Retirement Board

CITY OF MIDDLETOWN MINUTES OF THE RETIREMENT BOARD SPECIAL MEETING Monday, September 10, 2018 at 9:00 am The Special Meeting of the Retirement Board of the City of Middletown was held in room 208 of the Municipal Building Board Members Present: Mayor Drew, John Milardo, Steve Gomes, Linda Salafia, Joe Serra Board Members Absent: Carl Erlacher, Mary Bartolotta City Employees/Public/Others Present: Diana Doyle, Kori Wisneski, Deputy General Counsel (OGC), Michael Lepore (GYL), Cheryl Monarca, Joe Monarca, Derek Puorro (MPD)  Meeting Called to Order at 9:05 am  No Public Comments on the Agenda  Approval of Minutes o May 14, 2018 regular meeting  Joe motioned to approve and was seconded by Linda  All in favor, with Mayor abstaining  Election of Pension Board Chair and Secretary o Mayor nominated Steve for Chair and Carl for Secretary and was seconded by Joe o All in favor  Discussion of Disability Pension Complaint o Kori provided background to the Board regarding the complaint; stated that the duty disability pensioner named in the complaint completed and returned the affidavit for the pension audit conducted by the Board in Spring 2018; at the time, the individual reported that he was not working; she stated that she has no reason to believe that such statement was inaccurate; the complaint indicates that this is a new position for the duty disability retiree o Discussion by Board of further research regarding complaint o Kori suggested that the Board conduct an annual audit of duty disability pensioners o Board determined that no action be taken at this time and that Kori respond to pensioner making complaint  John motioned that Kori respond, on behalf of the Board, to complainant and was seconded by Linda  All in favor  Joe motioned that the Board request a job description from the pensioner’s employer; after further discussion he withdrew the motion  Review of Investments o Michael reminded the Board that the Investment Manager from New Amsterdam was scheduled to attend the regular meeting in August but, was unable to attend in September; Board suggested that the Manager attend at the February 2019 meeting o The Pension Fund value at the end of the 2nd quarter was $414,836,264, reflecting a return of .94% o Steve questioned what action the Board could take to increase the Small Cap return o Michael indicated possibility of adding a more aggressive growth manager but, questioned if it was consistent with the overall strategy of the Plan; advised Board to wait on taking action until meeting with the New Amsterdam Manager o Michael discussed the performance of the Fund Managers during the 2nd quarter; noted that Capital Group is outperforming benchmark and has erased previous underperformance; cautioned the Board that the return on High Yield Bonds will eventually begin to slow because the currently low “spreads” are not likely to remain that way o GYL recommended a rebalance to bring the US & Non-US Equities and Equities & Fixed Income into balance  Linda motioned to rebalance, as recommended by GYL, and was seconded by John  All in favor o Michael presented Investment Policy Amendment to the Pension Plan, reflecting the addition of REITs, to be signed by Carl o The OPEB Trust value at the end of the 2nd quarter was $12,829,644, reflecting a return of 1.34% o Michael reviewed the OPEB performance; specifically noted that Lazard International continued to improve with performance ahead of benchmark; Transamerica has been placed on a watch list due to the questionable governance of a fund that it has since separated itself from; confirmed to Board that there was no impact to the OPEB Portfolio o Affirmed that the asset allocation is on target, no recommendation to rebalance o Diana confirmed that a $600,000 contribution was made to OPEB, after approval of the budget by the Common Council o Steve asked that, because OPEB Trust is not used for current liabilities, could GYL present a more aggressive allocation o GYL will update asset allocation study for the next quarter o Michael presented Investment Policy Amendment to the OPEB Trust, reflecting the addition of REITs, to be signed by Carl   Reports: (informational) o Quarterly Securities Litigation Update – Kessler Topaz Meltzer Check, LLP o Treasurer’s Report o Pension Investment Report  Applications for Membership Start Date Department/Union Diann Amici 8/1/18 BOE/466 Owen Andrew 8/20/18 Fire/Fire Andrew Brooks 8/6/18 Police/Police Ramona Burkey 5/30/18 Library/Non-Barg Amanda Rose Colavito 5/21/18 BOE/466 Jeremy Colon 8/6/18 Police/Police Philip Delegan 8/31/18 Library/Library Suraj Gunpat 7/23/18 Central Comm/466 Sara Mendillo 5/14/18 Mayor/Non-Barg  Requests to Retire/Collect/Vest Yrs of Svc Department/Union Stephan Allison 10 yrs Arts & Culture/UPSEU Ernest Cantwell 29 yrs Fire/Fire Maureen Chabre – Vest 18 yrs Library/Library Michael Civitello 21 yrs Parks/466 Jaime DelMauro 21 yrs Police/Police Robert Young 12 yrs W&S/UPSEU  Refund Requests/Adjustments/Other Department/Union Linda Bettencourt Beneficiary – Rollover Town Clerk/UPSEU Thomas Tokarz – Refund Human Resources/Non-Barg William Vernile – Rollover Human Resources  Deceased Pensioners Andre Raymond – benefits to spouse Edith Kabatznick  Adjournment of Meeting  Joe motioned to adjourn and was seconded by John  All in favor Respectfully submitted: Carl Erlacher