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11-02-2016 Minutes THE CITY OF OCOEE POLICE OFFICERS'/FIREFIGHTERS' RETIREMENT FUND BOARD MEETING—NOVEMBER 2,2016 Chairman Brown called the meeting of the City of Ocoee Police Officers'/Firefighters' Retirement Trust Fund to order at 1: 10 p.m. in the Commission Chambers of City Hall. The roll was called and a quorum declared present. PRESENT: Charles Brown, William Wagner,William Maxwell, and Bryan Pace Others present: Mr.Tim Nash of Bogdahn Consulting,Lee Dehner Board Attorney,Jeanine Bittinger and Richard Cristini Fund Auditors, Amed Avila of Fiduciary Trust,Ryan Sladek of PNC and Lynn Skinner of Salem Trust and Fund Administrator Livia Giuliani of Benefits USA ABSENT and EXCUSED: Joe Moy 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 3, 2016. Trustee Maxwell moved to approve the minutes as presented.Trustee Wagner seconded the motion and the motion passed. PUBLIC COMMENTS There were no public comments at this time. Trustee Pace joined the meeting at 1:15 PM. QUARTERLY INVESTMENT UPDATE: Period ending 9/30/2016 Bogdahn Consulting Mr. Nash reported on a letter from the firm's CEO Mike Welker regarding the Bogdahn transition. He noted that Joe Bogdahn transferred his shares to Mike Welker. He said that the only thing changing will be the name. They will be changing the name to Independence as they will have no affiliation with managers or brokers. He also stated that nothing will change for the Board. Mr.Nash reported that fiscal year posted positive results. He noted that index funds performed better than active management. Equity Markets returned well,the S&P was up 15.4%;the Russell 3000 Index have been solid,returning 4.4%for the 3rd quarter and 15.0%over the trailing year. The MSCI Emerging Market Index(net)posted returns of 9.0% and 16.8%,respective, for the 3rd quarter and 1-year period versus returns of 6.4%and 6.5%for the MSCI EAFE Index. Mr.Nash reported on the fund returns noting that the total fund return for the quarter was 2.23%vs. the fund policy of 3.37%. The equity fund returned 3.34%vs.the equity policy of 5.05%.The total domestic equity returned 2.67%vs. the equity policy of 4.40%. GAMCO returned 3.94%outperforming the Russell 3000 of 3.87%. Vanguard fund returned 4.42%over the CRSP US Total market index of 4.41%. the Sawgrass Growth fund returned a negative-0.19%vs. the Russell 1000 index of 4.58%. The international equity, American Funds EuroPacific returned 8.23%vs. the international equity policy of 7.00%. The fixed income returned 0.14%vs. the fixed income policy of 0.40%. The domestic fixed income Garcia Hamilton returned 0.37%vs. the domestic fixed income policy of 0.40%. The Templeton Global fixed income was down by -1.23%vs. the Global fixed income median of 1.48%. The real estate fund returned 1.83%vs.the NCREIF ODCE of 2.13%. Page 1 of 5 Mr. Nash reported that the beginning market value at 10/1/15 was$41,525,643;the Contributions totaled $2,898,507; the Distributions were-$2,488,566;the management fees totaled-$174,019,the other expenses totaled-$122,928;the income totaled$1,129,179; the appreciation was$2,550,978 for an ending market value at 9/30/16 of$45,318,792. Mr. Nash reported on the Asset Allocation noting that Domestic Equity is 52.7%; International Equity 7.7%; Domestic Fixed Income 24.7%; Global Fixed Income 4.1%;Real Estate 7.7%and cash is 3.1%. He said all investments are in line with Asset allocation and there is no need to rebalance at this time. Fiscal year return was 8.48%. Tim said the fund is within policy for 3 and 5 year periods. add returns here. Compliance on page 44. Mr.Nash reported that the total Investment management, Custodian and Consultant Fees are approximately$245,000. Finally,Mr.Nash reported on the Bogdahn Fee increase noting that they are proposing an annual increase of$3,000 per year guaranteed for 3 years. The current fee is$22,000. He said the actual basis points were reduced from 8.0 basis points to 6 basis points. They are asking that the fee be effective 1/1/17. Trustee Wagner moved to approve the fee increase and Trustee Pace seconded the motion and it passed. Ms. Giuliani asked if the Agenda could be taken out of order due to the length of the meeting with the Custodian interviews. Trustee Wagner moved to amend the agenda and Trustee Pace seconded the motion and it passed 4-0. NEW BUSINESS: 2017 Meeting Dates The meeting dates for 2017 are February 1, Mary 3;August 2 and November 1, 2017 FPPTA Membership Dues Trustee Maxwell moved to approve the 2017 FPPTA Annual Membership Dues and Trustee Wagner seconded the motion and it passed. Presentation of 10/1/15 financial statements Ms.Bittinger reported that they have audited the accompanying financial statements for the Plan which comprise the statements of fiduciary net position as of September 30,2015 and 2014. Ms. Bittinger stated that the Board of Trustees is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles. Their responsibility is to express an opinion on these financial statements based on their audits. The conducted the audits in accordance with the auditing standards accepted in the United States. Those standards require that they plan and perform the audit to be assured that the Financial Statements are free of material misstatement. Their opinion of the financial statement presented fairly in all material aspects. Ms. Bittinger reported on the changes to the Fiduciary Net position noting that that for the fiscal year ending 9/30/15,the Employer Contributions were$1,726,011; the Employee Contributions$584,706;the net appreciation/depreciation was ($718,289)the interest was$497,478; the dividends were$775,215;the investment income was$558,350. The benefit payments including service retirees were$1,311,173; disabilities were$154,143;the total DROP benefits were$705,856;the refunds of contributions were $63,697 and the Administrative Expenses were$93,897. The net position restricted for pensions at the beginning of the fiscal year was $40,700,113 and the increase in net position was$881,651 resulting in the net position at the end of the fiscal year of$41,581,764. Ms.Bittinger reported that the during the fiscal year ending 9/30/15,the plan's membership consisted of 53 retirees and beneficiaries currently receiving benefits;25 terminated employees entitled to benefits;41 active vested members and 72 non vested members. Seeing and hearing no questions or comments, Trustee Pace moved to accept the October 1, 2015 financial statements and Trustee Wagner seconded the motion and it passed. Page 2 of 5 UNFINISHED BUSINESS: Custodian Interviews Mr. Nash reported on the Custodian RFP noting that the Board will be interviewing 3 Custodians today and gave a brief report on each of the firms. He reported that each firm is very good and does the same type of processing and that each of the firms has their own procedures. Fiduciary Trust Mr. Amed Avila,Mr. David Lederer and Mr. Gavin Lee were in attendance. Mr.Avila gave a brief report on the Company noting that they are located in Miami. He said someone is always available to answer phone calls. The strive to know and meet our clients' needs,and they fully accept our responsibility to protect their clients' interests. He noted that client assets are never intermingled with firm assets,they have been entrusted with over$75.0 billion in assets and current have $58.4 billion assets under administration. Mr.Avila said that he will be the account representative and oversees all the day to day transactions. He noted that if anyone ever has any questions or requests,that they can reach him personally. Finally,Mr. Avila reported on the fee noting that it's a 5 basis points all-inclusive annual fee$16,832.33. PNC Mr. Ryan Sladek reported that he is the Market Director of PNC Institutional Asset Management PNC headquarters is located in West Palm Beach. PNC is one of the largest banks in the United States based on deposits and branches. PNC Bank is a subsidiary of The PNC Financial Services Group, Inc. he said that there are Corporate&Institutional Banking Offices are located nationwide as well as in Toronto,Canada PNC has approximately 52,500 employees more than 9,000 ATMs and 2,600 and currently have$42 billion Assets Under Management. PNC's fee is 3 basis points with a base fee of$12,500;plus$3.00 for each pension payment plus postage and$25 for each lump sum an estimated annual fee of$16,669.40. Salem Trust Ms. Lynn Skinner and Mr. Mark Rhein were in attendance. Mr. Rhein reported that the home office is located in Lisle, IL. Salem Trust is a State of Florida Chartered Bank and Dedicated to State, County and Municipal clients, they are State of Florida approved depository, the Largest independent trust company in Florida and ranked 5th as largest trust company in Florida with over $7 billion in assets under administration and 215 Florida municipal pension plan clients. He noted that Salem is also an Employee owned company. After a lengthy presentation, Mr. Rhein proposed 2 separate fee quotes; one being 7 basis points all-inclusive for and an annual fee of$23,565.26; and the other is 5 basis points plus $2 for each pension payment and lump sum payment and $4 for each security transaction for an annual fee of $26,912.33. After the presentation and discussion Trustee Pace moved to engage the Custodial services of Fiduciary Trust and Trustee Maxwell seconded the motion and it passed. CONSENT AGENDA For Approval: Warrant#135 Benefits USA,Inc. (Flat Monthly Fee;Inv#10-2016 dtd 11/2/16) $2,100.00 Foster and Foster(Services Rendered; Invoice#9524 dated 10/13/16 $3,326.00 FPPTA(2017 Annual Membership Dues) $600.00 FPPTA(Re-Certification Fee for Brown,Wagner,Maxwell&Moy) $120.00 Garcia Hamilton(3'Qtr. 16 Mgmt Fee-Invoice#24737 dated 10/11/16) $7,064.53 Sawgrass Asset Management(3'Qtr. 16 Mgmt Fee-Invoice dated 10/11/16) $12,740.76 Total $25,951.29 Page 3 of 5 For Ratification: Warrants#131-134 Davidson,Jamieson&Cristini (Progress billing; invoice#R7562 dated 8/1/16) $6,000.00 Joe Moy(Mileage&per diem for FPPTA Trustees School) $332.06 William Maxwell (Mileage&per diem for FPPTA Trustees School) $332.06 William Wagner(Per diem for FPPTA Trustees School) $95.00 Total $6,759.12 Benefits USA, Inc. (Flat Monthly Fee for September 2016) $2,100.00 Christiansen&Dehner(Legal fees; Invoice#28745 dated 7/31/16) $39.40 Davidson,Jamieson&Cristini (Final billing; Invoice#R7588 dated 9/6/16) $8,500.00 Total $10,639.40 Bogdahn Group(3'Qtr. 16 Consulting Fee-Invoice#19551 dated 9/25/16) $5,500.00 Total $5,500.00 Benefits USA,Inc. (Flat Monthly Fee for Oct 2016; Inv#10-2016 dtd 10/12/16) $2,100.00 Christiansen&Dehner,PA(Legal fees; Invoice#27487 dated 9/30/16) $2,896.26 Fifth Third Bank(2"d Qtr. 16 Custodian Fees-Auto Debited) $3,679.06 Total $8,675.32 Pension Payments for Ratification: Edward B. Bennett(Monthly benefit payment effective 9/1/16) $3,433.74 Edward B. Bennett(DROP distribution) $189,562.87 Kenneth Minnick(Monthly benefit payment effective 9/1/16) $5,334.30 Jerry Byrd(Monthly Benefit payments effective 10/1/16) $1,970.67 Jerry Byrd(Partial Lump Sum option) $31,862.85 Trustee Maxwell moved to approve the Consent Agenda as presented and Trustee Pace seconded the motion and it passed Attorney' Report: H. Lee Dehner,Esq. Attorney Dehner reported on the Proposed Ordinance noting that on the fire side they are waiting on the negotiations regarding the Share Plan. Attorney Dehner also reported on follow up items of the requirements to Senate Bill 172 with regards to the Administrative Budget and an additional Compliance item noting that a detail of Administrative Expenses needs to be prepared for next meeting in February. It was noted that it should be the actual expenses incurred as of fiscal year ending 2016. Chairman's report: Chairman Brown had nothing further to report. Trustees: The trustees had nothing further to report. Next Regular Meeting date: February 1,2017 at 1:00 pm. Adjournment: The meeting adjourned at 4:15 pm. Page 4 of 5 Respectfully submitted by, .� Chairman Charlie Brown Contact the City Clerk's Office to listen to an electronic copy of omplete minutes. Page 5 of 5