CIVILIAN AND POLICE PENSION BOARDS
The Civilian and Police Pension Boards met on August 29, 2006 at 1:30 p.m. with Chairman Mullaney and Chairman Ruane presiding. Members present were Ret. Lt. Knotts, Ret. Capt. Gray, Mr. DePrima, Mr.Hogan, Mr. Ruane, Mrs. Mitchell, Mrs. McMaster (arrived 2:09 p.m.), Mr. Lucas, and Mrs. Rigby. Chief Horvath was absent.
AGENDA ADDITIONS/DELETIONS
Mr. Lucas requested the addition of Item #2, Discussion of the 2006 Civilian Pension Board Election.
Mrs. Rigby moved for approval of the agenda, as amended, seconded by Mr. Hogan and unanimously carried.
Quarterly Performance - Presented by Michael Shone of Peirce Park Group
Mr. Shone of Peirce Park Group provided members the Quarterly Investment Performance Analysis, as of June 30, 2006. He noted that for the past three years stocks have done very well. Mr. Shone explained the various investment strategies and reviewed the Asset Growth Summary Statement (Attachment #1) and the Performance Summaries (Attachment #2) for the General Employees and Police Funds, as follows:
GENERAL EMPLOYEES FUND
TOTAL FUND POLICY INDEX
Quarter Return (0.7%) (0.8%)
1 Year Return 11.3% 8.7%
3 Years Return 9.1% 9.0%
5 Years Return 2.9% 4.4%
Total Assets $15,681,591
POLICE FUND
TOTAL FUND POLICY INDEX
Quarter Return (0.9%) (0.8%)
1 Year Return 11.3% 8.7%
3 Years Return 8.9% 9.0%
5 Years Return 2.8% 4.4%
Total Assets $12,175,222
Mr. Shone observed that, due to stocks outperforming bonds, the funds were now allocated 70% stocks and 30% bonds. Mr. Shone recommended that the portfolio be re-balanced to reflect the target allocation of 65% stocks and 35% bonds.
Mr. Hogan moved to re-balance the asset allocation to a target allocation for the Employee Pension Fund based upon Mr. Shone’s recommendations. The motion was seconded by Mr. Lucas and unanimously carried.
Mr. Shone stated that during the asset allocation study, which was completed three years ago, the parameters initially chosen were 65%/35% with the 35% benchmarked as Intermediate Bonds. Then it was decided to benchmark the bonds to half intermediate and half short which caused the allocation among the VanGuard Bonds to be 5% Intermediate Bond Fund and 30% Short Term Bond Fund. Mr. Shone recommended returning to the original 35% Intermediate benchmark. This would be accomplished with 25% VanGuard Short Term Bond Fund and 10% Intermediate Bond Fund.
Mr. Shone indicated that the City pension funds were the second best performing of a total of sixteen clients and tied for the lowest fees on a percentage basis. Usually the fees average about .42%, whereas the city’s fees average .29%.
Mr. Hogan moved to re-balance the asset allocation to a target allocation for the Police Pension Fund based upon Mr. Shone’s recommendations. The motion was seconded by Ret. Lt. Knotts and unanimously carried.
Mr. Hogan moved to place the discussion of reallocating the target allocation for bonds on the next Police Pension Board meeting agenda. The motion was seconded by Ret. Lt. Knotts and unanimously carried.
Investments 101- Presented by Michael Shone of Peirce Park Group
Mr. Shone provided members with a detailed presentation which will be used as a re-education tool regarding the definitions of investment terms.
It was the consensus of members to table the balance of this presentation until the next meeting due to time constraints.
Mr. Hogan moved for adjournment of the Police Pension Board, seconded by Ret. Capt Gray and unanimously carried.
Police Pension Board meeting adjourned at 2:51 P.M.
Discussion of 2006 Civilian Pension Board Election
Responding to Mr. Ruane, Mrs. Traci A. McDowell, City Clerk, indicated that the current City Code stated that all eligible participants should be notified five days in advance of an election. In previous years, a notice was either posted at various locations or included as an insert with their pension checks. This notice would indicated that a term was expiring, the deadline to file for this term, and the dates, times, and locations to cast a ballot. During the voting process, all voters are recorded to ensure that the individuals are eligible to cast a ballot.
Mrs. McDowell stated that the notices for this election were mailed to retirees separately due to time constraints. The City Clerk’s Office completed two mailings from lists that were provided by another department and fifteen (15) of these notices, out of approximately 130, came back to the City Clerk’s Office due to wrong addresses. She stated that four (4) participants of the pension plan filed for the position.
Responding to Mr. Ruane, Mr. Lucas stated that Mrs. Pat Braun, a former board member, and a few other pension participants indicated that they did not receive a notice regarding the election and believe that the election should be held over again.
Mrs. Mitchell stated that the Human Resources Department has offered to supply mailing labels to the City Clerk’s Office for another mailing.
Mr. DePrima moved to recommend that the Civilian Pension Election be held again, seconded by Mr. Lucas and unanimously carried.
Responding to Mrs. McMaster, Mrs. McDowell stated that a list of eligible voters will be available in the City Clerk’s Office.
Mr. DePrima moved for adjournment of the Civilian Pension Board, seconded by Mr. Lucas and unanimously carried.
Civilian Pension Board meeting adjourned at 3:07 P.M.
Respectfully submitted,
Timothy Mullaney Eugene B. Ruane
Chairman - Police Pension Board Chairman - Civilian Pension Board
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S:ClerksOfficeAgendas&MinutesMisc-MinutesPENSION2006