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HomeMy WebLinkAbout06-20-17 MinutesCITY OF SEBASTIAN POLICE PENSION BOARD MINUTES OF REGULAR QUARTERLY MEETING JUNE 20, 2017 1. Call to Order— Chairman Steve Marcinik called the meeting to order at 10:00 am. Present Board Members Steve Marcinik Rich Snell Ken Killgore Also Present Charlie Mulfinger, Greystone Consulting, Consultant Scott Owens, Greystone Consulting, Consultant Grant McMurray, Highland Capital Management, Consultant Jason Gillette, Officer (in audience) Cindy Watson, Human Resources Director Susan Mann, Recording Consultant 2. Vote to Excuse Absent Board Member(s) Officer Marcinik stated that there are no Members to be excused and there two vacancies. Mr. Killgore responded that he has one application and believes he will be receiving another application soon. 3. Public Comment None 4. Approval of minutes A. Regular Meeting March 21, 2017 A motion to approve the March 21, 2017 minutes as presented was made by Mr. Killgore, seconded by Officer Snell and passed unanimously by voice vote. 5. Old Business A: Approval of Payments a. Christiansen & Dehner (March) $ 2,034.29 b. Christiansen & Dehner (April) $ 2,638.44 c. Christiansen & Dehner (May) $ 551.10 d. Greystone Consulting $ 3,375.00 e. Salem Trust $ 1,635.00 Officer Marcinik read the Approval of Payments list for the record. A motion to accept the Approval of Payments was made by Officer Snell, seconded by Mr. Killgore and passed unanimously by voice vote. POLICE PENSION BOARD MINUTES OF REGULAR MEETING JUNE 20, 2017 Page 2 B. Discussion of Glove Tax Claims Mr. Owens provided an explanation of the claims. Mr. Killgore stated that no money has been received and the amounts will be small. It was agreed that no action is necessary by the Board. C. Review of Annual Calendar of Board Activities Mr. Killgore explained that the Calendar is updated quarterly and provided to the Board to ensure that all items necessary for review are addressed. He stated that there is no action required. D. Consider Ordinance for DROP, Cola and Buybacks Mr. Killgore provided details on the process making changes to the Ordinance has involved. He noted that he had received a draft of the Ordinance from the attorney and forwarded it to the PBA representative and has not heard back. He stated that once the PBA legal representatives are happy with the Ordinance it can be voted on by the Board and forwarded to the City Council for action. It was agreed that a special meeting should be called as soon as the revised draft is received and only the Board needs to be present. Mr. Killgore stated he will forward the email containing the Ordinance to each Board Member. 7. New Business A. Report from Investment Monitor Mr. Mulfinger stated that the market was very strong during the quarter. He provided details on the change in Managers. He explained that the agreements before the Board for signature allow the managers to make investment decisions. Mr. Killgore stated that the agreements are very complicated. Mr. Mulfinger responded that the attorney and Mr. Owens are the ones who prepared the agreements and he is coordinating getting them signed. Mr. Killgore reviewed the agreements being presented and Mr. Mulfinger provided an explanation of each. Mr. Killgore stated that signatures of two individuals are required to act on behalf of the pension plan and one signature is for certification. Following discussion it was agreed that the Board Chairman and Mr. Killgore would be the signing parties for the agreements. Mr. Mulfinger stated that the Pension Board could continue under the existing fee structure and it will be addressed at a future date. Mr. Owens provided an explanation of the state of the economy, the impact of the election and the market providing details on the circumstances that impact the market, investments and returns. He stated that all the indicators show that the economy is strong and the stock market is showing improvement in earnings. He stressed the need for diversification to protect against the fluctuation in market. He reviewed the securities in the portfolio, their values, earnings and trends. Mr. Mulfinger reviewed the Summary of Relevant Facts and provided details on how the portfolio percentage of investments compared to the Policy for those investments. He explained the return for the current quarter and past performance. He stated that there are two Policy Indexes POLICE PENSION BOARD MINUTES OF REGULAR MEETING JUNE 20, 2017 Page 3 to show how the international investments impacted the performance of the portfolio. He concurred that Policy Index 1 provides the best overall indication of performance. He reviewed the Manager vs Benchmark: Return through March 2017 and the 3, 5, 14 % year Risk/Return Analysis and provided details on each. Mr. Owens responded to Mr. Killgore's question regarding the actuarial assumption being reduced to 7.3, by stating that would occur with the new fiscal year. Mr. Mulfinger reviewed the Tactical Asset Allocation Reasoning providing details on the Relative Weights. He concluded by stating that the Portfolio did well during the past quarter. B. Report from Investment Manager Mr. McMurry provided details on the performance of the market, earnings, the impact of the strength of the dollar. He noted that the Fed raising the interest rate did not have the impact on the market that was expected. He reviewed the performance of securities in the Portfolio. He stated that earnings is a big factor on whether to sell or hold securities. He provided a detailed explanation of how duration and the movement of the interest rates impacted the portfolio. He concluded by stating that the portfolio performed well during the quarter. He stated that Mr. Dehner requires a triple bypass, but developed other health issues which caused the surgery to be postponed. Mr. Killgore expressed concern about the increased number of companies involved with the Alternative Investments and the related fees. He asked how those fees were determined. Mr. Mulfinger responded that the fees were negotiated prior to and stated in the presentation made to the Board. There was an in-depth discussion regarding how fees are set, how they differ and what they are based on. Mr. Owens stated that the Alternative Investment managers can be present at the Meetings if so desired by the Board. C. Legal Updates — None D. Board Member Reports and Comments — None C. Next Quarterly Meeting: September 19, 2017 at 10:00 a.m. Officer Marcinik expressed appreciation for the update on Mr. Dehner. 12. Ad rn Chairman Mar�'gnik called for any further business, hearing none he adjourned the meeti t 11:10 am. / I No s/m