Police & Fire Pension

POLICE & FIRE PENSION BOARD MEETING DATE: August 18, 2015 CITY HALL, ROOM 112 TIME: 10:05 A.M. Present: Gail Budrow-Bradstreet, Stan Chubinski, John Hausman and Joe Newman. Absent: Doug Bagwell Also Present: Dori Drayton and Jeremy Tollas of Plante Moran Financial Advisors (PMFA); Linda Morrison, Finance and Revenue Services Director. Chair Newman asked for approval of the agenda. Motion Hausman, seconded Chubinski to approve the agenda. On a voice vote, motion carried. Minutes of the regular meeting of July 20, 2015 were presented. Motion Hausman, seconded Budrow-Bradstreet to approve the minutes as presented. On a voice vote, motion carried. A summary of assets prepared by Comerica Bank was presented. As of 7/31/15 the market value of our portfolio was $133,246,136, a loss of $214,803 since 6/30/15. As of today the market value of our portfolio is $132,761,610, presently a loss of $484,526 since the 7/31/15 month end. Motion Chubinski, seconded Hausman to accept the financial report as submitted. On a voice vote, motion carried. Board Reports Budrow-Bradstreet: new hire in Police Department – Lynette Fuller on 7/27/15. Chubinski – none. Hausman – City and Union getting closer to an agreement for the DROP program. Money will be in the pension fund portfolio (not a separate account) and accounted for manually for each individual in the program. The actuary will also provide separate reporting. Newman – none. Old Business FAC Policy Review: Final draft presented. Morrison suggested Exhibit B include some wording to make it clear that the stand-by pay off is at the current rate of pay regardless of when the hours were banked. Motion Budrow-Bradstreet, seconded Hausman to approve the FAC policy with correction. On a voice vote, motion carried. New Business Policy – Correction of Errors, Overpayment/Underpayments: legal counsel provided a draft policy for correction of errors resulting in overpayments/underpayments (copy attached). Motion Hausman, seconded Chubinski to adopt the proposed policy as written. On a voice vote, motion carried. Portfolio Update: Jeremy Tollas of PMFA reviewed the second quarter report noting the following market and portfolio points: Police & Fire Pension Board August 18, 2015 Page 2 of 2 - Official  Domestic equity market has been fairly flat;  Large cap investments: majority were within 2% above or below zero; one half added value compared to the index; most active managers in international stocks did better than the index;  Domestic fixed income (bonds) down with less than one half in the black; non-US fixed income were all in the red;  Small cap value and mid cap growth earned less than 1% in the 2nd quarter; for the one ended 6/30/15 small cap value gained 4.44%; mid cap growth gained 10.75%.  Bond market showed low returns with losses in the 2nd quarter and only small gains for the one year ended 6/30/15;  Earnest Partners (EP) – had slight gains year to date; PMFA still likes them for selection and duration; doing well compared to others;  Loomis Sayles investing in slightly lower quality bonds and slightly overweight on duration compared to EP – not doing as well.  Lazard – some of the emerging market stock selections did not do so well yet PMFA still feels they are a good manager. Current portfolio calendar year to date time weighted return as of 7/31/15 is 2.45%, above the benchmark of 2.10%. Fiscal year to date the time weighted return is 0.51%, annualized to 4.79%. Asset allocation is on track – no rebalancing necessary. Public Comment – Cody Titus asked if there was any consideration to allow for recognition of prior fire fighter or IAFF time with a different governmental unit. Board conveyed there is a possibility, in some cases, to help with vesting but nothing for service credit or improved benefit. Will review PA 345 to be certain. Next regular meeting: Monday, September 21, 2015 at 10:00 a.m. Meeting adjourned at 11:25 a.m. Respectfully submitted, Gail Budrow-Bradstreet, Secretary __________________________________ _________________________________ Board Member signature Board Member signature