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HomeMy WebLinkAboutMinutes Fire Pension 11190102/12/2002 15:47 5616243278 RESOURCE CENTERS PAGE 03 'PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND • MINUTES OF MEE'T'ING RELD November 19, 2001 A meeting of the Board of Trustees was called to order at 6:09 P.M. at the Main : tation, Palm Beach Gardens, Florida. Those persons present were: TRUSTEES OTHERS Ed Morejon Margie Adcock, Pension Resource Center, Steve Rogers Administrative Manager Phillip Buttaravoli Scott Givens, Bank of America, Richard Beladino Investment Manager Bill Stark, Bogdahn Consulting, Investment Mo: ,itor Bob Sugarman, Sugarman & Susskind, Fund At :) ney Visitor: Evan Bestland MAVUTES The minutes for the meeting of August 14, 2001 were reviewed. A motion was made, seconded, and passed 4 -0 to accept the minutes of August 14, 2001. INVESTMENT MANAGER • Scott Givens appeared before the Board to discuss the investment performance of th ; Fund for the quarter ending September 30, 2001, Mr. Givens gave a brief overview of the 1 iarket. He stated that he expected things to turn around next year. The market value of ti a total Fund as of September 30, 2001 was $5,143,081. Mr. Givens then discussed the letter regarding Chicago Equity Partners. He remin( ed the Board that about 2 years ago, Chicago Equity Partners bought themselves out, but E ank of America decided to keep them as a manager. Recently a decision has been n- ide to discontinue the contract to have Chicago Equity Partners manage any fund and the fi nction will be brought within Bank of America.. Mr. Givens advised that he does not expect to see any significant changes, except in terms of performance. He noted that performan ;e was better in this Fund when it was individually managed. When Chicago Equity F uiners bought themselves out, their style didn't do as well. This change will become ei :ective November 30, 2001. Mr. Givens discussed the new management for the Fund's portfolio. He advised that it would be managed in the style of the Nations Managed Index Fund, which mirrors ti a S &P 500 to some extent, but look to sectors and individual stocks that should be overwe ghted. In terms of the style of investment management, Mr. Givens noted that it is n )t that dissimilar. The biggest difference is that it will be managed in- house. The corporati entity is the same, but the people managing the fund will be different. • The Board asked several questions regarding this change in investment managemer.:. Bill Stark noted that it would not be that difficult to look at the performance for a period )f time to evaluate the management. He advised that they could look at other managers d tring a particular time frame to evaluate and compare them with the new fund offered by E ank of 02112/2002 15:47 5616243278 RESOURCE CENTERS PAGE 04 America.- Basing the performance on the Nations Managed Index Fund. the ann ialized • return for a five -year period is 10.59 %. There was then a discussion on possibly c Ding a manager. swcch_ . The Board determined that they wanted to have Joe Bogdahn adN .se the Board at the next meeting about the new investment management. Mr. Stark advised that as far as the fee for a manager search, there would be no fee initially to see what elst is out there. It would only be if the Board decided to make a change that the Board would ncur a fee of $2,100 as provided in the Agreement. A motion was made, seconded, and pas ed 4 -0 to have Joe Bogdahn start preliminary management search and investigate th : new investment management from Bank of America and continue to monitor that for the 3oard, with his findings to be brought back to the next Board meeting, Mr. Givens then discussed more on the performance of the Fund. He noted that the ;urrent ,fiscal year is off to a better start. The S &P 500 was up 1.9% in October, with the F ind up 2% for that same time period. He noted that the Fund has a long way to make up for he last year, but this fiscal year is starting out good. He would expect the next 12 month to be more positive than the last 18 months. INVESTMENT MONITOR Bill Stark appeared before the Board to discuss the investment performance for the Fi .rid for the quarter ending September 30, 2001. He advised that for the fiscal year, the Fu A was down 14,24% versus the benchmark which was down 13,91 %. For the third quar er, the Fund was down 8.11% versus the benchmark which was down 8.33 %. With respec to the asset allocation at cost, the Fund was comprised of 65% equities, 31% fixed income i rid 4% • cash. For the fiscal year, fixed income was up 12.47% versus the benchmark which vas up 13.17 %. For the third quarter, fixed income was up 4.52% versus the benchmark whi :h was up 4,76 %. The Fund was down 27.56% in equities for the fiscal year while the ben; hmark was down 26.62 %. For the third quarter the Fund was down 14.99% in equities ver .us the benchmark which was down 14.68 %. Mr. Stark noted that the Fund is $1,116,000 under the actuarial assumption with most of that loss occurring in the last 4 quarters, The actuarial report used a smoothing effect, iut the loss is significant so it will be noticed, Mr. Stark noted that it is not a good picture th i year, but it is another good reason to look at what is happening with other managers z ad the Fund's manager. Scott Givens and Bill Stark departed the meeting. ATTORNEY REPORT Bob Sugarman discussed with the Board the draft procedures for disability benefit rec pients he prepared. He advised that by state law the Board is required to periodically - eview disability applicants. He suggested that the Board review, at the same time each yf ar, the disability files. If the disability applicant is clearly disabled, then that would end the natter. If, however, it 'is not apparent that the applicant is disabled, then there are four t; pes of medical review that could be done, The Board discussed the draft procedures any other • issues regarding review of disability applicants. It was suggested that the files of the disability applicants be brought to a subsequent meeting of the Board for the Bi and to review. A motion was made, seconded and passed 4 -0 to adopt the Disability Determ nation and Review Procedure. 02/12/2662 15:47 5616243278 RESOURCE CENTERS PAGE 05 Mr. Sugarman discussed with the Board the draft of Trustee Election Procedures. There was a discussion regarding the process for conducting the election, it was determin4 d that an election should be by mail ballot if more than one person is nominated to fill a I rustee position. Mr. Sugarman was directed to revise the Trustee Election Procedures accor singly for the Board to adopt at the next meeting. Mr. Sugarman then discussed the state and federal laws relating to Participants tl at are called up to active duty. He advised that Participants that are called up to active duty io not have to make employee contributions. Mr. Sugarman was directed to correspond w th the City Manager and Finance Director regarding the laws governing Participants that are called up to active duty. Mr. Sugarman advised the Board of recent changes in the tax law that would allow Participants to purchase military service time before they were employed with the Cil Y. He noted that beginning in 2002, and assuming that an Ordinance change was d 'ne, a Participant could transfer 457 money into this Plan to purchase time. Mr. Sugarman a lvised that he would prepare an Ordinance change that would allow Participant to transfer noney from a qualified plan into this Plan to purchase time, ADDM9STRA'TM REPORT Margie Adcock reported that she obtained quotes for a Fidelity Bond for the Bc 3rd to is consider. Mr. Sugarman recommended that the Board obtain a Fidelity Bond. The Board then discussed the quotes for the Bond. A motion was made, second and passed ; -0 to obtain a Fidelity Bond with the 3 -year pre -paid option with a premium of $316.00. Ms. Adcock presented the disbursements to be made. A motion was made, second :d and passed 4 -0 to approve the disbursements. OTHER BUSYNESS Ed Morejon raised an issue of benefit changes to the Plan. He was directed at : prior meeting to conduct a membership poll to determine what benefit changes the mf tubers would like to see. Mr. Morejon discussed the results of the poll with the Board. A ::lotion was made, seconded and passed 4 -0 to have the Actuary calculate the cost of a 3% multiplier, a 3% COLA for lifetime of retiree, a 3% COLA starting at social security age of retiree, and a 3% COLA until social security age of retiree. There being no further business, a motion was made, seconded and passed 4 -0 to adjo irn the meeting. The meeting adjourned at 8:25 P.M. Respectfully submitted, • Ed Morejon, Secretary