HomeMy WebLinkAboutMinutes Police Pension 031220Minutes 03/12/2020
Page 1
City of Palm Beach Gardens Police Officers’
Pension Fund
Minutes of the Meeting Held
March 12, 2020
The regular meeting of the Board of Trustees of the City of Palm Beach Gardens
Police Officers’ Pension Fund was called to order at 9:03 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 Scott Baur (Resource Centers)
Brad Seidensticker, Secretary A.C. Lovingood (Resource Centers)
Marc Glass, Trustee (Joined 9:54 AM) Bonni Jensen (KKJ&L)
Greg Mull, Trustee (Joined 9:54 AM) John McCann (AndCo Consulting)
Allan Owens, Trustee Brian Liffick (Cherry Bekaert & Holland)
Jeffrey Amrose (GRS Consulting)
AUDIT PRESENTATION – CHERRY BEKAERT & HOLLAND
Brian Liffick appeared before the Board to present the Audited Financial Statement
for the period ending September 30, 2019. Mr. Liffick started his presentation by
reviewing the required communications section. He noted that there is an
unmodified opinion to be expressed with regards to the financial statements
prepared by management. There were no material weaknesses identified and no
significant deficiencies reported. And finally, there were no reportable
noncompliance issues. Mr. Liffick continued and reviewed the financial highlights,
noting that the State Premium Tax Dollars are not listed due to timing . The Plan is
funded at 85%, which is very healthy. Mr. Liffick explained that the accounting
funded ratio is on a gross basis and slightly higher than the actuarial funded ratio.
• Allan Owens made a motion to approve the Audited Financial Statement for
the Years Ended September 30, 2019. The Motion received a second from
Brad Seidensticker and was approved by the Trustees 3-0.
• Brad Seidensticker made a motion to approve the Cherry Bekaert
Management Representation Letter dated March 12, 2020. The Motion
received a second from Allan Owens and was approved by the Trustees 3-0.
ACTUARIAL VALUATION REPORT – GRS CONSULTING
Jeffrey Amrose appeared before the Board to present the Actuarial Valuation Report
for the period ending September 30, 2019. Mr. Amrose began his presentation by
informing the Board that contributions were up approximately $200,000, mainly due
to increased participation. City and State required contribution of Payroll for Fiscal
Year End 2019 was $3,566,126.00 and 694,576.00 respectively, for a total of
$4,260,702.00. The investment return assumption has been lowered from 6.6% to
6.5%.
• Trustees Greg Mull and Marc Glass joined the Board Meeting at 9:54 AM.
Minutes 03/12/2020
Page 2
This assumption change caused the required City contribution to increase by 1.74%
of covered payroll. There was a net actuarial experience gain of $278,506 for the
year, resulting in a more favorable than expected actuarial experience. This wa s
primarily due to the recognized investment return of 6.6%. The investment return
was 2.1% based on market value of assets and 7.5% based on actuarial value of
assets. This gain was partially offset due to higher than expected salary increases of
9.0% versus the 6.0% expected rate, and the mortality experience of the Plan. The
net actuarial gain decreased the required employer contribution by 0.33 % of cover
payroll. The funded ratio for the Plan was 78.2% versus the prior year’s rate of
77.8%. Mr. Amrose explained how smoothed values work with regards to the
Pension Plan. The new ASOP requirements were reviewed for the Pension Plan when
determining the accrued liability and actuarially determined contribution. Mr.
Amrose then reviewed the Actuarially Determined Employer Contribution and the
Actuarial Value of Benefits and assets with the Board in addition to the cumulative
actuarial gains and losses. He reminded the Board that in 2001 there was a
provision passed to offer the retirees an annual COLA contingent upon the
cumulative actuarial experience being positive. The negative balance has been
decreasing consistently since 2010. If the market continues to grow, this trend will
result in the balance going positive, thus triggering the COLA payments.
• Marc Glass made a motion to approve the 2019 Actuarial Valuation Report as
presented. The Motion received a second from Allan Owens and was approved
by the Trustees 5-0.
• Greg Mull made a motion based on the recommendation of the investment
consultant; to set the expected rate of return to 6.5% as the Board expects to
receive 6.5% for the short-term, mid-term, and long-term thereafter. The
Motion received a second from Brad Seidensticker and was approved by the
Trustees 5-0.
INVESTMENT CONSULTANT REPORT - ANDCO
John McCann presented the Investment Consultant Report for AndCo for the period
ending December 31, 2019. Mr. McCann reviewed AndCo’s M ission Statement and
reviewed AndCo’s company highlights.
For the quarter ending December 31, 2019, the Plan earned a net gain of 5.46%
compared to the benchmark of 5.75%. The one-year trialing returns were 19.89%
compared to the benchmark of 21.36%, the three-year return was 9.86% versus the
benchmark of 10.41%, and the five-year return was 7.95% compared to the 8.34%
benchmark. Since inception, the Plan has had a net investment return of 7.75%.
Mr. McCann then reviewed how each manager in the Plan is doing, noting that
RhumbLine did quite well for the quarter. However, currently the Plan is not doing
well. The Portfolio is down approximately 5%, not including yesterday’s market
closing. Mr. McCann stated that the Plan is focused on the long term and that is
where the Plan should keep its focus in the current environment. Mr. McCann stated
that the infrastructure IPS goes online in July and when those funds are called, he
stated that he would give the Board a market update. Mr. McCann suggested that
the money to fund new managers should come from Highland Capital Short Term
due to the current volatility in the markets.
• Brad Seidensticker made a motion to authorize John McCann to transfer funds
under his discretion to choose where funds are drawn to fund the new
Infrastructure and Real Estate Investment Accounts when the Capital Calls
Minutes 03/12/2020
Page 3
are made. The Motion received a second from Allan Owens and was approved
by the Trustees 3-0.
Mr. McCann then reviewed the revised Investment Policy Statement with the Board,
noting the changes of decreasing the S&P down to 17.5%, increasing Real Estate to
12.5%, the reduction of Fixed Income down to 22.5%, and adding the S&P Global
allocation of 7.5%.
• Brad Seidensticker made a motion to accept the revised Investment Policy
Statement as presented. The Motion received a second from Allan Owens and
was approved by the Trustees 3-0.
ATTORNEY REPORT
JENSEN MEMO – HB 1113-SB 1270 FIDUCIARY DUTY FOR LOCAL OFFICERS:
Attorney Bonni Jensen informed the Board that the Florida Legislative House and
Senate are considering a bill that adds a new section to Chapter 112 of the Florida
Statutes, which would establish a fiduciary standard for appointed public officials and
executive officers acting on behalf of a government entity. Ms. Jensen explained, if
this bill is passed, Trustees would need to complete five hours of Board governanc e
training for each term served.
JENSEN MEMO – IRS MILEAGE RATE FOR 2020: Mrs. Jensen informed the Board that
the IRS has lowered the Mileage Rate for 2020 from $0.58 a mile, down to $0.575
per mile.
JENSEN MEMO – NOTARY LAW CHANGES: Mrs. Jensen informed the Board that
effective January 1, 2020, Florida’s Notary Public Law, Chapter 117, was changed by
Bouse Bill 409. This change now permits a Florida Notary Public to perform remote,
online notarizations. Mrs. Jensen went into detail on how a notary wou ld perform a
remote, online notarization and stated that the Pension Plan’s Forms and Applications
that require a notarization will need to be updat ed.
JENSEN MEMO – SECURE ACT AND IRE LIMITS FOR 2020: Mrs. Jensen reviewed the
SECURE Act that was recently signed into law on December 20, 2019. The new law
is primarily intended to expand opportunities to increase individual retirement
savings; however, the interest to governmental retirement systems is the SECURE
Act’s new age start date for required minimum distributions. The age which a
member must start to take a minimum distribution has changed from 70.5 to 72
years old. The old age limit still applies to anyone who ahs reached 70.5 before
January 1, 2020.
PLAN DOCUMENT: Mrs. Jensen reviewed the changes made to the Plan Document.
There was a discussion regarding rehiring after retirement and the concerns on how
that would affect the Plan. The discussion resulted in the Board tabling the Plan
Document revisions.
EXPENSE POLICY: Mrs. Jensen presented the Board with the updated Expense Policy
for the Board and reviewed the changes that were made.
• Marc Glass made a motion to approve the Expense Policy as presented. The
Motion received a second from Allan Owens and was approved by the
Trustees 5-0.
Minutes 03/12/2020
Page 4
ANNUAL CLIENT CONFERENCE 2020: Mrs. Jensen informed the Board that her firm,
Klausner, Kaufman, Jensen & Levinson will have their Annual Client Conference at
the W Hotel in Fort Lauderdale Florida on May 27th through May 29th of this year.
ADMINISTRATOR REPORT
RESOURCE CENTERS – PANDEMIC PLANNING: Scott Baur reviewed The Resource
Centers Pandemic Planning Memo with the Board. Mr. Baur stated that in the event
of quarantine, The Resource Centers can operate remotely and is prepared if such an
order is set into place.
MEMBER LETTERS: Mr. Baur informed the Board that The Resource Centers will be
sending out letters to retired members to verify that they are still living. Currently
the Resource Centers utilizes a company that searches out death notificat ions of
members, however over the years the available information to verify if a member is
still living has decreased and Mr. Baur informed the Board that there is a 1% chance
that the Pension Plan is pay benefits to deceased members. The process to verify
that members are still alive was reviewed with the Board and it was noted that the
Resource Centers expects some retirees to ignore the letters. The estimated cost
per member to process this verification is approximately $3 .
2020 CONFERENCE LIST: Mr. Baur presented the Board with the 2020 Conference
List that The Resource Centers has created. Mr. Baur noted that not all conferences
are listed and that some of the conferences are more focused on Police and Fire
Pension Plans, while other conferences are more focused on General Employee
Pension Plans.
MINUTES
The December 11, 2019 minutes were presented in the Trustee packets for review
and were tabled till the next Board Meeting.
• Marc Glass made a motion to approve the December 11, 2019 minutes as
amended. The Motion received a second from Brad Seidensticker and was
approved by the Trustees 5-0.
DISBURSEMENTS
The Disbursements through December 11, 2019 were presented in the Trustee
packets for review.
• Marc Glass made a motion to approve the Disbursements as amended. The
Motion received a second from Brad Seidensticker and was approved by the
Trustees 5-0.
FINANCIAL STATEMENTS
The interim financial statements through November 2019 were provided for
informational purposes.
BENEFIT APPROVALS
The Benefit Approvals for March 12, 2020 were presented in the Trustee packets for
review. Marc Glass informed the Board that he cannot vote on his wife, Tiffany Glass
Minutes 03/12/2020
Page 5
Benefit Approval. Jay Spencer requested that the benefit for Tiffany Glass be voted
on separately. Attorney Bonni Jensen informed Marc Glass that he will need to fill
out a Form 8B.
• Greg Mull made a motion to approve the Benefit Approvals as presented for
March 12, 2020. The Motion received a second from Allan Owens and was
approved by the Trustees 5-0.
• Greg Mull made a motion to approve the Benefit Approval for Tiffany Glass.
The Motion received a second from Allan Owens and was approved by the
Trustees 4-0.
OTHER BUSINESS
Jay Spencer inquired if the Board is interested in joining NCPERS. Mr. Spencer noted
that the NCPERS Conferences contain much more detail that he believes would be
beneficial for all the Trustees on the Board. Attorney Bonni Jensen disclosed that
NCPERS is a client of her firm. There was a detailed discussion regarding the
NCPERS membership cost, available conferences, and each Trustee’s thoughts on the
membership.
• Greg Mull made a motion for the Board to join NCP ERS. The Motion received
a second from Marc Glass and was approved by the Trustees 5-0.
PUBLIC COMMENTS
There were no public comments at this time.
ADJOURN
There being no further business, the Trustees officially adjourned the meeting at
1:55PM. The next meeting is scheduled for Thursday, March 12, 2020 at 9:00 AM.
Respectfully submitted,
_____________________________
Brad Seidensticker, Secretary
DATE:
TO:
PALM BEACH GARDENS
'~ unique place to live, /,earn, work & play"
City of Palm Beach Gardens
Office of the City Clerk
10500 North Military Trail
Palm Beach Gardens, FL 33410
(561) 799-4122 psnider@pbgfl.com
Letter of Transmittal
July 22, 2020
Palm Beach County
Commission on Ethics
2633 Vista Parkway
West Palm Beach, FL 33411
Sent via email: ethics@palmbeachcountyethics.com
Re: From SB -City of Palm Beach Gardens Police Pension Board
~Your Records □ For Recording
□ As Requested □ Returned for Corrections
□ For Review and Signature □ Other: -------
Signed ~
PafriciaSnider,CMCty Clerk