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HomeMy WebLinkAboutMinutes Fire Pension 092109PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND MINUTES OF MEETING HELD September 21, 2009 A meeting of the Board of Trustees was called to order at 9:20 A.M. at Council Chambers, Palm Beach Gardens, Florida. Those persons present were: TRUSTEES Tom Murphy Rick Rhodes Ed Morejon Roy 011iff (9:58 A.M.) MINUTES OTHERS Margie Adcock, Administrator Pedro Herrera, Attorney Joe Bogdahn, Investment Monitor The Board reviewed the minutes of the meeting held July 20, 2009. A motion was made, seconded and carried 3 -0 to accept the minutes of the meeting held July 20, 2009. INVESTMENT MONITOR REPORT Joe Bogdahn appeared before the Board. He reviewed the market environment for the period ending June 30, 2009. He noted that small cap and mid cap did a little better than large cap, and low quality did a little better than high quality. Mr. Bogdahn reviewed the investment performance for the quarter ending June 30, 2009. The total market value of the Fund as of June 30, 2009 was $23,334,022. The asset allocation was 48% in domestic equities; 8.5% in international; 34.1% in fixed income; 3.6% in real estate; and 5.8% in cash. The Fund was up 5.68% net of fees for the quarter while the benchmark was up 11.73 %. Mr. Bogdahn noted that it was a tough quarter, although there were positive numbers. The total domestic equity portfolio was up 11.82% while the benchmark was up 16.82 %. The equity portfolio managed by Dana was up 11.07% for the quarter while the S &P 500 was up 15.93 %. The international portfolio managed by Voyageur was up 16.56% for the quarter while the EAFE was up 25.85 %. The real estate portfolio managed by American Realty was down 7.44% for the quarter while the NCRETF was down 5.20 %. The total fixed income portfolio was up 2.62% for the quarter while the benchmark was up 1.68 %. Agincourt was up 2.091/6 for the quarter while the benchmark was up 1.78 %. DHJ fixed income was up 3.10% for the quarter while the benchmark was up 1.68 %. There was a lengthy discussion on performance and meeting expectations. There was a lengthy discussion on the assumed rate of return of 8.25 %. Mr. Bogdahn stated that in general terms he would like to see a lower number as it would be easier to reach the return but would require the City to contribute more money. He stated that he thinks long term this is a good number. The difficult challenge in going forward it how to achieve it, but they have some things in progress to help such as increasing the international exposure. Mr. Bogdahn stated that he was not recommending any change at this time. Mr. Bogdahn reviewed the compliance checklist. Roy 011iff entered the meeting. Mr. Bogdahn stated that the only thing he would do is add some things, some of which cannot be done until the Ordinance is amended. However, one thing the Board could do now is add to emerging markets. There was a lengthy discussion on emerging markets. When the interest rates start to go up, it will be a bad time for bonds. He does not think that will happen for at least twelve to eighteen months, so there is time to look into that. There was a lengthy discussion on increasing the international limit to 25% and whether an Ordinance change is necessary. It was noted that this issue should be discussed at the upcoming Division of Retirement Conference. REAPPOINTMENT OF RICHARD RHODES It was noted that the term for Richard Rhodes as the 50' Trustee was due to expire on September 30, 2009. A motion was made, seconded and carried 3 -0 to reappoint Richard Rhodes for another term as the 5t' Trustee. Richard Rhodes did not vote on the motion. Tom Murphy departed the meeting. ATTORNEY REPORT Mr. Herrera stated that they forwarded the proposed Ordinance to the Actuary for an impact statement. They received a letter from the Actuary dated September 8, 2009 regarding the impact of allowing retirees to change their joint annuitants. Mr. Herrera replied to the Actuary regarding his letter asking if a recalculation would take into account the anti- selection. He has not yet heard back from Mr. Armstrong. Currently the language is that a recalculation will take place. They may need to include language that any cost will be passed on to the member requesting the calculation. There are two issues. One is the cost of the recalculation. The other is the actuarial funding cost and he is waiting to hear back from the Actuary on this. A motion was made, seconded and carried 3 -0 that any cost from anti - selection and a recalculation associated with that would be borne by the Participant requesting the recalculation. Mr. Herrera reviewed the Ordinance and noted that the Ordinance provides that the cost of any recalculation would be borne by the Participant. ADAI MSTRATIVE REPORT Ms. Adcock presented the Board with the benefit calculation and election for Evan Bestland. A motion was made, seconded and carried 3 -0 to approve the benefit election. Ms. Adcock presented the list of disbursements to be made. It was noted that on the invoice for the Attorney there were two entries for the same item on August 3, 2009. Mr. Herrera noted that they do not double bill for two attorneys and therefore would remove one of the entries. It was noted that $142.50 would be deducted from their invoice. A motion was made, seconded and carried 3 -0 to approve the disbursements listed with the exception that $142.50 would be deducted from the invoice for the Attorney. OTHER BUSINESS It was noted that Richard Hitchins resigned form the Board. The City Clerk has advised that there are two applicants for the vacant position. The City will appoint someone to the position in October. Mr. Bogdahn provided a revised Investment Policy Statement. He stated that it added language regarding scrutinized companies and incorporated an increase in the maximum for international securities to 25 %. Mr. Herrera stated that he did not want the Board to include the 25% maximum when the Ordinance had not yet passed. The Board decided to review the matter at the next meeting after they had a revised Statement and an impact statement from the Actuary. There being no further business, the meeting adjourned. Respectfully submitted, Tom Murphy, Secretary