HomeMy WebLinkAboutMinutes GEPB 062905General Employees Pension Fund
Special Meeting
June 29, 2005
General Employees Pension met on June 29, 2005 in the City of Palm Beach Gardens,
Council Chambers located at 10500 N. Military Trail, Palm Beach Gardens, Florida. The
meeting was called to order at 2:12 P.M.
Members Present: Kenneth Steele, Stephen Parella, Allan Owens, Jamie Smith arrived at
2:20 P.M.
Also Present: Joseph Bogdahn from Bogdahn Consulting
OLD BUSINESS
The board approved the minutes from the May 9, 2005 in a 3 -0 vote.
NEW BUSINESS
Approval of Bills To Be Paid
The Board approved the following bills to be paid in a 3 -0 vote:
Trustco - $5146.73 for quarter January — March 2005
Trustco - $258.70 for quarter October — December 2004
Christiansen and Deener - $1288.17 for Legal fees for May 2005
Fiduciary Insurance - $2178.00 for insurance through May 21, 2006
Reports by Prospective Investment Managers
Stephan Parella stated that this special meeting is being held to hear presentations from
prospective money mangers.
Joseph Bogdahn gave background of why they are seeing presentations from money
managers. Trustco, the current money manager has been on prohibition due to low
performance and the board is now considering changing money managers. He discussed
the fact that Trustco is rolling out a new product that could be very good for this pension.
Therefore, Trustco will also be presenting their new product at this meeting. He stated
that he liked the new product but was a little concerned because Trustco has taken a year
to roll out this product.
The three companies that will be presenting are Rockwood, Dana and Trustco. Mr.
Bogdahn gave a brief background on each company before asking the representatives to
come in to give their presentations.
Mr. Bogdahn gave the Board a account of how the proposed products have produced over
the past five years. He felt that any change to the plan will be an improvement to the
current plan they are in.
Tim Nash, Director Public Funds Unit from Trustco gave the first presentation on the
Active Allocation Fund. Tim gave a background of Suntrust and Trustco Company which
included some of the clients they work with. He stated Trustco believes they are a one
stop shop and they could handle all the City's needs with this pension plan. He went
through the different funds that are tied into this product. He said that this product is
designed to meet the challenges the organization faces every day with a dedicated
partner.
Mr. Nash discussed how they hire their managers and the expectations of each manager.
He talked about the recommended assets allocations and gave a breakdown of the
different allocations for each product.
The presentation included the historical performance annualized and the past risk and
return of current allocation. Stephen Parella asked how long Trusto keeps their managers
if they are not meeting objectives. Mr. Nash stated that their managers are always
expected to be in the top third. If they are not and the funds continue to lag they will
replace the large cap sector of the fund. There was a question about the length of time the
managers have been working with Trustco. Mr. Nash gave information about the
managers and their tenor with Trustco.
The next presentation was given by Andy Holtgrieve , Senior Partner and founder of
Rockwood Capital Advisors. Mr. Holtgrieve presented information to the board regarding
his background and the history of Rockwood Capital. He stated that 70% of their
business is dealing with public funds. He went over the accounts that the company has
lost in the last 5 years and gave a background of why these accounts were lost. He stated
that Rockwood has the best disciplined investment process he has seen in 23 years in this
business. He stated that they the equity discipline which includes buying stocks on the
rise with low risk. They invest in stocks that are expected to rise without regard for the
size or type. He discussed the equity portfolio performance over the past 5 years. He
stated that there are generally 40 stocks in the fund and cash is not part of their process.
There was discussion about the size of the company and the different types of stocks they
invest in.
The last presentation was given by Doug Clausen of Dana Investment Advisors. He also
gave background information about the firm, the process relating to stocks and the
process relating to bonds. He stated that the company is employee owned and will stay
that way. He stated that the largest part of their accounts are multiplies and most of them
are located in Florida. He stated the best way to describe their firm is Risk Adjusted
Returns. He explained how the company allocates their funds, how the company
capture's their growth rate and the companies overall performance. He explained that the
company's performance has been up even when the market was bad. He stated that
variable rate and fixed rate bonds would be blended in the portfolio and how the bonds
play a part in the portfolio. He discussed that Dana has never been negative in the bond
market and had only one negative year in the equity market. There were questions about
the small cap funds and how they are used in the fund. Mr. Clausen stated that most
municipalities are using small cap funds now and he feels they are an important part of
the fund. There was discussion about overweighting the sector and how it mirrored the
index.
The board discussed the three presentations Mr. Bogdahn gave a recap of each company
and what their approach to this pension fund would be. He felt that the three companies
had a different approach and that all of the funds would be better than where they are.
Stephan Parella felt they should move away from Trustco. Their past record did not prove
that they should stay with them, even with a new product. He personally, liked
Rockwood's approach better than Dana. The other board members agreed that it was
time to make a change and that even with Trustco's new product they did not want to stay
with them.
After additional discussion the board decided to change their money manager from
Trustco to Rockwood. The board voted 40 to have Attorney, Scott Christiansen draft the
necessary agreements and they will move toward to changing to Rockwood as their
money manger. Trustco will continue until all the contracts are signed and then
Rockwood will take over.
With no further business to discuss the meeting adjourned at 4:29 PM.
Submitted by:
L. C ,
Susan Bell, Public Information/Record CCoordinator