01-20-2009
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Police Pension Board of Trustees
Minutes - Special Meeting
January 20, 2009
Page 1 of3
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CITY OF EDGEW A TER
POLICE OFFICERS' PENSION BOARD OF TRUSTEES SPECIAL MEETING
POLICE DEPARTMENT SERGEANT'S OFFICE
Edgewater, Florida
Tuesday, January 20, 2009 - 4:00 P.M.
MINUTES
CALL TO ORDER! ROLL CALL/DETERMINATION OF A QUORUM
The Edgewater Police Officers' Pension Board held a special meeting on Tuesday, January 20, 2009
in the Sergeant's Office of the Edgewater Police Department.
Members Present:
Ferd Heeb
Gary Conroy
Dan Blazi
Lawrence Leaf
Jeanne DelNigro
Sheila Hutcheson
Tonya Niday, Joe Mengel (by telephone)
Donna Looney, Personnel Director
Tracey Barlow, City Manager
Phil Niebieski, Police Officer
Members Absent:
Plan Administrator:
Principal:
City Staff:
Chairman Blazi called the meeting to order at 4:08 p.m. Members indicated their presence; there was
a quorum, with four members present.
Discussion/consideration of issues related to VCP filing and filing for determination of qualified
status of the pension plan.
The Chairman opened by mentioning that he had learned a lot at the recent NAPO conference,
including information regarding IRS filing requirements, and provided a brief overview. Ms.
Hutcheson then summarized the telephone calls she had received from Ms. Niday on January IS and
January 16 regarding some additional reporting needs (VCP and a 415 amendment). These
discussions necessitated the special meeting, because the Board would have to authorize the fees of
$225.00/hour by Principal for completion of the VCP documents. The Plan Administrator also
outlined her concerns regarding the accuracy of the information provided by Principal, specifYing
errors in the documents sent to date, and later asked Principal to advise of the disadvantages of
deferring the filing for a determination of qualified status to Cycle E in 20 II. Chairman Blazi
discussed concerns about waiting for the later cycle and Principal also noted (later when they joined
the meeting by telephone) that the IRS is taking a more favorable view of plans filing under Cycle C
(by January 31, 2009). Chairman Blazi said that, due to all of the continuing issues/problems with
Principal, it was his opinion that the contract should be terminated and then the Board could deal with
the consequences of the separation. but he stated that he would defer that discussion till a meeting
attended by Attorney Dehner.
At this point, Chairman Blazi placed the telephone call to Principal (5:00 p.m.) to discuss the issues
Police Pension Board of Trustees
Minutes - Special Meeting
January 20, 2009
Page 2 of3
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with Tonya Niday and Joe Mengel and opened by stating that he had summarized the background of
the reason for the conference call and asked Ms. Niday to comment. She said that because the 1997
plan restatement had been signed several days later than required, Principal had notified the Board in
September, 2006 of the need to file the YCP, but no action had been taken in this regard. Ms. Niday
stated that there could be an adverse finding if the qualification package was filed (without the YCP
completed) and the reviewing IRS official noted that the YCP had not been filed. The IRS could then
assess a fine against the plan. Filing the YCP now in conjunction with the filing for qualification
would avoid this liability. She also confirmed that the qualification submittal could be delayed to
Cycle E, but that the IRS prefers that it be done now in Cycle C and that the 415 amendment needed to
be prepared/submitted.
Member Heeb made a motion to authorize Principal to prepare the VCP filing at a cost of
$225.00/hour and to prepare the 415 amendment by end of the current week; Member Leafseconded
the motion, which passed unanimously, upon a roll call vote.
The Plan Administrator asked what to do if the information to be sent by Principal this week creates
concerns as to its accuracy: would the Board then consider deferring the qualification filing? It was
the Board's consensus to submit to the IRS all of the documents provided by Principal, and if
problems arose with the information, it would be Principal's responsibility to deal with the issues.
Discussion: Request for refund of member contribution by terminated, vested member Brian
Mallard
~ Member Conroy outlined the background of this issue noting that when Diana Floyd retired (entered
DROP), Principal had prepared a retirement calculation showing alternative benefits based upon
whether or not there was a withdrawal of member contributions. Chairman Blazi and Plan
Administrator Sheila Hutcheson reported that they had discussed this matter with Foster & Foster and
Attorney Dehner on January 19,2009, as to the interpretation of the plan document in this regard. The
Attorney had said that he would need to review the document in order to determine whether or not the
refund requested by Mr. Mallard would result in the forfeiture of any future retirement benefits; then
Mr. Mallard would be able to make an informed decision regarding the refund.
This issue also affects Officer Phil Niebieski. When he entered DROP (as of January I, 2009), Foster
and Foster (F&F) said they didn't think the plan provided this option, so it became necessary to obtain
an interpretation by the Attorney on this matter as well. Chairman Blazi said there are different
interpretations to the relevant section of the plan document. Personnel Director Donna Looney said the
same provision is in the General Plan. Discussion among the Board members continued, with Member
Conroy stating that this may be a loophole, and Member Heeb saying that the Board would not be able
to make a decision until the Attorney's review of the plan provisions in this regard. Officer Niebieski
said he would not be able to recoup the money over the future years if he is unable to withdraw his
member contribution. The Board told him that this issue will be decided by the Board after receipt of
the Attorney's interpretation. Chairman Blazi stated that if the Attorney says that the provision for a
withdrawal of contributions and maintenance of a retirement benefit is legal, then the Board could
consider an amendment to the plan to clearly provide the option.
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Member Heeb made a motion to defer action until the Attorney has reviewed the document; Member
Conroy seconded the motion, which passed unanimously, upon a roll call vote.
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Police Pension Board of Trustees
Minutes - Special Meeting
January 20, 2009
Page 3 of3
STAFF REPORTS, DISCUSSION, AND ACTION - None
TRUSTEES' REPORTS, DISCUSSION, AND ACTION
Member Heeb mentioned that, after the last meeting on December 11, 2008, he had concerns about his
vote to authorize attendance by a Board member at the conference in Las Vegas. He felt that he
should have voted against the motion and wished to have the minutes reflect his concerns about the
expenditure based on the downturn of the returns of the plan. Mr. Heeb stated that his objection did
not, in any way, abrogate his support for training/schools for trustees; rather, it was based on concern
for costs to the plan in the current environment of negative performance by the fund. Member Conroy
also said that he almost voted against the motion because of the need to make cuts, but decided to
support the motion, since the conference wasn't very costly. Chairman Blazi, who had attended the
conference, reported that his meal costs paid by the plan were minimal and there were no lodging
costs, as he had a free hotel room. The Chairman continued with a review of some of the information
he received and said he would provide further information at the next quarterly meeting.
Member Heeb distributed the latest investment returns report.
REQUESTS FROM THE PUBLICIEMPLOYEES PRESENT - None
ADJOURNMENT
Member Leaf made a motion to adjourn the meeting; Member Heeb seconded the motion, which
passed unanimously. The meeting was adjourned at 5:45 p.m.
Respectfully Submitted:
Approved:
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DanBI .
Chai an
Sheila Hutcheson
Plan Administrator