Police & Fire Retirement Board

REGULAR MEETING MINUTES OF THE STERLING HEIGHTS POLICE AND FIRE RETIREMENT SYSTEM, ACT 345 JANUARY 17, 2013 FIRE DEPARTMENT CONFERENCE ROOM 41625 RYAN ROAD STERLING HEIGHTS, MI 48313 President Solak requested a moment of silence in honor of retired Fire Captain James Poterek who passed away on January 5, 2013. 1. The regular meeting of the Police and Fire Retirement System was called to order by President Solak at 4:01 p.m. 2. Board Members present: Solak, Nash, Lamerato, Varney. Absent: Wellhausen (excused). Also present: Daniel Welker of J.P. Morgan Asset Management; Tom Michaud, Legal Counsel; and Nancy Duyck, Pension Technician. 3. APPROVAL OF CONSENT AND REGULAR AGENDAS Motion by Lamerato, supported by Nash, to approve the consent agenda as presented. Ayes: Lamerato, Nash, Solak, Varney. Absent: Wellhausen. The motion carried. The following items were added to the regular agenda: 8 b 1 – Gregory Oliverio – refund of contributions - discussion 10 a 9 – Joseph Opalewski – DRO resolution - discussion Motion by Varney, supported by Lamerato, to approve the regular agenda as amended. Ayes: Varney, Lamerato, Solak, Nash. Absent: Wellhausen. The motion carried. 4. APPROVAL OF MINUTES No corrections were made to the draft minutes of the regular meeting of December 13, 2012. Motion by Nash, supported by Varney, to approve the minutes as presented. Ayes: Nash, Varney, Solak, Lamerato. Absent: Wellhausen. The motion carried; the minutes of the regular meeting of December 13, 2012 are hereby approved. 5. CITIZEN PARTICIPATION Daniel Welker of J.P. Morgan Asset Management was in attendance to introduce himself to the Board. 6. REPORT FROM LEGAL COUNSEL No formal legal report was presented. Mr. Michaud gave a formal report on Public Act 347 of 2012 that was signed by Governor Snyder on December 5, 2012, which takes effect on April 1, 2013. The new legislation substantially amends Public Act 314 – the Public Employee Retirement System Act with regard to investments, transparency rules, "pay-to-play" restrictions, Board governance requirements, trustee education/travel, retirement system summary annual reports and procedures for the removal of board members. Mr. Michaud will provide the Board with a compliance checklist to act on for compliance with PA 347 by the April 1st effective date at the March 21, 2013 regular meeting.  Mr. Michaud commented on items of old business as they were considered. CONSENT AGENDA 7. CORRESPONDENCE a. Correspondence from Comerica received December 26, 2012 re: change to pension processing. b. E-mail to Rodwan Consulting dated January 3, 2013 re: 2012 actuarial information. c. Other correspondence received from: 1. Merrill Lynch – market value updates 2. NCPERS 3. Pomerantz, Grossman, Hufford, Dahlstrom & Gross LLP 4. Robbins Geller Rudman & Dowd LLP 5. University Conference Services d. Magazines received: 1. Pensions & Investments for December 24, 2012 and January 7, 2013. 2. Institutional Investor for January 2013 3. Plan Sponsor for January 2013 8. BILLS AND EXPENDITURES c. Checking Account Summary Beginning Balance $4,894.48 12/01/12 Additions (1) 1. 12/14 $5,000.00 Subtractions (6) $2,372.99 1. 12/14 Check 1893 100.00 MAPERS – 2013 dues 2. 12/14 Check 1894 283.00 ND – postage reimbursement 3. 12/31 Check 1895 37.32 AT & T phone bill – 12/16/12 Contract Payment Nancy 4. 12/13 Check 5230 938.03 Duyck 5. 12/07 Check 5231 76.62 Contract fee – Gurin & Gurin Contract Payment Nancy 6. 12/21 Check 5232 938.02 Duyck  Electronic withdrawals (5) $1,734.58 1. 12/12 348.95 IRS Fed. tax w/h 2. 12/17 461.54 IRA contribution 3. 12/20 104.34 Michigan St. tax w/h 4. 12/26 348.96 IRS Fed. tax w/h 5. 12/28 470.79 IRS Fed. tax w/h Ending Balance $5,786.91 12/31/12 d. Transmittal of Checks 1. $42,078.89 received from Thomas Fett for the purchase of 1 year of eligible college service credit. 9. FUNDS MANAGEMENT a. The current value of funds as of December 31, 2012 is detailed below: Clearing account $ 2,170,113.49 Intercontinental $ 8,598,308.66 McDonnell $ 16,077,150.17 Pimco $ 16,422,518.74 Wamco $ 16,466,547.27 Winslow $ 17,819,573.63 Janus $ 18,845,118.38 Eagle $ 18,713,294.50 Herndon $ 18,874,098.74 Earnest Partners $ 10,245,630.79  NFJ/Allianz $ 15,231,447.42 AIM/Invesco $ 14,508,522.67 Checking account $ 5,786.91 TOTAL FUNDS $ 173,978,111.37 b. The Board received a copy of the Summary of Employer Contributions to the Police and Fire Retirement System for the 2012 tax year as of 1/14/13. The System has received $8,341,982.77 of the 2012/13 budget of $8,815,031.00, leaving a $473,048.23 balance. c. Benefit Register Listing as of January 1, 2013 from Comerica Bank showing 293 retirees/beneficiaries with a payout for January of $1,192,458.96 and a year-to-date of $1,192,458.96. d. The current Merrill Lynch Bond index for December 2012 is 1.60%. 10. BENEFITS & PLAN ADMINISTRATION a. Old Business 1. Abel/Noser Reports for November 2012 Abel/Noser has supplied the November 2012 report. 2. Thomas Fett – adjusted hire (retirement) date The adjusted hire (retirement) date for Police Captain Thomas Fett is August 28, 1988 after the purchase of 1 year of eligible college service credit. 3. Aaron Burgess – Application for DROP retirement  Police Sgt. Aaron Burgess has submitted an application for DROP retirement effective January 29, 2013. All required paperwork is on file in the Pension Office. REGULAR AGENDA 8. BILLS AND EXPENDITURES a. Disbursements other than retiree benefit payments (bills) 1. Disbursement to Rodwan Consulting Company in the amount of $3,000.00 for actuarial and consulting services rendered for the quarter ended 12/31/12 and Yanez EDRO calculation. 2. Disbursement to the City of Sterling Heights in the total amount of $650.59 for accounting services rendered for the quarter ended 12/31/12. 3. Disbursement to Merrill Lynch in the amount of $27,750.88 for the quarterly Herndon account UMA fee for the quarter ended 3/31/13. 4. Disbursement to Merrill Lynch in the amount of $26,232.79 for the quarterly Winslow account UMA fee for the quarter ended 3/31/13. 5. Disbursement to Merrill Lynch in the amount of $15,646.50 for the quarterly Earnest Partners account UMA fee for the quarter ended 3/31/13. 6. Disbursement to Merrill Lynch in the amount of $25,662.16 for the quarterly NFJ/Allianz account UMA fee for the quarter ended 3/31/13. 7. Disbursement to Merrill Lynch in the amount of $27,420.95 for the quarterly Pimco account UMA fee for the quarter ended 3/31/13. 8. Disbursement to Merrill Lynch in the amount of $27,601.43 for the quarterly WAMCO account UMA fee for the quarter ended 3/31/13.  Motion by Varney, supported by Lamerato, to approve the bills as presented. Ayes: Varney, Lamerato, Solak, Nash. Absent: Wellhausen. The motion carried. b. Disbursement to retirees/members other than monthly benefit payments 1. Gregory Oliverio - refund of contributions Fire Fighter Gregory Oliverio was hired on September 12, 2011 and was laid-off July 1, 2012. Mr. Oliverio has requested a refund of his contributions and interest. Walt Hessell has calculated the amount of the refund in the amount of $4,250.13. All required paperwork is on file in the Pension Office. Motion by Solak, supported by Nash, to approve the refund as presented. Ayes: Solak, Nash, Lamerato, Varney. Absent: Wellhausen. The motion carried. 10. BENEFITS & PLAN ADMINISTRATION a. Old Business 4. Aaron Burgess – municipal – 1 year and 5 months - discussion The above named individual has submitted an application for buyback of municipal time as noted. All required paperwork is on file in the Pension Office.  Motion by Solak, supported by Varney, to approve the municipal buyback. Ayes: Solak, Varney, Nash, Lamerato. Absent: Wellhausen. The motion carried. 5. James Poterek – survivor benefit - discussion Retired Fire Capt. James Poterek passed away on January 5, 2013. At retirement, Capt. Poterek chose a Regular retirement with the automatic 60% to his wife, Karyl. An application for survivor benefits has been requested as well as a copy of Mr. Poterek’s death certificate. After discussion, the following resolution was considered: L 13-1-17-1 Re: JAMES POTEREK – SURVIVOR PENSION RESOLUTION WHEREAS, the Board of Trustees is vested with the authority and fiduciary responsibility for the administration, management and operation of the Retirement System, and WHEREAS, the Board of Trustees has been advised that James Poterek passed away on January 5, 2013, and WHEREAS, upon his retirement on September 21, 1995, JAMES POTEREK selected a regular retirement pension benefit with an automatic sixty percent surviving spouse benefit, and WHEREAS, Section 6(1)(h) of Public Act 345 of 1937, as amended, provides in pertinent part that upon the death of a retirant who is receiving a regular retirement pension, his or her spouse, if living, shall receive a pension equal to 60% of the regular retirement pension the deceased was receiving, and WHEREAS, JAMES POTEREK is survived by his wife, KARYL POTEREK, therefore be it RESOLVED, that the Board of Trustees wishes to express its condolences to the family and friends of JAMES POTEREK, and further RESOLVED, that the Board of Trustees hereby directs that pension benefits be made payable to KARYL POTEREK in the amount of $2,594.54 consistent with Retirement System provisions, and further RESOLVED, that the Board of Trustees has requested a certified copy of JAMES POTEREK’s death certificate for its files, and further RESOLVED, that a copy of this resolution be forwarded to KARYL POTEREK. Motion by Solak, supported by Varney, to adopt the resolution and approve the disbursement as presented. Ayes: Solak, Varney, Nash, Lamerato. Absent: Wellhausen. The motion carried, the resolution is hereby adopted and the disbursement approved. 6. Donald Sypniewski – partial DROP distribution - discussion Sgt. Donald Sypniewski of the Police Department terminated his DROP retirement as of November 30, 2010. He is requesting a partial distribution from his DROP account. All required paperwork is on file in the Pension Office. Motion by Solak, supported by Nash, to approve the partial DROP distribution as presented. Ayes: Solak, Nash, Lamerato, Varney. Absent: Wellhausen. The motion carried. 7. Henry Yanez – DROP retirement termination information - discussion Lt. Henry Yanez of the Fire Department terminated his DROP retirement as of January 17, 2013. All required paperwork is on file in the Pension Office. Motion by Solak, supported by Lamerato, to approve the retirement and process the disbursements and retirement certificate. Ayes: Solak, Lamerato, Nash, Varney. Absent: Wellhausen. The motion carried. 8. February regular/quarterly meeting - discussion The Board discussed the February meeting and which managers, if any, should be requested to attend the meeting and the start time. Motion by Varney, supported by Solak, to change the start time to 3:30 p.m. from 4:00 p.m. Ayes: Varney, Solak, Nash, Lamerato. Absent: Wellhausen. The motion carried. 9. Joseph Opalewski – DRO resolution – discussion The Board is in receipt of a Domestic Relation Order for retired Fire Lt. Joseph Opalewski. Legal Counsel has approved the DRO. The following DRO resolution was considered: L 13-1-17-2  Re: tammy opalewski v. joseph opalewski macomb County circuit Court Case No. 12-2844-Do WHEREAS, the Board of Trustees is in receipt of a Domestic Relations Order dated January 8, 2013, wherein Tammy Opalewski, the Alternate Payee, is awarded certain rights to the benefits of Joseph Opalewski, the Participant, and WHEREAS, the Alternate Payee is entitled to 50% of the Participant’s monthly retirement benefit from the Retirement System that accrued as of September 18, 2012, and WHEREAS, the Alternate Payee is entitled to 50% of the Participant’s DROP Account that had accrued as of September 18, 2012, 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 Michael V. Sucaet, Esq., attorney for the Participant; and Kathy J. Vogt, Esq., attorney for the Alternate Payee. Motion by Solak, supported by Lamerato, to adopt the resolution as presented. Ayes: Solak, Lamerato, Nash, Varney.  Absent: Wellhausen. The motion carried, the resolution is hereby adopted. 11. Trustee Comments – None. 12. ADJOURNMENT Motion by Nash, supported by Solak, to adjourn at 4:37 p.m. Ayes: Nash, Solak, Lamerato, Varney. Absent: Wellhausen. The motion carried; the meeting is hereby adjourned. Mark Wellhausen Secretary