HomeMy WebLinkAboutMinutes Fire Pension 050218PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND
MINUTES OF MEETING HELD
MAY 2, 20x8
A meeting of the Board of Trustees was called to order at 1:06PM in the Council
Chambers, Palm Beach Gardens, Florida. Those persons present were:
TRUSTEES
Ed Morejon, Chairman
Jon Currier, Secretary
Marty Cohen
Tom Murphy
PUBLIC COMMENTS
NIA
OTHERS
Audrey Ross, Administrator
John Thinnes, Investment Consultant
Pedro Herrera, Attorney
Eric Leventhal & Liedhe Carpio Auditors
Doug Lozen, Actuary
Sean O'Brien, City of PBG Finance Department
MINUTES
The Board reviewed the minutes of the regular meeting held on February 7, 2018.
A motion was made by Marty Cohen to approve the minutes of the February 7, 2018
re alar meetinjz as amended. The motion was seconded by Jon Currier and carried
4-0.
9/30/2017 AUDITED FINANCIAL STATEMENTS: KSDT ERIC LEVENTHAL &
LIEDHE CARPIOI
Mr. Leventhal reported that an unmodified clean opinion was issued in regards to the
September 30, 2017 audited financial statements. As of September 30, 2017 the Plan had
$94,459,444 in assets compared to the beginning of the fiscal year at $81,344,787, which
was a net gain of $13,114,657. He reviewed the breakdown of admin expenses and stated
that the administrative fees increased this year due to prior fees being charged in this
fiscal year for prior fiscal years as well as their firm taping over the DROP and Share
accounting as well. The Trustees briefly discussed the policies and procedures that are in
place to make sure the billing does not fall behind again. Mr. Morejon discussed the
funding footnote regarding the Share accounts. He stated that the 2% of salary is
reflected correctly, but there is a cap of 4.8% that should be added into this language as
well. Mr. Leventhal stated that he will revise that section to add the cap. He noted this
change will not impact the financial statements. In addition, the investment footnote
language needs to be revised to reflect a 5% allocation (from 3%) to the Templeton fund.
Mr. Leventhal again noted that this change will not have any impact on the financial
statements.. Mr. Cohen discussed the footnote regarding the DROP and Share assets. He
explained that these assets are included in the Plan's total assets, but his argument for the
past couple of years is that the DROP and Share assets should not be included in the
Plan's assets because those monies belong to and are reserved for individual members.
The Trustees had a lengthy discussion on this because the argument is that the DROP and
Share monies are considered Plan assets until they are withdrawn. Mr. Leventhal
explained that for auditing and financial statement purposes, he is following the GASB
rules and regulation and this is how they like it reported. Last year Mr. Leventhal
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provided a side letter along with the financial statements explaining Mr. Cohen's
concern regarding the DROP and Share assets. He can provide such letter again this year
per the Board's request if that will satisfy Mr. Cohen's concern. Mr. Cohen concurred.
A motion was made by Tom Murphy to approve the September 30, 2017 audited
financial statements with the two non -material chan1jes as discussed. The motion
was seconded by Jon Currier and carried 4-0.
A motion was made by Tom Murphy to direct KSTD to draft the same side letter as
last year retarding the DROP and Share assets per Mr. Cohen's recommendation.
The motion was seconded by Jon Currier and carried 4-0.
A motion was made by Tom Murphy to avorove the September 30 2017 audit
representation letter as presented. The motion was seconded by ,Ion Currier and
carried 4-0.
9/30/2017 ACTUARIAL VALUATION REPORT: FOSTER & FOSTER(DOUG
LOZEN
Mr. Lozen presented the September 30, 2017 actuarial valuation report and stated that the
City had a slight shortfall this year of $26K. This is for informational purposes only for
the Board as the City will need to make the contribution as soon as possible and prior to
the Annual report being approved. Mr. O'Brien stated that the City will mare that
contribution right away. The City mares their contribution based off the percentage of
payroll at the beginning of the year so Mr. Lozen stated that he will help the City come
up with a more accurate dollar amount next year so that a shortfall does not occur again,
or at least a smaller amount. For the fiscal year ending September 30, 2019 the City is
required to contribute 57.26% of payroll versus 52.24% last year. Mr. Lozen reviewed
some of the Plan's changes such as the assumed rate of return decreased this year from
7.45% to 7.25% and the mortality table changed, which lead to an increase in payroll this
year. The Board had a lengthy discussion on the State money, which seems to be
decreasing each year. The Plan's funded ratio remains steady at 79.4% and Mr. Lozen
stated that he thinks maybe next year the Board should consider doing an another
assumption study.
A motion was made by Marty Cohen to approve the September 30, 2017 Actuarial
Valuation Report as present2d. The motion was seconded by Jon Currier and
carried 4-0.
INVESTMENT MONITOR REPORT: ANDCO CONSULTING JOHN
THINNEST
Mr. Thinnes briefly reviewed the S&P500 chart, which reflects historical and recent
market pullbacks.
Mr. Thinnes reviewed the May 31, 2018 ICMA DROP review. He noted that all the
investments are doing well and he does not have any recommendations at this time. He
reminded the Board that initially they were provided with a very large list of investments
to choose from and they narrowed it down to the investments on the 457 list, but they can
always go outside that list as well. Mr. Thinnes stated that he will bring back more
information to the next meeting regarding the ICMA list after he speaks with their rep.
Mr. Thinnes reviewed the April 30, 2018 flash performance report. For the quarter to
date they were slightly negative at -0.1 %, but for the fiscal year they are still up 3.9%.
He explained that there was a recent market pullback, but all managers are doing well
despite that.
Mr. Thinnes briefly reviewed the March 31, 2018 quarterly report. International,
equities, and fixed income all ended the quarter negative. The Plan's assets fell slightly -
under $1 OOM, but the Plan is still very strong and doing well despite the volatile market
place recently. He reviewed the Plan's asset allocations and noted that they are still
within their allowable ranges so he does not have any recommendations at this time for
rebalancing. For the quarter the Plan was slightly down at -0.19% but for the fiscal'year
they remain positive at 3.93%. He briefly reviewed each manager's performance and
noted that all the domestic and international equity managers outperformed their relative
indexes with the exception of RBC. Mr. Thinnes explained that they are still keeping
their eye on the Templeton Global Bond fund, but it is not on his firm's watch list either.
Overall the fund is doing very well and Mr. Thinnes stated that he will be bringing back
more information to a future meeting regarding increasing the international allocation.
ATTORNEY REPORT: SUGERMAN & SUSSKIND PEDRO HERRERA
Mr. Herrera stated that he started drafting the Share account policy per the Board's
request but he had some questions regarding some of the exact rules and regulations they
wanted in there. The Board had a very lengthy discussion on the Share accourits, how
they are calculated, how often, etc. The Board directed PRC to switch back to quarterly
statements effective October 1, 2018. Mr. Herrera confirmed that this does not require an
Ordinance change.
Mr. Herrera stated that the Legislative session has ended and there were no Bills that
passed that directly affected Defined Benefit Pians. There was a Bill that passed relating
to worker's comp and adding in PTSD.
ADMINISTRATIVE REPORT: RESOURCE CENTERS AUDREY ROSS
DISBURSEMENTS
The Board reviewed the disbursements presented for approval by the Administrator. Ms.
Ross stated that there is an error as a Police invoice was added to this warrant by mistake
and will be removed.
A motion was made by Tom Murphy to approve the disbursements as revised. The
motion was seconded by, Jon Currier and carried 4-0.
FINANCIAL STATEMENTS
The Trustees reviewed the interim financial statement as of March 2018.
The financial statements were received and filed as of March 2018.
Ms. Ross presented the Board with the service provider review list and noted that per the
Plan's direction, the Auditors information is provided today. The Trustees had a
discussion on Fosters & Fosters' s services as well as their fees.
A motion was made by Marty Cohen to retain Foster & Foster as the Actuary. The
motion was seconded by Tom Murphy and carried 4-0.
The Board reviewed the Auditor's contract as well and noted that the audit process this
year was delayed and as their diligence the Board should review options.
A motion was made by Jon Currier to issue an RFP for auditing services. The
motion was seconded by Tom Murphy and carried 4-0.
Ms. Ross stated in between meetings the Plan's Fiduciary Liability insurance was
renewed and therefore needs to be ratified by the Board today. She explained that she
worked with Mr. Morejon in between meetings to renew the coverage as the premium
actually decreased this year by $2,834 for a new premium amount of $9,446 for the same
coverage.
A motion was made by Tom Murphy to ratify the 2018/2019 Fiduciary Liabilitv
Insurance renewal. The motion was seconded by Jon Currier and carried 4-0.
The Trustees tabled the Summary Plan Description until the next meeting.
OLD BUSINESS
Mr. Herrera stated that they are still waiting on the claims to be filed in regards to the
Bancorp South case.
Mr. Cohen discussed adding in an alternative investment option to the Share accounts,
similar to the DROP account options. Currently the way the Plan is written, to add in
another Share account investment option it would require an Ordinance change and it
may also be a CBA issue. INfr. Currier stated that he will bring this up with the Union.
NEW BUSINESS
The Board briefly discussed increasing the COLA benefit. This benefit would need to be
negotiated and would require a cost study as well.
There being no further business, the meeting adjourned at 4:48PM
Respectfully submitted,
on �Cr,4 etar