- March 10, 2025
Palm Coast City Manager Jim Landon started a discussion with a rhetorical question at Tuesday’s City Council workshop: How many people with a 401(k) or mutual fund know how much in fees is charged by their investment companies?
Not many, he answered. To remedy that, Palm Coast has hired Fiduciary First, a retirement consulting firm, on a one-year contract to assess the efficiency of retirement plan benefits the city provides its employees through the management company Great-West Retirement Services.
Palm Coast does not have a defined benefits package for its employees. Instead, the city pays a percentage of each employee’s salary, to be invested as each employee sees fit in any of the options Great-West offers.
For a flat fee of $22,000, Fiduciary First will assess Palm Coast’s contract with Great-West to be sure that the company is providing competitive options for city employees.
While City Councilman Bill Lewis questioned whether a company that charged such a low annual fee could be viable, Landon said the company’s rates were comparable to other services.
“You have to understand that Great-West is a for-profit company,” Landon said. “Part of our responsibility as a city is to be sure that they’re actually offering strong investment opportunities for our employees.”
As a part of its services, Fiduciary First suggested the city form a retirement plan fiduciary committee composed of the city’s manager, its human resources manager, and its finance director as a resource for employees.
But with the new committee comes a need for Palm Coast to purchase indemnification insurance to protect the three city employees on the committee.
The additional insurance is needed because employees unhappy with their investment yields could sue the individuals on the fiduciary committee rather than the city itself, said City Attorney William Reischmann.
As long as the city is found to be doing its best to protect its employees’ retirement interests, the indemnity insurance would protect individuals from legal action, Reischmann said.
This committee, and the insurance that comes with it, is a standard practice for similar municipalities, Landon said.
The council will vote Tuesday on the issue.
