Loading...
HomeMy WebLinkAbout09202011 PRB (2) A Sebastian Police Pension Board Minutes: September 20, 2011, 10:00 a.m. Sebastian City Managers Conference Room TYPE OF MEETING: Regularly Scheduled NOTE TAKER: Harry Tanner ATTENDEES: Board Members: Denis Hovasse, Chairman Harry Tanner, Rec. Secretary Robert Zomok Debra Krueger Dan Acosta CONSULTANTS: Peter Goodridge, Wells Fargo Advisor Grant McMurry, ICC Capital Mgmt. (Portfolio Manager) Lee Dehner, Attorney (delayed arrival until 10:15 a.m.) SUBJECT CALL TO ORDER TIME: 10:05 a.m. A quorum being present the meeting was called to order by Chairman, Denis Hovasse. SUBJECT APPROVAL OF MINUTES TIME: 10:05 a.m. Denis Hovasse made a motion to approve the minutes of the June 14, 2011, meeting, seconded by Robert Zomok, unanimously approved by the Board. SUBJECT AGENDA Because of the absence of our attorney the agenda was set aside until his arrival at 10:15 a.m. NEW BUSINESS SUBJECT RESIGNATIONS AND NEW BOARD MEMBERS 10:05 a.m. The board was informed of the pending resignations of Board Members, Denis Hovasse and Dan Acosta, both members being the representatives of the Police on the Board. Their replacements were present awaiting arrival of the Police Officers Certified Vote count placing them on the Board. They are; Steve Marcinik, and, Greg Witt. The new members were introduced to the consultants and briefed on the consultant's functions, duties, and responsibilities. They remained in attendance as observers. Denis and Dan remained as part of the Board meeting. SUBJECT FUND REVIEW 10:15 a.m. Grant McMurry reports our funds return for the Quarter ending June 30, 2011 did not meet the index's they are compared to. Asset allocations were discussed and the graphs on page 3 of ICC's investment report were reviewed and discussed. Grant believes as he did in June that the equity market is the market to be in. He reports the present quarter which is about to end has also not been good, and he still believes the equities market is the place to invest. Financial investments were addressed and it was asked if the problem with Europe's banks might not be a risk to US financial institutions. Grant said US institutions have disclosed their foreign risk as it pertains to Europe and they are not at risk. Grant was asked about stable income accounts and Grant said they are accounts that are backed by insurance and that at this time the insurance is high. In the future they are an idea to look at. Grant stated the fund would be selling some bonds that were downgraded and fell below the Investment Policy limits. Lee Dehner stated the policy to sell these bonds is outlined in our Investment Policy as follows: they will be sold at the earliest beneficial opportunity. The question of accountability and the idea of who watches out for schemes such as "pay to play" was asked. Peter Goodrich stated that is his, Wells Fargo's, area of responsibility. SUBJECT INVESTMENT PERFORMANCE REVIEW Peter Goodridge, Well's Fargo Advisor, provided a Fund report for the 2"d Quarter ending June 30, 2011. It showed a negative return of(-.69%). The fund was invested, 48% stock, 43% bonds, and 9% cash. Peter discussed the 3 Corporate Bonds recently downgraded below our Investment Policy that need to be divested. The divesture was discussed during the Fund Review above and will take place at the earliest beneficial time. OLD BUSINESS SUBJECT WELLS FARGO INVESTMENT CONTRACT UPDATE 11:10 a.m. Peter Goodridge and Lee Dehner report they are almost in agreement on the contract with Wells Fargo. A discussion was held to identify what is not in agreement and Lee outlined the issues discussed last meeting and stated at this time there are two issues not in agreement. Lee stated the following issues; 1. The standard of liability desired by Wells Fargo is less than the standard the Board is held to and Lee said he wants Wells Fargo to accept a higher standard. 2. Waving a jury trial when agreement can not be reached. The issues were discussed and Lee stated he is not asking for anything from Wells Fargo that he does not get for other funds he represents. The following votes were taken as direction from the Board to our Attorney: Debra Krueger motioned to require the higher standard to Wells Fargo's liability. Seconded by Robert Zomok, voice vote passed unanimously. Debra Krueger motioned to not require a jury trial. Robert Zomok asked to amend the motion to include the words if Wells Fargo accepts the higher standard clause as higher standards and jury trials are connected. Debra amended the motion to not require a jury trial if Wells Fargo accepts the higher standard clause. Motioned seconded by Harry Tanner and passed unanimously by voice vote. Lee will report at the December 2011 meeting the results of the contract. SUBJECT PROXY STATEMENT Debra Krueger received the Proxy Report back from Robert Zomok. Grant reports that at the last meeting we asked if we could get the proxy statement voting information before the vote and Grant reports this would have to be done on a monthly basis and he will see if he can work out a way to e-mail each Board member with the information beforehand. Grant will report at the next meeting how this is working out. NEW BUSINESS SUBJECT PBA/CHAPTER 185 PLAN Debra Krueger had questions for our attorney regarding the tentative changes to the Chapter 185 Plan. The basic idea of the questions and answers were as follows: 1. Does the change in the accrual factor from 3 to 2% for new employees result in a status change from an amended Chapter 185 Plan to a Local Law Plan? Answer, yes, all members will be in a Local Law Plan. 2. Is there a possibility for employee contributions to increase from 5 to 8% based on the taxable value of the city on July 1, for officers hired before 10/1/11? Answer, yes. 3. Under a Local Law Plan what happens with the insurance premium distribution? Answer, It is used to fund pension benefits. 4. Guidance on SB1128, to be provided under Attorneys Report. SUBJECT ATTORNEYS REPORT FINANCIAL DISCLOSURE STATEMENTS Lee Dehner reminded the departing Board members and the new incoming Board members of their Financial Disclosure Statement filing requirements. SB1128 Lee provided a memorandum, dated Aug 22, 2011, to the Board members, covering benefit calculation issues. Lee stated a most important aspect of the new Law which goes into effect when all parties sign the Collective Bargaining Agreement (CBA) is the accrual factor going from 3 to 2. And the loss of calculating unused sick leave, and, accrued leave time in retirement calculations. The PBA, CBA, is scheduled for a vote on September 27, 2011. A question was asked about what happens with the State refunded insurance monies under the Local Law Plan? Debra said it goes to the Plan for additional benefits for Fund members. Robert Zomok had questions about the proprietary of the Board discussing these issues which involve collective bargaining between the City and the Union. Lee advised that this sort or discussion is allowable and could lead to suggestions from the Board as to what effect the new Law and the new CBA will have on the Plan. When the Law takes effect the retirement plan will change from a Chapter 185 Plan, to a Local Law Plan. Lee said we should set up a special meeting of the Board to deal with the issues associated with changing to the Local Law Plan. Discussion of the Plan was tabled until a special Board meeting scheduled for October 18, 2011, at 10 a.m. in the Council Chamber, This was approved by the Board. Debra Krueger will publish the appropriate announcement. Debra asked Lee if the scheduling of our Actuary, Foster and Foster, to provide the Board with a report should be delayed from a December presentation, and be further discussed by the Board at the December meeting in light of the new Laws pertaining to retirement. A discussion will be put on the December meeting agenda by Debra. Lee said an Actuary report for a Local Law Plan will be more expensive than it had been under the Chapter 185 Plan. 12:10 p.m. The Chairman called for a break while we awaited the arrival the election results for the two new members elected from the Police Department. 12:25 p.m. The election results were reported as follows. Five people ran for the position with a total of 24 votes cast. #1, with 23 votes, was Greg Witt, and, #2, with 12 votes was Steve Marcinik. Denis Hovasse made a motion to accept the election results and Bob Zomok seconded. The result to accept was voted unanimous by the board. SUBJECT ACTION ITEMS ITEM RESPONSIBLE PERSON Well Fargo Contract Goodridge/Dehner Agenda for Dec. meeting to include Debra Krueger a discussion on an actuary report? Report on sale of downgraded bonds. Grant McMurry How is E-Mail proxy Info. Working? Grant McMurry Special Meeting public notice. Debra Krueger SUBJECT ADJURNMENT 12:30 p.m. Having no further business for discussion, Chairman, Denis Hovasse adjourned the meeting. Next meeting, Special Board Meeting, Tuesday, 10/18/2011, 10:00 a.m. Next regularly scheduled meeting, Tuesday, 12/13/11, at 10 a.m. Special Sebastian Police Pension Board Meeting Minutes: October 18, 2011, 10:00 a.m. Sebastian City Council Chambers TYPE OF MEETING: Special Call to Discuss Local Law Plan. NOTE TAKER: Harry Tanner ATTENDEES: Board Members: Harry Tanner, Rec. Secretary Robert Zomok Debra Krueger Greg Witt EXCUSED Steve Marcinik CONSULTANTS: Grant McMurry, ICC Capital Mgmt. (Portfolio Manager) Lee Dehner, Attorney SUBJECT CALL TO ORDER 10:00 a.m. There being a quorum present, Secretary Harry Tanner, called the meeting to order. Having no Chairman; Harry Tanner made a motion to nominate Debra Krueger to chair the meeting. The motioned was seconded by Robert Zomak and passed unanimously. 10:00 a.m. Debra Krueger reported Board member Steve Marcinik had requested an excusal for scheduled police training, it is granted. 10:05 a.m. Lee Dehner reports the PBA/CBA passed and we are awaiting copies signed by all parties. Greg asked if the Insurance Premium for 2011 goes up who says what to do with and excess monies? Answer: A majority vote of the membership, and the signing off on the benefit expense by our actuary. Lee needed direction from the Board on three benefit calculation issues and then he will be able to bring the first draft copy of the Local Law Plan back for Board review. 1. Restoration. The Board in a unanimous voice approval wants future sick and leave time restored to the calculation, if calculated time was used. 2. The Board wants the calculated sick and annual leave accrued hours to be paid at the pay rate at the time of separation from the Force. 3. The Board wants the 300 overtime hours to be calculated on a Fiscal year schedule. It was suggested to put a tickler notification system in effect to notify officers when they are approaching the end of the hours they can use for overtime pay. The Board also requested the next Draft contain the following issues approve by the Board. ILBA Military Service Buyback. Prior Police Service Buyback, in or out of state as long as our standards were met. Buyback monies can be paid within 6 months of the request for the buyback. No Installment Pay Plan is to be used. Greg asked about how requests for new benefits are processed in formulating this new Plan. Lee told him the membership would make the request in writing and then it would be considered by the Board. Greg said he was going to bring back any request he gets from the membership in writing to the December meeting. Harry asked if the Local Law Plan could include the retirement age being lowered to 44 years old or 25 years for an employee hired at age 19. Lee said that is a major cost issue and would need actuary work to see if it is possible. This issue as all the new Local Law Plans pension benefit issues would have to be approved by the Union and then the City Council. Lee mentioned that as a general rule a 1% benefit increase adds a 10% cost increase to the Fund. Debra said we would be revisiting these issues in 2012. Greg asked about an Actuary report and was advised that the issue of a new Actuary report was already scheduled for the December meeting for discussion. Lee said we will need a contract with our actuary, Foster and Foster, now that we are a Local Law Plan. Debra said she would get prices from Foster and Foster. Further discussion now awaits the first draft of the new Plan which will be reported on and discussed at the regular December meeting. SUBJECT ACTION ITEMS ITEM RESPONSIBLE PERSON 1st draft Local Law Plan. Lee Dehner Actuary prices. Debra Krueger 12:05 p.m. Having no further business for discussion Chairman, Debra Kruger adjourned the meeting. Next regularly scheduled meeting is December 13, 2011,. at 10:00 a.m. in the City Council Chamber.