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HomeMy WebLinkAbout01-17-1994 Minutes POLICE OFFICERS ' /FIREFIGHTERS' RETIREMENT TRUST FUND % lay (PENSION MEETING) January 17, 1994 The meeting was called to order at 1:10 p.m. in the Community Center by Chairman Reed. PRESENT: Chairman Reed, Members Gledich, Williams, and Wilson. Also present were Attorney Definer, Actuary Foster and Scott Haynsworth, M.A.S. of Foster and Foster Actuarial Consulting, Terry McDougal of The Investment Counsel Company, Police Chief Boyd, and Clerk/Stenographer Lewis. ABSENT: Member Strosnider. APPROVAL OF MINUTES Member Gledich. seconded by Member Williams. moved to approve the minutes of November 12. 1993 as presented. Motion carried 4 -0. RECORDING SECRETARY In following up on the Board discussion and general approval regarding hiring a recording secretary, Chairman Reed asked about hourly pay and tasks covered. Attorney Dehner had asked Clerk /stenographer Judie Lewis to be present and act in that capacity and Ms. Lewis '�. suggested a rate of $9.81 per hour for preparing /posting the agendas and recording /distributing the minutes. Member Gledich, seconded by Member Williams. moved to retain the services of Judie Lewis to act as recording secretary for the Board. Motion carried 4 -0. Chairman Reed directed Attorney Dehner to prepare a contract reflecting the responsibilities of the secretary at a $9.81 hourly rate including a Letter of Agreement. REPORTS ATTORNEY Consideration /Adoption of Amendments to Operating Rules and Procedures and Selected Provisions Attorney Dehner discussed proposed amendment changes and selected provisions in the Operating Rules and Procedures and Member Gledich directed Mr. Dehner to prepare a draft for consideration/adoption at a special meeting scheduled for 11:00 a. m., Wednesday, February 9, 1994 in the Community Center, with the General Employees Pension Board meeting earlier that day to discuss the same issues to be followed with a Joint Board Meeting. Proposed Revision To Permit Employee Transferring To General Fund From Police /Fire Fund To Retain Vesting Credits Earned In Police /Fire Fund Attorney Dehner said that the Board had several issues that he had taken to the City Manager Shapiro and Personnel Director Psaledakis in connection with Ordinance amendments that the Board was considering for recommendation to the City, and pointed out several of the issues: Police Officers /Firefighters Retirement Trust Fund Board Meeting January 17, 1994 1. Would an employee who crosses over between two plans lose credit from the prior plan? 2. Are the number of years in both plans counting toward vesting if an individual leaves the Police /Fire Plan and goes into the General Plan? 3. What benefit would an employee take out of the Police /Fire Plan upon retirement from the General Plan? (i.e., Would the employee have an accrual rate calculation based on the rate from the General Plan or the rate in existence of that plan at the time of retirement. Mr. Dehner discussed the Family Medical Leave Act which allows an employee on such leave an opportunity to buy back the time as credited service in the plan indicating the current Ordinance does not cover this area. He suggested a buy back date for an employee who had taken leave during the fiscal year to occur annually between March 1 - April 30, and for the employee to provide a check for costs of Mr. Foster's calculation for employee buy back amount, and pointed out the importance of tracking personnel records, and placing a cap on the total amount that can be purchased. Another issue of concern was whether the amount of time should count for vesting purposes and if the employee should be given 12, 24 months, or an open ended time to buy back. City Manager Shapiro and Personnel Director Psaledakis had no objection and would support the changes indicated in the draft incorporating the plan if it is the recommendation of the Board. Mr. Dehner also recommended discussion with membership to determine where they would like to see the improvements made in 1.) increasing monthly retirement benefit which can be done by '.• increasing the accrual rate and /or decreasing the number of years that is provided for the average final compensation, and 2.) retirement age. Member Gledich asked Actuary Foster to prepare a costs estimate of what the improvements would be for the Board's recommendation on funding. The Board discussed legend changes on the agenda. Attorney Dehner told the Board that his service fees would increase from $150 to $180 an hour, travel fee was increasing from $75 to $90, effective February 1, 1994. ACTUARY Actuary Foster said that a new program had been created to access the Actuary Reports with the new format for the Individual Certificates offering a more detailed formulation to include all of the changes requested by the Board. Mr. Foster said that he will be prepared to discuss the specific costs of the items that are set forth on the second page of the October 12 meeting, will determine the funding requirements to implement those four items as well as various combinations, will be working with the results of the October, 1993 evaluation, and will also have information on the impact of the cross over provision, and cost studies between basing the piece of benefit attributable to General Employee Service on the earning, average and effected retirement versus the earnings average in effect at the time the General Employee leaves and becomes a member of the Police /Fire Plan, or the other way around. Actuary Scott Haynsworth 2 Police Officers /Firefighters Retirement Trust Fund Board Meeting January 17, 1994 explained in detail each aspect of the Investment Review and said there had been changes in cost methodology where (1) calculation of each individual actual retirement age within range, and (2) any member that is /at over the assumed retirement age is eligible on the evaluation date. Chairman Reed asked about the methodology changes in respect to retirement age and Mr. Foster said that the State wants the liabilities individually for each member, then determine the costs on that basis, and said even though the change is in the methodology used it must be approved by the State. Member Gledich. seconded by Member Williams, moved to accept the me olog h nges in the Actuarial Assumptions as mandated by the State. Motion carried 4 -0. Actuary Foster reviewed the Actuary Performance Report and said it was not too good and it even carried over to the Actuarial Evaluation where the underperformance of the return less than our 8% net expenses has generated actuarial loses that could have had the effect of increasing costs had the plan not had good salary increase experience. The December report shows it is turning around and the stock performance have pulled the bonds down. Mr. Foster said a schedule is being created that shows the performance of the various funds for the year ending September 30, 1993 to compare this performance with the performance of funds that have similar investment objective, and said that the actuary will not be looking at funds that are in the small cap investment. Member Gledich requested the list for the next meeting. Member Gledich, se s n• e s 1),y Member Wilson , moved to accept the Actuary Performance Report as 'resented. Motion carried 4 -0, INVESTMENT MANAGER Terry McDougal, of The Investment Counsel Company, presented the Investment Performance Review and distributed the Broker Commission Summary Report. Attorney Dehner pointed out discrepancies in the Investment Performance transactions and Ms. McDougal said that a written memo in response to both plans would be forthcoming. OTHER BUSINESS APPOINTMENTS Chairman Reed said a chairman and secretary must be approved for the Board. In view of Member Strosnider's absence, it was tabled for the next meeting. `, 3 Police Officers /Firefighters Retirement Trust Fund Board Meeting ,oir January 17, 1994 BILLS AUTHORIZED FOR PAYMENT Chairman Reed requested approval of the Board to send the following bills to Key Trust for payment: 1. Christiansen & Delmer, P.A. 289.79 2. Foster & Foster, Inc. 3,095.00 500.00 (Boyd & Chandler) 150.00 3. Investment Counsel Co. (Quarterly Fee) 1,015.90 Member Gledich. seconded by Member Tony. moved to pay the bills as presented. Motion carried 4 -0. ADJOURNMENT Member Williams. seconded by Member Gledich. moved to adjourn at 3:10 p.m. Motion carried 4 -0. Respectfully submitted, j I J E F. LEWIS, Clerk/Stenographer a: \wp6O \PFPEN11794 4