12-15-2014 CITY OF EDGEWATER POLICE OFFICERS' PENSION BOARD
QUARTERLY MEETING MINUTES
City Hall Council Chambers
Monday December 15, 2014 at 1:30PM
TRUSTEES PRESENT: David Arcieri
Lawrence Leaf
John Tarr
James Morey
TRUSTEES ABSENT: Larry Brinson
OTHERS PRESENT: H. Lee Dehner, Board Attorney
Ferrell Jenne, Plan Administrator
Jack Evatt, Investment Consultant
Doug Lozen, Board Actuary
John McKinney, Finance Director
Brian Bizzell, Salem Trust
Mark Rhein, Salem Trust
John Hamlin, Dana Investment
1. Call to Order John Tarr called the meeting to order at 1:35PM.
2. Roll Call -As reflected above.
3. Public Comment- None.
4. Approval of Minutes
The minutes from the September 15, 2014 quarterly meeting were approved upon motion
by James Morey and second by Lawrence Leaf motion carried 3-0.
5. New Business
a. Discussion of early implementation of GASB 68.
i. John McKinney stated that GASB 68 replaced GASB 27 and briefly
described what information the statement included. Mr. McKinney then
commented that the general employees' pension board voted for early
implementation and recommended for the police board to do the same.
Mr. McKinney also explained that the cost for the early implementation
will be reimbursed by the City in way of City contributions.
The Board voted to early implement GASB 68, upon motion by James Morey and second
by Lawrence Leaf, motion carried 3-0.
Note: David Arcieri arrived at 1:40pm
b. Discussion of Martha Miles calculation.
i. Lee Dehner recommended to contact Principal. Ferrell Jenne explained
that Foster & Foster tried to contact Principal but they replied that their
contract was with the City and a City representative would need to
request the information. Principal then told the Foster & Foster
representative that a contract with the City must be in place before they
answer any questions.
ii. Lee Dehner stated that Principal is not obligated to administer the Plan
any longer.
1
The Board voted to send an authorization letter to Principal naming Ferrell Jenne as a City
representative, upon motion by Lawrence Leaf and second by James Morey, motion
carried 4-0.
6. Old Business - None.
7. Reports
a. Salem Trust, Brian Bizzell and Mark Rhein
i. Lee Dehner stated that the general employees' pension board asked
Salem Trust to present fee schedule options to Jack Evatt and then they
are having Mr. Evatt do an analysis and make a recommendation based
on his findings.
ii. Board agreed to follow the general employees' action and directed Jack
Evatt to perform the same analysis.
iii. Mark Rhein discussed the pending litigation against Pennant
Management.
1. Mr. Rhein commented that the fraud was 180M and the
transaction was based on paperwork approved by an authorized
agent. Most of the assets are hard assets and they are pursuing
him criminally. Mr. Rhein stated that no Salem Trust or Pennant
Management employee was involved in this.
a. John Tarr asked if this was going to financially affect
Salem Trust. Mark Rhein commented that there is some
exposure. Lee Dehner stated that Jack Evatt is aware of
the situation and is keeping a close eye on any
developments.
b. The Bogdahn Group, Jack Evatt
i. Quarterly report as of September 30, 2014.
1. The quarter started at approximately 8.11M and ended at
approximately 8.08M. Mr. Evatt stated that it was a tough quarter
for active managers.
2. Earnings for the quarter were -1.17% (gross), underperforming
the policy benchmark of-.70% by 0.47% points.
3. The gross performance of-1.17% ranked in the 5511 percentile of
the public fund sample.
4. Since inception, the fund is at 4.76%, underperforming the policy
benchmark of 4.84% by 0.08% points.
5. The total fund portfolio (net)fiscal year to date is 10.69% beating
the benchmark of 10.29% by 0.40% and beating the assumed
rate of return.
6. Jack Evatt commented that the Plan had a very good fiscal year
and all managers performed well.
7. Mr. Evatt has no recommendations at this time.
c. Dana Investment Advisors, John Hamlin
i. Quarterly report as of September 30, 2014.
1. Earnings for the quarter were -0.30% (gross), underperforming
the policy benchmark of 1.13%.
2. The total return fiscal year to date is 21.42% beating the policy
benchmark of 19.73%.
3. John Hamlin briefly reviews the individual contributors and
detractors with the Board.
4. Mr. Hamlin stated that they have roughly a 2% position across
the portfolio, once anything gets to 4% or higher, they trim it.
5. James Morey asks about the balance difference between
09/30/13 and 09/30/14. Mr. Hamlin stated that this is due to
1.068M being moved from Dana Investment to Vanguard.
d. Christiansen & Dehner, H. Lee Dehner
i. Discussion of SB 1128.
2
1. Puts a 300 hour cap on overtime. The effective date is either July
1, 2011 or when the last CBA was done. As of the effective date,
max is what each member has accumulated. The member is
able to restore hours if used, but can't exceed the max.
2. John Tarr commented that the last CBA was October 1, 2011.
3. Mr. Dehner stated that the time period can be fiscal or calendar
year. He also recommended that hours should be able to be
replenished.
4. John Tarr commented that he thinks members should be able to
replenish hours and it should be based on fiscal year.
ii. Board discussed City health insurance documents.
a. Donna Looney stated that the City pays the provider
directly. Lee Dehner stated that a letter is needed from
the City stating that this is occurring.
iii. Board discussed Plan Restatement.
1. Lee Dehner stated that he is finishing up the draft plan
restatement and will present the draft for discussion at the next
meeting.
iv. Discussion of SB 534.
1. Keith Brinkman stated that the State is only going to post
information that is required by the Statue. However, Mr. Dehner
reminded the Board that additional information can be posted on
the City's website.
8. Disbursements
Disbursements were approved as stated on the agenda upon motion made by James
Morey and second by David Arcieri, motion carried 4-0.
9. Staff Reports, Discussion, and Action
a. 2015 membership fees for FPPTA.
i. Ferrell Jenne stated that the Board were members of FPPTA in 2013
and the fee is$600.
Board voted to renew their FPPTA membership for 2015 for $600 upon motion made by
Lawrence Leaf with no second motion, motion did not carry.
b. Salem Trust ACH authorization form.
i. Ferrell Jenne explained that Salem is not asking the Board to change the
way they approve payments, but to allow Salem to pay vendors via ACH
instead of a check.
Board approved executing the ACH authorization form upon motion made by James Morey
and second by David Arcieri, motion carried 4-0.
10. Adiournment The meeting adjourned at 2:50PM
11. Next Meeting March 16, 2015 at 1:30PM.
ppspectfully s bmitted by: Approved`by
err II Jenne(, PI n Administrator Joie Tarr, Chairman j :
Date Approved By the Pension Board: mKCH W, -010 11
3