02-07-18 MinutesTHE CITY OF OCOEE POLICE OFFICERS'/FIREFIGHTERS'
RETIREMENT FUND BOARD MEETING — February 7, 2018
Chairman Brown called the meeting of the City of Ocoee Police Officers'/Firefighters' Retirement Trust
Fund to order at 1:13 p.m. in the Commission Chambers of City Hall.
PRESENT: William Maxwell, Joe Moy and Bryan Pace
ABSENT and EXCUSED: Chairman Brown
Others present: Jennifer Gainfort of AndCo Consulting, Lee Definer Board Attorney
Plan Members David Ogletree and Trey Littlefield and Pete Prior of Benefits USA. Inc.
CALL TO ORDER —
Roll call and determination of quorum: The roll was called and a quorum declared present.
APPROVAL OF MINUTES
Approval of Minutes from Regular Meeting dated November 1, 2017. Trustee Maxwell moved to approve
the minutes as presented. Trustee Moy seconded the motion and the motion passed.
PUBLIC COMMENTS
Police member Ogletree asked the board if a former police officer was rehired for one day would they be
able to apply for a pension. The board was not aware of the situation but Trustee Pace noted that he heard
that a police officer was hired for one day to apply for a disability pension. Currently there is nothing
pending before the board on the matter and the Attorney said he would look into it. Officer Ogletree also
commented that he is one of the applicants considering the vacant position but decided to withdraw his
application at this time due to personal conflicts. Trustee Moy thanked the officer for his interest in the
board and the information provided.
QUARTERLY INVESTMENT UPDATE: Period ending December 31, 2017
AndCo Consulting
Ms. Gainfort reported on the economy noting that market returns were positive across the major equity
and fixed income indices for the 4"' quarter. The Russell 3000 index returned 6.3% and 21.1% for the
quarter and calendar year respectively. The international equity market benchmarks posted considerable
gains for both the 4" quarter and the year to date period with the MSCI-ACWI ex US returning 5.0% and
27.2% respectively. Emerging Markets outperformed both the international developed and US equities
over both periods returning 7.4% for the quarter and 37.3% for the calendar year. During the 4' quarter
the interest rates on the US Treasury Yield Curve rose for short term maturities. Large cap stocks
outperformed small cap equities. The Russell 1000 index return 6.6% for the quarter which is double the
return posted by the Russell 2000 of 3.3%. For the calendar year the Russell 1000 returned 21.7% vs. a
14.6% increase for the Russell 2000.
Ms. Gainfort reported on the asset allocation noting that the fund is invested 55.1% in Domestic Equity,
8.5% in International Equity, 21.7%in Domestic Fixed Income, 3.9% in Global Fixed income, 7.3% in
Real Estate and 3.5% in cash. Ms. Gainfort reported that the market value at 10/1/17 was $50,404,854,
the contributions were $659,219, distributions were -$866,144, management fees were -$50,232, other
expenses were -$37,005, income was $469,172, the appreciation was $1,245,344 for a total market value
at 12/31/17 of $51,825,206.
Finally, Ms. Gainfort reported on the returns noting that the total fund return for the quarter was 3.32%
vs. the fund policy of 3.96%. The equity return was 4.90% vs. the equity policy of 6.02%.
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The domestic equity returned 5.00% vs. the domestic equity policy of 6.34%. GAMCO returned 2.87%
vs. the Russell 3000 of 5.08%. Vanguard returned 6.34% vs. the Multi cap core index of 6.03%.
Sawgrass returned 5.97% vs. the Russell 1000 Growth index of 7.86%. American Funds Euro Pacific
returned 4.23% vs. the MSCI AC World ex USA index of 5.06%. The fixed income returned 0.53% vs.
the fixed income policy of 0.39%. Garcia Hamilton returned 0.95% vs. the Barclay's Aggregate of
0.39%. Templeton Global returned -1.77% vs. the Citigroup World Government Index of 1.04% and
American Realty returned 1.73% vs. the NCREIF ODCE index of 2.12%
NEW BUSINESS:
Appointment of 5"' Trustee
After reviewing the application of Mr. Littlefield, the board appointed Mr. Littlefield as the 5' member of
the board. Attorney Dehner advised him that he will have to complete the financial disclosure form. Mr.
Prior noted that he will send him the packet in email along with the instructions.
Selection of Board Secretary
Trustee Pace was nominated and accepted the position of Secretary for the Board of Trustees. There were
no other nominations.
Presentation of 10/1/17 Actuarial Valuation
Mr. Lozen reported that the Total Required Contribution for fiscal year ending 9/30/17 as a percentage of
Total Annual Payroll is 45.21%. This consists of 8.00% member contributions and 37.21% of City
Contributions. The Estimated state contribution is $432,404 or 5.54% of Total Annual Payroll. Mr.
Lozen noted the difference in the state monies. For Police Officers Under the "Default" provision the first
$223,377.02 received annually will offset the City's contribution requirement. Any future State Monies
received for the Police Officers' portion of the Plan in excess of $223,377.02 will be split 50/50, with
50% allocated to the newly established Share Plan, and 50% allocated as a credit to the City's annual
contribution requirements.
For the Firefighters, per mutual consent between the City and Firefighter Members, the first $171,631.09
received annually will offset the City's contribution requirement. Since the Mutual Consent Agreement
did not specify the baseline for determination of excess monies, the $171,631.09 is the difference between
the prior "frozen" State Contribution of $421,323.57 and the Police portion of State Monies determined
under the "Default" method from our February 17, 2017 analysis ($249,692.48). The firefighters came to
an agreement as the use of the monies.
Mr. Lozen reported that the plan experience during the last 12 months has been less favorable than
expected with regards to the actuarial assumptions. The primary component to the loss included
unfavorable turnover and retirement experience, a 7.69% investment return, compared to the 7.95%
assumption and no inactive mortality. Additionally, the funding requirements have increased based on a
change in assumption for investment return and mortality.
Mr. Lozen reported on Ordinance #2017-016 adopted and effective May 16, 2017 which implemented
changes to the benefit accrual rate, maximum benefit, vesting and the establishment of a Share Plan. He
also reported on Ordinance #2017-032 adopted and effective December 5, 2017 which provided details
regarding he Share Plan established.
Mr. Lozen noted that the investment return assumption was reduced from 7.95% to 7.90%. This
assumption will be reduced annually by 5 basis points until it reaches the rate of 7.75% with the October
1, 2020 actuarial valuation. He further noted that the mortality assumption has been changed from the
rates utilized by the Florida Retirement System effective July 1, 2015 to those utilized in the July 1, 2016
valuation for special risk participants.
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Mr. Lozen reported on the demographics noting that there is a total of 206 plan members; 116 actives, 45
service retirees, 10 DROP retirees, 1 beneficiary, 7 disability retirees, and 26 terminated vested members.
The total annual payroll was $7,811,311; the actuarial value of assets was $50,166,070 vs. the market
value of assets of $50,652,631. The Unfunded Actuarial Accrued Liability was $7,612,785 and the funded
ration is 86.8% funded, a 0.8% from the previous year. Attorney Dehner noted that a motion was in order
to approve the actuarial valuation. Trustee Maxwell moved to approve the valuation and Trustee Pace
seconded the motion and it passed. Attorney Dehner further added that a second motion was in order for
the rate of return for this year and over the long term. Trustee Moy moved to approve the rate of return
and Trustee Pace seconded the motion and it passed.
Detail of Administrative Expenses
Mr. Prior reported that the good news is, the fund did not go over budget. The budget was $166,522 and
the expenses totaled $134,724. No action is needed on this item.
Fiduciary Liability Insurance application
Mr. Prior noted that the application needed to be signed to obtain a quote. It was noted that since the
Chairman was not in attendance, the application could be sent to the Chairman for signature via email.
UNFINISHED BUSINESS:
Foster and Foster Fee Memo
Mr. Lozen reported on the additional fee memo noting that the Division of Retirement activated their
new online reporting portal for pension plans. The new reporting system is intended to capture
all of the actuarial data as well as financial and key census data. This compliance reporting
requires creating a comprehensive electronic file that contains over 100 fields of information in
the format stipulated by the Division of Retirement. The startup fee for this service will be $750
and the ongoing fee for subsequent years will be between $300. Trustee Maxwell moved to
accept the electronic reporting fee and Trustee Moy seconded the motion. The motion passed.
Summary Plan Description
Attorney Dehner reported that all the changes have been made and a motion is in order to
approve it. Trustee Maxwell moved the approve the Summary Plan Description as amended and
Trustee Pace seconded the motion and it passed.
Mar Vista Contracts
There was no report'on this item. Contracts were signed.
CONSENT AGENDA
For Approval:
Benefits USA, Inc. (Flat Monthly fee for Jan & Feb 2018; Invoice #0102-2018)
$4,200.00
Charles Brown (Parking Expense at FPPTA Trustees School $24 per day x 3 days)
$72.00
Davidson Jamieson & Cristini (Final Billing for 9/30/16 Audit; Inv dated 1/29/18)
$9,000.00
Fiduciary Trust Co. Intl. (411' Qtr. 17 Mgmt Fee -R&D; Invoice dated 1/19/18)
$686.86
Fiduciary Trust Co. Intl. (41" Qtr. 17 Mgmt Fee -R&D Invoice dated 1/19/18)
$2,036.07
Fiduciary Trust Co. Intl. (4" Qtr. 17 Mgmt Fee-GHA Invoice dated 1/19/18)
$1,422.81
Fiduciary Trust Co. Intl. (41" Qtr. 17 Mgmt Fee-GAMCO Invoice dated 1/19/18)
$1,256.08
Fiduciary Trust Co. Intl. (411' Qtr. 17 Mgmt Fee -SAW Invoice dated 1/19/18)
$1,283.28
Total
$19,270.24
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For Ratification:
Christiansen & Dehner (Legal Fee -Invoice #31362 dated 10/31/17) $823.04
Fiduciary Trust (3rd Qtr. Custodian Fee -R&D #S14800561925 dated 10/24/17) $1,980.40
Fiduciary Trust (3rd Qtr. Custodian Fee-Sawgrass #S14800561926 dated 10/24/17) $1,213.73
Fiduciary Trust (3rd Qtr. Custodian Fee-GAMCO #S14800561927 dated 10/24/17) $1,223.37
Fiduciary Trust (3rd Qtr. Custodian Fee-GHA #S 14800561928 dated 10/24/17) $1,412.39
FPPTA (Winter School Registration for Bryan Pace) $600.00
GAMCO (3rd Qtr. 17 Mgmt Fee -Invoice #20170930-157-4967-A dated 10/19/17) $18,350.00
Total $25,602.93
Benefits USA, Inc. (Flat monthly fee for December 2017 plus postage) $2,150.60
Christiansen & Dehner (Legal Fees -Invoice #31501 dated 11/30/17) $3,540.22
FPPTA (Winter School Registration for William Maxwell) $600.00
Total $6,290.82
FPPTA (Winter School Registration for Charles Brown) $600.00
FPPTA (Re -Certification Fee for Brown, Maxwell & Moy @ $30 each) $90.00
Total $690.00
AndCo Consulting (4"' Qtr. 17 Consulting Fee; Invoice #23920 dated 12/29/17)
$6,250.00
Christiansen & Dehner (Legal Fees -Invoice #31640 dated 12/31/17)
$1,276.02
Christiansen & Dehner (Legal Fees -Invoice #28202 dated 12/31/17)
$45.13
Garcia Hamilton (4''' Qtr. 17 Mgmt Fee -Invoice #28887 dated 1/10/18)
$7,139.57
Sawgrass Asset Mgmt (4t" Qtr. 17 Mgmt Fee-Inv#ocpfl IOs- 123117 dated 1/9/18)
$15,410.36
Total
$30,121.08
Foster and Foster (Services Rendered; Invoice #11705 dated 1/29/18)
$16,537.00
GAMCO (0 Qtr. 17 Mgmt Fee -Invoice #20171231-157-4967-A dated 1/12/18)
$18,842.00
William Maxwell (Trustee School expense reimbursement)
$152.68
Total
$35,531.68
Attorney' Report:
Attorney Dehner reported that there is a disability pending that is going past the threshold and that he
needed to file an extension with the Board. Trustee Pace moved to approve the extension. Trustee Moy
seconded the motion and the motion passed. Trustee Pace commented that it was his understanding that if
a member terminated their employment, they could not apply for a disability. Attorney Dehner stated that
is correct, the member must be employed in order to apply.
Attorney Dehner also noted that the legislation of Senate Bill 900 is in place and which is the bill
regarding presumptive cancer for firefighters; this bill is a repeat of last year due to it not passing. This
bill grants certain benefits to a firefighter upon receiving a diagnosis of cancer if certain conditions are met;
requiring an employer to make certain disability payments to a firefighter in the event of a total and permanent
disability; providing for death benefits to a firefighter's beneficiary if a firefighter died as a result of
cancer or cancer treatments; specifying that any costs associated with benefits granted by the act are to be
borne by the employer.
Attorney Dehner reported on Senate Bill 980 Revising minimum requirements for actuarial reports for
retirement systems or plans subject to part VII of ch. 112, F. S.; requiring the governing body responsible
for the retirement system or plan to review the enrolled actuary's statement within a specified timeframe;
requiring the unfunded liability of retirement systems or plans established on or after a certain date to be
amortized within a specified timeframe.
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Trustees Comments:
Trustee Pace noted that he had a member calling to get information but were not able to speak with
someone regarding request, such as early retirement. Mr. Prior noted that he was not aware of any delay
as the information was sent to the actuary. Mr. Lozen commented that there is a 10 working day
turnaround time. Mr. Prior said he would check with Livia regarding this.
Trustee Maxwell reported that he would like the travel policy placed on the next agenda for discussion.
He noted that the policy should be changed to allow the Trustees to stay at the hotel even if the
conferences are local.
Next Regular Meeting date: May 2, 2018 at 1:00 pm.
Adjournment: The meeting adjourned at 3:35 pm.
Respectfully submitted by,
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Contact the City Clerk's Office to listen to an electronic copy of the complete minutes.
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