Police & Fire Pension

POLICE & FIRE PENSION BOARD MEETING DATE: November 25, 2014 CITY HALL, ROOM 112 TIME: 10:03 A.M. Present: Doug Bagwell, Gail Budrow-Bradstreet, Stan Chubinski, John Hausman, and Joe Newman. Absent: None. Also Present: Dori Drayton of Plante Moran Financial Advisors (PMFA) and Linda Morrison, Finance and Revenue Services Director. Chair Newman asked for approval of the agenda. Motion Chubinski, seconded Bagwell to approve the agenda. On a voice vote, motion carried. Minutes of the regular meeting of October 20, 2014 were presented. Motion Hausman, seconded Bagwell to approve the minutes as presented. On a voice vote, motion carried. A summary of assets prepared by Comerica Bank was presented. As of 10/31/14 the market value of our portfolio was $131,068,676 which is a gain of $490,710 since 9/30/14. As of today the market value of our portfolio is $132,574,286, presently a gain of $1,505,610 since the 10/31/14 month end. Motion Hausman, seconded Budrow-Bradstreet to accept the financial report as submitted. On a voice vote, motion carried. Board Reports Bagwell – none. Budrow-Bradstreet:  Surviving spouse Margueritte Groat died 10/21/14. Final monthly benefit was $487.74. Due to the timing, Comerica notified to pull back the overpaid difference of $232.26;  MAPERS membership renewal document updated as needed; subsequently submitted;  The legal opinion from counsel regarding disability retirement process was distributed. A copy will be placed in the disability retirement folder and the folder containing all legal opinions. Chubinski – disclosed he is serving on the City of Battle Creek Police and Fire Retiree Health Care Insurance Board. Hausman – none. Newman – none. Old Business Disability Pension Application – reports from Medical Committee consisting of applicant’s designated physician and Board’s designated physician were received and are in agreement that Nichole Marshall is unable to perform her duties as a police officer and the incapacity is likely to be permanent. Motion Budrow-Bradstreet, seconded Bagwell to proceed with the service-connected disability retirement for Nichole Marshall. On a voice vote, motion carried. Police & Fire Pension Board November 25, 2014 Page 2 of 3 - Official New Business The proposed 2015 meeting schedule was distributed. Esteban Rivera requesting the purchase of military time (approximately 41 months) to make him eligible to retire effective January 16, 2015 with 25 years of service credit. Payment for actuarial valuation in accordance with city policy has been received. Calculations will be made based on policy limit of 12 months and approximate 41 months needed for full retirement. Pursuant city policy and PA 345 of 1937, MCL 38.556 Sec 6(1)(g) the request shall be submitted as soon as possible. In reviewing the city policy on Purchase of Military Time city officials discovered the policy wording “enchancing a pension benefit” was not clearly defined and some would say the policy was not followed for the last six (6) requests. City Manager Fleury recommended a task force be appointed to review the policy and suggested the Police and Fire Retirement System Board appoint two (2) representatives to serve on the task force. Budrow-Bradstreet will serve as Treasurer/Police and Fire Retirement System Administrator. Board not entirely certain other representation appropriate – awkward and potentially a conflict. It was suggested union representatives serve. Questioned Chief Blocker as part of the task force. Is his representation for Police personnel or because of his military service? If it is to represent PD potentially Chief Schmaltz should also serve to represent FD. Dori Drayton f PMFA highlighted the following from the monthly update:  Fixed income was up 5.12%; equities up 10.16% and since gone over 12%;  Domestic stocks and bonds doing well; active managers, due to stock selection, had a hard time beating the S&P 500 index for domestic equity for the quarter and calendar year;  International investments not doing as well;  The revised Gross Domestic Product was above 2% and more favorable than previously reported;  Small cap growth and value were the worst performers in the third quarter; while large cap did not do great in the quarter, for the year these investments did very well; the rally has been in U.S. stocks, most notably large cap;  For the 3rd quarter high yield asset managers did poorly but for the calendar year still a good return;  Interest rates are not moving right now;  Wells Cap Large Cap fundamental Growth Select, while receiving positive returns, are lagging behind the benchmark due to the type of large cap stocks selected; they have very little in the consumer driven products which are doing quite well; PMFA will have additional conversation with managers and may provide alternatives in the future; Drayton reviewed the P&F portfolio noting the following:  10/31/14 year to date return net of fees 5.38%, slightly below benchmark; however benchmark does not take into consideration fees;  Calendar year to date time weighted return as of 11/6/14 is 5.78%; annualized is 6.62% and below the benchmark;  Asset allocation is on target. Police & Fire Pension Board November 25, 2014 Page 3 of 3 - Official Public Comment - None. Next regular meeting: Monday, December 15, 2014 at 11:00 a.m. Meeting adjourned at 11:23 a.m. Respectfully submitted, Gail Budrow-Bradstreet, Secretary __________________________________ _________________________________ Board Member signature Board Member signature