General Employees Retirement Board

OFFICIAL MINUTES OF REGULAR MEETING OF THE STERLING HEIGHTS GENERAL EMPLOYEE’S RETIREMENT SYSTEM Thursday, May 17, 2018 ___________________________________________________________________ __ _ ___ Location: Room #201 40555 Utica Road, Sterling Heights, MI 48313 (586) 446-2333 Chairperson Weiler called the meeting to order at 1:32 p.m. BOARD MEMBERS PRESENT: Richard Weiler, Chairperson Jennifer Varney, Secretary Todd Marsh, Trustee Paul Henig, Trustee Mary Jaganjac, Treasurer BOARD MEMBERS ABSENT: ALSO PRESENT: Walt Hessell, Pension Administrator; Ryan Clark, Treasury Service Coordinator; Tom Michaud, Legal Counsel, VanOverbeke, Michaud & Timmony, P.C. (not present, excused absent) APPROVAL OF AGENDA: Motion by Marsh, supported by Henig, to approve the agenda as presented. Ayes: All. Motion carried unanimously. APPROVAL OF MINUTES: Motion by Henig, supported by Marsh, to approve the minutes of the regular meeting held April 19, 2018. Ayes: All. Motion carried unanimously. COMMUNICATION FROM CITIZENS: None REPORT FROM LEGAL COUNSEL Counsel reviewed and recommended approval of WCM Investment money manager contract, carried outside the Morgan Stanley umbrella contract and operating agreement. Motion by Varney, supported by Marsh, to receive and file reviewed contract from WCM Investment money manager and approve as reviewed by legal counsel. Ayes: All. Motion carried unanimously. CONSENT AGENDA: Motion by Marsh, supported by Henig, to receive and file consent items I A through I D-2. Ayes: All. Motion carried unanimously. I. RECEIVE AND FILE: A. Benefit register listing for April 1, 2018 from Comerica Bank showing 364 active retirees with a payout for April 2018 of $929,195.19 and a year-to-date of $4,602,527.42. B. Cash and Asset Statements as of April 30, 2018 from Comerica Bank and Morgan Stanley showing a total market value of $111,168,114.00 comprised as follows: 1  Desired Asset Class Percentage Manager / Fund $ Balance Allocation 0.00% Cash 0.37% COMERICA BANK $ 407,148.72 12.00% Fixed Income 11.74% BOYD WATTERSON 13,046,716.41 12.00% Fixed Income 12.03% WAMCO 13,371,065.63 11.00% SMID 9.72% EARNEST 10,801,729.70 4.00% Large Cap Value 3.43% CONFLUENCE 3,810,333.60 3.00% Large Cap Value 2.82% ISHARES VAL INDEX 3,131,006.12 4.00% Large Cap Value 3.35% MFS 3,727,276.77 4.00% Small Cap 4.23% EDGE 4,703,443.38 2.00% Large Cap Growth 3.27% CLEARBRIDGE 3,636,813.15 2.00% Large Cap Growth 3.05% ISHARES GR INDEX 3,389,963.80 3.00% Large Cap Growth 3.10% JANUS CAPITAL 3,440,959.10 6.00% Large Cap Core 5.05% LONDON 5,614,528.11 4.00% Large Cap Core 4.06% ISHARES S&P INDEX 4,513,954.50 6.00% Large Cap Global 6.13% INVESCO INTL 6,811,369.24 11.00% Large Cap Global 11.22% CAMBIAR 12,473,441.30 6.00% Large Cap Global 6.30% HARDING INTL 6,999,022.84 3.00% Emerging Markets 3.10% LAZARD / HLMEX 3,448,895.67 2.00% REITS 2.23% PRINCIPAL REIT 2,479,504.20 5.00% MLP’s 4.82% CUSHING ASSET 5,360,941.69 0.00% Closed MGR 0.00% AMI 0.07 100% 100% $ 111,168,114.00 C. Correspondence 1. March 26, 2018 Form ADV brochure received from Winslow Capital 2. March 26, 2018 Morgan Stanley letter: confirmation of account change reallocating assets under London from 56/44 to 55/45 split (Income Equity/ iShares Core SP 500 ETF) 3. March 27, 2018 Form ADV brochure received from Harding Loevner 4. March 27, 2018 Form ADV brochure received from Cambiar Investors 5. March 29, 2018 Morgan Stanley letter: confirmation of account change transferring assets from Winslow to Clearbridge for Large Growth Cap and iShares Russell 1000 Growth index fund 6. March 29, 2019 Form ADV brochure received from Invesco Advisors 7. March 30, 2018 Settlement Report for shareholder class actions from Robbins Geller Rudman & Dowd 8. April 11/12, 2018 Morgan Stanley email string and letter correspondence regarding transfer of funds for benefits payment 9. April 16, 2018 Form ADV brochure received from Principal Global Advisors 10. April 16, 2018 Crain Pensions & Investments publication 11. April 18, 2018 Form ADV brochure received from Lazard Asset Management 12. April 23, 2018 Morgan Stanley letter: confirmation of instructions to transfer $725k to Comerica for monthly disbursement of benefits 13. April 23, 2018 Comerica letter: institutional trust account manager transition to Benjamin Howes 14. April 24, 2018 Form ADV brochure received from Boyd Watterson 15. April 25, 2018 Form ADV brochure received from Janus Capital 16. April 30, 2018 Crain Pensions & Investments publication 17. April 2018 Form ADV brochure received from MFS Institutional: no date on letter 18. May 2, 2018 email and letter from Sterling Heights to Morgan Stanley transferring assets from Invesco- International Equity to WCM Investment Management – International Equity 19. May 10, 2018 Form ADV brochure received from Earnest Partners 20. May 10, 2018 Form ADV brochure received from Confluence D. Approve Invoices for Payment 1. Payable from System Assets for the quarterly service period ending March 31, 2018: Morgan Stanley Management in the amount of $145,501.74 and from Boyd Watterson in the amount of $4,920.00. 2. Payable from City Assets for the quarterly service period ending March 31, 2018: Comerica Bank custodial fees in the amount of $4,857.10 2 REGULAR AGENDA: II. OLD BUSINESS: A. One-Time $500 Payment for Sterling Heights Police Clerical Association Retirees Motion by Varney, supported by Henig, to receive and file the summary update for the one-time $500 payment for Sterling Heights Police Clerical Association Retirees showing payment due for the June 1, 2018 payout date to Linda Pierce. Ayes: All. Motion carried unanimously. B. Service Retirement Information for Denise Doyle, Court Clerk, 41-A District Court Motion by Marsh, supported by Henig, to approve the service retirement for Denise Doyle, Deputy Court Clerk, 41-A District Court, effective April 21, 2018 with service credit of 17 years and the monthly pension amount of $1,617.55, under Straight Life without annuity withdrawal based on a monthly final average compensation of $4,299.14. Ayes: All. Motion carried unanimously. III. NEW BUSINESS: A. Change in Retiree Status – Leonard Hendricks (Deceased) Motion by Varney, supported by Marsh, to approve termination of option B benefits for retiree, Leonard Hendricks, due to his death on April 11, 2018 and the preceding death of his spouse, Irene Hendricks. Ayes: All. Motion carried unanimously. B. Pension Administration Comments 1.Annual Update & Review RFP Status – Service Providers Varney pointed out that PA 202 of 2017 will require additional actuarial review which may impact the RFP schedule in future years. Motion by Marsh, supported by Henig, to receive and file the Annual Update and Review RFP (request for proposals) Status – Service Providers Ayes: All. Motion carried unanimously. 2. Proposed Fiscal Year 2018 / 2019 GERS Meeting Schedule Motion by Henig, supported by Marsh, to approve proposed Fiscal Year 2018 / 2019 GERS Meeting Schedule Ayes: All. Motion carried unanimously. C. Trustee Comments - none ADJOURN: Motion by Henig supported by Marsh, to adjourn the meeting at 12:43 p.m. Ayes: All. Motion carried unanimously. Respectfully Submitted, ___________________________________ Jennifer Varney, Secretary 3