08-06-1997 Minutes THE CITY OF OCOEE POLICE OFFICERS'/FIREFIGHTERS'
RETIREMENT BOARD MEETING - August 6,1997
Member STROSNIDER called the meeting of the City of Ocoee Police Officers' /Firefighters'
Retirement Trust Fund to order at 10:04 a.m. in the Commission Chambers Conference Room of
City Hall. The roll was called and a quorum declared present.
PRESENT: Chairman Reed, Members Strosnider and Wilson. Also present were Actuary
Foster, Attorney Delmer, Money Manager Ballew, and Recording Secretary
Mela.
ABSENT: Members Gledich, Williams
Discussion ensued concerning the Minutes of May 7, 1997 as follows:
Randy Conyers presented a letter to the Police Officers'/Firefighters' Pension Board.
The letter was read to the board by Member STROSNIDER. Chairman REED asked if the
Police Officers'/Firefighters board or the General Employee board gave Randy an answer to his
question in writing or verbal.
Chairman REED suggested that we answer his questions. The suggestions were to send
him a copy of the minutes of May 7, 1997 in an inter - office envelope, and highlight his portion
of the minutes.
Member STROSNIDER, seconded by Member WILSON, moved to approve sending Randy
Conyers a copy of the May 7, 1997 minutes with highlighted section. Motion carried
unanimously.
APPROVAL OF MINUTES
Member STROSNIDER, seconded by Member WILSON, moved to approve the Minutes of
the May 7, 1997 Police Officers'/Firefighters Retirement Trust Fund as presented. Motion
carried unanimously.
QUESTIONS /COMMENTS FROM AUDIENCE
There were no questions from the audience.
Police Officers'/Firefighters' Retirement Trust Fund
August 6, 1997
OTHER BUSINESS
1- AUTHORIZE/RATIFY PAYMENT OF BILLS
Member STROSNIDER presented a May 7, 1997- August 6, 1997 list of bills which had
already been paid, and asked for ratification of payment, and requested approval of the Board to
present to SunTrust for payment, the following bills:
1. SunTrust $6,094.55
2. Foster & Foster $1,000.00
3. City of Ocoee $ 32.76
4 FPPTA CONFERENCE
Tony Wilson $200.00
5. FPPTA CONFERENCE
Mike Reed $200.00
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6. Christian & Dehner $65.40
7. Christian Dehner $604.35
8. Sue Mela $58.86
Chairman REED brought up that Member WILSON will not be attending the FPPTA
Conference and therefore, the $200.00 was not paid. This was per Diane Garcia of SunTrust
Bank.
Member WILSON, seconded by Member STROSNIDER, moved to authorize and ratify
payment of the bills as presented. Motion carried unanimously.
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Police Officers'/Firefighters' Retirement Trust Fund
August 6, 1997
2- RECORDING SECRETARY POSITION
Concerning the recording Secretary position. Recording Secretary Mela asked the board to
find another recording Secretary due to not having the capacity to properly due the minutes.
Discussion ensued with the board to hire a Court Stenographer to record the minutes. Recording
Secretary Mela offered to inquire what the cost would be and where we would go to get a
Stenographer.
Chairman REED asked approval from the board to let Recording Secretary Mela ask around to
get this information for the next meeting.
3- EXPIRING TERM
Chairman REED, Member STROSNIDER, and Member WILLIAMS term expires
October 1, 1997.
Member STROSNIDER suggested this be put on the next Agenda for election.
'to" Chairman REED motioned that we contact Jean Grafton, City Clerk to contact Member
WILLIAMS to see if he would like to serve again next and to discuss the election procedures,
for the meeting in September, 1997.
REPORTS
ACTUARY
Actuary FOSTER presented the performance report as of June 30, 1997, to be signed by the
Secretary Strosnider and Chairman Reed. Actuary FOSER reported this was a good quarter.
The report completes 2 1/2 years of investment management by STI Capital Management. He
reported how things have grown in 2 1 /2 years, starting out with $1,500,000.00 and now with
$3,700,000.00, showing that this has more than doubled the money in the 2 1 /2 year period. The
average annual return over that 2 1/2 year period has been 19.4% per year. This is almost 2 1 /2
time more than anticipated for actuarial purposes (looking at 8% and receiving almost 20 %). He
reported the rate of return for the quarter was 10 %. The report for the period ending June 30,
1997 is on file and available for review.
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Police Officers'/Firefighters' Retirement Trust Fund
August 6, 1997
Chairman REED made a motion to accept the Investment Performance of June 30, 1997.
Member STROSNIDER, seconded by Member WILSON, moved to accept the Investment
Performance of June 30, 1997 as presented. Motion carried unanimously.
MONEY MANAGER
Money Manager BALLEW presented the Investment Performance Report Ending May 7 1997,
with a few comments stocks being up 17 1/4%. This was the strongest quarter for the Stock
Market, since the first quarter of 1991. We trailed the S &P by a couple of percent for the
quarter. This report for the period ending June 30, 1997 is on file and available for review.
PERFORMANCE MONITOR
This was presented by Actuary FOSTER in the Actuary Report.
ATTORNEY COMMENTS
"N` Attorney DEHNER informed the Board about the following:
1) Removing quality restrictions from their investments for Fixed Income and to increase
their Equity limit from 50 to 60 %. It would be a good time for the Board to consider it
since they were moving on the ordinance anyway. They were not talking about a Policy
change at this point. Member WILSON, seconded by Member STROSNIDER, moved
to have Attorney DEHNER change the Plan's Ordinance, Section investment in Equities
from 50 to 60% at cost. Motion carried unanimously.
2) Set -off for a member receiving Workers Comp Plan Disability Benefits and Social
Security Benefits. Years ago, the Board had discussed but had chosen not to approve a
Set -off Provision at a 100% Workers Comp Disability combined. Member
STROSNIDER, seconded by Member WILSON, moved that an individual will not
receive more than a 100% of average weekly wage as defined in the Comp Statute
Chapter 440 through combined three elements (Workers Comp, Disability, and Social
Security) Motion carried unanimously.
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Police Officers'/Firefighters' Retirement Trust Fund
silow August 6, 1997
Attorney DEHNER said that they would need a sign -off from the Union(s) before the
second reading of this ordinance. Chairman REED will send a copy of the final
ordinance to the Union(s).
Two bills were pending in Washington that if passed will have an affect on the Plan, both
positive:
3) Section 415 C - Internal Revenue Limit - One is where we have Buy -backs (There was
a buy -back provision in the Plan although it was limited to a year. Attorney DEHNER
was not sure if it exceeded the limit). Currently, a buy -back is subject to Section 415 C,
Internal Revenue Limit, a contribution limit which is the lesser of 25% of $30,000. If
anyone exercises a buy -back now Actuary Foster was required to calculate the amount to
see that it was not going to exceed that amount. If it did exceed that amount, there was a
cut -off for what they can buy in that year, whatever the amount was. Attorney
DEHNER will keep them updated.
4) Code Section 40184 - A non - discrimination section of the Internal Revenue Code that
essentially provides that higher salaried employees could not get more Plan benefit
options than what lower salaried employees could get. It was a non - discrimination
provision. It had been applicable and in the Code for years. It has been applicable in the
private sector for years. Also, for about 20 years, there had been a series of temporary
moratoriums on this application of public Plans because problems that existing in private
Plans did not lend itself to public Plans. Currently scheduled to become effective January
1, 1999 for public Plans, and if that occurred, Actuary FOSTER would have to do
testing to verify that the Plan did not violate the provision. A Bill was pending that
would make that Moratorium, that's been happening on a temporary basis for 20 years,
permanent. If that passed the Board would not have to worry about non - discrimination.
In response to Chairman REED, Actuary FOSTER said that their billing statement would
reflect any time that might be spent for litigation regarding the NASDAQ Market Wager Anti
Trust Litigation.
Chairman REED said that the Board must ratify the election results at the November 17
meeting.
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Police Officers'/Firefighters' Retirement Trust Fund
` y August 6, 1997
Discussion ensued about a `floor contribution," a popular sort of pre - funding approach. Actuary
FOSTER provided an example: "If the Plan had a 20% return, then the beneficiary of a good
experience would be the City, their contribution would go down, members still pay whatever
they are paying but if the Plan had a funding, for example, 18% , then, out of the proposed
benefit increase, the City would be contributing 19.6% but in two or three years, if the Plan had
good experience it could go to 15 %. If you have a floor, however, that may be 18 %, then the
Plan had an opportunity to store up excess investment earnings and build the Fund up so that
they could afford benefit improvements without going back and asking for money." Mr.
FOSTER did not support this approach from the Board at this time.
ADJOURNMENT
Member STROSNIDER, seconded by Member WILSON, moved to adjourn the meeting at
11:15 a.m.. Motion carried unanimously.
Respectfully submitted,
Sue Mela, Recording Secretary
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