Bill No.                2-12                          

Concerning:  Personnel – Retirement Trust Funds – Emerging Investment Managers      

Revised: December 22, 2011 Draft No.1

Introduced:      January 17, 2012            

Enacted:         March 6, 2012                

Executive:       March 16, 2012              

Effective:        June 15, 2012                

Sunset Date:   None                             

Ch.   3      , Laws of Mont. Co.    2012    

 

County Council

For Montgomery County, Maryland

 

By: Council President at the request of the County Executive

 

AN ACT to:

(1)        require the Board of Investment Trustees and the Consolidated Retiree Health Benefits Trust Board of Trustees to make a good faith effort to hire qualified emerging investment managers; and

(2)        generally amend the laws governing the Employees’ Retirement System and the Consolidated Retiree Health Benefits Trust Fund.

 

By adding

Montgomery County Code

Chapter 33, Personnel and Human Resources

Sections 33-60B and 33-162A

 

 

Boldface                                             Heading or defined term.

Underlining                                          Added to existing law by original bill.

[Single boldface brackets]                  Deleted from existing law by original bill.

Double underlining                              Added by amendment.

[[Double boldface brackets]]              Deleted from existing law or the bill by amendment.

*   *   *                                                  Existing law unaffected by bill.
 
 

 

 

 

 

 

 

 


The County Council for Montgomery County, Maryland approves the following Act:



          Sec. 1.  Sections 33-60B and 33-162A are added as follows:

33-60B.      Emerging Investment Managers.

(a)     Legislative findings.

(1)     Emerging investment managers, including businesses owned by women, minorities and disabled individuals, should receive an equal opportunity to provide investment management services to the Board of Investment Trustees.

(2)     The Board of Investment Trustees has adopted a policy requiring its staff to identify qualified emerging investment managers to participate in an investment manager search, including regular monitoring of investment managers.

(3)     Expanding opportunities for emerging investment managers will increase competition.

(b)     Definitions.

As used in this Section:

          Assets means total client assets managed by an investment manager.

          Emerging investment manager means:

(1)     an investment manager with assets or product assets below the 75th percentile of their respective peer group; or

(2)     a new or developing investment manager.

          New or developing investment manager means an investment manager:

(1)     raising its first or second private institutional investment fund; or

(2)     creating its first institutional product.

Product Assets means client assets managed by an investment manager in a single strategy.

(c)      Consistent with the fiduciary duties established in Section 33-61C, the Board must make a good faith effort to remove any barriers that limit participation by qualified emerging investment managers to manage funds for the Employees’ Retirement System.

(d)     The Board must adopt guidelines to identify and evaluate qualified emerging investment managers.  The guidelines must include procedures for:

(1)     identifying possible firms;

(2)     reviewing, evaluating and interviewing emerging investment managers on an ongoing basis; and

(3)     maintaining research files on emerging investment managers.

(e)      The Board must report annually to the Council and the Executive on compliance with this Section on or before September 1 for the prior fiscal year.  The report must:

(1)     identify each emerging investment manager used during the fiscal year;

(2)     list the percentage and dollar value of the assets of the trust fund, by investment sector, managed by each emerging investment manager; and

(3)     describe the good faith effort made to include qualified emerging investment managers in the procurement process during the fiscal year.

33-162A.    Emerging Investment Managers.

(a)     Legislative findings.

(1)     Emerging investment managers, including businesses owned by women, minorities and disabled individuals, should receive an equal opportunity to provide investment management services to the Consolidated Retiree Health Benefits Trust Board.

(2)     The Board has adopted a policy requiring its staff to identify qualified emerging investment managers to participate in an investment manager search, including regular monitoring of investment managers.

(3)     Expanding opportunities for emerging investment managers will increase competition.

(b)     Definitions.

As used in this Section:

          Assets means total client assets managed by an investment manager.

          Emerging investment manager means:

(1)     an investment manager with assets or product assets below the 75th percentile of their respective peer group; or

(2)     a new or developing investment manager.

          New or developing investment manager means an investment manager:

(1)     raising its first or second private institutional investment fund; or

(2)     creating its first institutional product.

Product Assets means client assets managed by an investment manager in a single strategy.

(c)      Consistent with the fiduciary duties established in Section 33-163, the Board must make a good faith effort to remove any barriers that limit participation by qualified emerging investment managers to manage funds for the Consolidated Retiree Health Benefits Trust Fund.

(d)     The Board must adopt guidelines to identify and evaluate qualified emerging investment managers.  The guidelines must include procedures for:

(i)                identifying possible firms;

(ii)             reviewing, evaluating and interviewing emerging investment managers on an ongoing basis; and

(iii)           maintaining research files on emerging investment managers.

(e)      The Board must report annually to the Council and the Executive on compliance with this Section on or before September 1 for the prior fiscal year.  The report must:

(1)     identify each emerging investment manager used during the fiscal year;

(2)     list the percentage and dollar value of the assets of the trust fund, by investment sector, managed by each emerging investment manager; and

(3)     describe the good faith effort made to include qualified emerging investment managers in the procurement process during the fiscal year.

Approved: