11-04-2015 Mintues THE CITY OF OCOEE POLICE OFFICERS' /FIREFIGHTERS'
RETIREMENT FUND BOARD MEETING — NOVEMBER 4, 2015
Chairman Brown called the meeting of the City of Ocoee Police Officers' /Firefighters'
Retirement Trust Fund to order at 1:00 p.m. in the Commission Chambers of City Hall. The roll
was called and a quorum declared present.
PRESENT: Charles Brown, Joe Moy, William Maxwell, Brain Pace, and Joe Moy
Also present: Mr. Tim Nash of Bogdahn Consulting, Fund Attorney Lee Dehner; Fund Auditors
Jeanine Bittinger and Richard Cristini, Fund Actuary Doug Lozen of Foster & Foster, and Fund
Administrator Pete Prior of Benefits USA.
ABSENT and EXCUSED:
CALL TO ORDER —
Roll call and determination of quorum
Roll call was taken and it was determined that there was a quorum.
APPROVAL OF MINUTES
Approval of Minutes from Regular Meeting dated August 5, 2015. Trustee Wagner commented
that he was not a member at the beginning of the meeting and was appointed under new business.
The Chairman asked that the minutes reflect the change. Trustee Maxwell moved to approve the
minutes as amended. Trustee Moy seconded the motion and the motion passed.
PUBLIC COMMENTS
There were no public comments at this time.
QUARTERLY INVESTMENT UPDATE: Period ending 09/30/2015
Bogdahn Consulting
Mr. Nash provided a brief report on economy noting that the last quarter was very difficult for
everyone in the market and the plan did not make its assumed rate of return for the year. The
Fund was down net -4.32% in line with the policy for the quarter and earned 0.89% net for the
fiscal year vs. the Fund policy of 0.04 %. The gross return for the fiscal year was 1.27% ranking
in the 10 percentile. The total equity fund was down -7.27% for the quarter vs. the equity policy
of - 8.28 %. The domestic equity was down -6.71% vs. the Russell 3000 of - 7.25 %. GAMCO was
down -7.98% vs. the Russell 3000 value index of - 8.59 %; the Sawgrass Growth Fund was down
-4.99% vs. the Russell 1000 Growth index of - 5.29 %. The Vanguard Total Stock Market Index
Fund was down b -7.26% in line with the CRSP US Total Market TR Index. The international
equity fell -10.81% vs. the international policy of - 12.10 %. Mr. Nash did not have any quarterly
returns for the American Funds Euro Pacific Growth Fund. Mr. Nash noted that the fixed
income manager Garcia Hamilton outperformed the benchmark and continues to do well for the
fund. Real estate again did well returning almost 14% to the portfolio for the fiscal year. Tim
noted that he does not have any recommended changes for the portfolio at this time; however; he
reported that the fund did have to transfer $30,000 from bonds to cover the monthly
distributions.
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NEW BUSINESS:
Presentation of 2014 Financial Statements
Mr. Cristini introduced himself and Ms. Bittinger to the board noting that this is the first
independent audit of the Police and Fire Pension Plan. Mr. Cristini reported briefly on the plan
noting that the Plan is a defined benefit pension plan covering all sworn firefighters and police
officers of the City. Participation in the Plan is required as a condition of employment.
Mr. Cristini reported that originally established in 1986 and amended substantially in 1996,
2010, and 2013, the Plan provides for pension, death and disability benefits. The Plan is subject
to provisions of Chapters 175 and 185 of the State of Florida Statutes. Mr. Cristini reported that
the plan earned 10.95% for the fiscal year ended September 30, 2014. The total contributions
were $2,571,678 with Employer Contributions of $1,955,278 and employee contributions of
$616,400. The market value at the beginning of the year was $35,632,521 and the increase in the
net position was $5,067,592 for a total market value at 9/30/14 of 40,700,113.
Mr. Cristini reported on the New accounting procedures noting that the GASB67 is reporting for
Pension Plans and GASB 68 is reporting for the Employers. These reports address the
accounting and financial reporting requirements for pension plan activities. Mr. Cristini
reported that this plan is a single employer pension plan as defined by GASB 67. The
requirements for GASB 67 require changes in presentation of the financial statements, notes to
the financial statements, and required supplementary information. Mr. Cristini reported that the
implementation of GASB 67 did not significantly impact the accounts receivable and investment
balances, as they were already accounted for in accordance with GASB 67 requirements and
therefore no restatement of the 2013 balances were necessary. The implementation consisted of
the assumptions and actuarial calculation of the total and net pension liability; comprehensive
footnote disclosures regarding the pension liability and assumptions and increased investment
activity disclosures.
Mr. Cristini reported that the plans investments of $4,702,088 depreciated by ($1,565,014)
ending 2014 with the net appreciation totaling $3,137,074 in investments. Mr. Cristini noted that
a portion of the plans assets are designated for the DROP benefits. The undesigmated net
position at 9/30/14 was $39,276,822 plus the total DROP benefits of $1,423,291 results in a total
net position of $40,700,113. Mr. Cristini reported that the components of the pension liability of
the City as of 9/30/14 were total pension liability $ 47,615,120 less the Plan fiduciary net
position of $40,700.113 resulting in the City's net pension liability of $6,915,007 and as a
percentage of 85.47 %.
Mr. Cristini reported on the actuarial assumptions noting that the total pension liability was
determined by an actuarial valuation as of October 1, 2013 updated to September 30, 2014 using
the following actuarial assumptions applied to all measurement periods. Inflation 3.00 %; Salary
increases 6.00% and Investment rate of return 8.00 %.
Mr. Cristini reviewed the internal controls noting that there were no issues. That being said
Trustee Moy moved to approve to the financial statement as presented and Trustee Wagner
seconded the motion and the motion passed.
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FPPTA Winter School
Trustee Maxwell noted that he would like to attend the FPPTA Trustees School in January. The
other trustees said they would advise at a later date.
2016 Meeting dates
Attorney Dehner reported on the 2016 meeting date schedule noting that the dates are as follows:
February 3, May 4, August 3 and November 2 and all meetings are scheduled for 1:00 PM.
UNFINISHED BUSINESS:
Experience Study
Mr. Lozen provided the trustees with a copy of the experience study noting that he will go
directly to the summary of the report and will entertain questions from this point on. He noted
that on page eleven, some of the changes would result in the City's estimated annual required
contributions to change. Currently the City contributes 1.8 million dollars or 23.82% of payroll;
if the investment assumption is lowered to 7.75 %; the required contribution would increase to
$1,990,000 or 25.79% of payroll. Mr. Lozen reported that if all of the proposed changes were
adopted, using the combination of 8.00% and 7.75% investment assumptions, the City's required
contribution would be $2,100,000 and $2,270,000 respectively, an increase of $260,000 or
27.57% and $430,000 or 29.81% respectively. Mr. Lozen said the board does not have to do
anything now and he will bring back the valuation in February status quo and at that time, the
board could direct him to redo the valuation with the assumptions, if they wish to do so.
Chairman Brown said he is not comfortable making a decision now as there are other issues that
would impact this decision. Mr. Lozen noted that this is fine with him and it would be good for
the board to discuss this issue in the near future.
CONSENT AGENDA
For Approval: Warrant #114
Benefits USA, Inc. (Flat Monthly Fee for November; Inv #11 -2015 dtd 11/4/15) $2,100.00
Foster & Foster (Services Rendered; Invoice #7969 dated 10/29/15) $8,220.00
FPPTA (2016Annual Membership Dues) $600.00
GAMCO (3r Qtr. 15 Management Fee - Invoice dated 10/15/15) $14,353.00
Garcia Hamilton (3r Qtr. Mgmt Fee -Inv #26268 dated 10/14/15) $6,675.35
Sawgrass Asset Mgmt (3r Qtr. 15 Mgmt Fee - Invoice dated 10/8/15) $11,817.00
Total $43,765.35
For Ratification: Warrants #110 -113
Christiansen & Dehner (Legal fees - Invoice #26952 dated 7/31/15) $844.40
Fifth Third (Custodian Fees - Invoice #4538762 dated 7/6/15) $3,634.61
FPPTA (Trustee School Registration for 4 Trustees @ $450 each) $1,800.00
FPPTA (CPPT Certification Fee for Bryan Pace) $900.00
Total $7,179.01
Naples Grand Beach Resort (Hotel Conf #32CKVTQ3; N/O W Wagner $507.00
Naples Grand Beach Resort (Hotel Conf #32CKVXPJ; N/O W Maxwell $507.00
Naples Grand Beach Resort (Hotel Conf #32CKVXV3; N/O J Moy $507.00
Naples Grand Beach Resort (Hotel Conf #32CKVXT8; N/O B Pace $507.00
Total $2,028.00
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Joe Moy (mileage and per diem for FPPTA Trustees School) $309.64
William Maxwell ((mileage and per diem for FPPTA Trustees School) $309.64
William Wagner (per diem for FPPTA Trustees School) $90.00
Bryan Pace (per diem for FPPTA Trustees School) $90.00
Total $799.28
Benefits USA, Inc. (Flat Monthly Fee for September; Inv #09 -2015 dtd 10/7/15) $2,100.00
Benefits USA, Inc. (Flat Monthly Fee for October; Inv #10 -2015 dtd 10/7/15) $2,100.00
The Bogdahn Group (3rd Qtr. 15 Consulting Fee -Inv #12741 dated 9/15/15) $5,500.00
Christiansen & Dehner (Legal Fees Invoice #24844 dated 9/30/15) $1,920.48
Total $11,620.48
Trustee Maxwell moved to approve the consent agenda as presented. Trustee Moy seconded the
motion and the motion passed.
ATTORNEY COMMENTS:
H. Lee Dehner, Esq.
Attorney Dehner reported briefly on House Bill 1309 regarding mortality tables and Senate Bill
172 and how it applies to the state premium tax distributions since the employees are in
negotiations.
Chairman's report:
The Chairman had nothing further to report.
Trustees Comments:
The Trustees had no further comments.
NEXT REGULAR MEETING DATE: FEBRUARY 3, 2016 AT 1:00 PM.
ADJOURNMENT: The meeting was adjourned at 2:30 pm.
Respectfully submitted by,
Ch. Charle. Bre n
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Contact the City Clerk's Office to listen to an electronic copy of the complete minutes.
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