Police and Fire Retirement Board

Item 4. January 9, 2024 CENTER LINE POLICE & FIRE RETIREMENT COMMISSION MINUTES REGULAR MEETING December 12, 2023 Page 1 of 6 The regular meeting of the Center Line Police and Fire Retirement Commission was called to order at 3:02 p.m. by Chairperson Stys. Members Present: Richard Stys, Gregory Suma, Danny Petroff and Jorge Bermudez who arrived at 3:11 p.m. Members Absent: Gregory Pearl. Also Present: Timothy Brice from the Graystone Group of Morgan Stanley and Thomas Michaud from VanOverbeke, Michaud and Timmony P.C. AGENDA ITEM 2A. – Approval of the Agenda: A. Motion by Trustee Petroff to approve the December 12, 2023 was supported by Trustee Suma. AYES: 3 NAYS: None Motion carried 3 - 0. ABSENT: Bermudez and Pearl. AGENDA ITEM 3 – Public Comment Seeing there was no one in the audience this item was closed. AGENDA ITEM 4 – Approval of the minutes A. Approval of the Regular Meeting minutes held on November 17, 2023. Trustee Suma made the motion to approve the November 17, 2023 minutes was supported by Trustee Petroff. AYES: 3 NAYS: None Motion carried 3 - 0. ABSENT: Bermudez and Pearl. AGENDA ITEM 5 – Remembrances of deceased Members and Beneficiaries: A. None. Trustee Jorge Bermudez arrived at 3:11 p.m.  Item 4. January 9, 2024 CENTER LINE POLICE & FIRE RETIREMENT COMMISSION MINUTES REGULAR MEETING December 12, 2023 Page 2 of 6 AGENDA ITEM 6 – Presentations: A. Thomas Michaud of VanOverbeke, Michaud & Timmony, P.C. Re: Michigan Public Act 214 of 2023 (H.B. 4346) Open Meetings Act Amendments. Mr. Michaud says this law allows Retirement Commission and Retiree healthcare commissions to allow trustees to attend meetings virtually as long as they have a policy in place. The law becomes effective February 13, 2024. The Commissions also needs to have accommodations for the public. B. Tim Brice from Morgan Stanley Graystone Group: . Timothy Brice from Graystone Consulting a division of Morgan Stanley. i. On The Markets – Buy the Rumor, Sell the news – December 2023. ii. November 2023 Money manager performances. iii. Market value and asset allocation through December 6, 2023. Mr. Brice addressed the On The Markets document. Morgan Stanley came out with its 2024 predictions. Interest rates went up to 5.02% on the ten-year treasury note and they have come back down to around 4.21%. In 2023 the equity and bond markets rallied due to evidence of economic slowdown. The “Street” believes now that the FED is done raising rates. Economists are predicting the FED will drop rates by 1.00% by the middle of 2024. Equities may struggle as the valuations at the index are very high. Morgan Stanley says the prudent move is active stock picking and an overweight stance to Investment grade credit where bonds from issuers with high quality balance sheets are providing the most favorable yields in over fifteen years. Trustee Suma said we should trim our Large-cap growth index to zero and allocate it to a new bond manager or our existing bond managers. Mr. Brice said he is going to discuss our allocations but has the same feeling. Mr. Brice said month to date the portfolio is up over 1.00%, quarter to date almost up 6.00% and year to date we are up 12.50% or about $ 1,400,000.00. As of November 30, 2023 the portfolio is valued at $ 12,968,549.04. Mr. Brice said our asset equity allocation is at 65.60% our target model is 54.00% and our max allocation is 75.00%. John Hancock, ETF S & P 500, Clearbridge are all growth managers. Pioneer is a conservative growth manager. Mr. Brice said we have a lot of growth managers. Mr. Brice said if we were to trim our growth exposure where would it go. Our fixed income allocation is at 15.50%. Our minimum target is 15.00% and we are at the low end. Our Target model is 25.00% Morgan Stanley from it On The Markets document believes fixed income should be the target now. Western is up 1.25% month to date,  Item 4. January 9, 2024 CENTER LINE POLICE & FIRE RETIREMENT COMMISSION MINUTES REGULAR MEETING December 12, 2023 Page 3 of 6 quarter to date they are up almost 5.00% with the benchmark up 3.90% through December 11, 2013. Year to date they are up 2.90% with the benchmark up 2.70%. Western has a lot of income in its portfolio and high-quality being AA grades. Boyd is up .90% moth to date, up 3.91% quarter to date and up for the year to date at the benchmark. So, Mr. Brice said if we are going to add he feels Western is where the money should be allocated. Trustee Suma asked Mr. Brice if he has done a fixed income manager search lately and he says he has. Some of the managers that have come up are John Hancock and Wedge. Some of his clients just added funds to their existing fixed income managers. We have an allocation to Private Credit at 3.00%. So we add the two public and private credit together we are nowhere close to our target. Mr. Brice said that on a risk adjusted basis adding money to fixed income is a good idea. Western has a current yield of 6.00% with AA grades. Trustee Suma asked Mr. Brice if we should allocate some funds to a new manager or place it with Western. Mr. Brice said we do not necessarily need a new manager. Mr. Brice said since the moves by the FED in interest rates Western has outperformed and has been the best manager out there. Mr. Brice said out Large-cap growth index has about a 1.50% allocation. We could also take some funds from the other Large-cap managers who are up over 40.00% year to date. Mr. Brice said his first three choices to where the funds should come from are number 1, the Russell index, number 2 would be Clearbridge and number 3 being John Hancock. Mr. Brice said the commission could give him a percentage of how much we want to allocate to Western and then Tim could come back to Trustee Suma with Mr. Brice’s plan how to reduce from the growth managers. A motion by Trustee Suma to have Mr. Brice give us a new allocation of 3.00% to fixed income and present it to the commission at its next meeting was seconded by Trustee Petroff. AYES: 4 NAYS: None Motion carried 4 - 0. ABSENT: Pearl. AGENDA ITEM 7 - For Your Information: A. Correspondence from Allan Swaringen, President and CEO from JLL Income Property Trust Re: Third Quarter 2023 Review. The fund was -.64% for the quarter. Trailing 1 year, 3 year and 5 years respectively are down 8.43%, up 8.61% and up 6.72%. Since inception up 7.14%. A motion by Trustee Suma to receive and file was seconded by Trustee Bermudez.  Item 4. January 9, 2024 CENTER LINE POLICE & FIRE RETIREMENT COMMISSION MINUTES REGULAR MEETING December 12, 2023 Page 4 of 6 AYES: 4 NAYS: None Motion carried 4 - 0. ABSENT: Pearl. B. Correspondence to Parker Redburn Re: Packet for refund of employee contributions. Trustee Suma said he received a phone call from Mr. Redburn and asked what his options were for taking his contributions out. He was sent him a packet including the IRS Section 402 (f) notice. A motion by Trustee Suma to receive and file was seconded by Trustee Petroff. AYES: 4 NAYS: None Motion carried 4 - 0. ABSENT: Pearl. AGENDA ITEM 8 – Old Business: A. None. AGENDA ITEM 9 – New Business: A. MAPERS One Day Seminar on Thursday, February 29, 2024 at the MotorCity Hotel. A motion by Trustee Suma to allow any trustee who wishes to attend the seminar be allowed to do so was seconded by Trustee Bermudez. AYES: 4 NAYS: None Motion carried 4 - 0. ABSENT: Pearl. B. Resolution Re: Open Meetings Act – Electronic Meeting Attendance Policy via Public Act 214 of 2023. Trustee Suma said as we discussed earlier our Policy will be to conduct meetings here on-site and let anyone to attend virtually when needed and to adopt the resolution. That is Trustee Suma’s motion and was seconded by Trustee Bermudez. AYES: 4  Item 4. January 9, 2024 CENTER LINE POLICE & FIRE RETIREMENT COMMISSION MINUTES REGULAR MEETING December 12, 2023 Page 5 of 6 NAYS: None Motion carried 4 - 0. ABSENT: Pearl. C. Proposed 2024 P & F Retirement Commission meeting dates. A motion by Trustee Suma to adopt the 2024 P & F Retirement Commission meeting dates was seconded by Trustee Petroff. AYES: 4 NAYS: None Motion carried 4 - 0. ABSENT: Pearl. AGENDA ITEM 10 – Retirements: A. None. AGENDA ITEM 11 – Annuity Withdrawals: A. None. AGENDA ITEM 12 – Approval of Pension Figures: A. None. AGENDA ITEM 13 – Vouchers: A. November 24, 2023, pensions paid: Pay Report 526 ~ $ 129,651.64. A motion by Trustee Petroff pay the November 24, 2023 pensions was seconded by Trustee Bermudez. AYES: 4 NAYS: None Motion carried 4 - 0. ABSENT: Pearl. B. Reimburse the City of Center Line for retirement system administrator Wages from July 1, 2023 through December 31, 2023. $ 27,709.62. Trustee Petroff asked what this invoice is for. It was explained to him that Trustee Suma’s work for the retirement commission is now being charged directly the retirement commission and it’s in our budget. About sixty percent of his work time is dedicated to  Item 4. January 9, 2024 CENTER LINE POLICE & FIRE RETIREMENT COMMISSION MINUTES REGULAR MEETING December 12, 2023 Page 6 of 6 retirement system business. A motion by Trustee Bermudez pay the City of Center Line invoice was seconded by Trustee Petroff. AYES: 4 NAYS: None Motion carried 4 - 0. ABSENT: Pearl. AGENDA ITEM 14. - Commission Members Comments: Trustee Suma welcomed back Danny Petroff to the retirement commission. AGENDA ITEM 15 – Adjournment: As there was no further business to discuss, a motion by Trustee Suma and supported by Trustee Bermudez that the meeting be adjourned at 3:56 p.m. AYES: 4 NAYS: None Motion carried 4 - 0. ABSENT: Pearl.