HomeMy WebLinkAboutMinutes Fire Pension 081604PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND
MINUTES OF MEETING HELD
August 16, 2004
A meeting of the Board of Trustees was called to order at 11:07 A.M. at Station 3, Palm
Beach Gardens, Florida. Those persons present were:
TRUSTEES OTHERS
Ed Morejon Margie Adcock, Pension Resource Center,
Tom Murphy Administrative Manager
Steve Rogers Joe Bodgahn, Bogdahn Consulting,
Investment Monitor
Robert Sugarman, Attorney
MINUTES
The Board reviewed the minutes of the meeting held May 17, 2004. Steve Rogers
questioned about the non - response from the City of the letter sent by the Board asking if
they would rehire an individual on a disability retirement if it was found that they were
able to return to work. Robert Sugarman stated that the City is just ignoring the letters
from the Board and that is disrespectful to the Board. The Board questioned what would
happen if the Board determined that an individual on a disability retirement was
determined to be able to return to work but the City did not rehire them. Margie Adcock
provided the Board with a copy of the current Ordinance. Mr. Sugarman stated that if the
Board determines that an individual on a disability retirement is no longer disabled the
Board must recommend to the City that the City rehire the individual back and the Board
would stop the pension payments. If the City does not rehire the individual, then the
individual will have no job and no pension. There was then discussion about the effect of
the recommendation of surgery to a disability applicant. Mr. Sugarman stated that if
surgery is recommended to the applicant and the surgery is appropriate and the prognosis
is that the person will be able to return to work as a firefighter, then the disability is not
permanent and a disability retirement can not be granted. It was noted that there is a new
job description for the Department and there was discussion on which job description
would apply to the individuals on disability retirement. It was noted that at the last
meeting the Attorney present advised that the old job description would apply. Mr.
Sugarman stated that the new job description applies to whether a disability retiree is still
disabled. There was then discussion that the 2% of pay for the cost of the additional
benefits was to be taken out prior to any distribution to the individual accounts. The
minutes of the meeting of May 17, 2004 reflect otherwise. Mr. Sugarman stated that the
2% comes off the top and suggested amending the minutes of the meeting of May 17,
2004. A motion was made, seconded and carried 3 -0 to accept the minutes of the
meeting held May 17, 2004 as amended.
INVESTMENT MONITOR REPORT
Joe Bogdahn appeared before the Board to discuss investment performance for the
quarter ending June 30, 2004. The Fund was down 1.01% for the quarter while the
benchmark was up .36 %. The Fund was up 12.35% for the year while the benchmark
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was up 12.21%. The total market value of the Fund as of June 30, 2004 was $9,336,000.
The asset allocation at market was 66% in equities; 31% in fixed income; and 3% in cash.
The fixed income was down 2.34% for the quarter while the benchmark was down
2.52 %. The total market value of the fixed income portfolio was $2,875,000. Equities
for the quarter were down .47% versus the S &P 500 which was up 1.72 %. The total
market value of the equity portfolio was $6,166,000. Mr. Bogdahn stated that it was a
disappointing quarter and the Manager had a bigger swing than they normally have. He
stated that he talked to the portfolio manager and stated that they have picked up about
100 basis points in the month of July. He noted that he anticipates that the next two
quarters will be strong. He stated that the longer term performance of the Manager is
good. For the last three quarters for equities they are up 15.97% and in the 25`h percentile
and for the one year they are up 20.38% and in the 16`h percentile.
There was then a discussion on pension obligation bonds. It was noted that the Board
previously had people come into talk to them about this and sent them to the City to
discuss such bonds. The Board felt that the City might have missed any opportunity to
get involved with pension obligation bonds. It was noted that the employees want some
more benefit improvements and they need to find a way to come up with the money to
fund such improvements. It was noted that this Fire Department is behind other local fire
departments even with the most recent benefit changes that were made to the Plan. Mr.
Sugarman suggested that a wish list be created and that the Board have the Actuary cost
the items out. It was noted that if the interest rate assumption is lowered it will create an
increase to the City. It was noted that the Board can not maintain the current interest rate
assumption of 8.5% if there is no prospect to maintain it. Mr. Sugarman recommended
discussing this with the Actuary and the Investment Monitor. Mr. Bogdahn discussed a
Sarasota pension plan where they locked in bonds and hold them to maturity. It ties up
the money but it was noted that there was a strong cash flow here. Mr. Bogdahn stated
that he would discuss this with the Actuary. Mr. Sugarman stated that the places where
the Fund can get more money are from superior investment returns, the employees, the
City or Chapter 175 monies. It was noted that a meeting would be held with the members
to get a wish list of benefit improvements for the Actuary to cost out. A motion was
made, seconded and carried 3 -0 to authorize the Actuary to cost out certain benefit
improvements and to share the results with the Union and the City. There was then
further discussion on Dana Investment Advisors. Mr. Bogdahn stated that he
recommended Dana Investment Advisors continue to be retained as the Investment
Manager.
ATTORNEY REPORT
Mr. Sugarman discussed Chapter 2004 -21 of the Laws of Florida. He stated that he sent
a letter to the City Attorney on this matter. He also stated that he prepared an Ordinance
that provides that retirees may authorize direct third party payments as a deduction from
met benefits, bringing the Plan into compliance with Chapter 2004 -21 of the Laws of
Florida, enacted by the 2004 Florida Legislature. A motion was made, seconded and
carried 3 -0 to approve the proposed Ordinance and have it forwarded to the City for
passage.
Mr. Sugarman reported that Steve Rogers has been cleared of any ethics charges and the
fine has been waived because of the unusual circumstances that were involved.
Mr. Sugarman reported that Kathleen Bush has filed a disability application and that his
office is in the process of obtaining medical records. He stated that she will be sent for
an independent medical examination one he receives all the records. Mr. Sugarman also
reported on the status of the disability review of Richard Hodgkins and Kevin Mitchell.
Mr. Sugarman advised that a person who leaves employment after five years is entitled to
their Share Account monies.
It was noted that the City approached the Actuary on doing a cost analysis on one
member with regards to buying years of service. It was further noted that the Actuary did
the analysis without consulting with he Board. Mr. Sugarman stated that the Actuary
should not have proceeded without contacting the Board. The Board will discuss this
with the Actuary at a future meeting.
ADMINISTRATIVE REPORT
Margie Adcock presented the list of disbursements to be made. A motion was made,
seconded and carried 3 -0 to approve the disbursements listed.
Ms. Adcock reported that Richard Beladino had contacted her office regarding a concern
with the service of the Administrator including registration at a conference and timeliness
issues of the agenda packets. Ms. Adcock stated that she spoke with Mr. Beladino prior
to this meeting and it appeared that the issues had been resolved with Mr. Beladino, but
stated that she would report to the Board on his concerns to ensure there were no issues.
The Board advised that they had no concerns with the Administrator and stated that there
would be no further discussion on the matter unless Mr. Beladino raises an issue himself.
Ms. Adcock noted that the Board had Steve Gordon perform the Audit last year and had
discussed the decision of having an independent audit performed every year. The Board
determined that it wanted to continue with having Steve Gordon perform an annual
independent audit of the Fund.
Ms. Adcock discussed the matter of Shawn Thurman.
OTHER BUSINESS
There being no further business, and the next meeting being scheduled for Monday,
November 15, 2004 at 11:00 A.M., the meeting adjourned at 1:10 P.M.
Respectfully submitted,
Ed Morejon, Secretary