02-01-2017 Minutes THE CITY OF OCOEE POLICE OFFICERS'/FIREFIGHTERS'
RETIREMENT FUND BOARD MEETING —February 1, 2017
Chairman Brown called the meeting of the City of Ocoee Police Officers'/Firefighters'
Retirement Trust Fund to order at 1:06 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, Joe Moy and Bryan Pace
Others present: Mr. Tim Nash of Bogdahn Consulting, Lee Dehner Board Attorney, Doug Lozen
of Foster and Foster and Livia Giuliani of Benefits USA. Inc.
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 November 2, 2016. Trustee Wagner moved to
approve the minutes as presented. Trustee Maxwell seconded the motion and the motion passed.
PUBLIC COMMENTS
There were no public comments at this time.
QUARTERLY INVESTMENT UPDATE: Period ending 12/31/2016
AndCo Consulting
Mr. Nash reported on the new Company name noting that the meaning of the name AndCo is
putting the customer first.
Mr. Nash reported that the January returns were all positive,the managers performed well,and
the 10-year treasury was up 1%. U.S. equity index returns were positive. Small cap benchmarks
posted the quarter's strong returns for both value and growth issues. The Russell 2000 returned
8.8% for the quarter and 21.3%for the year. The Russell 1000 Index returned a 3.8%return for
the quarter and 12.1%for the year. Value benchmarks more than doubled their comparable
growth benchmarks with double-digit returns 31.7% for the Russell 2000 Value Index and 17.3%
for the Russell 1000 Value Index. The growth index performance lagged value results
substantially, returning 11.3%and 7.1% for the Russell 2000 Growth and Russell 1000 Growth
respectively. The 4th quarter's return for developed and emerging markets were negative,posting
(-0.7%) and(-4.2%)respectively.
Mr.Nash reported that the market value as of 10/1/16 was$45,318,792, contributions totaled
$553,835,distributions totaled-$615,215, the management fees totaled-$29,544,the other
expenses totaled-$25,540,the income totaled$322,396, the net appreciation totaled$90,443 for
a total ending market value at 12/31/16 of$45,615,167.
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Mr. Nash reported that the total fund return was 0.85% outperforming the fund policy of 0.76%.
The total equity fund returned 1.77% vs. the equity policy of 2.87%. The domestic equity fund
returned 2.63% vs. the domestic policy of 4.21%. GAMCO returned 3.02% vs. the Russell 3000
of 7.24%; Vanguard Total Stock Market Index 4.12%vs. the CRSP U.S. Total Market TR Index
4.11%; Sawgrass Growth returned 0.98% vs. the Russell 1000 Growth of 1.01%. The Total
International Equity was down -4.15%the International Equity Policy-1.20%. American Funds
EuroPacifre Growth as with International equity posted the same returns. The total fixed income
was down -0.93% vs. the fixed income policy of-1.98%. Domestic Fixed Income as well as
Garcia Hamilton were down -2.43% vs. the IM U.S. Broad Market Core Fixed Income and the
Barclays Aggregate of-2.98%respectively. Templeton Global Bond Fund returned 832%vs. the
Citigroup World Government Bond Index -8.53%and the IM Global Fixed Income(MF)
Median-3.95%respectively. American Realty returned1.20%vs. NCREIF ODCE 2.19%and
the IM U.S. Open End Private Real Estate Median of 2.20%.
Finally, Mr. Nash reported on the Compliance noting that the Equity fund did not meet or exceed
the benchmark performance for the 3 and 5 year periods. The total fund and the fixed income
did meet or exceed the benchmark performance for the 3 and 5 year periods. Mr. Nash reported
that he had no recommendations at this time. That being said, Attorney Dehner noted that a
motion was in order to accept the Investment report. Trustee Maxwell moved to accept
investment report as presented and Trustee Pace seconded the motion. The motion passed.
NEW BUSINESS:
Presentation of 10/1/16 Actuarial Valuation
Mr. Lozen reported that the Fund has a small loss. He noted that this valuation was prepared using the
assumption rate of 7.95%. Mr. Lozen reported that as a result of an experience study dated October I,
2015,the following changes were made in this valuation: Salary increases-The assumed rate of individual
salary increases was changed from a flat 6.0%each year to a service-based table. Mortality Rates-the
assumed rates of mortality were changed to match what is used by the Florida Retirement System(FRS)
for special risk participants. Retirement Rates-Modified for Normal and Early Retirement per results of
the Experience Study. Withdrawal Rates-The assumed rates of turnover changed from age-based table to
a service-based table. Payroll Growth-Lowed in compliance with Chapter 112 of the Florida Statutes.
Mr. Lozen said additionally,the investment return assumption was reduced from 8%to 7.95%.
He reported that the employee contributions are 8%and the Total Required Contribution as a percentage
of Annual Payroll for the p/y/e 9/30/18 and 9/30/17 are 43.79%and 37.71%respectively. The total
required Contribution for fiscal year ending 9/30/16 was$2,765,388 which consisted of member
contributions of$593,431,City Contributions of$1,750,633 and State Contribution of$421,324. The
City may use State Contributions for determining its minimum funding requirements. Additionally,the
City has a prepaid contribution of$11,692.71 that may be used for the fiscal year ending September 30,
2017. The plan experience was less favorable this year relative the actuarial assumptions. This was due to
lower than expected employee turnover,earlier than expected Normal Retirements,and a Disability
Retirement for a prior terminated participant. The losses were partially offset by an investment return of
8.32%which exceeded the 8%assumption and an average increase of pensionable compensation that
were less than the assumption by almost 3%. The fund requirements increased based on a change of
certain assumptions approved by the Board.
Mr. Lozen reported on the assumption changes noting that the total actuarial accrued liability with the
new assumption rate decreased to$54,257,730 from$54,315,008 respectively. The funded ratio also
decreased from 101.2%to 97.5%respectively.
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The present value of future salaries increased from$48,471,620 to$61,218,225 respectively.The present
value of future member contributions also increased from$1,087,135 to$1,456,435 respectively.
Finally,Mr.Lozen reported on the participant data noting that there are 114 active members;42 service
retirees; 10 DROP retirees; 1 beneficiary;7 disability retirees and 25 vested terminated members, The
total annual payroll under the assumed retirement age is$7,432,068. The actuarial value of assets with
the new assumption rate was$46,264,915 and the market value of assets was $45,408,536 which is the
same under the old assumption rate. The liabilities increased from$61,154,906 to$65,737,444
respectively. Attorney Dehner noted that if there were no questions or comments that a motion was in
order to accept the 10/1/16 actuarial valuation. Trustee Maxwell moved to accept the valuation as
presented and Trustee Moy seconded and it passed.
Attorney Dehner reported that in addition to approving the valuation, the rate of return needs to be
approved. Mr. Nash reported that the Rate of Return for this year is 7.95% and 7.90% for the long
term and over the next several years. Trustee Wagner moved to approve the rate of return and
Trustee Pace seconded the motion and it passed.
Detail of Administrative Expenses
Ms. Giuliani reported on the detail of administrative noting that the actual expenses paid for
fiscal year ending 9/30/16 were$135,502 which was under budget.
Fiduciary Liability Renewal
Ms. Giuliani reported that the insurance was due on 3/14/17 and that she obtained a quote which
was $4,063. She stated that the Chairman's signed the application and that his signature needed
to be ratified. Trustee Wagner moved to approve the fiduciary liability quote for $4,063 and
Trustee Maxwell seconded the motion. The motion passed.
UNFINISHED BUSINESS:
Proposed IRC Ordinance
Attorney Dehner noted that this ordinance is still pending due to contract negotiations. It was noted that it should be
placed on the next agenda.
CONSENT AGENDA
For Approval: Warrant#139
Benefits USA, Inc. (Admin Fee for February'17 plus postage) $2,105.52
GAMCO(3`d Qtr. 16 Mgmt Fee-Inv#20160930-157-4967-A dated 10/12/16 $16,084.00
GAMCO(41h Qtr. 16 Mgmt Fee-Inv#20161231-157-4967-A dated 1/11/17) $16,573.00
Garcia Hamilton(451 Qtr. 16 Mgmt Fee-Invoice#27621 dated 1/4/17) $6,893.73
Houston Casualty Company(Fiduciary Liability Insurance Renewal due 3/19/17)$4,063.00
Total $45,719.25
For Ratification:Warrants#136-138
Benefits USA,Inc. (Flat Monthly Fee plus postage Invoice dated 12/1/16) $2,146.06
Fifth Third Bank(3r°Qtr. 16 Custodian Fee-Inv dated 10/5/16) $3,792.44
FPPTA Trustees School Registration for William Maxwell) $500.00
Total $6,438.50
Benefits USA,Inc. (Flat monthly fee for January 2017) $2,100.00
Bogdahn Group(4th Qtr. 16 Consulting Fee-Invoice#20181 dated 12/29/16) $5,500.00
Christiansen&Dehner(Legal Fees-Invoice#29906 dated 12/31/16) $4,079.02
Sawgrass Asset Management(4111Qtr. 16 Mgmt Fee-Invoice dated 1/10/17) $12,865.53
Total $24,544.55
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Fifth Third Bank(411'Qtr. 16 Custodian Fee-Invoice#5035026 dated 1/5/17) $3,801.17
Fifth Third Bank(Final Billing Custodian Fee-Invoice#5310772 dated 1/18/17) $2,658.64
Total $6,459.81
Pension Payments for Ratification:
Tim Allen (Monthly Benefit payment effective 12/1/16) $2,557.02
Tim Allen(DROP distribution; $2,557.02 x 5 months; 20%PLOP plus interest) $101,823.09
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 briefly on some pending legislation, House Bill 143 and related Senate
Bill 158 which establishes a presumption to a firefighter's condition caused by certain types of
cancer that may be contracted in the line of duty. Bill 143 specifies certain criteria firefighter
must meet to be entitled to presumption;requires employing agency to provide physical
examination for firefighter prior to employment.
Attorney Delmer also reported that Chapter 112 will be implementing the privacy of Confidential
information for Firefighters. He noted that it is already in place for Police Officers.
Trustees Comments:
Trustee Maxwell reported briefly on the FPPTA Trustees School asking what the Board's
procedure was for getting reimbursed for the per diem and expenses incurred. Ms. Giuliani
reported that all the expenses that are incurred from the Conferences and Schools are
reimbursable and that he should submit all his receipts to Madeleine who normally prepares the
expense vouchers.
The Chairman had nothing further to report.
Next Regular Meeting date: May 3,2017 at 1:00 pm.
Adjournment: The meeting adjourned at 2:15 pm.
Respectfully submitted by,
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Contact the City Clerk's Ofce7.7r'ten to an electronic copy of the complete minutes.
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