HomeMy WebLinkAboutMinutes Fire Pension 052107PALM BEACH GARDENS FIREFIGHTERS' PENSION FUND
MINUTES OF MEETING HELD
May 21, 2007
A meeting of the Board of Trustees was called to order at 10:03 A.M. at Station 3, Palm
Beach Gardens, Florida. Those persons present were:
TRUSTEES
Ed Morej on
Steve Rogers
Tom Murphy
Philip Buttaravoli
MINUTES
OTHERS
Margie Adcock, Administrator
Ken Harrison, Attorney
Dave West, Investment Monitor
Mike Dana, Investment Manager
The Board reviewed the minutes of the meeting held April 30, 2007. Mr. Morejon
requested that the actual assumed rate of return be reflected in the last paragraph of the
second page. A motion was made, seconded and carried 4 -0 to accept the minutes of the
meeting held April 30, 2007 as amended.
DANA INVESTMENT ADVISORS
Mr. Dana appeared before the Board to report on the performance for the quarter ending
March 31, 2007. He reported that the equity market was good and stronger than expected.
He stated that there was low unemployment and a lot of demand for securities. He noted
that some companies are buying back their own stock or doing private equity deals. As such,
there are less stocks and bonds available and more demand for them. The total market value
of the portfolio as of March 31, 2007 was $17,334,610. He discussed the performance for
the quarter ending March 31, 2007. The total portfolio was up 2.45% for the quarter while
the benchmark was up 1.38 %. The fixed income portfolio for the quarter was up 1.58%
while the benchmark was up 1.59 %. Equities for the quarter were up 3.15% while the
Russell 3000 was up 1.28 %. Since inception of June 10, 2002, the portfolio was up 8.10%
versus the benchmark which was up 7.21 %. Mr. Dana reviewed the bond characteristics.
He stated that the portfolio had an AA credit quality rating. The fixed income duration was
just a little shorter than the benchmark at 3.12 years versus 3.66. He reviewed the treasury
yield curve. He noted that foreign securities have done very well. He stated that it was a
great economy worldwide.
Mr. Dana stated that they have a growth product that he likes very much. He stated that he
sees growth a little less expensive than value. He stated that he would like to blend the
portfolio with 50% in growth and 50% in value. He thinks large cap value and growth will
outperform temporarily small cap. Mr. West stated that perhaps the Board could talk more
about it at the next meeting.
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Mr. Dana reviewed the asset allocation. As of March 31, 2007 the asset allocation was 49%
in large cap equities; 11% in small cap equities; 35% bonds; 2% in ARMs; and 3% in cash.
Mr. Dana reiterated that he thought it was time to split growth and value. Mr. West stated
that he sees a migration to large cap. He noted that the timing of the shift was the question.
He was not sure there was an urgency to do it today. He stated that it was a topic that he
would like to bring more information and a recommendation back to the Board on. There
was a lengthy discussion. Mr. West stated that he would bring back information and a
recommendation. The Board asked Mr. West to bring back options of other managers who
manage strictly growth products as well. There was further discussion. The Board stated
that they were pleased with the performance of Dana. However, if there were to be
discussions on changing things, the Board wants to make sure that they follow their due
diligence and look at all options.
Mr. Harrison noted that his office provided a letter to be sent to the State on the annual
expected rate of return. He noted that the State wants to see that the Actuary, Manager and
Monitor had input. There was a lengthy discussion.
INVESTMENT MONITOR REPORT
Dave West appeared before the Board. He discussed the investment performance for the
quarter ending March 31, 2007. The Fund was up 2.63% for the quarter while the
benchmark was up 1.67 %. The total market value of the Fund as of March 31, 2007 was
$19,375,000. The asset allocation at market was 62% in equities; 33% in fixed income;
2% in REIT and 3% in cash. He stated that he was not suggesting any rebalancing at this
time. Equities for the quarter were up 3.37% versus the benchmark which was up
1.71 %. The equity portfolio managed by Dana was up 3.0% for the quarter while the
benchmark was up 1.28 %. The total market value of the equity portfolio managed by
Dana was $10,389,000. The international equities managed by Voyageur Asset
Management, formerly known as Freedom Capital, were up 5.78% for the quarter while
the benchmark was up 4.15 %. Since inception of December 31, 2005, the Fund's
portfolio was up 32.58% versus the benchmark which was up 24.96 %. The total market
value of the international equity portfolio was $1,707,000. The REIT portfolio was up
4.48% for the quarter while the benchmark was up 3.62 %. The total market value of the
REIT portfolio was $331,000. It was noted that again American Realty had not called a
lot of money for the REIT portfolio but stated that he was expecting a capital call shortly.
There was a lengthy discussion on the capital calls. Mr. West stated that there were no
compliance issues with the Fund. He provided a revised Investment Policy Statement.
Mr. Harrison stated that he just received the Statement and had some initial comments.
He stated that he would review the Statement and provide his comments.
Mr. Dana departed the meeting.
There was a discussion on the appropriate benchmark to use if the equity portfolio is split
50% in growth and 50% in value. Mr. West stated that he would recommend using the
Russell 3000 for the total equity portfolio but noted that they would also compare Dana's
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growth product to the appropriate growth benchmark and the value product to the
appropriate value benchmark.
ATTORNEY REPORT
Mr. Harrison reported on the status of the contract with Galliard. He stated that at the last
meeting Galliard said that they had other Florida public pension plan clients and could
provide those contracts. However, what they provided was their standard boilerplate
contact which he said was not acceptable. They responded back this morning that they
could not provide the contracts with any other Florida clients without the permission of
those clients. Mr. West stated that he would provide Mr. Harrison with a contract that
Galliard has with another Florida public pension plan.
Mr. Harrison reported on the status of the Ordinance amendment. He stated that the City
indicated that they did not receive the impact statement and that is why the City did not
put it on the agenda as of yet. Mr. Morej on stated that the impact statement was sent to
the Finance Director. Mr. Harrison stated that he would continue to follow up with the
matter.
Mr. Harrison provided an update of the legislation. He reported on a survey done by
Primus Global regarding risk tolerance. He noted that the survey showed the public plans
are becoming more risk tolerant and corporate plans are becoming less risk tolerant.
Philip Buttaravoli departed the meeting.
Mr. Harrison noted that the Form 1 Financial Disclosures are due on July 1.
It was noted that there was a vacancy on the Board from Richard Beladino. There was a
lengthy discussion. It was noted that the Administrator should send a letter to the City
Clerk regarding the vacancy.
ADMINISTRATIVE REPORT
Ms. Adcock provided the Board with a copy of the prior billing of the Attorney showing
what was considered "miscellaneous" as requested at the last meeting.
Ms. Adcock presented the list of disbursements to be made. It was questioned about the
billing for travel by the Attorney. It was noted that the Attorney was not supposed to
charge for travel if they were already up in the area for another meeting. Mr. Harrison
stated that he would follow up on that matter and would make any necessary adjustment.
He noted that it would have been an extra charge of $400. A motion was made, seconded
and carried 3 -0 to approve the disbursements listed less $400 for travel on the invoice for
the Attorney.
Ms. Adcock reported that the Actuary would be able to produce the employee benefit
statements for the Participants in the Plan. A motion was made, seconded and carried 3 -0
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to authorize the Actuary to produce the employee benefit statements for the Participants
in the Plan.
OTHER BUSINESS
Lt. Reid appeared before the Board. He inquired about the status of increasing the
benefits of the Plan. It was explained to him that the Board authorized the Actuary to
perform a study and the results of the study were provided to both parties. The matter is
now with the negotiating parties.
There being no further business, the meeting adjourned.
Respectfully submitted,
Tom Murphy, Secretary