Madison Heights — The City Council voted June 23 to approve a resolution to terminate participation in the Municipal Employees Retirement System (MERS) defined-contribution plan and to execute a withdrawal and transfer agreement that will move the city's affected retirement accounts to Mission Square Retirement.

The action followed a statutorily required two-meeting public hearing; the council held the first hearing on June 9 and opened the second on June 23 before approving the resolution by voice vote. No members of the public spoke specifically on the MERS transfer during the hearing.

Council opened the item noting that, "This public hearing is scheduled to receive public comments on the proposed Municipal Employees Retirement System of Michigan defined contribution, withdrawal, and transfer agreement," and that the MERS termination process requires notice at two consecutive regularly scheduled council meetings. City staff recommended council approve the drafted resolution and the withdrawal and transfer agreement.

Dan Stewart, introduced by staff as a representative of Mission Square Retirement, told the council Mission Square is currently the record keeper for the city's 457(b) deferred compensation plan and that the transfer would "bring everything under one roof to have better services for city employees." Stewart said the arrangement — in partnership with the Bryce Group — will offer "an open tech architecture investment lineup, more choices, more options, more oversight, in addition to a reduced cost, and also improved services by having streamlined education." He added Mission Square has been in business since 1973 and has served as the city's record keeper since the early 2000s.

Council members asked for a brief overview before voting. In response to a question about retirees, Stewart said existing retirees and separated employees will have investments "mapped over" to similar funds at Mission Square and will see the reduced fee structure; retirees retain the right to leave the plan and roll their accounts elsewhere if they choose.

After the presentation and a short period for questions, a council member moved to approve the MERS resolution to terminate and to authorize execution of the withdrawal and transfer agreement. The motion was seconded and adopted by voice vote. The council then opened general public comment for other agenda items.

Why it matters: The transfer consolidates the city's retirement account recordkeeping under Mission Square for the 401(a) plan and the 457(b) plan, which city staff and the presenter said should reduce fees, expand investment choices and streamline retirement education for employees. The council did not adopt any amendment or condition to the transfer during the meeting.

Next steps: With the council's approval, staff will execute the withdrawal and transfer agreement with Mission Square per the resolution and follow MERS procedures for plan termination and asset transfer. The council did not set additional conditions or follow-up tasks during the meeting.