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HomeMy WebLinkAboutMinutes Police Pension 012612 Minutes 1-26-12.doc Page 1 of 4 City of Palm Beach Gardens Police Officers’ Pension Fund Minutes of the Meeting Held January 26, 2012 The regular meeting of the Board of Trustees of the City of Palm Beach Gardens Police Officers’ Pension Fund was called to order a t 9:07 AM by Jay Spencer in the Council Chambers at the Palm Beach Gardens City Hal l at 10500 North Military Trail, Palm Beach Gardens, Florida. TRUSTEES PRESENT OTHERS PRESENT Jay Spencer, Chair Audrey Ross (Resource Ce nters) David Pierson, Secretary Bonni Jensen (Law O ffices of Perry & Jensen) Brad Seidensticker, Trustee Donna Kramer (PBG Clerk’s Office) Marc Glass, Trustee Steve Stack (ICC Capital Ma nagement) Wayne Sidey, Trustee John McCann (Thistle Asse t Consulting) Steve Palmquist (GRS) Jim Burdick (CBH) Mr. Spencer introduced and welcomed new Trustee Mar c Glass to the Board. He is the new Trustee that was elected to fill Mr. Barone ’s vacancy. Discussion with City Regarding the Collective Barga ining Agreement Changes to the Pension Plan & Chapter 185 Money Ms. Ross stated that the City had asked the Pension Board to reschedule their January meeting to today so that the City’s Finance Director could be present to review and discuss some of the pension changes. It was noted that the board did comply with the City’s request and rescheduled thei r meeting, although no one from the City ever attended. Ms. Jensen explained that the Police Officers did n ot pass the CBA the other day, and the Board discussed what would happen from here. I t was explained that more than likely this issue will be taken up in a Special Mas ters. Ms. Jensen reviewed the process of going though a Special Masters and expla ined what the City “theoretically” can impose and what they cannot. The board discuss ed the different options that the City has put on the table in regards to negotia tions, such as a start/stop plan, merging both the Police & Fire pension funds togeth er, opting out of the Chapter 185/175 Plans, or moving into the FRS. The Plans A ctuary, Mr. Palmquist noted that he has done a good amount of cost studies for the P lan and parties involved during this process and he commented that closing out the Plan will cost the City more up front and will take about 15-20 years for the City to start seeing some savings. Also the Plan’s unfunded liability would have to be paid off before they can close the Plan. Lastly Mr. Palmquist stated that benefits can be ch anged going forward, but any benefits that have already been earned cannot be ta ken away. Mr. Sidey asked what the motive could be behind opting out of the Chapte r 185 Plan since that is free money the Plan and City receives each year. Ms. Je nsen commented that the main motivation for the City would be to have the local control over the pension plans and then to eventually move into the FRS. Ultimately w e will have to wait for the outcome of the bargaining units to see what changes will actually be made. Minutes 1-26-12.doc Page 2 of 4 INVESTMENT MANAGER REPORT ICC Capital Management – Presented by Steve Stack Mr. Stack briefly reviewed his firm and what servic e they provide to the board as an update for new Trustee Mr. Glass. ICC Capital runs the Fund’s fixed income and equity portfolios. For the quarter ending December 31, 2011 the fixed income portfolio had a great quarter and outperformed the benchmark at 1.54% net of fees versus 1.12%. The Equity side also had a strong quarter and outperfor med the benchmark net of fees at 11.34% versus 10.61%. Mr. Stack reviewed the curre nt market environment and commented that ICC has started to trade some U.S. T reasuries which has benefited their portfolio. They also increased their credit quality by moving more into AAA and AA and out of BB, BBB and A. Also they are taking more risk in duration and are also trying to keep the barbell effect in the portf olio. Mr. Stack explained that they are starting to see more value in the Equities, whi ch have already started to rally and if inflation does hit then ICC might get hurt b ecause they long duration by lowering the average credit quality. INVESTMENT CONSULTANT REPORT Thistle Asset Consulting – Presented by John McCann Mr. McCann stated that he has revised the Plan’s In vestment Policy Guidelines to reflect an allocation to Real Estate and to also in clude their new Real Estate Manger, American Realty. MOTION: Mr. Seidensticker made a motion to approve and accept the revised Investment Policy Guidelines as presented b y the Plan’s Consultant to include an allocation to the n ew Real Estate Manager, American Realty. SECOND: Mr. Pierson seconded the motion. CARRIED: The motion carried unanimously 5-0. Mr. McCann reviewed the total funds performance for the quarter ending December 31, 2011. The total fund net of fees was slightly behind the benchmark at 7.34% versus 7.70%, which is also the same for their fiscal year to d ate. For the 1 year, the fund is also behind at 1.59% versus 2.46%. Mr. McCann stated that all managers outperformed for the quarter with the exce ption of the Rhumbline S&P 500 account, which fell shy of the index at 11.80% vers us 11.82%. He noted that the fund was behind for the quarter net of fees only, a nd not gross. PRESENTATION OF THE SEPTEMBER 30, 2012 AUDITED FINA NCIAL STATEMENTS Cherry, Bekeart & Holland (CBH) – Presented by Jim Burdick Mr. Burdick introduced himself to the new Trustee. He commented that the report here today is the draft report of the Audit and the y are still waiting on a couple more confirmations before they can release the final cop y. Although Mr. Burdick stated that he does not think any of the numbers or materi al will change in the final revision. Mr. Burdick reported that there were no material we aknesses found while performing the audit and they have issued an unqualified opini on, which is the highest level of opinion that can be issued. He reviewed the Plan’s internal controls which are well Minutes 1-26-12.doc Page 3 of 4 documented in the report, and also the Plan’s asset s which are tracked on a market value. Mr. Burdick noted that that the Plan does n ot have any liquid or unvalued assets in the portfolio. Lastly he commented that there were no disagreements or difficulties with any party involved in the audit p rocess while performing the audit. The Trustee’s tabled the approval of the Audit unti l all information and confirmations are received in case anything does change. ATTORNEY REPORT Law Offices of Perry & Jensen - Presented by Bonni Jensen Ms. Jensen reviewed the memo regarding the task for ce on public employee disability presumptions. She explained that the Di vision of Retirement created a task force and they were to review the disability presum ptions pursuant to SB 1128. Ms. Jensen stated that the task force could not reach a consensus on the findings and recommendations, although they did agree that a wel lness program would help reduce the cost of group health and worker’s compen sation claims. She noted that no action is needed at this time. Ms. Jensen notified the Board that she did receive the American Realty documents and she reviewed some important materials that need ed to be disclosed to the Trustees’ before investing. The Trustees reviewed Ms. Jensen’s memo that outlined the important information that needed to be disclos ed and they commented that they understood the rules and regulations behind it all. MOTION: Mr. Sidey made a motion to approve and acce pt the agreements with American Realty. SECOND: Mr. Seidensticker seconded the motion. CARRIED: The motion carried unanimously 5-0. Ms. Jensen briefly explained the changes that were proposed in HB 1499 which would affect the Plan’s funded ratio. She commente d that this bill was filed on 1/18/2012, but has not been approved. Ms. Jensen w ill update the Board as more information becomes available. Ms. Jensen reviewed the revised and final statement of policy regarding expenses associated with public records, class actions, and domestic relations orders. MOTION: Mr. Sidey made a motion to approve and acce pt the revised statement of policy regarding expenses associated w ith public records, class actions, and domestic relations orde rs as presented. SECOND: Mr. Seidensticker seconded the motion. CARRIED: The motion carried unanimously 5-0. ADMINISTRATOR REPORT Resource Centers – Presented by Audrey Ross Ms. Ross presented the board with the 2012 fiduciar y liability insurance renewal quote. She commented that the premium this year ha s decreased by $484 from last year. MOTION: Mr. Seidensticker made a motion bind covera ge for the 2012 Fiduciary Liability Insurance Renewal. Minutes 1-26-12.doc Page 4 of 4 SECOND: Mr. Sidey seconded the motion. CARRIED: The motion carried unanimously 5-0. Ms. Ross stated that she has the Salem Trust author ized signors form with her today that needed to be updated and executed since we hav e a new Trustee on the Board. MINUTES MOTION: Mr. Pierson made a motion to approve the mi nutes from the October 20, 2011 regular meeting. SECOND: Mr. Sidey seconded the motion. CARRIED: The motion carried unanimously 5-0. DISBURSEMENTS APPROVALS MOTION: Mr. Pierson made a motion to approve the di sbursements. SECOND: Mr. Sidey seconded the motion. CARRIED: The motion carried unanimously 4-0. BENEFIT APPROVALS MOTION: Mr. Sidey made a motion to approve the appl ication to enter the DROP for Robert Odell, the application to exit the DROP for Martin Greenberg, and the application for distribut ion from DROP account (due to retirement) for Martin Greenbe rg. SECOND: Mr. Seidensticker seconded the motion. CARRIED: The motion carried unanimously 5-0. FINANCIAL STATEMENTS The board reviewed and discussed the financial stat ements that were provided through December 2011. The board received and filed the financial statemen ts through June 2011. OLD BUSINESS Mr. Spencer stated that Mr. Smith has contact him a gain regarding his situation. Mr. Smith was one of the members who opted out of the p ension plan years ago. He now wants to “repay” back his contributions for the time that he was not in the pension plan. Ms. Jensen explained that he cannot just pay back the amount that he would have contributed into the Pension plan as if he never opted out the plan, but rather he would have to buyback and purchase his pr evious time with the City to be credited for it. Mr. Spencer directed Ms. Jensen t o send a letter to Mr. Smith explaining this. OTHER BUSINESS The Trustees stated that they would like to get Mr. Barone a little gift to thank him for his time and commitment that he serve on th e pension board for so many years. Minutes 1-26-12.doc Page 5 of 4 MOTION: Mr. Sidey made a motion to authorize the ad ministrator to purchase a $100 gift card to a restaurant of the Bo ard choice for former Trustee Jules Barone. SECOND: Mr. Seidensticker seconded the motion. CARRIED: The motion carried unanimously 5-0. PUBLIC COMMENTS N/A AJOURN There being no further business, and the future mee tings are scheduled for the 3rd Thursday of the first month proceeding the quarter. The next regular meeting was scheduled for Thursday April 19, 2012 at 9AM; the T rustees officially adjourned the meeting at 11:22AM. Respectfully submitted, _____________________________ DAVID PIERSON, Secretary