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HomeMy WebLinkAbout03-09-2009 Workshop Minutes Minutes of the Workshop Session of the CITY OF OCOEE GENERAL EMPLOYEES’ PENSION BOARD Held on March 9, 2009 At 150 N. Lakeshore Drive Ocoee, FL 34761 AGENDA ITEM I. CALL TO ORDER - Chairman Wagner A. Chairman Russ Wagner called the meeting to order at 9:08 a.m. in the Commission Conference Room #109 in City Hall. The roll was called and a quorum declared present. Present were Trustees Russ Wagner, Jean Grafton, David Wheeler, Tom Hendrix and Wendy West. Chairman Wagner announced that Doug Lozen with Foster & Foster was in attendance to answer the Boards questions and that Mr. Lozen asked to be here on his own dime. Chairman Wagner explained briefly what the Board would be discussing and about the Plan Administrator’s resignation. AGENDA ITEM II. NEW BUSINESS A.Discussion – RFQ/Consultant Reviews on a Set Schedule a.Performance Expectations Chairman Wagner spoke about putting out RFQs on a rotating schedule. Trustee Grafton asked if the Board was aware that Pension Attorney Dehner was prepared to resign because he felt if the Board was putting out RFQs then they must not be happy with the performance. Discussion ensued. Chairman Wagner said that wasn’t necessarily true and encouraged open communication. Trustee Grafton said the reason Attorney Dehner mentioned this to her at the end of their last meeting was because the issue of putting out RFQs was discussed. Chairman Wagner said they just agreed to discuss the issue by putting it on the next agenda as a possible RFQ, which is what they were here today to address. Discussions ensued. Trustee Grafton asked if it would have been more palatable if the Board said they were going to do a review instead of saying they were going to put out RFQs. Trustee Grafton mention the issue of Foster & Foster getting the Member Statements done timely and said the reason they were late was mainly because of when the information was received. Doug Lozen asked to speak and said that Foster & Foster did not received the data in October as mentioned at the February meeting, that it was actually received on November 4, 2008. He said he understood at the February meeting it was also mentioned there was an expectation that Foster & Foster would have the Member Statements ready for the November meeting but said they weren’t made aware of the November meeting and said it would have been difficult anyway considering the time frame. Mr. Lozen went on to explain why he was unable to attend the February Board meeting. Discussion ensued about the Board’s Regular Quarterly Meeting schedule. General Employees’ Pension Board Workshop Session, March 9, 2009 Page 2 of 8 Trustee Grafton reminded the Board of Foster & Foster’s involvement during the implementation of all the recent changes made to the Plan. Doug Lozen assured the Board if it was either the expectation of work or displeasure with their service, if that was just communicated to them then they could operate more to the Board’s satisfaction. Discussion ensued regarding communication. Doug Lozen asked to speak about one more piece as far as their performance and said what Foster & Foster holds most important is getting people paid their retirement. He said he did some research and found that their turnaround time from submission of data to a return of the notification to be given to the member for choice of benefit was around one week when they have contractually a two week turnaround. Trustee Grafton stated that when she was involved in with she was never dissatisfied with Foster & Foster’s service. Discussions ensued about the Member Statements and possible expectations from employees. Doug Lozen said it was probably not a bad idea to have a membership workshop to explain their benefit because employees may be thinking the market impacts their benefit. Further discussion ensued. Trustee Wheeler suggested they may need to change their schedule for meetings if there is an issue with Foster & Foster having the Member Statements ready for the November Board Meeting. Trustee Grafton suggested having an additional meeting, possibly in December. Doug Lozen said Foster & Foster generally ties the Member Statement to the Valuation Report completion and the next Quarterly Meeting but could accommodate special requests if that is what the Board would like. Discussion ensued about communications and what is allowed to occur between Board Members without violating any law. Chairman Wagner talked about the Merrill Lynch issue and the Plan Administrator’s concern regarding Attorney Dehner’s guidance. Trustee Grafton stated Attorney Lee Dehner did tell the Board they needed to look into it and said there were things they needed to pay attention to but she believed the Plan Administrator was not at those meetings and would like to review the recordings to hear exactly what was said. Trustee Wheeler asked what the Board wanted to do about getting a Plan Administrator since Jim Carnicella resigned. Discussion ensued about what duties the Plan Administrator was performing and the possibility of getting someone else to take that over, what Debbie Bertling’s role was in assisting Mr. Carnicella, and what functions Human Resources may possibly still perform. Chairman Wagner said there seems to be only a couple of choices, to look outside for a Plan Administrator or for a Board Member to do it but said he isn’t sure he really likes the idea of having a Board Member do it unless it was just on an interim basis. Doug Lozen spoke about outside individuals he was aware of that perform some of the Plan Administrator duties. Further discussion ensued. Chairman Wagner said he would like to discuss this with City Manager Rob Frank. Doug Lozen said before he looses track, in order to do the Valuation Report he needed updated pay for the Commissioners and City Manager. Mr. Lozen was advised that the request for this information was forwarded to Finance and they should be providing it soon. He said Foster & Foster would also need this data each year in order to know who has come in and out of the plan. Chairman Wagner told Mr. Lozen he could contact Tracey Darin in Finance directly. General Employees’ Pension Board Workshop Session, March 9, 2009 Page 3 of 8 Trustee West said she feels that since she has been on this Board there have been some personality conflicts but said if you are going to business you should put them aside. Discussion ensued regarding the Pension Attorney and about the Attorney firm, Beggs & Lane, who offered to look at the files regarding Merrill Lynch. Chairman Wagner said he thought they asked Attorney Dehner to look into others that were bringing possible action against Merrill Lynch and stated he would contact the Attorney after this meeting for an update. Discussion ensued about what records needed to be provided to the Attorney looking into the Merrill Lynch issue. Trustee Grafton said there are boxes of files in the offsite storage and in Human Resources and possibly a file cabinet at the Fire Department. Further discussion ensued. Chairman Wagner asked if Lee Dehner was also the Police & Fire Pension Attorney and if that Board was using Merrill Lynch, which was confirmed to be the case. Chairman Wagner said his question now is if the Police & Fire Pension Board were pursuing something against Merrill Lynch. Discussion ensued. Trustee Wheeler said they should probably schedule a special meeting after the Board has a chance to talk to the City Manager and talk to one of the outside Plan Administrators to see what functions they provide or to contact someone at FPPTA. Doug Lozen said when Chairman Wagner calls Attorney Dehner he may want to ask his office to forward a list of Plan Administrators. Trustee Grafton asked if Mr. Carnicella gave them any information on exactly what functions would be passed down to them to do if neither he nor his staff would be involved going forward. Chairman Wagner said that was one of the issues he wanted to talk to the City Manager about and he would also contact Attorney Dehner and the Police & Fire Pension Board Chairman Charlie Brown. Discussion ensued about all the Board Members meeting with the City Manager and so a brief break was taken to schedule this meeting. The Board then skipped to Item C concerning the Operating Rules and Procedures. b.Interview Schedule B.Discussion – Summary Plan Description a.Eligibility for Plan Membership Chairman Wagner said under eligibility for Plan Membership in the rules they left in a line regarding the City Manager and his five years of credited service but felt that it was not necessary to be in there since it was a one time thing and suggested it be deleted. He then skipped to number c below. b.PLOP vs. DROP Information Chairman Wagner said he had questions about what the advantage or disadvantage was of someone going under the DROP Program. Doug Lozen handed out a document with examples and went on to explain. He said he could give it to them basically in a summary. He went on to say whether DROP or PLOP is more valuable depends primarily on two things, the number of years of service when you decide to retire at age 60, since there is no DROP available for early retirement, and salary increases. Chairman Wagner said there was General Employees’ Pension Board Workshop Session, March 9, 2009 Page 4 of 8 something in the Rules that said you have to choose the DROP within 12 months of your sixtieth birthday and asked Doug why that would be. Discussion ensued about the window being taken out when the Board changed the length of the DROP from five to seven years. Doug Lozen stated it makes sense that the window would be removed. Mr. Lozen then went over the examples in the handout. He said for short service members it would not be as beneficial to go into the DROP and went on to explain. Brief discussion ensued and then Mr. Lozen continued going over the examples. Further discussion ensued. Doug Lozen explained that employees who have a long service history with the City it would be more beneficial for the member to enter the DROP if they were sixty or older at that point because of the 81% cap, which is basically reached at 27 years of service. He said these examples should help employees make a decision and could be distributed to employees. Brief discussion ensued about employee meetings and providing materials then the meeting was adjourned. c.Death Before Retirement Chairman Wagner asked if someone died before they retired what would their spouse be entitled to. Doug Lozen stated the person had to be vested and if they were then Foster & Foster would figure the benefit accrued up to date. He said the beneficiary usually has four options and went on to explain they could take it when the member would have turned age sixty, or at early retirement age, which is reduced, or they could take it the month following the day the member died but could be a very big reduction if the member died in their forties. d.Reemployment After Retirement Chairman Wagner mentioned there was an issued recently regarding a retiree who is drawing the early retirement benefit and talked about coming back but what would happen if he were reemployed. Doug Lozen said the Attorney could give an answer on that but what he sees more often is that the benefit is suspended and the member becomes a member of the plan again accruing a new benefit and would be one hundred percent vested, so they would receive two benefits. Discussion ensued. e.Additional Credited Service – Buy Back 1)Timing Issues Chairman Wagner said he didn’t understand the language. He said it reads the request must be made on or before 18 months from the date of your employment with the City of Ocoee. Discussion ensued. Chairman Wagner said he would like to get with Attorney Dehner as to whether this could be removed. Further discussion ensued. 2)Air Time Limitations Chairman Wagner stated the Board added Air Time recently. Trustee Grafton asked why they did this. Doug Lozen said it was something new from the Pension Protection Act of 2006 and it found its way into Municipal Pension Plans. Chairman Wagner said the maximum credit says it is five years but you have to take into account if you have already taken prior military credit or prior government credit and General Employees’ Pension Board Workshop Session, March 9, 2009 Page 5 of 8 asked if it was a law. Doug Lozen said no but that most actuaries recommend you don’t go much beyond five years. Discussion ensued about prior years of service with the City. Chairman Wagner said he would check with Attorney Dehner to see why it was structured that way. f.Forfeiture of Pension Trustee Wheeler said this item was interesting because it says if you are convicted of a felony you forfeit your pension. Doug Lozen said this was also an issue for the Pension Attorney. Discussion ensued about whether this should even be in the Plan. g.Exhibit “A” – Update Chairman Wagner advised the list of Board Members needed to be updated since David Wheeler took the place of Terry Reed. h.Schedule for Dissemination to Plan Participants Chairman Wagner said it is stated that the Summary Plan Description should be updated and distributed to the employees every two years. Trustee Grafton said it was her experience that it typically takes a full year for the Board to review the Summary Plan Description. Discussion ensued. Chairman Wagner suggested the Board should probably get with Attorney Dehner and have him finalize the document as best he can with all the changes that were made up to this point. The Board then went back to number b above regarding PLOP vs. DROP. C.Discussion – Operating Rules and Procedures a.Extension of Term Limits for Board Members Discussion ensued about the term length for Board Members. Trustee West said she thought the Board had asked for five-year terms. Trustee Wheeler said the City Commission threw it back to them to get some type of official position. He also said that a comment came up during the Commission meeting regarding Board Members becoming certified. b.FPPTA Certification Requirements Chairman Wagner said he heard it takes three years to get certified, which was why he thought the recommendation was for four years terms. Discussion ensued. c.Board Member Eligibility Discussion ensued about employees being vested before becoming eligible to be a Board Member. Chairman Wagner said he would contact Attorney Dehner about an Ordinance to address these issues. General Employees’ Pension Board Workshop Session, March 9, 2009 Page 6 of 8 d.Agenda Materials - Availability Discussion ensued about the meeting schedule and the timing for receiving their Agenda materials. The Board decided it would be beneficial to receive their packets a week before their Board meetings. Trustee Grafton suggested she and Chairman Wagner get together around the middle of the month prior to their Quarterly Meeting dates in order to put the Agenda together. Trustee Grafton the mentioned the Operating Rules and Procedures. Chairman Wagner asked if the Board had adopted the Operating Rules recently because the one he had still said draft on it. Discussion ensued. Trustee Wheeler went back to the Agenda and suggested Chairman Wagner send it out to all the Board Members weeks ahead of the meeting to see if they had anything to add. Chairman Wagner agreed. e.Meeting Dates / Number Per Year Chairman Wagner asked if the Board wanted to set a schedule to meet more often than quarterly and then just decide when they needed to hold a special meeting. It was agreed to leave the schedule as is. Trustee Wheeler said he contacted Tracey Darin in Finance during the break concerning the data she provides to Foster and Foster each year for the Member Statements and reported she has several year end items to do but could probably get it done within 30 days of the request. f.Office Personnel / Administration Not addressed at this time. g.Expense Payments Procedures Not addressed since this was in the Operating Rules, which will be addressed at another meeting. h.Retirement Applications – Board Review Chairman Wagner said there was something in the Operating Rules about the Board reviewing retirement applications. Trustee Grafton said the Board has never reviewed them but said they use to receive a report on who had retired, if someone took a lump sum payout, and if they retired what option was selected. Discussion ensued. Chairman Wagner said this may be something they could focus on for the Plan Administrator to provide. i.Auditing of Funds Chairman Wagner said he knows the City does some type of audit of the plan. Brief discussion ensued. Trustee Wheeler suggested they talk to Finance Director Wanda Horton to see what type of audit the City does. Discussion ensued about hiring outside auditors and the cost associated with doing so. Trustee Grafton reported she looked over the files and discovered an error was made concerning the amount two retirees were receiving because their benefit was calculated from the estimate instead of their final compensation amount. General Employees’ Pension Board Workshop Session, March 9, 2009 Page 7 of 8 j.Appearance at City Commission Meetings for Ordinance Amendments Chairman Wagner said there was something in the Operating Rules about a Board Member attending the City Commission Meetings when Ordinance Amendments for the Pension Plan were being considered. Discussion ensued. k.Actuarial Statements Chairman Wagner asked Doug Lozen about the timing of producing the Actuarial Statements, to which Mr. Lozen replied 30 days from the time Foster & Foster receives the data from Finance should be no problem. l.City Liaison / Plan Administrator Previously discussed. D.Discussion – Administrative Issues a.Calendar of Events and Target Dates Chairman Wagner said the binder books were very helpful and a good start but he would like to expand on it. He suggested splitting the book into two books with the smaller notebook containing such things as their meeting dates/times, when their Conferences were, and when they should receive the Actuarial Report. b.Annual Report to City Commission Chairman Wagner suggested all the Board Members attend a City Commission meeting at least once a year and should summarize what they have done, how many people are in the Plan, anything that was enacted, and how much money is in the Plan. c.Communication w/City Manager Previously discussed. d.Pending Items Workbook Previously discussed. e.Reference / Resources “Bible” Previously discussed. f.Status Report on Retiree Contributions Previously discussed. General Employees'Pension Board Workshop Session,March 9,2009 Page 8 of 8 g. Employee Meetings/Newsletter Chairman Wagner said he would like to see that they have employee meetings on a regular basis and a newsletter. He suggested that Foster & Foster come to the employee meetings and hand out some information to explain their options. Discussion ensued. The Board then went back to Item B. E. Further Discussion Items from Trustees/ Plan Administrator None. AGENDA ITEM III. ADJOURN There being no other business, the meeting was adjourned at 12:08 p.m. Respectfully submitted by A oved Debbie Bertling •1Jr_ HR Analyst Russell B. Wagner, Chairman C