Investment Consulting Services

Monica I. Mezzapelle STATE TREASURER THE STATE OF NEW HAMPSHIRE State Treasury 25 CAPITOL STREET, ROOM 121 CONCORD, NH 03301 (603) 271-2621 FAX (603) 271-3922 TDD Access: Relay NH 1-800-735-2964 REQUEST FOR PROPOSAL TO PROVIDE INVESTMENT CONSULTING SERVICES TO THE STATE OF NEW HAMPSHIRE OFFICE OF THE STATE TREASURER RFP TREAS 2022-1 Issued: March 29, 2022 Submission Deadline: April 27, 2022 4:00 p.m. ET Page 2 of 14 Section 1 – Overview and Schedule A. Executive Summary The purpose of this Request for Proposal (RFP) is to enter into a contract with a qualified firm (the “Firm”) for Investment Consulting Services for the State of New Hampshire Treasury (the “State Treasury”) as indicated in the Scope of Services section and in accordance with requirements of this RFP. The State Treasury expects that a contract will be effective on or around June 1, 2022 or upon the approval of the Governor and Executive Council (if applicable). The term of the contract is expected to be three years

with a three-year renewal option at the sole discretion of the State Treasurer. Like many state governments, the COVID-19 Pandemic had a tremendous impact on the cash management and banking needs of the State Treasury. Fiscal year 2020 included an unprecedented increase of $1.25 billion in federal Coronavirus Aid, Relief, and Economic Security Act (“CARES”) funds to the state of New Hampshire from the U.S. Treasury to assist the State in its efforts to combat the COVID-19 pandemic as well as to provide economic relief to small businesses, non-profits, municipalities, and other entities that had emergency expenses or that suffered revenue losses as a result of the pandemic. Additional receipts in fiscal year 2021 include $497 million in additional federal aid the State received from the State and Local Fiscal Recovery Fund authorized through the American Rescue Plan Act of 2021 (“ARP”). In addition to other federal grants available to the state of New Hampshire through the CARES Act, Coronavirus Response and Relief Supplemental Appropriations Act of 2020 (“CRRSA”), and the ARP Act, in fiscal year 2021, the State Treasury received $225 million for the Emergency Rental Assistance Program, $179 million from the CRRSA Act and $46 million authorized through the ARP Act. The State’s most recently audited financial statements are available at the following web address: https://das.nh.gov/accounting/FY%2021/FY_2021_Annual_Comprehensive_Financial_Report.p df B. Schedule The following table provides a Schedule of Events for this RFP through contract finalization and approval. The State Treasury reserves the right to amend this Schedule at its sole discretion and at any time through a published Addendum. EVENT DATE LOCAL TIME RFP Release 03/29/2022 Questions due from Firms 04/05/2022 4:00 PM Responses due back to Firms 04/08/2022 4:00 PM Presentations (if requested) 04/21/2022 or 04/22/2022 Proposals Due 04/27/2022 4:00 PM Firm Selection 05/04/2022 Contract Complete 06/01/2022 https://das.nh.gov/accounting/FY%2021/FY_2021_Annual_Comprehensive_Financial_Report.pdf https://das.nh.gov/accounting/FY%2021/FY_2021_Annual_Comprehensive_Financial_Report.pdf Page 3 of 14 Section 2 - Description of Agency/Program Issuing the Request for Proposals The State Treasury is entrusted with the fiduciary responsibility of managing State funds to ensure cash is available when required to ensure the efficient financial operation of the State while employing prudent and statutorily compliant investment policies and procedures. The State Treasury has in place investment policies and procedures for the safekeeping and prudent management of various State assets. General operating funds of the State are invested primarily to preserve the value and safety of the principal, maintain liquidity appropriate for short-term cash needs, and optimize the return on these investments consistent with the goals of safety and liquidity and in accordance with state and federal law. Investment decisions are made within the context of several risk categories, including custodial risk, concentration risk, and interest rate risk. In fiscal year 2021, the State Treasury administered over $8.7 billion in receipts and $8.2 billion in disbursements. Additional information is available on the State Treasury website and specifically: https://www.nh.gov/treasury/documents/annual-report-2021.pdf https://www.nh.gov/treasury/cash-investment-management/index.htm As of June 30, 2021, the State Treasury had a total of $2.8 billion under management consisting of 54 operating accounts totaling $1.3 billion and 117 accounts totaling $1.5 billion representing a variety of other funds. The State Treasury is a public agency and its records, including all responses to this RFP, will be deemed a public record and subject to public disclosure under the State’s Right-to-Know laws, pursuant to New Hampshire Statute RSA 91-A, after actual award of the contract. Information in the proposals considered by the Firm to be confidential and proprietary should be clearly identified and easily separable. Any requested public disclosure restrictions should be clearly explained. Section 3 –Scope of Services State Treasury intends to hire a qualified investment consulting firm to provide the following services. All Firms must be able to provide all the services listed below for the entire term of the contract. Review of Cash and Investment Operations 1. Review current cash management and investment practices for operating (pooled cash) and other funds and make best practice recommendations to achieve the objectives described in the respective investment policies and guidelines. 2. Assist in the development of a prudent and efficient investment strategy for the State’s pooled cash including, but not limited to, cash-flow analysis and forecasting tools. 3. Recommend trades and exchanges needed to achieve current and prospective investment strategies, including changes in investment instruments and classes. 4. Review current banking services, costs, and arrangements and make best practice recommendations to improve cash management practices. https://www.nh.gov/treasury/documents/annual-report-2021.pdf https://www.nh.gov/treasury/cash-investment-management/index.htm Page 4 of 14 5. Provide periodic reviews and best practice recommendations relative to aspects of cash and investment operations. 6. Review and make best recommendations to investment policies, guidelines, and procedures initially, on an annual basis, and when conditions change. 7. Monitor compliance with investment policies and guidelines and report on a quarterly basis. 8. Recommend what investments should be managed by State Treasury personnel and advise on the design and monitoring of internal investment operations. 9. Advise on risk management issues impacting cash and investments. 10. Review current earnings distribution methodology and make best practice recommendations, as needed. 11. Advise and assist in the development of daily, monthly, quarterly, annual, and other required reporting on all cash and investments held by State Treasury. 12. Advise, monitor, and evaluate the selection and use of appropriate investment instruments and financial institutions and recommend changes, as needed. 13. Advise on new developments in financial instruments and/or investment products and assist in the implementation of those instruments/products, as needed. 14. Monitor the financial strength of financial institutions used by the State Treasury. 15. Evaluate and monitor the forms and sufficiency of collateral used to assure the safety of deposits and all financial instruments. 16. Review financial terms of current, and proposed investment agreements including, but not limited to, collateral and repurchase agreements. 17. Analyze and benchmark investment management expenses of investment funds and firms. 18. Evaluate costs associated with asset management and investment including, but not limited to, custody, transaction fees, brokerage fees, commissions, and any other costs. 19. Pre-screen and monitor broker-dealer relationships and maintain an approved list as requested. 20. Advise on changing market conditions and regulations, and recommend changes to investment strategies accordingly. 21. Provide research on special investment topics, as requested. 22. Attend Legislative committee meetings, as requested. 23. Provide guidance on proposed legislation, as requested. 24. Lead conference calls to review strategy and operations with State Treasury personnel on a monthly basis. 25. Participate in quarterly meetings with State Treasury personnel to review quarter-end and year-end performance, as well as best practice recommendations. Reporting 1. Prepare monthly performance analysis of State Treasury cash and investments, including total return calculation and benchmarking. 2. Provide an investment report of historical monthly balances based on amortized cost for earnings distribution. 3. Provide quarterly, and as needed, asset allocation reviews and recommendations. Page 5 of 14 4. Prepare annual Government Accounting Standards Board compliant investment statements on an amortized cost and fair market value basis for pooled cash and other funds. 5. Maintain an efficient and secure data processing interface with the State Treasury’s financial partners, at the Firm’s expense, for the purposes of compiling all required performance reviews and reports. Section 4 – Process for Submitting a Proposal A. Proposal Submission, Deadline, and Location Instructions Proposals must be received by the State Treasury no later than the date and time specified in the Schedule section, herein. Submissions must include one (1) original and two (2) copies. Proposals must be submitted by U.S. Mail, Delivery Service, or in-Person. The State Treasury accepts no responsibility for mislabeled mail or mail that is not delivered or undeliverable for whatever reason. Any damage that may occur due to shipping shall be the Firm’s responsibility. Proposals must be addressed to: Richard M. Bowen Assistant State Treasurer State of New Hampshire Treasury 25 Capitol Street, Room 121 Concord, NH 03301 Unless waived as a non-material deviation in accordance with Section 6B, late submissions will not be accepted and will be returned to the Firm unopened. Delivery of the Proposals shall be at the Firm’s expense. The time of receipt shall be considered when a Proposal has been officially documented by the State Treasury, in accordance with its established policies, as having been received at the location designated above. The State Treasury accepts no responsibility for mislabeled mail or mail that is not delivered or undeliverable for whatever reason. Any damage that may occur due to shipping shall be the Firm’s responsibility. B. Proposal Inquiries All inquiries related to this RFP must be must be submitted via e-mail to the following RFP designated Point of Contact: TO: Richard Bowen, Assistant State Treasurer: Richard.Bowen@treasury.nh.gov CC: Rachel Miller, Chief Deputy Treasurer: Rachel.Miller@treasury.nh.gov Inquiries must be received by the State Treasury’s Point of Contact on or before the date and time specified in the Schedule section, herein. The State Treasury will post all inquiries and responses as an Addendum to this RFP on the Administrative Services Bureau of Purchase and Property website on or before the date and time specified in the Schedule section, herein. No communication with any other State employee is allowed to take place regarding this RFP during the RFP process. mailto:Richard.Bowen@treasury.nh.gov mailto:Rachel.Miller@treasury.nh.g Page 6 of 14 C. Restriction of Contact with Agency Employees From the date of release of this RFP until an award is made and announced regarding the selection of a Firm, all communication with personnel employed by or under contract with the State Treasury regarding this RFP is forbidden unless first approved by the RFP Point of Contact listed in the Proposal Inquiries section, herein. State Treasury employees have been directed not to hold conferences and/or discussions concerning this RFP with any potential contractor during the selection process, unless otherwise authorized by the RFP Point of Contact. Firms may be disqualified for violating this restriction on communications. D. Validity of Proposal Proposals must be valid for one hundred and weighty (180) days following the deadline for submission as listed in the Schedule herein or until the effective date of any resulting contract, whichever is later. Section 5 - Content Requirements for a Proposal Proposals shall follow the below format and provide the required information set forth below: Overview: 1. Organization of the Proposal - Proposals shall be organized in the order in which the requirements are presented in the Scope of Services section herein. All pages of the proposal shall be numbered. 2. All information requested should be submitted in a single package. Failure to submit all information requested may result in the State requiring prompt submission of missing information and/or lowering the evaluation of the proposal. Proposals that are substantially incomplete or lack key information may be rejected by the State Treasury, at its sole discretion. 3. Clarity of Proposal – Narratives in the proposal should be prepared in clear language and provide a straightforward, concise description of capabilities to satisfy the requirements of the RFP. Narrative responses to each numbered service listed under the Scope of Services section herein must begin with a restatement of the service followed by a description of the Firm’s ability to provide the services required by the State. In the event that the Firm has no previous experience with, or is unable to satisfy one or more of, the following requirements, that fact should be clearly stated. Information Requirements: - Firms are required to submit the following information in the order presented below: