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HomeMy WebLinkAbout04-16-2024 MinutesCITY OF SEBASTIAN POLICE OFFICERS' RETIREMENT SYSTEM PENSION BOARD OF TRUSTEES QUARTERLY MEETING MINUTES Council Chambers, 1225 Main Street, Sebastian, FL 32958 Tuesday, April 16, 2024, at 5:OOPM TRUSTEES PRESENT: Tim Wood David Puscher Paul Reeves Ken McDonough TRUSTEES ABSENT: None OTHERS PRESENT: Stephen Malone, Fiera Capital (via Zoom) Eleni Southworth, Fiera Capital (via Zoom) Siera Feketa, Foster & Foster Bonni Jensen, Klausner, Kaufman, Jensen & Levinson Karen Russo, Salem Trust Scott Owens, Graystone Consulting TJ Loew, Graystone Consulting Matthew Radock, Plan Member 1. Call to Order— Tim Wood called the meeting to order at 5:05PM and a quorum was determined. 2. Roll Call — Siera Feketa called roll call. The Board discussed modifying the agenda to add discussion of an actuarial report under Old Business since it was tabled at the previous meeting. The Board voted to modifv the agenda as discussed, upon motion by Tim Wood and, second by David Puscher: motion moved 4-0., 3. Public Comments — None. 4. Approval of Minutes a) January 16, 2024, quarterly meeting i. Bonni Jensen commented there was one correction. Bonni commented she would get with Siera on that correction. The January 16, 2024, ouarterly meeting minutes were approved with correction,, upon motion by David Puscher and second by Tim Wood: motion carried 4-0. 5. New Business a) Renewal of FPPTA Board membership i. Siera Feketa commented it was $750 for the year and they would also process any CPPT renewals with that. 1 The Board voted to approve renewal of FPPTA Board membership, upon motion by David Puscher and second by Tim Wood: motion moved 4-0. ii. David Puscher commented he would be attending, but not under the Board's fees. Siera Feketa asked if her office needed to take action. David Puscher commented they probably didn't need to register him. Siera Feketa commented her office would reach out to FPPTA to make sure no action was needed. b) Designation of Records Management Liaison Officer (RMLO) i. Siera Feketa reviewed the RMLO commenting it was the prior administrator and recommending Foster & Foster being the RMLO. Tim Wood asked if that would be an added fee. Siera Feketa commented it would not be an additional fee as it was part of their services. The Board voted to designate Foster & Foster as RMLO. uaon motion by Tim Wood and second by David Puscher; motion moved 4-0. c) Upcoming Trustee term expirations i. Tim Wood, member elected, expires May 2024 ii. Andrea Ring, city appointed, expires May 2024 iii. Siera Feketa briefly reviewed the expiring terms commenting she would update the Board on these at the next meeting. Siera Feketa commented she would get with Tim after the meeting to discuss how the elections had been held. iv. Ken McDonough asked how the City handles the city appointed seat and how someone would apply if they were interested. Tim Wood discussed some postings he had seen. David Puscher discussed the process to apply if someone was interested. 6. Old Business a) Actuarial study for benefit changes i. Tim Wood commented the last meeting they tabled the Board's decision on whether they were going to do an actuarial analyst at the request of the police officers' union. ii. Matthew Radock informed the Board he spoke to the City and the union regarding the study and they were supportive of it. The Board and Matthew Radock discussed the different items in the requested study. Paul Reeves asked what 25 years of service means in the study. Matthew discussed that would mean that a member would be eligible for retirement after reaching 25 years of service including buybacks. The Board, Matthew Radock, and Bonni Jensen discussed buybacks. Matthew stated they would need the cost study for the negotiations and reviewed the purpose of having the study prepared. Tim Wood asked if he met with the other union members to see if they were comfortable with this. Matthew stated he did, and the officers would like to move forward with this. Paul Reeves asked if it would impact current retirees. David Puscher commented he doesn't think this would impact the retirees, only members that were employed and eligible for retirement. 2 The Board voted to authorize a cost studv. upon motion by Tim Wood and second, by Ken McDonough; motion moved 4-0. 7. Reports (Attornev/Consultants) a) Salem Trust, Karen Russo, Board Custodian i. Update on Salem Trust 1. Karen Russo gave a brief update on Salem Trust and the statistics on transactions processed. 2. Karen Russo commented they did receive a new authorized signer form from Foster & Foster and they like that updated every three years so unless there were any other changes she would remind them to update this again in three years. 3. Karen Russo gave an update on the pensioner portal. Tim Wood asked if future retirees would receive notice of the portal. Karen Russo commented they would send something out, but they had to be paid one time before they could access the system. ii. Acquisition of Salem Trust 1. Karen Russo commented this was discussed at a previous meeting commenting they would need the agreement executed. Bonni Jensen briefly reviewed the assumption, assignment, and ratification agreement and the required sections that were added to the contract. Bonni Jensen recommended approval of the agreement. The Board voted to aoorove the Salem Trust assumption. assignment, and ratification aareement. uoon motion by David Puscher and second by Tim Wood;, motion moved 4-0. 2. Karen Russo commented Salem Trust would be at FPPTA and welcomed the Board to attend their dessert function. b) Fiera Capital, Eleni Southworth, Investment Manager i, Quarterly report as of March 31, 2024 1. Eleni Southworth introduced herself and Stephen Malone. 2. Eleni Southworth gave an organizational update commenting they added a new CEO, Maxime Menard. 3. Scott Owens asked if there were any changes to the investment decision making process. Eleni Southworth commented there were no changes. 4. Stephen Malone gave an update on the portfolio. 5. The fund gross performance for the quarter was 14.38%. The 1-, 3-, and 5-year gross returns were 26.12%, 5.53%, and 17.78%. Since inception (7/19/2017), total fund performance gross returns have been 13.82%. 6. Stephen Malone reviewed the 4th quarter gross performance attribution. 7. Stephen Malone reviewed the SMID Growth Composite Performance. 8. Stephen Malone discussed performance and statistics. 3 9. Stephen Malone reviewed the positioning. Stephen discussed the market environment and their outlook on the market. 10. David Puscher commented they pretty much received a report on the 4th quarter of 2023 and asked how they had been performing this quarter. Stephen Malone briefly reviewed the current portfolio and why they were positioned like they were. Stephen discussed the turnover in the portfolio. David Puscher asked for the most recent information in the quarterly reports rather than being a quarter behind. Stephen commented it was a timing issue, but they would share the 3/31/24 information as soon as it was final. 11. Eleni Southworth thanked the Board for their business and time. c) Graystone Consulting, TJ Loew/Scott Owens, Investment Consultant i. Quarterly report as of March 31, 2024 1. Scott Owens briefly discussed the Large Cap Growth search he brought to the last meeting. Scott commented they did not have a very compelling reason to make a change from their current portfolio. Scott briefly reviewed their large cap growth allocation. 2. Scott Owens gave an update on the market environment for the quarter and the economy. Scott reviewed the capital market returns. 3. Scott Owens reviewed the recession indicators. 4. The total fund gross returns for the quarter were 5.92%, slightly outperforming the benchmark of 5.38%. The 1-, 3-, 5-, 7- and 10- year gross returns were 16.44%, 5.06%, 8.93%, 7.91% and 7.49% compared to the benchmarks of 15.56%, 4.56%, 8.27%, 8.11% and 7.60% for the same respective periods. Since inception (02/01/2011), total fund gross returns were 7.61%, slightly underperforming the benchmark of 8.12%. Scott Owens briefly touched on the performance of the plan. 5. Scott Owens reviewed the asset allocation. David Puscher and Scott Owens discussed the outlook on real estate. Scott reviewed the asset allocation compliance. Scott commented they had 1.5% in cash and wanted to look at the distributions over the next 90-180 days, hold that in cash and then move the remainder to fixed income. Scott commented he did not think they need more than 6 months in cash. Paul Reeves asked where in fixed income. Scott discussed the two fixed income managers recommending giving half to each. David Puscher asked to see the performance. Scott reviewed the performance of Genter and Highland Capital and the environments they would perform best in. Paul Reeves asked if they could just raise from Highland Capital for another quarter. Scott Owens commented that would be fine. The Board approved increasina the amount to Hiahland Capital to bring them into compliance and keep the rest in cash, upon motion by Paul Reeves and second by David Puscher: motion carried 4-0. ri 6. TJ Loew reviewed the performance of the managers. The Board, Scott Owens, and TJ Loew discussed the performance of the Large Cap Growth managers. 7. Scott Owens reviewed the Large Cap Manager search and the performance of the various managers over the different timeframes. The Board discussed the market outlook with Graystone. The Board discussed being more conservative and possibly bringing in Sawgrass to present. Scott discussed what he would expect from Sawgrass. a. The Board agreed to have Sawgrass attend the next meeting to give a presentation. s. TJ Loew finished discussing the performance of the managers. Scott Owens stated they would have Intercontinental attend the meeting after next. d) Klausner, Kaufman, Jensen & Levinson, Bonni Jensen, Board Attorney i. Legislative update 1. Bonni Jensen briefly reviewed the bill on insurance credits commenting there could be an impact on the State Monies. Bonni commented they would continue to monitor this situation. ii. Bonni Jensen gave a brief update on the House Bill 3 filing commenting the State reported there was 100% compliance. iii. Discussion of Social Security status 1. Bonni Jensen commented she was contacted regarding the fact sheet with the State. Bonni commented it indicated that the police officers didn't contribute to social security, so she reached out to the state to get that corrected as they do contribute. The Board briefly discussed. 8. Old Business — None. 9. Consent Agenda a) Payment ratification i. Warrant #10 b) New Invoices for payment approval i. None c) Fund activity report for January 15, 2024, through April 9, 2024 The consent agenda was approved as presented. upon motion ba David Puscher and second by Paul Reeves. motion carried 4-0.. 10.Staff Reports, Discussion, and Action a. Foster and Foster, Siera Feketa, Plan Administrator i. Update on plan administration transition 1. Siera Feketa gave a brief update on the transition commenting it was almost complete. b. Discussion of PF-6s and PF-11s 1. Siera Feketa reviewed PF-6s (disability affidavits) and the purpose of them. Siera commented the Operating Rules required they be done every year and asked the Board if they wanted to stop 5 sending them once the disability retirees reach what would have been their normal retirement age. Siera commented they would likely need to amend the Operating Rules for this, but it was common practice. Siera advised the Board her office would bill hourly for this project, but there weren't many disability retirees so she didn't think it would be a long project. The Board voted to amend the Ooeratina Rules to cease the disability affidavits once the member reached normal retirement eliaibilibi, upon motion by Tim Wood and second by David Puscher: motion carried 4-0., 2. Siera Feketa commented the attorney would likely draft the Operating Rules amendment and they would put that on the next agenda for approval and her office would send out the PF-6s for members under the normal retirement age. s. Siera Feketa discussed the PF-11s (annual confirmation of receipt of benefits) and the purpose of them. Siera commented the bank did a monthly death audit so it may not be necessary and her office would bill hourly for this project as well. David Puscher commented having the form notarized every year could be difficult. Karen Russo reviewed their death search that's done on a monthly basis. Karen commented it is as good as the information given to them. Bonni Jensen commented she is a fan of it and reviewed the benefits that could be overpaid. Tim Wood commented he felt they were in tune with their retirees and since they were a small department he doesn't think it's necessary as they usually know when someone passes away. The Board agreed to forgo it for now. The Board voted to forao PF-91s and continue with the Salem Trust death audit, upon motion by David Puscher and second by Paul Reeves; motion carried 4-0., c. Update on State Annual Report i. Siera Feketa commented the State Annual Report was submitted and they were just waiting on the audited financial statements to submit to the State with the report. d. Siera Feketa gave a brief update on the member portal commenting they were waiting on data from the City, but her office would monitor this and keep the Board updated. e. Siera Feketa commented she understood the Board approved using one authorized signer with Salem Trust at the last meeting but wanted to discuss further at this meeting. Siera reviewed the benefits of allowing for just one signature commenting everything goes before the Board for ratification. Bonni Jensen reviewed the benefits of requiring two signatures and having as many trustees as possible added as signers. The Board briefly discussed. The Board aoproved usina 2 authorized signers, one administrator and one trustee, upon motion David Puscher and second by Ken McDonough: motion carried 4-0.. f. Upcoming educational opportunity r. i. FPPTA 40th Annual Conference, June 23-26, 2024, Orlando, FL. 1. Siera Feketa briefly touched on the registration and reimbursement process. 11.Trustee Reports. Discussion. and Action a) David Puscher discussed getting something for Ms. Graham as a thank you for her service. Siera Feketa commented she would bring a card to the next meeting for Board signature and make sure it gets mailed off. 12.Adiournment—The meeting adjourned at 7:06PM. 13. Next Meeting — Tuesday, July 16, 2024, @ 5:OOPM, Quarterly Meeting. Rvy submitted Siera Feketa, Plan Administrator Date Approved by the Pension Board: 7 Approved b G Tim Wood, Chairman 7-16-24