Police & Fire Pension

POLICE & FIRE PENSION BOARD MEETING DATE: AUGUST 12, 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), Justin Cohen (CAPTRUST), Aaron Kuhn (Revenue Services Director). Chair Chubinski asked for approval of the agenda. Motion Martin, seconded by Wolfersberger. On a voice vote, motion carried. Presented minutes of the regular meeting from June 3, 2024. Motion Wolfersberger, seconded by Todd to approve the regular meeting minutes from June 3, 2024. On a voice vote, motion carried. Bank Summary of Assets & Expense Reports for May, June, and July: As of 5/31/2024, the market value of the portfolio was $183,875,900.76, a gain of $5,744,377.07 from the 4/30/2024 balance. For the month of May, the following expenses were deducted: Additional Expense Type Payee Amount Frequency Details 3/31/24- Cash Management Fees Loomis 81.47 Monthly 4/30/24 3/31/24- Cash Management Fees Comerica Bank 979.03 Monthly 4/30/24 Administrative Fee Comerica Bank 13,529.33 Quarterly 1/1/24-3/31/24 VanOverbeke, Michaud & Legal Fees Timmony, P.C. 1,206.00 As Needed EDRO review Independent Medical Disability Re- Medical Fees Evaluations PC 3,275.00 As Needed Exam Cost x2 Class Action Misc Fees Comerica Bank 20.00 As Needed Handling Fees Total Admin. Fees 19,090.83 pg. 1 As of 6/30/2024, the market value of the portfolio was $185,856,834.78, a gain of $1,980,934.02 from the 5/31/2024 balance. For the month of June, the following expenses were deducted: Expense Type Payee Amount Frequency Additional Details Administrative Fee City of Battle Creek 3,300.00 Quarterly 4/1/24-6/30/24 Cash Management Fees Loomis 129.03 Monthly 4/30/24-5/31/24 Cash Management Fees Comerica Bank 808.16 Monthly 4/30/24-5/31/24 Total Admin. Fees 4,237.19 As of 7/31/2024, the market value of the portfolio was $189,504,262.33, a gain of $3,647,427.55 from the 6/30/2024 balance. For the month of July, the following expenses were deducted: Expense Type Payee Amount Frequency Additional Details Cash Management Fees Loomis 187.15 Monthly 5/31/24-6/30/24 Cash Management Fees Comerica Bank 803.42 Monthly 5/31/24-6/30/24 Administrative Fee Comerica Bank 13,720.81 Quarterly 3/31/24-6/30/24 Misc Fees Comerica Bank 10.00 As Needed x1 Class Action Handling Fee Misc Fees Loomis 2.99 As Needed Deposit Recovery Fee (Class action) Total Admin. Fees 14,724.37 Motion Martin, seconded by Wolfersberger to accept the financial reports and quarterly bank summaries submitted for May, June, and July. On a voice vote, motion carried. Board Reports Chubinski – none Martin – none Rabbitt – none Todd – none Wolfersberger – none Vardell – • Deferred Not Vested Annual Statements were mailed to 17 former employees with funds remaining in the P&F Pension System on 6/20/24. • DROP Annual Statements were mailed to the 13 active DROP participants on 6/21/24. • One new firefighter hired on 5/13/24: o Glenn Leeper • Two new firefighters hired on 6/17/24: o Clayton Frank o Andrew Dotson pg. 2   Andrew terminated 6/27/24. A letter regarding his options for withdrawal was sent 7/15/24. • Two new police officers hired on 5/30/24: o Patrick Russell o Christian Fields • One new police officer hired on 7/15/24: o Chantel Einhardt • Alexis Nickles, Police Officer, terminated 6/3/24: o A letter regarding her options for withdrawal was sent 6/12/24. o Alexis withdrew her contributions totaling $9,994.24 on 6/13/24. • Mikael Ziegler, Police Sergeant, terminated 7/13/24: o He is vested. A letter regarding this options for either withdrawal or deferred retirement was sent 7/25/24. • James Basner, former Police Officer who terminated 2/14/20, withdrew his contributions totaling $1,705.83 on 6/21/24. • Brian Sturdivant, former Fire Chief who terminated 4/29/22, withdrew his contributions totaling $49,363.99 on 7/2/24. • Chad Perry, former Police Officer who terminated 12/31/21, withdrew his contributions totaling $45,452.94 on 7/2/24. • Samuel Calmo Paiz, former Police Officer who terminated 12/12/2019, withdrew his contributions totaling $1,743.67 on 7/24/24. • One employee has submitted their retirement application: o Stephanie Estree, Police Detective, has submitted her application to retire effective 9/21/24. She will have 25 years of service. • One employee has submitted their application to enter the DROP: o Todd Elliott, Police Lieutenant, has submitted his application for entering the DROP effective 9/15/24. Upon entering the drop, he will have 25 years of service. • One resolution to approve: DRO resolution for retiree Martin Brown WHEREAS, the Board of Trustees is in receipt of a Domestic Relations Order dated July 2, 2024, wherein Michelle Lynn Brown, the Alternate Payee, is awarded certain rights to the benefits of Martin Francis Brown, the Participant, and WHEREAS, the Alternate Payee is entitled to a portion of the Participant’s monthly retirement benefit from the Retirement System, and WHEREAS, the Alternate Payee’s share of the Participant’s monthly retirement benefit from the Retirement System shall be payable in the form of a single life annuity over the life of the Participant based on the Participant’s election of the Retirement System’s regular straight life retirement allowance, which further provides that the Alternate Payee will no longer qualify as the Participant’s spouse for purposes of the Retirement System’s automatic 60% surviving spouse benefits, and pg. 3 WHEREAS, the Board’s policy is to require that the costs for the actuary’s calculations are to be borne by the parties to the domestic relations proceedings and the parties’ DRO provides that the parties shall be equally responsible for any and all additional costs for actuarial services, and WHEREAS, said matter having 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, therefore be it RESOLVED, that the Board acknowledges receipt of said court order and will administer benefits consistent with said order as soon as administratively feasible, and further RESOLVED, that a copy of this Resolution be immediately attached as the top sheet of the Participant’s pension file and other appropriate records be retained by the Retirement System relative to this matter, and further RESOLVED, that copies of this resolution be sent to Martin Francis Brown, the Participant; Michelle Lynn Brown, the Alternate Payee; Sean P. Cox, Esq., attorney for the Participant; and the Board’s Actuary. Motion Rabbitt, seconded by Martin to approve the DRO resolution for retiree Martin Brown and alternate payee Michelle Lynn Brown. On a voice vote, motion carried. Old Business • GRS updated option factors – discuss using 6.25% or 5.25% interest assumption: o At the 6/3/24 meeting, GRS proposed updating the assumptions used in optional forms of retirement. The Board needs to determine if a 6.25% or 5.25% interest rate will be used in the updated assumptions. o Comment from Martin – I am in favor of using the 6.25% interest assumption so that it matches the Board’s rate of return assumption. Motion Martin, seconded by Wolfersberger to approved the GRS proposed updated assumptions for optional forms of benefit calculations, which includes a 6.25% interest assumption, using the PubS-2010 mortality table, and using the Unisex Mix of 100% male and 0% female. On a voice vote, motion carried. New Business • Review GRS proposed fees for fiscal year 7/1/24-6/30/25: o The board reviewed the fee schedule for fiscal year 2025. o Comment from Vardell – we review our actuary vendor options every five years to make sure the annual fees are comparable to the rest of the market. Motion Rabbitt, seconded by Martin to accept the GRS proposed fee schedule for fiscal year 7/1/24-6/30/25. On a voice vote, motion carried. pg. 4  • Review Purchase of Military Time Policy – change on page 2, updated wording for charges: o Comment from Vardell – since the actuarial fee GRS charges for military calculations has increased, we need to update the policy so it remains in line with the fee. If we change the policy to state that ‘the cost of the calculation will be based on the charges set by the Actuaries in their annual service agreement contract,’ we will not have to update the policy with a new dollar amount every year. Motion Martin, seconded by Todd to accept the change to the wording regarding actuarial charges in the Military Time Policy. On a voice vote, motion carried. • Review Disability Retirement Policy – change on page 1 to match corresponding Disability Retirement Application: o Comment from Vardell – on the Board’s Application for Disability Retirement, it states that the physician the employee selects ‘must be independent and apart from previous medical involvements funded by the City of Battle Creek.’ This statement is not in the Board’s Disability Retirement Policy. The Board’s attorney has recommended we also include this statement in the Board’s Policy so that it is in line with the Board’s Application. Motion Rabbitt, seconded by Wolfersberger to accept the change to the Disability Retirement Policy so that the wording matches the Board’s Application for Disability Retirement. On a voice vote, motion carried. • Fiscal Year 2025 Budget: o The Board reviewed the budget for fiscal year 7/1/24-6/30/25. Motion Wolfersberger, seconded by Todd to approve the proposed Fiscal Year 2025 budget. On a voice vote, motion carried. • CAPTRUST: Cohen provided a quarterly investment update for the quarter ending 6/30/24: o Year-to-date for 2024: U.S. Small-Cap Stocks were up 1.7%, U.S. Large-Cap Stocks were up 15.3%, and International Stocks were up 5.7%. o For the quarter ending 6/30/24: U.S. Small-Cap Stocks were down 3.3%, U.S. Large-Cap Stocks were up 4.3%, and International Stocks were down 0.2%. o From an equities perspective, growth continues to outperform value, with Large- Cap Growth up 20.7% year-to-date while Small-Cap Value was down 0.8% year- to-date. Technology and Communication Services sectors have been the best performers. o For quarter ending 6/30/24, the top Asset Class performers were Large-Cap Growth, Large-Cap Value, and Mid-Cap Growth. pg. 5  o At the beginning of the calendar year, the market value of the portfolio was at $174,831,887, with an ending value at 6/30/24 of $186,265,160. o Calendar year-to-date, the investment returns for the total portfolio were up 7.73%, above the portfolio’s benchmark of 7.39%. For the fiscal year-ending 6/30/24, the total portfolio was up 13.92%. o As of 8/7/24, the market value of the portfolio was at $182,827,729. Public Comment: none Next regular meeting: Monday, September 30th at 1:30pm. Meeting adjourned at 2:23pm Respectfully submitted, Lily Vardell, Recording Secretary __________________________________ __________________________________ Board Member signature Board Member signature pg. 6