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Home My WebLink AboutMinutes GEPB 080706General Employees Pension Fund Meeting Minutes August 7, 2006 The General Employees Pension Board met on August 7, 2006 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 by Chairperson, Stephen Parella at 2:11 p.m. L ROLL CALL Members Present: Members Absent Stephen Parella Dindial Laljie Kenneth Steele Allan Owens Jami Smith Additional Attendees: Sarah Varga, Accountant Dave West — Bogdahn Consulting H. APPROVAL OF MINUTES MOTION: Approval of the minutes' from the May 8, 2006 Meeting. MOTION BY: Steve Parella MOTION SECONDED BY: Dindial Laljie MOTION CARRIED. Minutes were approved. DISCUSSION: Kenneth Steele asked for a clarification on the second page of the minutes regarding equity being reflected at 65% plus 5 %. Mr. West explained that it was 65% plus the 5 % International, for a total of 70 %. III. REPORT FROM BOGDAIN CONSULTING, LLC Dave West conducted an overview of the General Employee's Retirement System, dated June 2006, calling to mind that a new management team went into effect beginning October 2005 and has made forward strides; positive changes are reflected in the Bogdahn Consulting GBRS June 2006 Report, comparing the 6/30/2006 figures to the 2006 YTD figures, particularly pointing out the following items: • Page 2 — Cash Flow — Trailing Returns through 6/30/06, annualizing as follows: Year l Fund 5.51, Policy 4.71 (Diff 0.80); Year 2 Fund 5.70, Policy 5/75 (Dill. - 0.05); Year 3 Fund 7.42, Policy 7.45 (Diff.- 0.03). For Calendar Year Returns through the 6/30/06 Ouarier, Fund -1.09, Policy -0.89 , (Diff. - 0.20); For 2006 YTD, Fund was 11.59, Policy 1.35 (Dill 0.24). • Page 3 — Asset Allocation through June 30, 2006 — At Market Cash & Equiv 2 %; Fixed Income 37%; Equity 61 %. At Cost Cash & Equiv 2 %a; Fixed Income 391/o; Equity 590/o.. • Page 5 — Contribution — Trailing Returns through 6/30/06, annualizing as "follows: Year 1 5.51 Return (40 percentile); Year 2 5.70 Return (39 percentile); Year 3 (43 percentile). For Calendar Fund Year Returns through .the 6/30/06 Quarter, Fund Return_ -1.09 (55 Percentile); For 2006 YTD, Fund Return 1.59 (42 percentile). For. Calendar Year Policy Returns -0.89 (42 percentile); For 2006 YTD 1.59 Return (42 percentile); Policy Return 1.35 (52 percentile). General Employees Pension Fund Meeting Minutes 080706 Page 1 • Page 6 — Total Fixed Income — Executive Summary — Sawgrass and Lehman Aggregate Bond Market contributed to results. • P4ge.7 — Total Fixed Income — Universe Comparisons — During the first six months the bonds were not a big driver for the quarter. • Page 10 — Total Equity — Executive Summary — For the Calendar Year Returns, bench marks changed from -0.36 in 6/30/06 Qtr. to 0.10 for 2006 YTD. • Page 11 — Total Equity — Universe Comparisons — Pure Large Cap Core — Calendar Year Returns for Fund Return went from -1.80 for 6/30/06 Qtr. to 2.81 for 2006 YTD (changing from 55 percentile to 36 percentile). The Policy Return went from -1.44 for 6/30/06 Qtr. to 2.71 for 2006 YTD (changing from 38 percentile to 39 percentile). • Page 13 — Equity & Cash Rockwood — Calendar Year Returns for Fund Return went from -1.80 6/30/06 Qtr. to 2.81 for 2006 YTD (changing from 55 percentile to 36 percentile). The Policy Return went from -1.44 for 6/30/06 Qtr. to 2.71 for 2006 YTD (changing from 38 percentile to 39 percentile — average ranking). Meaning: for the quarter it trailed, but was up for the YTD figures. Neither equity or peer group were drivers for the market. As of 6/30 the International allocation moved to a defensive posture. Steve Parella questioned the exact date moved to the International sector; Dave West will research and report answer. (Date presently is only reflected as ending 6/30/2006.) Mr. West noted that in the Portfolio Appraisal section of the report, that on Page 2 there are three International Equities reported: Canadian. Pacific'Raiiway, Ltd.(new); Rynair Holdings PLC -SP (ADR); and Volvo Aktiebolaget (ADR). Ken ,Steele applauded these three and noted that they are a good start as presently reported. But he asked for clarification on the 5% international allocation and where it had been derived from.; he felt it should not have been taken out of the domestic — it should have been out of equity rather than bonds. Mr. West was in agreement, but stated that the since reports had already been filed, he would take care of making the requested adjustment. He wants to assure that we are within the 31 -day posting qualification required -for all policy changes. Allan Owens inquired whether the ward had approved the policy change and if this were only an internal change; Steve Parella stated the Board had approved this action and that Scott Christiansen (Pension Board Attorney, who is not present at this meeting, but will appear at the next meeting) has been working on this issue and his report will be presented at the next meeting. Bogdahn and Rockwood will be coordinating this bond/equity change; Mr. West will assure that the letter is put out to make the above adjustment; changing from 65% to 70"/o equity total. Mr. West will follow up with Mr. Christiansen to assure it has been implemented and reported accordingly. Steve Parella stated that Scott Christiansen had been working on the Summary Plan Description, and that he feels that the policy change is in order; but Dave West should follow up with Scott on this item. General Employees Pension Fund Meeting Minutes 080706 Page 2 IV. APPROVAL OF BILLS The procedure for paying bills was changed per a motion at a previous meeting. Bills are now paid and then'reported to the Board for approval at the meeting. The following bills have been paid and were reported by Steve Parella as follows: Bogdahn Consulting, LLC Period of 4/1/06 — 6/30/06 $2,000.00 Christiansen & Dehner Period of 4/30 $ 242.13 Christiansen & Definer Period of 6/1.9 $1,088.38 Rockwood Qtrly.Fee GEPP (based on 70 point basis fee) $3,000.25 Sawgrass Asset Management Period of 6/30/06 (35 pt. fee) $ 912.00 Salem Trust Period of 6/30/06 $ 750.00 MOTION: Approval of payment for the stated bills. MOTION BY: Steve Parella MOTION SECONDED BY: Allan Owens MOTION CARRIED: Payment of bills was approved. V. ADDITIONAL ITEMS Legal Issues In lieu of Mr. Christiansen's participation at meeting, Dave West brought up three items on a Legal agenda that he felt were relevant: • Florida Legislation pending — no action — nothing has changed regarding pension plans ` • National Legislation on Pension plans — some items are up for change regarding full funding that may affect PBGC — to date nothing has changed regarding public pension plans. • Form 1 Financial Disclosure Forms deadline is here — Steve Parella inquired whether members had complied; everyone replied that they had filed. Retirement Plans Ken Steele brought up a concern on present retirement plan; we have a small group of people and the city has turned down new employees coming into the present 401 retirement plan. Allan Owens agreed that the city has taken that view, however, per their August meeting agenda'they are looking at another defined plan:for new general employees (The Florida Retirement System — FRS). Present employees will have the choice of remaining in the existing 401 Plan or changing to the FRS plan. New employees will be required to join the FRS (401 will'not be available as an option for them.) Ken brought up the thought that the retirement issue will probably have a lot of changes and be under constant scrutiny due to the large number of "baby boomers" preparing for retirement. Allan agreed and indicated the need to get out of a defined benefit plan and that it appeared the FRS would be better way. General Employees Pension Fund Meeting Minutes 080706 Page 3 VI. ADJOURNMENT With no further business to discuss the meeting adjourned at 2:50 p.m. APPROVAL: Stephen Parella Dindial Laljie Allan Owens Kenneth Steele Jamie Smith Submitted By: Tuesday Craig Municipal Services Coordinator { Note: These summary minutes are prepared in compliance with 286.011 F.S. and are not verbatim transcripts of the meeting. A verbatim audio record is available from the Office of the City Clerk. 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