03-19-2018CITY OF EDGEWATER
POLICE OFFICERS' PENSION BOARD
QUARTERLY MEETING MINUTES
City Hall Council Chambers
Monday, March 19, 2018 at 1:30PM
TRUSTEES PRESENT: David Arcieri
Lawrence Leaf
Alexander Penalta
TRUSTEES ABSENT: Larry Brinson
OTHERS PRESENT: Ken Harrison, Sugarman & Susskind
Ferrell Jenne, Foster & Foster
John Thinnes, AndCo Consulting
Drew Ballard, Foster & Foster
Call to Order — Alexander Penalta called the meeting to order at 1:35 pm.
Roll Call — As reflected above.
Public Comment — None.
4. Approval of Minutes
The minutes from the December 11, 2017, quarterly meeting were approved upon motion
by David Arcieri and second by Lawrence Leaf, motion carried 3-0.
New Business
a. Update on Trustee terms.
i. Ferrell Jenne confirmed Alex Penalta was reappointed by Council at the
February 5, 2018, meeting. Ferrell explained that Tim Webb resigned
from the pension board. A notice went out to the membership and one
member, Joseph Mahoney, expressed interest in serving on the board.
Ferrell commented she would reach out to Joseph and inform him he ran
unopposed.
ii. Ferrell Jenne commented that David Arcieri' s seat would expire in June.
David Arcieri commented he would let Ferrell know if he wanted to
continue to serve.
iii. Ferrell Jenne commented that they could vote on the 51h trustee seat at
the next meeting.
Reports
a. AndCo Consulting, John Thinnes, Investment Consultant
i. Quarterly report as of December 31, 2017.
1. John Thinnes briefly reviewed the firm's growth.
2. Total Fund Gross returns were 3.63% for the quarter,
underperforming the benchmark of 3.75%. The 3 and 5-year
trailing returns were 6.66% and 8.93% respectively. Since
inception (10/1/2000), total fund gross returns were 5.21%,
underperforming the benchmark of 5.33%.
3. The market value of assets as of 12/31/17 were $9,785,672.
4. John Thinnes reviewed the performance of each manager and
didn't recommend making any changes.
5. John Thinnes commented that the American Realty subscription
documents would be executed at today's meeting and the plan
would then go into the Queue.
The board voted to approve the December 31, 2017, AndCo Consultinq quarterly report as
presented upon motion by David Arcieri and second by Lawrence Leaf, motion carried 3-0.
Foster & Foster, Drew Ballard, Actuary.
i. Presentation of the October 1, 2017, actuarial valuation report.
1. Total Required Contributions (as a % of total annual payroll)
remained the same at 57.7%.
2. Drew Ballard commented that there was a City shortfall
contribution of $21,934 for the fiscal year ended September 30,
2017. An interest charge of $137 was payable for each full
month after September 30, 2017, until the shortfall contribution
was deposited. It is important to note that the September 30,
2016, Funding Standard Account Credit Balance was utilized in
its entirety to meet the City's required funding obligation for the
fiscal year ended September 30, 2017. The Credit Balance is
now exhausted, and the shortfall contribution (plus interest) was
the amount still due from the city.
3. Drew Ballard commented that experience since the prior
valuation was less favorable than expected, relative to the
actuarial assumptions. The primary sources of loss included
unfavorable turnover experience, a 6.85% investment return
(Actuarial Asset Basis), falling short of the 7.50% assumption, no
retiree mortality, and the granting of Disability Retirements for
two prior Vested Terminated members. These losses were
partially offset by average increases in pensionable earnings that
were lower than the assumed rate.
4. Drew Ballard reviewed the UAAL and the 4-year smoothing
technique for investment returns.
5. Drew Ballard reviewed the assets and liabilities.
The board voted to approve the October 1, 2017, actuarial valuation report as presented
upon motion by David Arcieri and second by Lawrence Leaf, motion carried 3-0.
6. Drew Ballard and Ken Harrison both recommended to declare
the same investment return assumption that was approved in the
October 1, 2017, Valuation Report.
The board voted the declaration of returns for the plan shall be 7.50% for the next year, the
next several Vears, and the long-term thereafter, net of investment -related expenses, upon
motion by David Arcieri and second bV Lawrence Leaf, motion carried 3-0.
Sugarman & Susskind, Ken Harrison, Attorney.
i. Statement of policy for benefit calculations and legislative update.
1. Ken Harrison reviewed the statement of policy for benefit
calculations covered by the plan. The policy stated that members
of the plan would receive one estimate and one final calculation
for their career. Additional calculations can be done, but the
member would have to cover the cost.
The board voted to approve the statement of policy for benefit calculations covered as
presented upon motion by David Arcieri and second by Lawrence Leaf, motion carried 3-0.
ii. Legislative Update.
1. No pension reform bills were passed. Ken Harrison commented
there was a bill that passed which would allow police and fire
members to file for PTSD under workers' compensation without
an incident.
2
2. Ken Harrison advised that Dustin Watkins was no longer with the
firm, as he had left to care for his family due to medical issues.
3. Drew Ballard explained the share plan and how allocations
would be determined.
7. Consent Agenda
a. Payment ratification of Warrants.
i. Warrant #42, #43, #44, and #45
b. Fund Activity Report for December 7, 2017 — March 12, 2018
The board voted to approve the consent agenda as presented upon motion by David
Arcieri and second bV Lawrence Leaf, motion carried 3-0.
8. Staff Reports, Discussion, and Action
a. Foster & Foster, Ferrell Jenne, Plan Administrator
i. Upcoming educational opportunities.
1. Ferrell Jenne commented the FPPTA 341h Annual Conference
would be held on June 24-27, 2018, in Orlando, Florida.
2. Ferrell Jenne commented that the Division of Retirement
conference would be held on June 4, 2018 — June 6, 2018 in
Tallahassee, Florida.
9. Trustee Reports, Discussion, and Action — None.
10. Adjournment — The meeting adjourned at 2:19 p.m.
11. Next Meeting — Friday, July 13, 2018, 1:30 p.m.
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