Firefighters Pension Board

NITES FIREFIGHTERS' PENSION FUND BOARD OF TRUSTEES MEETING 8360 DEMPSTER NttEs, tt 50714 August 18, 2017 The meeting was called to order at 8:33 a.m. by President Byron Tull. Trustees Present: Bob Greiner, Byron Tull, Wally Blase, Jim Grammas, and Marimel Lim. Officials Present: Tom Sawyer from Sawyer Falduto Asset Management, LLC, lnvestment Advisor to the Fund; Attorney Carolyn Clifford, Ottosen Britz; Rich Scipione, Pension Clerk to the Fund; Steve Earnhardt, Lauterbach & Amen, LLP; and Jessica Fain (Arrived 9:00 a.m.), Actuary to the Fund, Lauterbach and Amen. Public Comment: No public comment. Previous Minutes Approval: On a motion by Greiner, seconded by Blase, the minutes from the May 18,2017 meeting were approved by a unanimous voice vote. Lauterbach and Amen, LLC Report Steve Earnhardt from Latuerbach & Amen presented the July 3L,2OL7 Monthly Financial Report. At the end of July 2017, the net position held in trust for pension benefits was S30,953,977.09. The Fund paid checks numbered 30116-30129 (Harris account) and 50031 (Schwab account) from May 1, 2017 through J uly 3L,2OL7,fot a total of5172,321.92. A motion was made by Blase, seconded by Lim, to approve the financial report including bills and disbursements as presented. Upon a call ofthe roll: AYES: Greiner, Tull, Blase, Grammas, and Lim NAYS: None ABSENT: None Motion carried. The Department of lnsurance annual statement is in draft format awaiting the Village of Niles audit completion. Lauterbach & Amen are scheduled to file the Department of lnsurance annual statement by the October 31 deadline. L  NITES FIREFIGHTERS' PENSION FUND BOARD OF TRUSTEES MEETING 8360 DEMPSTER NttEs, tt 60714 August 18, 2017 The affidavits of eligibility are ongoing and still waiting for one person to submit the affidavit. lnvestment Advisor/s Report: Tom Sawyer presented the Fund's June 30, 2017 "Second Quarterly lnvestment Report." The 2017 second quarterly ending market value was 529,972,53L, with an investment return of 577z,s&o. The total account return for the second quarter was 2.52% versus the benchmark of 2.32%. The equity rate of return for the second quarter was 3.81% versus the blended benchmark of 3.3L%. The fixed income rate of return was 1.09% versus the benchmark of 1.16%. Our current portfolio allocation as of June 3O,2OL7: Equities at 57.1%, Fixed lncome ar42.7%, and Cash Equivalent at 0.2%. A motion was made by Tull, seconded by Blase, to accept the Quarterly lnvestment Performance Report, June 30, 2017, as presented. Upon a callofthe roll: AYES: Greiner, Tull, Blase, Grammas, and Lim NAYS: None ABSENT: None Motion carried. Actuarial Study Jessica Fain, actuary from Lauterbach & Amen, presented the preliminary actuarial valuation as of May 1, 2017. This is a draft document awaiting audited results. Once audited results are received, the final actuarialvaluation will be updated for Board approval. The actuarial cost method will continue to be entry age normal. The current method for funding will be 100% funded by the year 2037, as opposed to the lllinois statutory minimum contribution of 90% by the yea( 2O4O, usingthe projected unitcostmethod. TheVillageof Niles pension paymentwill be amortized using level percent funding instead of level dollar cost averaging as in the past with a five-year smoothed market value. The recommended contribution has increased $27L,579 from prior year due to salary increases, demographic changes, assumption changes, funding policy changes, asset return less than expected, and contributions greater than expected. 2  NITES FIREFIGHTERS, PENSION FUND BOARD OF TRUSTEES MEETING 8360 DEMPSTER Ntlfs, tL 60714 August 18, 2017 Our current actuarial investment return is 7.25% versus our current return on investment at 9.9% net of administrative expenses. The actuarial value return on investment is 4.3% net of administrative expenses. The actuarial liability is 575,157,327. The actuarial value of assets was 41.88% and the market value of assets was 40.17%. The actuarial value of assets is equal to the fair market value of assets with unanticipated gains/losses recognized over five years. The actuarial value of assets is currently 104% of the market value. lf the actuarial calls of assets increased to over 120% the Fund should consider lowering the actuarial investment return. The employer normal cost contribution is $1,256,352, the statutory minimum contribution is S3,099,821, and the actuary contribution recommendation is 53,799,026. Jessica presented the Niles Firefighters' Pension Fund GASB 57/58 Report. Old Business: We have two disabled members who were sent to a physician for their annual IME: Steve Zook and John Crosby. John Crosby is completed and is disabled per the lndependent Medical Evaluation. Steve Zook's docto/s appointment was on August 7 and has not received a report as of this meeting. This is John Crosby's last year as he turns fifty this year. The Board tabled Lauterbach and Amen's engagement letter upon further review from Carolyn. Carolyn will compose a resolution of appreciation for retired trustee James Callero. She will write the resolution and distribute prior the November meeting. The Board tabled the authorization of signatory authority until next meeting. Consideration of and Action upon Applicants for Admission and/or Withdrawal from Fund: Chief Steve Borkowski applied for regular retirement on June 77,2017. He had thirty-five years and eiBht months of creditable service with a total salary of S150,795.62. His monthly pension is 59424.79. On a motion by Greiner, seconded by Tull, to approve Chief Steve Borkowski regular retirement pension with a monthly pension of S9424.79. AYES: Greiner, Tull, Blase, Grammas, and Lim NAYS: None ABSENT: None 3  NILES FIREFIGHTERY PENSION FUND BOARD OF TRUSTEES MEETING 8360 DEMPSTER NttEs, tt 50714 August 18, 2017 Motion carried. New Business: Carolyn prepared a code of conduct letter to be presented to the pension funds vendors. They are required to sign it and the Board will keep it on file. The Board welcomes new trustee James Grammas. He was advised of his training requirements of a thirty two hour program. He has until August 10, 2018 to complete his training requirements. Training: Carolyn distributed training material for the Board to review. Training article included 'Telling Your Fund's Story: Annual Report to Members and Municipality." The Board designates one hour of training for the material and actuary review. Next Meeting: The ne$ meeting is scheduled for November 2.2017 at 8:30 a.m. The meeting was adjourned at 10:06 a.m. on a motion by Tull, seconded by Grammat and approved upon a unanimous voice vote. Respectfully subm itted, g^L M,*> Bob Greiner, Secretary Minutes approved by the Board of Trustees at its meeting on November 2, 2017. Minutes prepored by Rich Scipione, Pension clerk to the Fund 4