HomeMy WebLinkAboutMinutes Fire Pension 02200203/08/2002 12:38 5616243278 RESOURCE CENTERS PAGE 03
PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND
MINUTES OF MEETING HELD
February 20, 2002
A meeting of the Board of Trustees was called to order at 8;45 A.M. at the Main . station,
Palm Beach Gardens, Florida. Those persons present were:
TRUSTEES OTHERS
Ed Morejon Margie Adcock, Pension Resource Center,
Richard Beladino Administrative Manager
Phillip Buttaravoli Scott Givens, Bank of America., Investment Ma .alter
Joe Bodgahn, Bogdahn Consulting, Investment ✓Ionitor
Bob Sugarman, Sugarman & Susskind, Fund At orney
MINUTES
The minutes for the meeting of November 19, 2001 were reviewed. A motion was made,
seconded, and passed 3 -0 to accept the minutes of November 19, 2001 _
INVESTMENT MANAGER
Scott Givens appeared before the Board to discuss the investment performance of th ; Fund
for the quarter ending December 31, 2001. Mr. Givens gave a brief overview of the i mrket.
He stated that there are signs of a turn in a positive direction. There is growth in the equity
markets, but not overly strong. He noted that there have been two down years in the narket
in a row, which has not happened since 1973 and 1974. The market value of the tot. t Fund
as of December 31, 2001 was $5,517,479. The Fund was up 5.88% for the quarter.
Mr. Givens then discussed the change from Chicago Equity Partners to managing int ;rnally
within Bank of America.. He noted that they have sold the international portion of the
portfolio. He advised that it was underperforming its peer group so it was sold in J tnuary
2002. They will look to replace it at some point, but they are focusing on domesi c area
right now.
Mr. Givens then discussed more on the performance of the Fund. He noted that th ; asset
allocation as of December 31, 2001 was 60,80% in equities, 37.24% in fixed incol le and
1.96% in cash, He advised the Board that the Fund had no position in Enron.
INVESTMENT MQNITOR
Joe Bogdahn appeared before the Board to discuss the investment performance for th : Fund
for the quarter ending December 31, 2001. He advised that for the trailing one yE ir, the
Fund was down 7.50% versus the benchmark, which was down 4.91 %. Since incep, ion on
April 30, 1998, the Fund is up 3.28% versus the benchmark, which was up 4,10 %. With
respect to the asset allocation at cost, the Fund was comprised of 65% equities, 330/ fixed
income and 2% cash_ For the fourth quarter, the Fund was up 5.84% while the benc hmark
was up 6.97 %,
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The total market value for the fixed income portion for the portfolio as of Decem )er 31,
2001 was $ 2,081,000. For the trailing one year, the fixed income portion of the p )rtfolio
was up 7.07% versus the benchmark, which was up 8.51 %. For the fourth quarter, ti a fixed
income portion was down .03% while the benchmark was up .06 %. The total marks t value
for the equity portion of the portfolio as of December 31, 2001 was $ 3,355,000. 'or the
trailing one -year, equities were down 14.98% versus the benchmark, which wa; down
11.88°/x. For the fourth quarter, equities were up 10.16% versus the benchmark, whi :h was
up 10.69 %.
Mr. Bogdahn advised that Bank of America has addressed their relationship with C hicago
Equity Partners when it determined that it was not where it would have liked it to t Mr.
Bogdahn advised the Board that he thinks it is prudent to place Bank of Ame. ica on
probation because of the manager change and their performance. He did not t iat the
investment vehicle that Bank of America is putting the Fund in has a long -term track record
to meet the criteria of the Fund and noted that he will provide a more detailed review for the
next quarter.
Mr. Bogdahn then reviewed with the Board three other managers and discusse l their
performance over various time periods. There was a lengthy discussion regarding 1 'hat, if
any, action the Board should take. Mr. Bogdahn recommended that at a minimum the Board
should place Bank of America on probation and obtain information on where the pi irtfolio
will be going forward. Mr. Bogdahn advised that he could do a formal manager sea -ch for
the Board to review. He then discussed the process of the manager search. A moti ,n was
made, seconded and passed 3 -0 to put Bank of America on probation until further no ice. A
motion was made, seconded and passed 3 -0 to direct Joe Bogdahn to do an inv( stment
manager search and present his findings to the Board at a special meeting set for Ma -ch 14,
2002 at 8,30 a.m. r
There was a discussion regarding education for the Trustees. Bob Sugarman advisec that it
would be permissible for the Fund to pay for Trustees to receive a subscriptiol for a
pension - related magazine or newspaper. It was decided that each Trustee should re :eive a
different magazine or newspaper. 'A motion was made, seconded and passed 3 -0 tc allow
Board members to get a subscription for a pension - related magazine or newspaper.
Margie Adcock then noted that Bank of America provides custodial services in add ;ion to
investment. management. If the Board were to change investment managers, then a new
custodian would be needed. The Board asked Ms. Adcock to obtain information froi ► other
custodians in the event the Board changes investment managers and needs a custod an. A
motion was made, seconded and passed 3 -0 to allow the Administrator and Monitor; elect a
custodian for the Board in the event a new manager is retained that does not offer cL stodial
services.
There was then a question regarding the necessity of having an independent audit 'or the
Fund. Mr. Sugarman discussed with the Board the possibility of having an index indent
audit. A motion was made, seconded and passed 3 -0 to have the Administrator obtain
information on having an independent audit done by the City's auditor, the police Luditor
and other possible auditors for public pension plans. A motion was made, second :d and
passed 3 -0 to appoint a subcommittee comprised of Richard Beladino and Ed Mor jon to
select an independent auditor if they determined that would be the best avenue.
03/08/2002 12:38 5616243278 RESOURCE CENTERS PAGE 05
RNEY REPORT
Bob Sugarman reviewed the revised Trustee Election Procedures. A motion wa: made,
seconded and passed 3 -0 to adopt the Trustee Election Procedures.
Mr. Sugarman advised the Board that he sent a proposed Ordinance to the City that would
allow for the transfer of 457 money into the Plan to purchase time. He noted that he lad not
received a response from the City as of yet. It was then determined that revisiol s were
necessary to the proposed Ordinance. Mr. Sugarman will revise the proposed Or, finance
and forward it to the City.
Mr, Sugarman then discussed a proposed records retention policy. He explained to the
Board about the public records law and noted that the Board should have a City offic al sign
a statement that the Fund's records are confidential. It was determined that Mr. Su ,arman
would prepare the necessary letter for the Chairman to present to the City for signatu: e. Mr.
Sugarman then advised that the Board should appoint a records management liai: )n. A
motion was made, seconded and passed 3 -0 to adopt the records retention polic) and a
resolution that the Administrator would be the records management liaison.
Mr. Sugarman advised the Board that the IRS Notice regarding rollovers has been cl anged.
Mr. Sugarman provided the Administrator with the new IRS Notice.
Margie Adcock presented the disbursements to be made. A motion was made, seconc ed and
passed 3 -0 to approve the disbursements.
DISABILITY REVIEWS
Margie Adcock reported that she brought the files on the two disability recipients th ; Fund
currently has as directed at the last meeting. The Board reviewed the files of Kevin N itchell
and Richard Hodgkins. Mr. Sugarman reviewed the various options that were avail ible to
the Board. There was a lengthy discussion regarding the current job descriptioi for a
firefighter for the City. It was noted that there has been discussions'to change 1,-le job
description to more accurately reflect the firefighter requirements. The Board dec: led to
table the review of the two disability recipients pending the feasibility of having 1 he job
description changed.
OTHER BUSINESS
There being no further business, a motion was made, seconded and passed 3 -0 to adjo im the
meeting. The meeting adjourned at 11:55 A.M.
Respectfully submitted,
Ed Morejon, Secretary