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HomeMy WebLinkAbout07-21-2016 MinutesDraft7/21/2016 Minutes Sebastian Police Pension Board Minutes July 21, 201610:00 a.m. Sebastian City Council Chambers TYPE OF MEETING: Special ATTENDEES: Board Members: Steve Marcinik, Chair Robert Zomok, Secretary Ken Killgore Richard Snell Bruce Hoffman EXCUSED: CONSULTANTS: CITY HR MANAGER: Cindy Watson CALL TO ORDER 10:00 a.m. Steve Marcinik, Chairman called the meeting to order. VOTE TO EXCUSE ABSENT BOARD MEMBER N/A PUBLIC COMMENT NONE APPROVAL OF MINUTES 10:13 a.m. Richard Snell motioned the revised minutes of the June 14, 2016 Board Meeting be approved. Motioned seconded by Bob Zomok and passed unanimously. OLD BUSINESS A. Reconsider Adopted Operating Rules and Procedures Bruce Hoffman, Board Member Bruce Hoffman moved to change Rules 1.7 A -B -C to reflect four (4) year terms for all Directors. The terms for the Police Officer Directors shall be alternating. Steve Marcinik seconded the motion and it passed with Bob Zomok dissenting. v- 1 Draft7/21/2016 Minutes Ken Killgore moved to delete Rule 5.2 C. Bruce Hoffman seconded the motion and it passed unanimously. The Board determined to review Rule 7.3 with Counsel at the September 20, 2016 meeting. The Board determined that there are several issues that need to be combined into a document from the City of Sebastian defining the Duties of the City including items in Rule 12 — Accounting Services. The Board also needs to complete the exploration of a "requirement" to have the Plan audited by an outside firm. The Valuation was discussed as possibly fulfilling this requirement; however, the document accompanying the Valuation specifically prohibits using the Valuation for any other purpose. The Board determined the need to update the calendar of requirements. This document was originally produced by Lee Dehner. Ken Killgore is to lead the review and updating processes. B. Discussion of SB 172 — Change to City Ordinance Bruce Hoffman Board Member The document distributed by Lee Delmer at the June meeting will be reviewed at the September 20, 2016 meeting. NEW BUSINESS A. Approval of Payment to Highland Capital $14,463.86 to 06/30/16 Steve Marcinik, Chairman B. Approval of Payment to Foster & Foster $744.00 Steve Marcinik, Chairman Ken Killgore moved to approve these two payments and presented bills from Christiansen & Dehner in the amount of $5,210.67 and the bill from Salem Trust in the amount of $1,860.00 for approval. Bob Zomok seconded the motion and it passed unanimously. C. Annual Determination and Disclosure of Illiquid Assets/Securities Bruce Hoffman, Board Member The term "Illiquid Assets is defined in the Investment Policy. Bruce will follow up on this item and it will be an agenda item for the September 20, 2016 meeting. D. Administrative Cost and 2017 Proposed Budget, The Cost of Doing Board Member Business (Compliance) for a Small Dollar Plan IV- Draft7/21/2016 Minutes Bruce Hoffman, Board Member Bruce presented the Pension Plan Budget for this fiscal year. The 2016/2017 Budget will be presented for review and approval at the September 20, 2016 meeting E. City Budget/Pension Issue Going Forward — Concerns for the Plan Bruce Hoffman, Board Member Bruce noted that the decrease in the Expected Rate of Return (planned to go to 7.3%) may cause the City to increase its contribution. The Board had determined to keep the City's contribution to 14.2%; however, Bruce noted that even the lower rate of return may not be achievable in the current market. The Board monitors the Plan performance each quarter. During the discussion, the need to continue to continue to pursue alternative approaches to Asset Allocation was noted. (See Item H below) F. Contracts and Insurance Notebook Bruce Hoffman, Board Member Bruce raised the question concerning the actual repository for the contracts and insurance policies approved by the Board. This subject will be discussed at the September 20, 2016 meeting when Lee Delmer will be present. The Board opined that they may reside with our attorney. Ken Killgore noted that he is unaware of any central repository within the City offices for these documents. A review of these documents will be included in the revision of the Board's Calendar. G. Annual Calendar of Items to do Each Quarter of the Year Bruce Hoffman, Board Member See Items A and F above. H. Discussion of Investment Policy Steve Marcinik, Chairman The discussion of Asset Allocation continued along with the necessity to review the Investment Policy. At the moment, the Board is considering continuing with Highlands Capital, determining the Asset Allocation desired along with preparing RFPs to fund managers for each of the asset allocation markets, or moving to a WRAP program. If the Board opts for the WRAP program, this would eliminate our relationship with Highlands Capital. Morgan/Stanley would take over tracking and reporting all activity of the various fund managers. The question arose about the fallout that might occur in the form of creating an "empty seat" at the Board meeting. The "empty seat" refers to the State requirement of having 1 V- 3 Draft7/21/2016 Minutes an objective third party review the performance of the fund manager. This item and the various approaches will be part of the agenda for the September 20, 2016 meeting. Further, the Board needs to resolve the question of when to revise the Investment Policy. At the moment, there are two approaches being discussed — revise the Policy first so that we can guide the investment managers or revise the Investment Policy as we determine what market products we will move to as part of the Asset Allocation revisions. I. Board Member Comments Steve Marcinik, Chairman Ken Killgore advised the Board that he had received communication from Salem Trust concerning the placement of money market funds into a government fund. Morgan/Stanley was consulted and recommended this change and Ken had implemented it. The Board ratified this change in money market funds investment. J. Next Quarterly Meeting: September 20, 2016 Steve Marcinik, Chairman As noted above, the following items will be on the agenda: Review of the Operating Rules Changes Discussion of the document required from the City of Sebastian and determination of the items to be included in that document to include the "requirement" for a Plan audit conducted by an outside firm. Review of the updating of the Board's Calendar of Requirements Update on the actions necessary, if any, on "Illiquid Assets." Budget Update Location of current contracts and insurance policies Asset Allocation/Investment Policy A. There being no further business, the meeting was adjourned at 12:10 PM Respectfully Submitted, Bob Zomok, Secretary IV -4