and implementation
of removing, adding or replacing funds in the Advisor Plan.
 Review Investment Policy annually. Recommend changes and help implement
changes as necessary.
CollegeAdvantage Guaranteed 529 Savings Plan (Guaranteed Savings Plan)
 Monthly Flash Report: Provide, within fifteen business days of month end, a
monthly flash report to OTTA summarizing the performance of the Guaranteed
Savings Plan results through the end of the most recent month end.
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Quarterly Performance Evaluation-Guaranteed Savings Plan managers: Provide,
within six weeks of the end of the previous quarter, and present a quarterly
performance evaluation on the Guaranteed Savings Plan to OTTA’s staff and
Board. Consultant should independently verify return calculations and market
values for each manager and provide a quarterly report on the organizational
structure, investment process and team and performance of each manager and
how that manager’s performance compares to relative benchmarks and peers.
This performance evaluation will provide the foundation needed to monitor the
performance of the investment managers.
Asset Allocation Review: Review the Asset Allocation of the GSP on an annual
basis or upon request by OTTA. Review the asset allocation mix to be sure
consultant and OTTA are comfortable with the expected return and expected risk
parameters of the GSP.
Manager Searches and Transition Services: Conduct manager searches as
necessary. This could be a result of the quarterly performance evaluations,
changes as a result of the Asset Allocation Review or any other changes. Assist
the OTTA staff in negotiating contract terms and fees for selected manager(s).
Provide assistance with any transition of assets, providing a report measuring the
success of each transition.
Review Investment Policy annually. Recommend changes and assist with
implementation of changes as necessary.
General:
 Provide access to investment firm’s resources and research.
 Be available to answer general and specific investment questions from the
OTTA’s staff and/or Board as they relate to OTTA.
 As part of this consulting assignment, provide education to the OTTA staff and
Board as necessary.
 Be available to attend quarterly Board meetings.
 The investment consulting services do not include legal, tax or accounting
advice.
 OTTA shall have the sole responsibility for determining whether to implement any
recommendations made by investment consulting firm and for implementing such
recommendations, including without limitation, the review and negotiation of any
agreements or other documents required.
IV. State Requirements and/or OTTA preferences
OTTA values the relationships the State of Ohio has created with various firms. We are
interested in partnering with firms that have a major Ohio presence in terms of location,
economic value and employment.
OTTA is subject to Executive Order 2011-12K, which governs the Expenditure of Public
Funds for Offshore Services.
V. Instructions for Responses
Please compete and return the Questionnaire (contained herein as Article VI). Your
responses should be clear and as concise as possible. OTTA will evaluate the
responses received and determine whether to issue a Request for Proposals (RFP).
Any questions concerning the RFI process or timing should be submitted electronically
to Trisha A. Good, CFO/CIO [email protected]. Questions will be
addressed as received and until the RFI responses are due.
All information submitted in response to this RFI become property of the OTTA and is
public information unless a statutory exception exists that exempts it from public release
under the Ohio Public Records Act, as defined in Section 149.43 of the Ohio Revised
Code.
Please return your response electronically by February 13, 2017 to:
Trisha A. Good
CFO/CIO
[email protected]
VI. Questionnaire
The following series of questions have been created in order to assist OTTA with the
next steps of the process, including the decision on whether to issue a subsequent RFP
for these services. Your responses will be used to gauge your interest in continuing
within the search process, and provide insight to OTTA in terms of the types of firms
they may be able to partner with in the future.
As noted previously, responses should be as clear and as concise as possible. If
additional space is required, please attach additional materials, and clearly crossreference which materials address which question.
Company Overview and Experience
1. Company name
2. Contact information (name, email,
phone)
3. Core competencies of company (i.e.,
overview of general services provided)
4. City and State where work would be
completed (if multiple locations, please
specify). What percentage of the work
would be completed in the state of
Ohio?
5. Are you currently doing any business
with the State of Ohio? If so, please
briefly describe the relationship and
services provided.
6. If awarded this work, would any of the
work be performed by off-shore
Response
operations? If so, please describe which
services.
7. Do you have any investment experience
within the 529 industry? If yes, please
describe your experience in supporting
direct, advisor and guaranteed savings
plans.
8. Please describe all of the types of
investment products you currently
provide investment consulting services,
including but not limited to:
 Mutual funds
 Fund of funds (age-based, riskbased)
 Banking products (savings, CDs)
 Guaranteed Savings Plan (aka
Prepaid programs)
9. List the 529 plans currently serviced,
and provide the assets under
management, the number of
participants, and the services provided
for each plan.
10. Based on the objectives that have been
documented within this RFI, do you feel
your firm has the ability to support OTTA
in an investment consulting capacity? If
so, would you like to receive the RFP, if
one is issued?