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HomeMy WebLinkAboutAgenda Fire Pension 031609 PALM BEACH GARDENS FIREFIGHTERS’ PENSION FUND Meeting of Monday, March 16, 2009 Location: Council Chambers, Palm Beach Gardens City Hall 10500 North Military Trail Palm Beach Gardens, FL 33410 Time: 9:00 A.M. A GENDA 1. Call Meeting to Order 2. Minutes of Meeting Held January 12, 2009 and February 2, 2009 3. Investment Monitor Report: Bogdahn Consulting 4. Actuarial Report: Brad Armstrong • Actuarial Valuation • Status of Study Requested by City 5. Attorney Report: Bob Sugarman • Discussion on Share Accounts with a Negative Balance • Discussion on DROP Interest Election Options and Form 6. Administrative Report: Margie Adcock • Disbursements 7. Other Business 8. Schedule Next Meeting: Monday , May 18, 2009 at 9:00 A.M. 9. Adjourn PLEASE NOTE: Should any interested party seek to appeal any decisi on made by the Board with respect to any matter considered at such meeting or hearing, he will need a record of t he proceedings, and for such purpose he may need to insure that a verbatim record of the proceedings is made, which record includes the testimony and evidence upon which the appeal is to be based. In a ccordance with the Americans With Disabilities Act of 1990, persons needing a special acco mmodation to participate in this m eeting should contact Tegrit Plan Administrators, LLC no later than four days prior to the meeting. PALM BEACH GARDENS FIREFIGHTERS’ PENSION FUND MINUTES OF MEETING HELD January 12, 2009 A meeting of the Board of Trustees was called to order at 9:05 A.M. at Council Chambers, Palm Beach Gardens, Florida. Those persons present were: TRUSTEES OTHERS Tom Murphy Margie Adcock, Administrator Rick Rhodes Bob Sugarman, Attorney Richard Hitchins Joe Bogdahn, Investment Monitor Ed Morejon Steve Gordon, Auditor Roy Olliff MINUTES The Board reviewed the minutes of the m eeting held November 17, 2008. A motion was made, seconded and carried 5-0 to accept the minutes of the meeting held November 17, 2008. ANNUAL AUDIT Steve Gordon appeared before the Board to present the audit for the period ending September 30, 2008. He stated that he was issuing a clean unqualified opinion. He reviewed the Statement of Plan Net Assets. The total assets of th e Fund as of September 30, 2008 were $23,649,308 almost all of which were in investments. Total liabilities were $45,516. Total net assets of the Fund as of September 30, 2008 were $23,603,792. Mr. Gordon reviewed the Statement of Changes in Plan Net Assets. He reported that there was a total net investment loss was $3,085,849. Th e total contributions to the Fund were $4,512,281. The total additions were $1,431,067 a nd total deductions were $618,361. The net increase in Plan net assets was $812,706. Mr. Gordon then discussed the schedule of funding progress that he is required to include in the Audit but that is provided for in the Actuarial Valuation. He reviewed the notes to the financial statements. Mr. Gordon stated that there was no unusual matter to disc uss or disclose regarding the audit of the Fund for the period ending September 30, 2008. A motion was made, seconded and carried 5-0 to accept the audit for the period ending September 30, 2008. INVESTMENT MONITOR REPORT Joe Bogdahn appeared before the Board. He stated that he would have the quarterly report for the period ending December 31, 2008 at the next meeting. He stated that the total market value as of December 31, 2008 was $22,144,000. However, that amount does not include the American Realty Decem ber 31 number. Mr. Bogdahn discussed the Madoff situation. He stated that the Fund had no investments with Madoff. 2 Mr. Bogdahn provided a revised Investment Policy Statement. He stated that the Statement was changed to change the name of the bond index from the Lehman Brothers to Barclays Intermediate Aggregate Bond I ndex. He also provided an Addendum to DHJ for the ability to invest in TIPS/CIPS. A motion was made, seconded and carried 5-0 to approve the revised Investment Policy Statement. Mr. Bogdahn provided an update on the inte rnational growth search. He provided information on the following managers: Manning & Napier; Masters’ Select International; MFS International Growth I; American Funds Euro Pacific R5; and Voyageur International Equity. There was a discussion on the changes at Voyageur. It was noted that Jack Farland was no longer w ith the firm. He was the client servicing person. Mike Spencer has been meeting with clients now so Mr. Bogdahn does not see client servicing being an issue. He noted th at a lot of the managers have cut back on the marketing team in this economic downtur n. There have been no other changes at Voyageur. Mr. Bogdahn reviewed the performan ce of the international growth candidates as of September 30, 2008. He reviewed the ri sk and return analysis of the blended candidates with Voyageur. He reviewed th e up and down capture ratios of the blended candidates with Voyageur. He noted that Manning & Napier would have someone visit the Board whereas with Euro Pacific that would not be a possibility. Manning & Napier would also do a side letter for the Fund. There was a lengthy discussion. A motion was made, seconded and carried 5-0 that base d on the recommendation of the Investment Monitor that the Board engage Manning & Na pier as the manager for international growth contingent upon reaching an acceptabl e agreement. The Board authorized the Chairman to execute the agreement once approved by the Attorney. ATTORNEY REPORT Mr. Sugarman stated that the City has ma de a request for actuarial information. The Actuary did provided a cost estimate in pr oviding the requested information. Allan Owens appeared before the Board and stated that he was requesting from both the Fire and Police Pension Plans information from the Actuary on the contribution requirements for Actuarial Valuations as of October 1, 2008 – October 1, 2012. He stated that the City was trying to get a five-year forecast for budgeting and effects of the market on the Pension Funds. He requested the Board’s cons ideration. It was noted that in a letter dated January 9, 2009 the Actuary stated th at they could do a study not to exceed $3,000 to be done within two to three weeks. Mr. Sugarman stated that the request was appropriate and the City, the Fund or both, coul d cover the cost. Mr. Owens stated that his first choice would be for the Fund to pay for the study, but he was willing to do whatever he could to work with the Board on this. There was discussion on the City’s committee formed to look at FRS. Mr. Owens stated that a committee was formed to look at FRS. It is at the beginning stages . The City is hiring a consultant and the representative for the Fire is Mark Floyd. There have been some discussions but it is very early on in those discussions. There has been only one meeting. It was noted that Mark Floyd represents the Union and not the Board. The Board stated that they have previously requested to have a representative on that committee. The Board asked again if the City would consider having a represen tative from the Board on the committee. Mr. 3 Owens stated that the Actuary firm the City selected is Bolton Partners who previously did an experience study and the City has a current agreement with them. There was a lengthy discussion on the City’s re quest. It was noted that Council Member Russo asked for this information in a Counc il meeting. The Board asked to see the request that was made. Mr. Owens stated that it was a verbal directive at the last Council meeting. Mr. Rhodes stated that he was not comfortable with the Fund paying for the cost of the study because the Board is not asking for the study and the Board is not getting a seat on the committee. Mr. Murphy fe lt that if the Board and the City were a partnership, the cost should be split. Mr. Morejon stated that if there were truly a partnership then they Board would have been made a part of the committee. He stated that he was concerned that the study would be used to dissolve the promises that the City made to the employees and he finds it hard to use Fund money to do that. There was further discussion. A motion was made, sec onded and carried 5-0 to authorize the Actuary to do the study requested by the City and have the study delivered to both the City and the Board with the expense to be split between the Fund and the City with the total cost not to exceed $3,000. The Board asked Mr. Owens to assist in getting a Fund representative on the committee. Mr. Owens stated that he would take the Bo ard’s request to the City Manager. Mr. Owens stated that the committee meetings were open to the public. The Board stated that they would like to do a workshop as it was in the very least important for Council Member Russo to hear from this Board. Mr. Sugarman stated that he would do a response to Council Member Russo. He stated that he would need someone to listen to the recording from the Council meeting. He st ated that the request from Mr. Owens was just for documents, but the documents do not tell the whole story. Mr. Bogdahn stated that he did meet with Mr. Owens after the last meeting. One question that came up was whether it was feasible to go to FRS. He stat ed that he would be pleased to be involved in a workshop or whatever is needed. Mr. Morejon stated that for the longest time the City contributed absolutely nothing to the Pla n. The cost to the City overall has been very low. There was discussion on how to proceed. Mr. Morejon stated that he understood that the transcription of the Council meeti ngs were on the City’s website. He would obtain a copy and provide that to Mr. Sugarman. Mr. Sugarman discussed the status of the di sability hearing for Toby Bivins. He stated that Mr. Bivins went for an IME in December. He is expecting the draft written report to be provided in the next week. The Board stat ed that a special meeting should be held as soon as possible. It was determined that a special meeting would be held on February 2, 2009. Roy Olliff departed the meeting for an emergency call. There was discussion on the remaining balance of the Share Account form Mr. Bivins. It was noted that the Actuary advised that he would be able to provide all of the Share Account balances by the end of the week. A motion was made, seconded and carried 4-0 4 to disburse the remaining balance as of September 30, 2008 of the Share Account for Toby Bivins as soon as possible once that amount is provided by the Actuary. Roy Olliff re-entered the meeting. Mr. Sugarman discussed House Bill 5 regardi ng the proposal to increase the international allocation to 25%. Mr. Sugarman discussed the IRS Determination Letter. He stated that there are two more windows ending in 2011 and 2014. He recommende d waiting to see if any Legislative relief is forthcoming. ADMINISTRATIVE REPORT Ms. Adcock presented the list of disbursements to be made. A motion was made, seconded and carried 5-0 to approve the disbursements listed. Ms. Adcock noted that the Fiduciary Liability Policy renewal was due on March 10, 2009. She stated that she did not have th e renewal quote at this time. A motion was made, seconded and carried 5-0 to renew th e Fiduciary Liability Policy not to exceed 120% of last year’s premium. OTHER BUSINESS There being no further business, the meeting adjourned. Respectfully submitted, Tom Murphy, Secretary PALM BEACH GARDENS FIREFIGHTERS’ PENSION FUND MINUTES OF MEETING HELD February 2, 2009 A special meeting of the Board of Trustees was called to order at 1:00 P.M. at the Lobby Conference Room in City Hall, Palm Beach Gardens, Florida. Those persons present were: TRUSTEES OTHERS Tom Murphy Margie Adcock, Administrator Rick Rhodes Bob Sugarman, Attorney Roy Olliff Richard Sicking, Attorney for Toby Bivins Ed Morejon Toby Bivins, Applicant Allan Owens, Finance Director DISABILITY HEARING FOR TOBY BIVINS Mr. Sugarman provided the background and re quirements for a disability pension. He reviewed the questions that the Board needed to answer. He noted that Dr. Sherman had encouraged the Board to obtain a Functional Capacity Evaluation (FCE). The Board sent Mr. Bivins to Dr. Lichtblau for the FCE. Mr . Sugarman stated that it was originally the intent to send the FCE back to Dr. Sherman fo r review. However, because of the length of the report, Dr. Sherman could not advise when he would be able to look at it but stated that it would be at least a month or more. The Boar d felt that was not fair to make Mr. Bivins wait that long for a hearing. Mr. Sugarman reviewed the disability book that had been prepared previously for the August 18, 2008 meeting. He stated the issues befo re the Board. He stated that this was an informal hearing where Mr. Bivins and his attorney would present to the Board their case. After all of the information is recei ved, the Board can grant, deny or table the disability request for Toby Bivins. Mr. Sugarman st ated that his job is to make sure that Mr. Bivins and his attorney get a fair hearing and to make sure the Board makes a decision in which they are comfortable with. Mr. Suga rman noted that one Board Member was not present. He stated that he advised Mr. Sick ing of that prior to the meeting. Mr. Sicking stated that he was previously told that one Board Member was missing but that he wanted to proceed and not wait for a full Board. Mr. Sicking stated that from the last meeting the direction was for the Board to interview the co-workers for the month before Mr. Bivins’ injury. He inquired about those interviews. Mr. Murphy stated that he was charged with doi ng the interviews. He stated that he took the run sheets and highlighted the employees Mr. Bivi ns worked with during that time. He made copies and distributed the copies of the run sheets to the Board and asked Mr. Sugarman for some direction on the questions to ask. Mr . Murphy reviewed the questions and noted that 2 he asked each employee the same questions. He stated that he received some “don’t recalls”. However, for the most part, of thos e that did remember they indicated that Mr. Bivins did respond to calls and did his shar e of the work. He was not limping and not complaining of injury or weakness or pain and they remembered him doing his station duties. He stated that he did not get anyt hing that deviated from those responses. Mr. Morejon stated that he was also the Union representative for the firefighters and he was asked to take part in an interview with George Helm in the workers’ compensation process. Mr. Bivins had invoked his Firefighter Bill of Rights and Mr. Morejon was the Union representative. He did not know if that mattered here, but he did want to disclose that. Mr. Sicking reviewed pages five and six of the FCE. He stat ed that the FCE report states that Mr. Bivins does not have the functional capacity to return to firefighter work. He reviewed the limitations set forth in the FC E. He noted that the employer has a time limitation of when a firefighter can no longer come back to work. At that point the firefighter is terminated. He noted that legal issue with the Gaines court case. Mr. Sicking stated that from a medical standpoint and an employer standpoint Mr. Bivins meets the definition for a permanent and total disability. He stated that the real question is whether the disability is service connected. Mr. Sicking stated that the records show that in late February Mr. Bivins went to the clinic and co mplained of back pain but he worked full duty the next day and for several duty days after that up until the time of the Hertz tool incident. The FCE mentioned in three or four places th at the medical opinion is that the current condition was exacerbated since his injury in March. Mr. Sicking stated that all three requirements for a duty disability have been me t and he asked the Board to award a service- connected disability to Mr. Bivins. There was discussion on permanence of the di sability. Mr. Sicking stated that the FCE stated that at this point it is a management of the medial problems. The Board inquired about whether exacerbating an injury can be considered. Mr. Sugarman stated that exacerbating an injury is the aggravation of an injury. The FCE is stating that the Hertz tool incident was an aggravation of his pre-exis ting injury that was caused by his on the job injury. The Board inquired about the Gaines court case. Mr. Sugarman discussed the Gaines court case. He stated that if the City terminates an employee for not being able to work due to an injury, a pension plan is estopped from cl aiming the person is able to work when a municipality says they cannot work. He stated that in such a situation, that would answer the issue of being disabled as a firefighter, but does not answer the question of permanence and totality. There was a lengthy discussion on the record befo re the Board. The Board stated that the FEC answered all the questions that were still open from the August meeting. A motion was made, seconded and carried 4-0 to grant a duty disability to Toby Bivins. There was discussion as to the date of the disability. A motion was made, seconded and carried 4-0 to determine that Mr. Bivins became entitled to a disability as of the date he went off City payroll. 3 OTHER BUSINESS Mr. Morejon reported that Mr. Owens stated at the last meeting that he would talk to the City Manager about allowing a representa tive from the Board on the City’s FRS committee. It was noted that the City Manage r has agreed to that. Mr. Morejon stated that he submitted two names – himself or Rick Rhodes. Mr. Sugarman advised of some possible changes to FRS with the Legislatur e. He stated that he hopes the City’s committee does not act too quickly in case the Legislature would act. There being no further business, the meeting adjourned. Respectfully submitted, Tom Murphy, Secretary