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HomeMy WebLinkAboutMinutes Police Pension 092216 Minutes 9-22-16.doc Page 1 of 4 City of Palm Beach Gardens Police Officers’ Pension Fund Minutes of the Meeting Held September 22, 2016 The regular meeting of the Board of Trustees of the City of Palm Beach Gardens Police Officers’ Pension Fund was called to order at 9:04 AM by Jay Spencer in the Council Chambers at the Palm Beach Gardens City Hall at 10500 North Military Trail, Palm Beach Gardens, Florida. TRUSTEES PRESENT OTHERS PRESENT Jay Spencer, Chairman Audrey Ross (Resource Centers) Marc Glass, Trustee Bonni Jensen (KKJ&L) Brad Seidensticker, Trustee John McCann (The Bogdahn Group) Greg Mull, Trustee Steve Stack (Highland Capital) Brad Rinsem (Salem Trust Company) Karen Russo (Salem Trust Company) R. Anderson (PBG Police Officer) Randy Buntin (PBG Police Officer/ Union Rep) Greg Allen (PBG Police Officer/Union Rep) TRUSTEE UPDATE Ms. Ross stated that Mr. Manuel had to resign from the pension board due to a new position he has accepted at his work. The City has not appointed a replacement as of yet. PUBLIC COMMENTS Ms. Jensen stated that at the past couple of meetings they have discussed the setup of Share accounts and how it will be funded with the State money. Since no mutual agreement was reached between the City and the Union and written into the CBA, the States default plan will be put into place. The State money will be split 50/50 between the City and the members share accounts. Mr. Spencer stated that he would have liked to see the State money stay status quo in that they use the money to pay for the supplemental benefit that retirees receive to help offset issuance costs when they retire. The State’s default Plan only distributes the State money to active members share accounts and retirees don’t get any of the benefit. Mr. Buntin explained that the City has already made it clear that they are done with the CBA for this contract and that they can discuss it when it reopens. Mr. Spencer stated that he would like to see this one issue be reopened with the City but Ms. Jensen also commented that this is time sensitive because the Actuary will need to know what the outcome is because he needs to incorporate it into his Actuarial Valuation report as of September 30, 2016. The City did not add the State money language into the CBA/Ordinance and the Board wants to have a sit down meeting with the PBA/Union, City, and a pension rep to get this straightened out. The Trustees had a very lengthy discussion on this issue and asked Ms. Jensen to reach out to all the included parties to see what can be done at this point. SALEM TRUST COMPANY Presented by Brad Rinsem & Karen Russo Mr. Rinsem welcomed himself and Ms. Russo back. He explained that he was here today to review some changes that are occurring in regards to the Plan’s sweep money market account. The Plan is currently invested in the Goldman Sachs prime Minutes 9-22-16.doc Page 2 of 4 money market account. The standards for this account will be changing and therefore Salem is recommending some alternative funds to move into. Mr. McCann stated that he has reviewed this change and is recommending a switch from the Goldman Sachs prime money market fund to the Goldman Sachs Financial Governmental Fund. He commented that there is not really a big difference between the funds other than reporting requirements. MOTION: Mr. Seidensticker made a motion to authorize and approve Salem Trust to change the Plan’s sweep vehicle account from the Goldman Sachs prime money market fund to the Goldman Sachs Financial Governmental fund per the recommendation of the Investment Consultant. SECOND: Mr. Mull seconded the motion. CARRIED: The motion carried unanimously 4-0. Ms. Russo passed out an authorized signors list for Salem Trust as well as a list of authorized people allowed to receive statements. She asked the Board to review the documents for any changes. Mr. Rinsem stated that Salem Trust offers a global tax service in where they will claim the foreign tax recovery on behalf of the fund. He explained that Salem would file all the necessary on behalf of the Board to recoup their fees. Salem partnered with a tax firm to be able to offer this service to their clients. Mr. McCann stated that this service would only apply to the Highland Capital account as Rhumbline files their own. The Trustees discussed this service and decided not to move forward with it at this time. INVESTMENT MANAGER REPORT Highland Capital Management – Presented by Steve Stack Mr. Stack reported that for the fiscal year to date the equity fund was up 5.36%. He commented that both the equities and growth had rallied during the previous quarter but when the BREXIT occurred they lost about 100 basis points. Also airlines hurt their performance as well. Mr. Stack stated that he thinks the rates will stay low for the foreseeable future and they recently increased their exposure to the corporate debt which helped them out. In addition they are still seeing the flattening of the yield curve which is beneficial to the portfolio and it should remain like this through the end of the year. The bond market is still a rough place to be, but all together they are comfortable with where they are positioned. INVESTMENT CONSULTANT REPORT The Bogdahn Group – Presented by John McCann (via teleconference) Mr. McCann stated that for the quarter ending June 30, 2016 the total fund net of fess was up 2.03% which put them at $79M in assets. For the fiscal year to date the fund is up 7.43% so they are on the right track for meeting the Plan’s assumed rate of return this year. He briefly reviewed each manager’s performance during the quarter and noted that they all did well. Since the end of the quarter we have closed out the Vanguard account and transferred the funds to the new Rhumbline Equity account. Mr. McCann also reviewed the Dreyfus and Oppenheimber accounts in which both managers have negative yield, although their quarterly returns were good. He does not like that both managers participate in the negative yield and therefore he is recommending transferring these two mutual fund accounts over to Highland Capital’s equity fund. Minutes 9-22-16.doc Page 3 of 4 MOTION: Mr. Seidensticker made a motion to authorize the transfer of the Dreyfus and Oppenheimer accounts to the Highland Capital bond fund as recommended. SECOND: Mr. Mull seconded the motion. CARRIED: The motion carried unanimously 4-0. Mr. McCann commented that he will revise his fee as well since he is no longer managing the mutual fund accounts. ATTORNEY REPORT KKJ&L - Presented by Bonni Jensen Ms. Jensen discussed the rehire after retirement issue which should already be dealt with by the City. If any future issue arises then Mr. Mull or Mr. Glass will notify the Board so it can be properly dealt with. They also discussed the job description of a training coordinator in which Mr. Glass will send to Ms. Jensen to review as they are looking to fill that position with a retiree. ADMINISTRATOR REPORT Resource Centers – Presented by Audrey Ross Ms. Ross presented the Board with the September 30, 2016 audit engagement letter from Cherry Bekaert. She commented that the fee this year increased by $450 to $15,150. Ms. Jensen stated that there is supposed to be additional language added to the audit engagement letter regarding public records request and she will get with the auditor to get that added. MOTION: Mr. Glass made a motion to approve the September 30, 2016 Cherry Bekaert audit engagement letter as amended adding in the public records request language. SECOND: Mr. Mull seconded the motion. CARRIED: The motion carried unanimously 4-0. Ms. Ross presented the Board with the 2016/2017 Administrative Budget. She explained that they have to create a budget for the next fiscal year and submit it to the Plan’s Sponsor as a new State requirement. MOTION: Mr. Mull made a motion to approve the 2016/2017 Administrative budget as presented. SECOND: Mr. Glass seconded the motion. CARRIED: The motion carried unanimously 4-0. Ms. Ross stated that it is time to renew the Plan’s commercial general liability insurance policy. The policy increased by $95 for a total of $1,013. MOTION: Mr. Mull made a motion to approve the 2016/2017 Administrative budget as presented. SECOND: Mr. Glass seconded the motion. CARRIED: The motion carried unanimously 4-0. Minutes 9-22-16.doc Page 4 of 4 MINUTES MOTION: Mr. Glass made a motion to approve the minutes from the June 1, 2016 regular meeting. SECOND: Mr. Mull seconded the motion. CARRIED: The motion carried unanimously 4-0. DISBURSEMENTS APPROVALS MOTION: Mr. Glass made a motion to approve the disbursements. SECOND: Mr. Mull seconded the motion. CARRIED: The motion carried unanimously 4-0. BENEFIT APPROVALS MOTION: Mr. Mull made a motion to approve the applications to enter the DROP for Timothy Connors, Richard Moretti, and Kevin Folmar, the applications to exit the DROP for Andrew Spragg, Robert Odell, and Gary Carmack, the applications for distribution from DROP accounts due to retirement for Andrew Spragg and Robert Odell, the applications for distributions from DROP accounts (6/15/2016) for Gwen Fleming, the applications for distributions from DROP accounts (7/15/2016) for William Brandt and Joseph Sheehan, and the applications for distributions from DROP accounts (8/15/2016) for Sheree Brown, Gwen Fleming, and Jay Spencer, and the application for a refund of contributions for Abel Alves SECOND: Mr. Glass seconded the motion. CARRIED: The motion carried unanimously 4-0. FINANCIAL STATEMENTS The board reviewed and discussed the financial statements that were provided through May 2016. The board received and filed the financial statements through May 2016. OTHER BUSINESS Ms. Ross presented the Board with the September 30, 2015 Chapter 112.664, F.S. Compliance Report that was prepared by the Plan’s Actuary. This report is for information purposes as required by the State. Mr. Spencer stated that he would really encourage the other Trustees to attend the Division of Retirement School in November if it fits into their schedules. He would also like the Trustees and Ms. Jensen to attend the lead matrix conference at WestPoint next year as it is very beneficial. Mr. Seidensticker stated that he had a question in regards to the recent unfortunate events of police officers passing away. He wanted to know what type of death benefit is available to a police officer’s family if they are killed while actively employed. Ms. Jensen explained that if the police officer was not vested then a refund of contributions would be issued (for either a non-duty or duty death). The Plan does have a death benefit (accrued benefit) for vested members that is payable Minutes 9-22-16.doc Page 5 of 4 to the members spouse or children upon the members death. The Trustees stated that they would like to discuss this issue at a future meeting as well. PUBLIC COMMENTS N/A AJOURN There being no further business, the Trustees officially adjourned the meeting at 12:46PM. The next meeting is scheduled for Thursday December 1, 2016 at 9AM. Respectfully submitted, _____________________________ Brad Seidensticker, Secretary