Girard Miller, CIO, OCERS (Art by Tim Bower)Five months after issuing “the
RFP from hell”, Orange County’s pension system has chosen Meketa Investment
Group as its general consultant to replace NEPC, CIO has learned.
Meketa will begin its five-year relationship with the $12 billion plan pending final contract negotiations. Orange County Employees Retirement System (OCERS) also tapped Pension Consulting Alliance as a backup finalist.
NEPC has served as OCERS’ general consultant since 2011 and will finish up its obligations through 2016, the board said.
In a memo obtained by CIO, investment chief Girard Miller praised Meketa’s “broad organizational depth in a conventional consultant business model, with a larger overall staff, more research personnel, and capacity to assist the staff with bullpen managers.”
Miller also emphasized Meketa’s local presence in San Diego County with more than 30 professionals able to serve OCERS.
The consulting firm was able to withstand OCERS’ demanding 56-page request for proposal, Miller continued, offering “very strong strategic and analytical commentary and suggestions in their written RFP model.”
In its pitch to OCERS’ board, Meketa presented a number of strategies that could save $8 million in fees per year and increase expected gains by $12 million per year.
The firm recommended OCERS reducing allocations to unconstrained fixed income and tactical asset allocation products and increasing private equity exposures over a five-year period.
Miller reinvented OCERS’ open bid, demanding all-custom and non-boilerplate responses from all applicants.
The grueling RFP asked bidders whether they host or sponsor “pay-to-play” or “clients4free but managers pay” conferences, and requested they name “two distinct aspects of your consulting practice and capabilities of clear and major relevance to OCERS”—and if they can offer a better track record than their peers.
“Self-awareness and candor will be judged more favorably, as nobody’s perfect all-around,” the RFP said.
Meketa’s Co-CEO Steve McCourt will act as OCERS’ primary consultant once the contract is finalized. The firm also quoted $475,000 as its consulting fees for the first year.
Related: The RFP from Hell & 2015 Industry Innovation Awards: Girard Miller