Pension Board of Trustees

AGENDA WILTON MANORS GENERAL EMPLOYEE & POLICE PENSION BOARD OF TRUSTEES REGULAR MEETING Tuesday September 4, 2018 COMMISSION CHAMBERS 5:30 PM I. PLEDGE OF ALLIGENCE II. CALL TO ORDER Ill. ROLL CALL IV. ADDITIONS/DELETIONS V. COMMENTS FROM THE PUBLIC Any member of the Public may speak on any issue for three (3) minutes ~- CONSENTAGENDA Items listed under Consent Agenda, Item VI , are viewed to be routine and One Motion will enact the recommendation in the form listed below. If discussion is desired , then the items(s) will be removed from the Consent Agenda and will be considered separately. Approval of Minutes: • June 5, 2018 Motion to Receive and File: Warrant 2018-014 • Trustees per diem I FPPTA Conference $612.00 Warrant 2018-015 • Hoekstra- Recording/Secretarial Services $825.00 Warrant 2018-016 • Gabriel Roeder Smith Invoice #439191 $7,350.00 Warrant 2018-017 • Professional Indemnity Ins. Renewal $7,433.00 Warrant 2018-018 • Bihus & Hoekstra Reimburse Hotel & mileage FPPTA Cont. $1 ,167.32 Warrant 2018-019 • Klausner, Kaufman , Jensen & Levinson Invoice 6/30/2018 $750.00 • Southeastern Advisory Services 6/30/18 $4,621 .67 Warrant 2018-020 • Balistreri - Reimburse Hotel & fuel - FPPTA Cont. $618.53 Warrant 2018-021 • Garcia Hamilton & Associates Invoice #29519 $4 ,063.74 Klausner Kaufman Jensen & Levinson , Attorney Invoice 5/31/18 0 Klausner Kaufman Jensen & Levinson, Attorney Invoice 7/31/18 0  • 2018 Rate of Return is 2.31% Net of Fees • Garcia Hamilton & Associates OE 6/30/18 • Saxena White 02 2018 Select Investor Monitoring Report • GRS -112.664 Florida Statutes Compliance Report 9/30/2017 • June 6, 2018 follow up e-mail to Shawn Chadwick regards filing Form 1F • June 6, 2018 e-mail from John Small, Southeastern Advisory to Regions • June 4-6, 2018 e-mail correspondence regards to Pension Account • June 14, 2018 e-mail to trustees- reminder to file Form 1 Disclosure • June 20, 2018 e-mail regards renewing Fiduciary Ins • August 17-20 e-m ails from Regions re-COLA input • KSDT, Auditor signed Engagement Letter • FPPTA School September 30 to October 3, 2018 • 48th Annual Police & Firefighters' Pension Conference Nov. 14-16, 2018 • DROP Disbursement Rollover Julia Kunz- $203 ,781 .97 VII. NEW BUSINESS VIII. OTHER BUSINESS 1. Southeastern Advisory Services OE 6/30/2018 2. Asset Allocation IX. JOAN WALL, ADMINISTRATOR X. ATTORNEY REPORT XI. REPORT FROM BOARD MEMBERS XII. ADJOURNMENT Pursuant to FS 286.015 , if a person decides to appeal any decision made by the Board , agency or commission with respect to any matter considered at such meeting, or hearing, he/she will need a record of the proceedings and that, for such purposes, he/she may need to ensure that a verbatim record of the proceedings is made, which record includes the testimony and evidence upon which the appeal is to be based . ANY PERSON REQUIRING AUXILIARY AIDS AND SERVICES FOR THIS MEETING MAY CALL THE ADA COORDINATOR AT 390-2122 AT LEAST TWO WORKING DAYS PRIOR TO THE MEETING. IF YOU ARE HEARING OR SPEECH IMPAIRED, PLEASE CONTACT THE FLORIDA RELAY SERVICE BY USING THE FOLLOWING 2 PHONE NUMBERS: 1-800-995-8770 (VOICE) 1-800-955-8771 (TDD) POST: City Hall Bulletin City of Wilton Manors General Employee & Police Pension Board of Trustees Minutes June 5, 2018 I. Pledge of Allegiance II. Call To Order Acting Chair Bihus called the meeting of the Wilton Manors Pension Board of Trustees to order at 5:35p.m. Ill. Roll Call Biagio Balistreri, John Pilch and Acting Chair Barbara Bihus Chairman Joshua Kroon out of town Others Present: Theora Braccialarghe, Melissa Moskovitz, John Small, Carol Conal & Bob Mays, Finance Director, Joan Wall. IV. Appointment of 5th Member There was one applicant for 5th Member for the GE & Police Pension Board of Trustees George J. Farrell Ill. Mr. Farrell introduced himself to the Board and his background on previous pension board/FPPTA. Trustee Barbara Bihus made the motion to nominate George J. Farrell Ill as the 5 th Member of the Board of Trustees, seconded by Trustee John Pilch. Approved Unanimously V. Comments from the Public None VI. Consent Agenda Acting Chair Bihus asked for a motion to approve the consent agenda and also asked if anyone wanted any item pulled from the Consent Agenda for further discussion and if not she would like a motion to approve the Consent Agenda. Approval of Minutes: • March 6, 2018 Trustee Balistreri made a motion to approve the March 6, 2018 minutes, seconded by Trustee Pilch . Approved Unanimously Page 1 of 6 City of Wilton Manors GE & Police Pension Board of Trustees Minutes - June 5. 2018 Page 2 of 6 Receive and File: Warrant 2018-008 • Hoekstra - Recording/Secretarial Services & Supplies $1 ,053.92 Warrant 2018-009 • KSDT, Auditor lnv. #56856 $3,515.00 • Klausner, Kaufman , Jensen & Levinson lnv. Feb. 28, 2018 $ 900.00 Warrant 2018-010 • Gabriel Roeder Smith Invoice #437088 $5,300.00 Warrant 2018-011 • Garcia Hamilton & Associates Invoice #29147 $4,044.39 • Klausner, Kaufman , Jensen & Levinson Invoice 3/31/2018 $1 ,275.00 • Southeastern Advisory Services 3/31/18 $4,621 .67 Warrant 2018-012 • FPPTA- Registration FPPTA School $1 ,950.00 Warrant 2018-013 • Joan L. Wall , Bookkeeper 1/19/18-5/18/18 Copies & Postage $1 ,034.08 Klausner Kaufman Jensen & Levinson , Attorney Invoice 4/30/18 0 • 1018 Rate of Return is (0.35%) Net of Fees • Garcia Hamilton & Associates QE 3/31/18 • Saxena White Q1 2018 Select Investor Monitoring Report • March 7, 2018 e-mail Shawn Chadwick Form 1F • May 22, 2018 e-mail from City Clerk Faith Lombardo -Community Board Minutes to be included in Weekly Updates • March 7, 2018 KSDT, Auditor- signed Representation New Pension Benefit Payments • Timothy Blanton -April 2 , 2018 $2,953.00 • Julia Kunz- May 31 , 2018 $2 ,246.64 Request for Benefit Calculation • Rita Sanz - Retirement Date September 18, 2018 Trustee Balistreri made a motion to ratify the bills and other items under receive & file , seconded by Trustee Pilch. Approved Unanimously VII. Other Business 1. Gabriel Roeder Smith & Company Actuarial Valuation October 1, 2017 Theora Braccialarghe & Melissa Moskovitz were present to go over the Valuation with the Board. Melissa Moskovitz started the presentation by going over the summary. City of Wilton Manors GE & Police Pension Board of Trustees Minutes -June 5, 2018 Page 3 of6 1. Summary of Plan Provisions/Assumptions Normal Retirement Benefit 3% * AFC * Years of Service Monthly Stipend $10 *Years of Service (max $200)- for members hired before September 30, 2005 Normal Form of Benefits Life annuity Normal Retirement Date* Age 60 & 5 YOS or 20 YOS Early Retirement Factor 3% per year (maximum of 12%) Average Earnings Average Compensation over the highest three consecutive YOS Cost of Living Adjustment "COLA" Certain ee's of the police bargaining unit, including non-sworn members participating in the General Employees Plan who retire or DROP during the 02-05 CBA receive a delayed 3% COLA PBA members with 10 or more YOS as of 10/1106 receive a 3% COLA starting six years after retirement. Plan Status Closed to new entrants hired on or after August 1, 2007 (the effective Date of the City's participation in FRS) Funding Method Entry Age Normal; amortization through 2029130 Employee Contribution Rate Police Officers 10% of pay and General Employees 11% of pay Mortality Assumption Mortality Tables used for Regular Class Members (General) and Special Risk Class Members (Police) of the Florida Retirement System (FRS) Investment Return Assumption 7.0% rate, net of investment expense, compounded annually *Active members with 15 or more YOS as of 10/1/06 who retired by September 30, 2009, retired with unreduced benefits , payable when the member would have reached NR if they had remained employed. 2. City Contributions General Employees - Annual Required Contribution $762,090 Police Officers - Annual Required Contribution $904,959 Combined Annual Required Contribution $1 ,667,049 As Percentage of Payroll 277.95% (because it is a closed plan) 3. Gain I (Loss) General Police Officers Gain I (Loss) due to investments ($55,221) ($ 71 ,261) Gain I (Loss) due to other sources $98.350 $212.472 Total Gain I (Loss) $43,129 $141 ,211 4. Historical Gain I (Loss) Year Ending Gain I (Loss) 913012017 $184,340 913012016 $138,520 913012015 $450,252 9130/2014 $636,721 9/3012013 $40,745 City of Wilton Manors GE & Police Pension Board of Trustees Minutes -June 5. 2018 Page 4 of6 5. Variability of Future Contributions • The actuarial value of assets (AVA) exceeds the market value (MV) as of October 1, 2017 by about $800k. • If the MV had been used instead of the AVA the required city contributions would have increased by about $37k . • 6. Key Considerations • The Plan was closed to new entrants June 12, 2007. At this point about 87% of the accrued liability is for inactive members. • The Current Funding Method is Entry Age Normal. Under this funding method the City is making a long term commitment to continue funding the plan even after the last member retires. 7. Recommendations • Steps have been taken to improve the funded position of the Plan such as lowering the investment earnings assumption and gradually lowering the amortization period . We recommend monitoring the investment return assumption. Melissa said at some time we will have to lower the 7% assumption as more people retire. Funded Ratio this year is 67.0% last year it was 64.9% Melissa & Theora went over some of the other figures and requirements in the valuation with the Board . There is one more report that needs to be prepared by the actuary and posted to the State Website 60 days after approval of the valuation , which is the 112.665 reporting requirement. Attorney Levinson said a motion to approve the Valuation and for the actuary to prepare the 112.665 reporting was in order. Acting Chair Bihus asked for a motion to accept the Valuation as presented . Trustee Balistreri made the motion to accept/approve the Valuation as presented, seconded by Trustee Bihus. Approved Unanimously Acting Chair Bihus asked for a motion to approve the 112.665 reporting requirement that needs to be prepared and posted on the State website by GRS, actuary. Trustee Pilch made the motion to have GRS prepare the 112.665 reporting requirement, seconded by Trustee Bihus. Approved Unanimously 2. Southeastern Advisory Services First Quarter- March 31 , 2018 John Small was present to go over the 151 quarter performance with the Board . John went the overview of the markets for the quarter and said it was not a very good quarter. • S&P 500 -0.8% for the quarter, one year 14.0% that is good • The EAFE Index -1 .5% for the quarter, 14.8% for the one year- pretty much in line with US market • BbgBarc U.S. Aggregate -1 .5% for the quarter, 1.2% for the one year • CPI 1.2% for the quarter, 2.4% for the one year City of Wilton Manors GE & Police Pension Board of Trustees Minutes- June 5, 2018 Page 5 of6 Portfolio Growth • $28,258,676 for the quarter ending 3/31/18 Performance Comparison Total Fund Analysis 1st quarter -0.3%/52nd - 1 year 9.0%/75th Equity Analysis 1st Quarter • Vanguard Russell1000 -0 .7%/47th versus Russell1000 -0.7%/43rd *Vanguard Russell1000 was funded on June 16, 2016 • Vanguard Mid Cap Value -1.4%/55th versus Russell Mid Cap Value Index -2.5%/79th *Vanguard Mid Cap Value was funded on June 14, 2016 • Eaton Vance SMID Cap 1.1%/28th versus Russell 2500 -0.2%/45th *Eaton Vance SMID Cap was funded on June 16, 2016 • Garcia Hamilton Fixed -0.4%/1 oth versus Barclays Int. Govt/Credit -1 .0%/55th • Vanguard Ultra Short Bond 0.2%/1Qth versus 91-Day Treasury Bill 0.4%/6th Allocation of Assets for the Quarter Ending March 31 , 2018 • Equity 65.4%- International 0.0%- Fixed Income 28.6%- Cash 6.0% Objectives and Policy Review • The total rate of return should equal or exceed the Consumer Price Index plus 5% over a rolling three-year period . Not Achieved 4.3% • The total rate of return should rank in the top half of the Wilshire Cooperative Public Fund Universe over a rolling three year period. Not Achieved goth • Each security class to exceed the appropriate selected unmanaged market index over a rolling three year period. • Garcia Hamilton- Fixed- Achieved 1.6% • Percentile Rank of Manager in Appropriate Universe Must Exceed the Median (50th percentile) • Garcia Hamilton Fixed Income- Achieved 39th • Percentile Rank of Manager in Appropriate Universe Must Place Within the Top Third (33 1/3 percentile). • Garcia Hamilton Fixed Income- Not Achieved 29th Garcia Hamilton did a very good job all the other managers are relatively new. Asset Allocation - Actual- Quarter Ending 3/31/18 Equity- Within Range 65.4% - Fixed Income- Within Range 28.6% -Cash- Within Range 6.0% Everything within range and no violations of policy. It was a relatively good quarter April and May so far up 1.7% City of Wilton Manors GE & Police Pension Board of Trustees Minutes - June 5, 2018 Page 6 of 6 John Small went over the Asset Allocation with the Board showing where changes need to be made. Estimated distribution for the quarter $700,000 and also for next quarter. Trustee Balistreri made the motion to approve John Small's recommendation , seconded by Trustee Pilch . Approved Unanimously John Small said he would notify Regions bank about the reallocation . It was also noted that there were two more retiree's receiving approximately $5,000 total to the distribution every month. John Small he will make a note of that for the future distribution . Attorney Levinson asked that a copy of the investment policy be sent to George Farrell. Attorney Levinson said a motion to accept the Southeastern Advisory quarterly report was in order. Trustee Bihus made the motion to accept the report, seconded by Trustee Pilch. Approved Unanimously Attorney Levinson told John Small when we are running low on the cash and money market account there would be no problem to coordinate with Judy, Joan and the Chair, because we don't want to run low on any particular quarter, so feel free to do that coordination. Attorney Levinson said there was an engagement letter from KSDT, auditors which needs the Boards approval for the audit to be prepared. It was noted that the Audit Fee is $10,875. KSDT has been doing the audit and everything seems to go smoothly during the time they prepare the audit. Bob Mays, Finance Director for the City said there was no problem on their end with KSDT. Acting Chair Bihus asked for a motion to approve signing the auditor's engagement letter for their services to do the audit. Trustee Balistreri made the motion authorizing Acting Chair Bihus to sign the engagement letter from the auditor's, seconded by Trustee Pilch. Approved Unanimously VIII. Joan Wall, Administrator None IX. Attorney Report 1. Reminder for Board Members to send their Form 1 Disclosure Forms 2. Memo from City about Sunshine Law Training - Board should attend this training 3. Contact Shawn Chadwick about filing his Form 1F and to follow up that it is completed X. Reports from Board Members None XI. Participant Section None XII. Adjournment Trustee Bihus made a motion to adjourn the meeting, seconded by Trustee Balistreri.