Police & Fire Pension

POLICE & FIRE PENSION BOARD MEETING DATE: August 19, 2019 CITY HALL, ROOM 302A TIME: 10:00 A.M. Present: Doug Bagwell, Stan Chubinski, Tammy Giannunzio, Ed Guzzo and Jake Martin. Absent: none Also Present: Dori Drayton of Plante Moran Financial Advisors (PMFA); and Kourtney Matuschka, Finance Officer/Police & Fire Retirement System Administrator. Chair Chubinski asked for approval of the agenda. Motion Bagwell, seconded Guzzo to approve the agenda. On a voice vote, motion carried. Presented minutes of the regular meeting on July 26, 2019. Motion Guzzo, seconded Bagwell to approve the minutes as presented. On a voice vote, motion carried. Bank Summary of Assets & Expense Report: As of 7/31/2019, the market value of the portfolio was $150,523,307, a gain of $540,520 since 6/30/2019. As of 8/15/2019, the portfolio market value was $146,872,659, which is a loss of $3,650,648 since 7/31/2019. For the month of July, the following invoices were authorized by Giannunzio and paid from the Cash Account: Actuarial Fees 364.36 Administrative Fee 2,000.00 Consulting Services 23,750.00 Custodian Fees* 17,404.33 *Custodian Fees were not approved by Giannunzio. Invoices are quarterly bank charges deducted directly by Comerica Bank. Motion Bagwell, seconded Giannunzio to accept the financial report and quarterly bank summary as submitted. On a voice vote, motion carried. Board Reports Bagwell – none. Chubinski – none. Giannunzio – none. Guzzo – none. Martin – 2 members retiring & entering DROP. Matuschka  Terminations: Kim Tuyls, Warrant Officer retired effective 8/10/2019 and Shea Peters, Firefighter resigned 8/1/2019. August 19, 2019 Page 2 of 3 - Official  New Hires: Samuel Calmo-Paiz, Veronica Granados and Cecil Rose hired as Police Officers effective 7/29/2019.  At 6/18/2019 Commission meeting, Edward Guzzo was reappointed to the Police & Fire Pension Board with the term of 7/1/2019 – 6/30/2023.  The following resolution needs approved by the board: Melissa A. Brady v. Stephen R. Brady Calhoun County Circuit Court – Case No. 17-1245-DM WHEREAS, the Board of Trustees is in receipt of an Eligible Domestic Relations Order (“EDRO”) dated September 10, 2018 wherein the Alternate Payee, Melissa A. Brady, is awarded certain rights to the benefits of the Participant, Stephen R. Brady, and WHEREAS, the Alternate Payee is entitled to claim a portion of the Participant’s retirement benefits from the Retirement System, and WHEREAS, the payments from the plan to the Alternate Payee shall begin either when the Participant commences benefits from the Retirement System, or any time after the Participant reaches his earliest retirement date upon the Alternate Payee’s application, and WHEREAS, the Board’s policy is to require that the cost for the actuary’s calculations are to be borne by the parties to the domestic relations proceedings, and the order provides that the Alternate Payee and the Participant have agreed to share any additional actuarial costs equally, and WHEREAS, said mater had been discussed with legal counsel who has opined that the applicable terms of said court order are consistent with the provisions of the Retirement System and applicable law including Public Act 46 of 1991 (MCLA 38.1701) as applicable, therefore be it RESOLVED, that the Board acknowledges receipt of said court order, will pay pension benefits consistent with said order subject to an application being filed by the Participant to commence benefits, and further RESOLVED, that upon application of the Participant or the Alternate Payee this file be forwarded to the Board’s actuary for calculation of the benefits, and further RESOLVED, that a copy of this resolution be immediately attached to the top sheet of the pension file and other appropriate records be kept for the Retirement System relative to this matter, and RESOLVED, that copies of this resolution be sent to Stephen R. Brady, the Participant; John D. Brundage, Esq., attorney for the Participant; Melissa A. Brady, the Alternate Payee; Michael J. Toth, Esq., attorney for the Alternate Payee; and the Board’s actuary. Motion Bagwell, seconded Martin to approve the EDRO Resolution for Stephen R. Brady. On a voice vote, motion carried. August 19, 2019 Page 3 of 3 - Official New Business Domestic Relations Order Policy: Revision needed on page 2, second full bullet point, to clarify the DRO/EDRO along with the FAC, will be used to determine benefit payment. Motion Bagwell, seconded Guzzo to accept the Domestic Relations Order Policy with the revision mentioned. On a voice vote, motion carried. Disability re-examination process: Previously the board has required duty disability retirees to undergo reexamination at least once within 5 years of their disability retirement date. Matuschka will notify Nichole Harrell of upcoming reexamination requirement. Matuschka will also revise the Disability Policy and Medical Form to include additional information regarding the frequency of reexamination to be presented at next meeting. PMFA – Asset Manager Portfolio Update:  Consumer spending growth slowed in 1st quarter 2019 but GDP grew 3.1% since 1/1/19. GDP is the measurement tool used to determine when the economy is in a recession. A recession is when GDP is negative for two consecutive quarters.  Current expansion period is now the longest expansion since WWII.  Fiscal year to date investment manager returns totaled 6.97% vs. blended benchmark of 7.47%. Still out performed 6.5% actuarial assumption.  Boston Company and Robeco Large Cap are two managers PMFA have been watching over the past couple months. They differ from other peer groups due to having limitations in international investments. Most large cap value managers do not invest in technology. Growth managers typically purchase technology-based stocks and PMFA does not want managers overlapping and purchasing same investments.  Calendar Year to Date return for total portfolio through 7/31/19 was 12.72% vs. blended benchmark of 12.81%.  Time weighted returns as follows: o Calendar year to date through 8/12/19: 11.27% in comparison to benchmark of 11.49%. o Fiscal year to date through 8/12/19: -.73% in comparison to benchmark of -.69%. Public Comment – Next regular meeting: Monday, September 16, 2019 at 10:00 a.m. Meeting adjourned at 11:00 a.m. Respectfully submitted, Kourtney Matuschka, Recording Secretary __________________________________ __________________________________ Board Member signature Board Member signature