HomeMy WebLinkAboutMinutes Fire Pension 111411PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND
MINUTES OF MEETING HELD
November 14, 2011
A meeting of the Board of Trustees was called to order at 9:05A.M. at Council
Chambers, Palm Beach Gardens, Florida. Those persons present were:
TRUSTEES
Ed Morej on, Chair
Tom Murphy, Secretary
Donna Wisneski
Mark Joyce
Rick Rhodes
MINUTES
OTHERS
Margie Adcock, Audrey Ross, Administrator
Pedro Herrera, Attorney
Troy Brown, Investment Monitor
Steve Stack, Investment Manager
The Board reviewed the minutes of the regular meeting held on September 20, 2011.
A motion was made by Rick Rhodes to approve the minutes of the September 20,
2011 regular meeting. The motion was seconded by Tom Murphy and carried 5 -0.
INVESTMENT MANAGER REPORT: ICC CAPITAL (STEVE STACK)
Mr. Stack commented that it was a challenging quarter on the equities side, although
through November 9, 2011 the fund was up 8.62 %. For the fiscal year ending September
30, 2011 the total equity fund was down -18.63 versus the benchmark at - 15.28. He
reviewed the sectors that were leading during the quarter such as health care and staples,
but since the end of October they were already down. Mr. Stack explained that equities
were hit very hard during the quarter, and all the negative surrounding Europe did not
help either. In addition people still have a lot of fear which leads to uncertainly and
volatility in the market place. Mr. Rhodes questioned whether or not the Russell 3000
index is the best and most accurate index that we should be using to compare too. Mr.
Stack replied and explained that the Russell 3000 index is the most accurate index in
comparison with this fund. He briefly reminded the Board of ICC's investment
philosophy and stated that this portfolio is a sector attribution portfolio that is directed
into where they think growth will occur. There is no model that drives this portfolio,
although they do have some systems that help them choose what stocks they want in their
portfolio. Lastly Mr. Stack commented that they are starting to slightly see things turn
around in the market place, and that the funds portfolio is a in a great position to take
advantage of the growth opportunities out there.
INVESTMENT MONITOR REPORT: THE BOGDAHN GROUP (TROY
BROWN
Mr. Brown updated the board on the return as of November 11, 2011 and commented that
the fund is up 6.6 %, which is a huge turn around since September 30, 2011. Mr. Brown
briefly updated the board on the current market environment and reiterated that the 3rd
quarter 2011 was extremely difficult for equities as well as all other market segments as
well. Both fixed income managers in the portfolio underweighted Treasuries mostly due
to the downgrade and all other active managers were short duration. Also yields tanked
during the quarter which had a huge impact on equities. Mr. Brown reviewed the sector
breakdown during the quarter and stated that they are inline with their policy. The total
fund (net of fees) was negative and behind the benchmark for the quarter at - 11.29%
2
versus - 10.23% and the total equities were in the same position at - 18.56% versus
- 15.83 %. The total fixed income was in a better position but still lagging the benchmark
at 1.15% versus 2.30 %, and last the total real estate was almost inline with the benchmark
at 3.17% versus 3.30 %. Mr. Brown briefly commented on each Mangers performance
and pointed out the different investment styles between Dana Advisors and ICC Capital.
ICC Capital does sector rotation as Dana Advisors does stock selection and is stock
neutral.
Mr. Brown reported that for the fiscal year ending September 30, 2011 the fund did not
meet their assumed rate of return, but they still were in a better position then most
pension plans at -.42% net of fees. He commented that although fear is what is driving
the volatility in the market, the fund overall had a great year and just a bad quarter.
Lastly he reported that he does not have any recommendations at this time regarding any
of the managers, but he does have a recommendation to transfer $100K from the R &D
account to ICC Capital. Mr. Brown explained that the plan took $100K from ICC during
the quarter to pay out benefit payments and now he would like to give it back to them.
Also he stated that he has made other arrangements for the future so that we do not have
to withdraw money from ICC again.
A motion was made by Donna Wisneski to approve and authorize the transfer of
$100K from the Plan's receipt and disbursement account to ICC Capitals account
per the Investment Consultants recommendation. The motion was seconded by
Rick Rhodes and carried 5 -0.
ATTORNEY REPORT: SUGERMAN & SUSSKIND (PEDRO HERRERA)
Mr. Herrera reviewed the revised travel expense policy and stated that it will be sent over
to the administrator to be executed.
Mr. Herrera briefly commented on the memo regarding the mandatory local law pension
plan revisions. He explained that these changes were part of the SB 1128 that was
recently passed and the biggest change had to due with the definition of pensionable
compensation /salary. Mr. Morej on noted that he has asked the City to include these
mandatory changes in the Ordinance that is still pending. Ms. Wisneski requested at the
next meeting a list of all the pending Ordinance changes /revisions so that we can keep
track of them all at this point.
The board discussed the status of the study that is in the process of being completed by
GRS regarding the proposed amendments to the pension plan. Ms. Ross commented that
she has not received anything back from the Actuary as of yet, but as soon as she does
she will forward it to all parties involved.
Mr. Herrera reported that the IRS Determination Letter has been submitted and we are
still waiting on a response. He commented that he was told that the entire process would
take about 6 -8 months to complete.
Mr. Morej on wanted to discuss the recent pension report that was issued regarding the
grading of the pension plans. He explained that this article that was produced by a Firm
named Leroy Collins, and he went through and graded each Florida Public pension plan
with an A thru F solely based off their funded ratio. The Trustees discussed the article
and commented that the article is very misleading and they would like their Actuary to
prepare some kind of response to this Firm educating them that this pension fund is well
funded despite the funded ratio number, which is an actuarial computed number.
Lastly Mr. Herrera explained that his office receives many investment manager
performance reports and inquiries on almost a daily basis, so therefore his office is trying
to come up with a data base to track all the necessary information that is needed for each
fund. Sugarman & Susskind is asking their client's permission to access their Custodial
Statements to get the information they need to be able to put together this data base. Mr.
Herrera noted that there is no cost associated with this. The Trustees discussed and
commented that they consent to this and will allow Sugarman & Susskind access to the
Plan's Custodial statements.
ADMINISTRATIVE REPORT: RESOURCE CENTERS (MARGIE ADCOCK &
AUDREY ROSS)
DISBURSEMENTS
The Board reviewed the disbursements presented for approval by the Administrator. The
Trustees' had a question regarding the Auditors bill and asked that the language
regarding the State Annual Report be removed since they do not provide that service for
the board. Ms. Ross acknowledged that she will contact Steve Gordon to get this error
fixed going forward.
A motion was made by Rick Rhodes to approve the disbursements that were
Presented by the Administrator. The motion was seconded by Tom Murphy and
carried 5 -0.
OTHER BUSINESS
Ms. Ross commented that she had the Regions authorized signors form here today for
execution as we needed to remove Ms. Adcock as a signor and add myself.
Ms. Adcock handed out the disability pension review and commented that the last time
we reviewed this was in November 2010. The board directed the Administrator to send
out the letters in May /June 2012.
Ms. Wisneski asked that the minutes be sent out earlier then one week prior to a meeting.
She stated that about one month after the conclusion of a meeting would be reasonable.
The board confirmed the 2012 meetings dates which have also been confirmed with the
City as well.
Lastly Mr. Herrera briefly updated the board on the HB 365 that was recently filed
regarding Chapter 175 & 185 disability pensions. He stated that he will keep the board
informed as more information develops regarding this bill.
There being no further business, the meeting adjourned at 10:59AM.
Respectfully submitted,
Tom Murphy, Secretary