05-10-2010
Police Pension Board of Trustees
Minutes - Special Meeting
May 10,2010
Page I of2
CITY OF EDGEWATER
POLICE OFFICERS' PENSION BOARD OF TRUSTEES SPECIAL MEETING
MINUTES
Monday, May 10,2010
CALL TO ORDER! ROLL CALLIDETERMINA TION OF A QUORUM
The Edgewater Police Officers' Pension Board held a special meeting on Monday, May 10, 2010 in
the City Hall Conference Room at the City of Edgewater, Florida.
Members Present:
Dan Blazi
Ferd Heeb
Gary Conroy
Lawrence Leaf
Kevin Seymour
Brad Heinrichs, Foster & Foster
Sheila Hutcheson
Julie Christine
Tracey Barlow, City Manager
John McKinney, Finance Director
Members Absent:
Plan Actuary:
Board Administrator:
City Staff:
The special meeting of the Police Officers' Board of Trustees was called to order at 11 :09 a.m. There
was a quorum with four members present.
NEW BUSINESS
Presentation: October 1,2009 Actuarial Valuation - Foster & Foster
Actuary Brad Heinrichs distributed the 2009 Actuarial Valuation and opened with a discussion of the
funding requirements, noting that the cost is increasing from 59% to 64% of payroll. Investment
losses were greater than normal, and the four-year smooth of returns was also negative. The adverse
funding impact will continue based on unrecognized investment losses of $1.3 million. Mr. Heinrichs
pointed out that there is a credit balance of $560,000; this is a reserve that has been set aside to offset
funding requirements and could be used into to help defray the City's funding with the Board's
approval.
Member Heeb made a motion to allow the City to use such funds as needed from the reserve balance
to defray any portion of the City's contribution cost in excess of 41.1% of payroll for thejiscal year
ending September 20, 2011; Member Conroy seconded the motion, which passed unanimously on a
roll call vote.
The Actuary continued by reporting an influx of DROP participants this year, with a corresponding
retirement liability decrease. The market value of assets has decreased and the liabilities have
increased, which is the opposite of what is optimal. The investment performance was sub-par and the
funded percentage of the plan is at 68%, which is worse than the average across the State. He noted
that the unfunded actuarial accrued liability went down, which is good. The report continued with a
comment that there are three components of cost: active members, administrative costs, and the
amortization of unfunded liability; it is these factors that are used to determine the required
contribution to the plan. The cost was helped by the negative salaries for the past year.
Police Pension Board of Trustees
Minutes - Special Meeting
May 10, 2010
Page 2 of2
In relation to the Valuation, there was discussion on the impact of termination from Principal and the
loss of the monies Principal would keep for the retirees under the benefit index. The Actuary said this
would have a significant adverse impact on funding.
Member Conroy made a motion to approve the 2009 Valuation; Member Heeb seconded the motion,
which passed unanimously on a roll call vote.
STAFF REPORTS, DISCUSSION, AND ACTIONffRUSTEES' REPORTS, DISCUSSION,
AND ACTION/REQUESTS FROM THE PUBLICIEMPLOYEES PRESENT
The Police Board discussed meeting injoint session with the General Employees' Board at 9:30 a.m.,
in advance of the June 7, 2010 quarterly meeting (with all the consultants present). The Chairman will
ask Milberg to attend the meeting as well.
ADJOURNMENT - The meeting was adjourned at 12:03 p.m.
Respectfully Submitted:
Approved:
~~
~
Sheila Hutcheson
Plan Administrator
Dan Blazi Irman
Police Icers' Pension Board