HomeMy WebLinkAboutMinutes Police Pension 072111City of Palm Beach Gardens Po /ice Officers'
Pension Fund
Minutes of the Meeting Held
July 21, 2011
The regular meeting of the Board of Trustees of the City of Palm Beach Gardens
Police Officers' Pension Fund was called to order at 9:07 AM by Chairman 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, Chair Audrey Ross (Resource Centers)
David Pierson, Secretary Bonni Jensen (Law Offices of Perry & Jensen)
Brad Seidensticker, Trustee Donna Cannon (PBG Clerk's Office)
Jules Barone, Trustee Grant McMurray (ICC Capital Management)
Wayne Sidey. Trustee John McCann (Thistle Asset Consulting)
INVESTMENT MANAGER REPORT
ICC Capital Management - Presented by Grant McMurray
Mr. McMurray updated the Board on the current market environment and stated that
there is negative correlation between the bond market and the stock market. Lately
more people seem to be moving out of bonds and into stocks, which means interest
rates will probably stay low for a while longer. Housing and unemployment are still
down, and investors are putting their money into stocks.
Mr. McMurray reported that for the quarter ending June 30, 2011 the fixed income
portfolio underperformed at 2.03% versus 2.29 %. He noted that he did have some
concern about the Treasury market because that is where the traders currently are
due to the fact that they can get out of them very easily. The Trustees discussed the
Sovereign bonds overseas and Mr. McCann stated that Greece will have an effect on
all the Sovereign Countries. On the equity side, the fund also underperformed at
-2.25% versus .76 %. Mr. McMurray explained that there is still a lot of cash out
there on the sidelines, and that is why he is still hopeful that there are some
opportunities still out there.
INVESTMENT CONSULTANT REPORT
Thistle Asset Consulting - Presented by John McCann
Mr. McCann reviewed the Plans compliance checklist which is inline with the Policy,
but the total fund is trailing for the 3 year return. As of June 30, 2011 there was
64% in equities, 35% in fixed income and 1% in cash. Mr. McCann then reviewed
the asset allocation by Manager and commented that the portfolio is very diversified,
but he thinks they should add in some real estate. For the quarter ending June 30,
2011 the total fund was behind the index at .52% versus 1.07 %. The total equities
were also negative at -.39% versus .30 %, and the total fixed income did slightly
better at 2.19% versus 2.46 %. Also for the fiscal year to date the fund is up
10.91 %. Mr. McCann then briefly reviewed each mangers performance for the
quarter:
Rhumbline S &P 500 - Right inline with the index for the quarter at .10 %.
Rhumbline S &P 400 - Was negative for the quarter, but outperformed the
index at -.70% versus -.73.
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Rhumbline S &P 600 - Also outperformed the index, but still negative at
-.10% versus -.16 %.
ICC Larae Cap Growth - This fund did not have a good quarter due to the
market environments. They were negative and trailing the index at -2.20%
versus .76 %.
ICC Fixed Income - Had a better quarter, but still slightly trailing the
benchmark at 2.23% versus 2.30%
International Equity - Slightly underperformed during the quarter, but still
positive at 1.25% versus 1.83 %.
International Fixed Income - This fund was positive at 2.84% versus the
index at 3.68 %.
Mr. McCann reviewed the risk versus reward chart and explained that the fund is
taking less risk, but it is also receiving less of a return. He reminded the board that
the bulk of their assets are in index funds, and he would like to look into some more
diversification. The Trustees inquired about Gold and Mr. McCann stated that he is
not to fond about gold right now, but he could bring in an asset class that would
contain ETF's which are precious metals and diversified metals. He noted that
adding a commodity like metals will add more risk to the portfolio, but it will also add
more return. Ms. Jensen reminded the board that if they were to buy into ETF's,
then there would be no fiduciary responsibility. Also it would be a separate asset
class that would need to be added into the portfolio. The Trustees discussed ETF's
and decided not to move forward with that type of asset class right now.
Mr. McCann explained that he would rather invest in real estate or infrastructure
before proceeding with ETF's. He briefly explained to the board the type of real
estate that he is interested in, and commented that he will bring back an asset
allocation to include this next time. The real estate investment that he is
recommending would be commercial buildings and would be actively managed. Also
all properties are within the United States
ATTORNEY REPORT
Law Offices of Perry & Jensen - Presented by Bonni Jensen
Ms. Jensen stated that she had the revised buyback policy with her today to be
executed, but she will have to revise it again to include an effective date as to when
the vesting was not included. She commented that she will bring it back to the next
meeting again.
Ms. Jensen noted that the IRS mileage rate increase to .555 cents effective July 1,
2011.
Ms. Jensen presented that board with a statement of policy regarding expenses
associated with public orders, class actions, and domestic relations orders. She
reviewed the order and the purposes it serves. The board discussed the order and
Ms. Jensen stated that she will bring it back to the next meeting with any revisions
that need to be made.
Ms. Jensen briefly discussed the fiduciary liability quote that Mr. Spencer wanted the
board to obtain for non -owned autos. She stated that we should have the quote
back by the next meeting, in which the board can review at that time.
Ms. Jensen notified the board that the Union has requested a meeting with her and
Jules Barone to look over some items that they need cost out. Ms. Jensen noted that
she will notify Union of the new ethnic's law that FL put in place as well.
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Ms. Jensen updated the board of the summary plan description and stated that the
Trustees need to review it before it is sent out. She explained that the SPD reflects
the pension plan as it exists, but we will probably have more changes once the City
and the Union agree.
Ms. Jensen notified the Trustees that the new ethnic rules have been revised under
the law. She commented that she is looking into this to see whether or not the
pension board must abide by these rules too. She stated that she sent a letter to
the Commissions on Ethnics, so as soon as she receives a response from them she
will update the board.
ADMINISTRATOR REPORT
Resource Centers - Presented by Audrey Ross
Ms. Ross notified the board that the 2010 state annual report was approved on June
1, 2011.
MINUTES
MOTION: Mr. Pierson made a motion to approve the minutes from the
April 21, 2011 regular meeting and the June 8, 2011 special
meeting.
SECOND: Mr. Seidensticker seconded the motion.
CARRIED: The motion carried unanimously 5 -0.
DISBURSEMENTS APPROVALS
MOTION: Mr. Seidensticker made a motion to approve the
disbursements.
SECOND: Mr. Sidey seconded the motion.
CARRIED: The motion carried unanimously 5 -0.
BENEFIT APPROVALS
MOTION: Mr. Seidensticker made a motion to approve the applications to
enter the DROP for George Clay, Glenn Wright, James
Shackelford, Steven Fee, Todd Thomas and William Brandt, and
the application for distribution from DROP account for David
O'Neill and the application for a refund of contribution for
Andrew Rundle.
SECOND: Mr. Barone seconded the motion.
CARRIED: The motion carried unanimously 5 -0.
FINANCIAL STATEMENTS
The board reviewed and discussed the financial statements that were provided
through June 2011.
The board received and filed the financial statements through June 2011.
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OLD BUSINESS
Ms. Jensen reported that the Custodians have sent back their revised see schedule.
She reviewed the different fees from the various Custodians, and the board
discussed the differences between each Custodian.
MOTION: Mr. Pierson made a motion to hire Salem Trust as their new
Custodian.
SECOND: Mr. Seidensticker seconded the motion.
CARRIED: The motion carried unanimously 5 -0.
OTHER BUSINESS
N/A
PUBLIC COMMENTS
N/A
A]OURN
There being no further business, and the future meetings are scheduled for the 3rd
Thursday of the first month proceeding the quarter. The next regular meeting was
scheduled for Thursday October 20, 2011 at 9AM; the Trustees officially adjourned
the meeting at 11:18AM.
Respectfully submitted,
DAVID PIERSON, Secretary
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