07-29-2015 CITY OF EDGEWATER GENERAL EMPLOYEES' PENSION
BOARD QUARTERLY MEETING MINUTES
City Hall Council Chambers
Wednesday, July 29, 2015 at 11 .00AM
TRUSTEES PRESENT: Chris Mathewson
Brenda Dewees
Tyna Hilton
John McKinney
Tim Sopko
TRUSTEES ABSENT: None
OTHERS PRESENT: H. Lee Dehner, Board Attorney
Ferrell Jenne, Plan Administrator
John Thinnes, Investment Consultant
Tracey Barlow, City Manager
Julie Christine, HR Department
1. Call to Order Brenda Dewees called the meeting to order at 11:06AM.
2. Roll Call - As reflected above.
The board voted to amend the agenda, moving item 6A before public comments
upon motion by Tvna Hilton and second by Chris Mathewson, motion carried 5-0.
3. Old Business
a. Brenda Dewees thanked Tim Sopko and John McKinney for their service
and welcomed them to the board.
4. Public Comments — None.
5. Approval of Minutes
a. John McKinney asked about the method the board had discussed at the
last meeting regarding replenishment in conjunction with SB1128. John
McKinney asked why the board had the finance department run a report
on the cost of replenishment and then without knowing the outcome of the
report; authorized Lee Dehner to produce a draft Ordinance to include
replenishment.
b. Brenda Dewees stated the intent was to have the cost report and draft
Ordinance discussions coincide.
c. John McKinney commented that the March 16, 2015 meeting minutes
should reflect that the board voted to discuss replenishment instead of
voted to allow replenishment.
d. Lee Dehner stated that the prior minutes were accurately stated. The
board did vote to authorize an Ordinance to be drafted to include
replenishment.
e. The board decided to wait and discuss this topic further under new
business.
The minutes from the March 16, 2015 quarterly meeting were approved upon
motion by Tvna Hilton and seconded by Tim Sopko, motion carried 5-0.
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6. New Business
a. Presentation of draft ordinance.
i. Lee Dehner presented the draft Ordinance and stated it provides
for replenishment. Mr. Dehner stated that the board can make a
change before it goes to the City or actuary for an impact
statement.
ii. John McKinney stated he was concerned about the cost impact on
the City if replenishment is allowed.
iii. John McKinney stated his concern with the need for
replenishment when the City already allows accrual cash-ins on
an annual basis, whereas other cities only allow cash-ins at
retirement.
iv. Brenda Dewees commented that her understanding of
replenishment was different than what John McKinney explained.
V. John McKinney asked for clarification on the last three lines of the
draft Ordinance.
vi. Lee Dehner clarified that the intent of the ordinance was to allow
replenishment only at retirement, not annually.
The board voted to have Foster& Foster do an impact statement on the proposed
Ordinance upon motion by Tyna Hilton and second by John McKinney, motion
carried 5-0.
7. Old Business
a. Discussion of restatement letters from Julie Christine and Donna Nichols.
i. Brenda Dewees gave an overview of the discussion from the last
board meeting. Brenda stated that Foster & Foster can do a cost
study for reinstatement of both Ms. Christine and Ms. Nichols into
the defined benefit plan. The cost study is to be paid in full by Julie
Christine and Donna Nichols. It was agreed at the last meeting to
table the discussion until there was a full board in place.
ii. Tracey Barlow stated the first step is to have the cost study done
which should be paid for in advance by Ms. Christine and Ms.
Nichols. An evaluation can then be done on the outcome of the
study and Ms. Christine and Ms. Nichols can determine if they
want to proceed.
iii. John McKinney commented that if the board allows the study,
there will be no guarantee Ms. Christine and Ms. Nichols will be
reinstated back into the defined benefit plan.
The board voted to have Foster& Foster do a cost study for Julie Christine and
Donna Nichols to be reinstated into the defined benefit plan upon receipt of full
payment from Ms. Christine and Ms. Nichols for an amount not to exceed $1,250
upon motion by John McKinney and second by Tim Sopko, motion carried 5-0.
Note: Tracey Barlow left the meeting at 12:15pm.
8. Reports
a. Bogdahn Group, John Thinnes.
i. Quarterly Report as of March 31, 2015.
1. John Thinnes gave a brief overview of the marketplace
during the first quarter. John stated there was no need for
any rebalancing at this time. Everything in the portfolio was
within ranges stated in the investment policy statement.
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2. Fiscal-year-to-date market value of the fund is $12.7M.
3. Net earnings for the quarter were 2.55%, outperforming the
policy benchmark of 2.07% by 0.48%.
4. Fiscal-year-to-date net earnings were 5.55%,
outperforming the policy benchmark of 4.60% by 0.95%.
5. Since inception, the fund is at 4.90%, underperforming the
benchmark of 5.70% by -0.80%.
6. The board had no questions.
b. Christiansen & Dehner, Board Attorney, Lee Dehner.
i. Legislative update.
1. Senate Bill 534 required additional calculations to be done
by the actuary. The reports must be filed with the State
and posted on the City's website. John McKinney
confirmed that all documents have been posted on the
City's website.
2. House Bill 1309 (formerly known as SB242), mandates all
local law plans to utilize the FRS mortality tables. In most
cases this will cause additional funding requirements since
the FRS tables are more conservative. Implementation
date will need to be discussed with the actuary but the
effective date is January 1, 2016.
ii. Lee Dehner asked the board if all trustees had filed Form 1,
Financial Disclosure, which was due July 1, 2015. All Trustees
stated that they had filed.
iii. John McKinney asked about the Naples letter. Lee Dehner stated
that it doesn't affect this plan since it has to do with State Monies
for police and fire plans.
iv. Chris Mathewson asked as the union steward, does opening up
the defined benefit plan to Julie Christine and Donna Nichols open
the doors for others. Lee Dehner stated he would like to review all
documents if the board approves moving forward with allowing
Ms. Christine and Ms. Nichols to be reinstated because there is a
possibility that it could open up this option for others who were in a
similar position.
9. Disbursements
Disbursements were approved as stated on the agenda upon motion made by Tim
Sopko and second by John McKinney, motion carried 5-0.
10. Staff Reports, Discussion, and Action
a. Fiduciary liability insurance.
i. Ferrell Jenne informed the board the current fiduciary liability
policy will expire on October 1, 2015. Ms. Jenne stated she is
working on completing the application to renew the policy through
the City.
ii. John McKinney recommended the board make a motion allowing
the plan administrator to renew the liability policy each year
without prior approval.
The board voted to allow Ferrell Jenne to bind a new fiduciary liability policy each
year upon motion by Tyna Hilton and second by Tim Sopko, motion carried 5-0.
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11. Trustee Reports, Discussion, and Action
a. John McKinney asked that a RFQ be done for legal, actuarial, and
performance monitor. Brenda Dewees stated that this was done a year
ago and doesn't need to be done again.
b. Brenda Dewees commented that board elections for Chairman and
Secretary will need to be held at the next meeting.
12. Adjournment The meeting adjourned at 12:49pm.
13. Next Meeting September 14, 2015 at 11:OOAM.
Respectfully submitted by: Approved by:
Name: Ferrell Jenne Name:
Title: Plan Administrator Title:
Date Approved By the Pension Board:
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