Police & Fire Pension

POLICE & FIRE PENSION BOARD MEETING DATE: JUNE 3, 2024 CITY HALL, ROOM 302A TIME: 1:30 P.M. Present: Stan Chubinski, Jake Martin, Chris Rabbitt, Josita Todd, and Tammy Wolfersberger. Also Present: Lily Vardell (Police & Fire Pension Administrator), Jeremy Tollas (CAPTRUST), Justin Cohen (CAPTRUST), Aaron Kuhn (Revenue Services Director), Derek Henning (GRS – attended virtually), and Scott Marshall (Public). Chair Chubinski asked for approval of the agenda. Motion Rabbitt, seconded by Wolfersberger. On a voice vote, motion carried. Henning led a discussion about updating option factors:  GRS is recommending the Board update the assumption factors used in calculating optional forms of benefit.  This update would impact the 100% and 50% survivor benefit options, not the straight life 60% survivor option.  As of 6/30/23, there was only one retiree with a 100% survivor benefit option, however, it is still important to maintain up‐to‐date assumption factors used for these calculations.  The P&F Pension system is currently using the following assumptions: o Interest rate at 7% per year. o 1983 GA‐M/GA‐F Mortality Tables. o 100% male rate and 0% female rate for the Unisex mix, with the opposite mix for beneficiaries.  GRS is proposing the following updated assumptions: o Interest rate at 6.25% per year, to align with the Board’s current funding assumption rate. The Board may also consider adopting a lower interest rate of 5.25% to reduce the Board’s liability. o PubS‐2010 Headcount‐Weighted Healthy Retiree Mortality Tables, to align with the Board’s current funding assumption rate. o Unisex mix remains the same at 100% male rate and 0% female rate with the opposite mix for beneficiaries. Tabled for further discussion ‐ The Board will continue to review the GRS recommendation document and further discuss updating the option factors at their next meeting. pg. 1 Presented minutes of the regular meeting from May 13, 2024. Motion Rabbitt, seconded by Todd to approve the regular meeting minutes from May 13, 2024. On a voice vote, motion carried. Board Reports Chubinski – none Martin – none Rabbitt – none Todd – none Wolfersberger – none Vardell –  One new firefighter hired on 5/13/24: o Noah Haines  Cole Natta, Police Officer, terminated 5/2/24: o A letter regarding his options for withdrawal was sent 5/15/24.  Beverly Behrndt, surviving spouse of former Police Sgt Edward Behrndt, passed away 5/21/24: o Her 6/1/24 pension benefit was reversed and replaced with a prorated benefit of $1,126.22 (for benefits earned 5/1/24‐5/21/24.)  Michele Hughey, Fire Battalion Chief, exited the DROP with a retirement date effective 5/4/24 (DROP resolution is also below.) o Benefits totaled $8,904.53 o Only in DROP for 28 days, no interest received, so no ability to withhold interest for admin costs or early withdrawal penalty. o $8,904.53 was issued as a lump sum payment to Michele on 5/17/24.  Jake Martin was the sole nomination for the Fire Representative position on the P&F Pension Board. o His term was set to expire on 6/30/24. His new four‐year term will be 7/1/24 through 6/30/28. o Per a 2022 City policy put in place by the City’s Board Committee, we will need a motion to approve this reappointment: Motion Rabbitt, seconded by Wolfersberger to accept the renewed term for Fire Representative Pension Board Member Jake Martin for 7/1/24‐6/30/28. On a voice vote, motion carried.  Two resolutions need approval: HOLLY E. VANSICKLE – FIRE LIEUTENANT DROP WHEREAS, the Board of Trustees is in receipt of an application for participation in the Deferred Retirement Option Plan (DROP) from Holly E. Vansickle requesting an effective retirement date of 4/28/2024, and pg. 2  WHEREAS, Holly E. Vansickle is eligible for retirement based on her service credit pursuant to Act 345 of the Public Acts of 1937, as amended, and retirement provisions of the union contract, and WHEREAS, the final actuarial calculation was received, and WHEREAS, Holly E. Vansickle elected straight life with 60% surviving spouse benefit, therefore be it RESOLVED, that the application of Holly E. Vansickle for participation in the DROP is approved, and RESOLVED, the DROP benefit for Holly E. Vansickle shall commence as of 4/28/24, and RESOLVED, the gross monthly retirement benefit is $7,100.43 and shall be Holly E. Vansickle’s DROP benefit credited monthly to her DROP account and RESOLVED, Holly E. Vansickle’s participation in the DROP shall terminate on 4/27/2029. MICHELE S. HUGHEY – FIRE BATTALION CHIEF DROP WHEREAS, the Board of Trustees is in receipt of an application for participation in the Deferred Retirement Option Plan (DROP) from Michele S. Hughey requesting an effective retirement date of 4/6/2024, and WHEREAS, Michele S. Hughey is eligible for retirement based on her service credit pursuant to Act 345 of the Public Acts of 1937, as amended, and retirement provisions of the union contract, and WHEREAS, the final actuarial calculation was received, and WHEREAS, Michele S. Hughey elected straight life with 60% surviving spouse benefit, therefore be it RESOLVED, that the application of Michele S. Hughey for participation in the DROP is approved, and RESOLVED, the DROP benefit for Michele S. Hughey shall commence as of 4/6/24, and RESOLVED, the gross monthly retirement benefit is $9,573.66 and shall be Michele S. Hughey’s DROP benefit credited monthly to her DROP account and RESOLVED, Michele S. Hughey’s participation in the DROP shall terminate on 5/3/2024. Motion Martin, seconded by Rabbitt to approve the DROP resolution for Holly Vansickle and the DROP resolution for Michele Hughey. On a voice vote, motion carried. New Business  CAPTRUST: Tollas provided a May investment update: o As of 5/29/24, the market value of the portfolio was $184,288,560.  CAPTRUST: Cohen provided CAPTRUST’s recommendation to update international managers to help diversify the Plan’s international portfolio: o There are currently two Funds in the Plan’s international portfolio: American Funds Europacific Growth and Hartford International Opportunity. o CAPTRUST is recommending the Board replace Hartford International Opportunity with John Hancock Disciplined Value. pg. 3   American Europacific leans more towards growth. Hartford was initially hired to be a blended fund. Over time, Hartford has moved to more of a growth fund, which leaves an imbalance in the Plan’s international portfolio. John Hancock is more of a value fund. Replacing Hartford with John Hancock would bring the international portfolio more in balance between value and growth. Motion Martin, seconded by Todd to replace the Hartford International Opportunity fund with the John Hancock Disciplined Value fund within the Board’s portfolio, as proposed by CAPTRUST. On a voice vote, motion carried. Public Comment: none Closed session to discuss disability retirement application. Motion Wolfersberger, seconded by Rabbitt to go into closed session. On a voice vote, motion carried. Motion Rabbitt, seconded by Todd to appoint Dr. Poortinga as the Board’s doctor on the Medical Committee for the disability retirement application. On a voice vote, motion carried. Motion Todd, seconded by Martin to exit closed session. On a voice vote, motion carried. Next regular meeting: Monday, August 12th at 1:30pm. Meeting adjourned at 2:48pm Respectfully submitted, Lily Vardell, Recording Secretary __________________________________ __________________________________ Board Member signature Board Member signature pg. 4