Loading...
HomeMy Public PortalAbout2021-06-08_Pol Fire Meeting_MinutesCITY OF CRESTVIEW POLICE OFFICERS' & FIREFIGHTERS' EMPLOYEES PENSION TRUST FUND PENSION BOARD OF TRUSTEES QUARTERLY MEETING MINUTES 198 N. Wilson Street Crestview, FL 32536 TRUSTEES PRESENT: Tuesday, June 8, 2021, at 2:30pm Andrew Schneider David Griggs Corey Winkler Ellis Conner TRUSTEES ABSENT: None OTHERS PRESENT: Drew Ballard, Foster & Foster Tyler Grumbles, AndCo Consulting Stu Kaufman, Klausner, Kaufman, Jen,��,,� Kim Kilgore, Foster & Foster Gina Toussaint, City Finance Director 1. Call to Order — Andrew Schneider called the meeting to order at 2:30pm. 2. Roll Call — As reflected above. 3. Public Comments — None. 4. Approval of Minutes a. Kim Kilgore commented the prior administrator would be completing the drafted meeting minutes for the September 1, 2020, December 1, 2020, and March 2, 2021 board meetings to present at the next meeting for approval. 5. Reports (Attornev/Consultants) a. Foster & Foster, Drew Ballard, Board Actuary i. October 1, 2020 Actuarial Valuation Report 1. Drew Ballard stated the contribution amounts presented in the report were for fiscal year ending September 30, 2022. 2. Drew Ballard reviewed the minimum required contribution (MRC) as of percentage of projected annual payroll had increased from previous valuation from 22.70% to 23.90%. Drew further commented the City's required contribution increased from 11.50% to 12.70%. Drew noted the City had access to a prepaid contribution of $97,593.67 which would be available to offset a portion of the stated required contribution for fiscal year ending September 30, 2021. 3. Drew Ballard commented the increase in the MRC was primarily attributed to unfavorable plan experience of less turnover than expected, unfavorable retirement experiences and a non -vested member being granted disability retirement. Drew further commented the losses were offset by gains associated with inactive mortality experience, an average salary increase of 5.98% which fell short of the 6.13% assumption, and an investment return of 7.42% (Actuarial Asset Basis) which exceeded the 7.25% assumption. 4. Drew Ballard reviewed the mutual consent agreement between the City and plan membership for the State annual premium tax distributions with the City retaining the first $192,522.69 of distribution and an additional 25% of any amount in excess of the 1 $192,522.69 with the remaining excess to be transferred to the Share Plan. 5. Drew Ballard reviewed the State mandated change in the assumed rates of mortality to the rates used by Florida Retirement System valuation report for special risk employees. 3. Drew Ballard commented the fund's total asset market value was $22,161,327 and liability was $30,919,797 as of October 1, 2020. 7. Drew Ballard reviewed the minimum required contribution of 23.90% of total annual payroll was the sum of the normal cost of 18.30%, administrative expenses of 1.40% and the unfunded actuarial accrued liability (UAAL) payment of 4.20%. 8. Drew Ballard stated the UAAL balance as of October 1. 2020 was $2,267,496 with an annual payment due of $194,367. Drew Ballard reviewed the fund's history of funding progress for the past 10 years with current funded ratio of 89.10% 10. Drew Ballard stated the need to review the plan's assumptions every 3 to 5 years for adjustments needed. Drew further stated the last experience study performed for the plan was in 2016. Drew recommended to perform an experience study which would cost $7,500 to complete. The board approved for the actuary to complete an experience study as recommended by the actuary, upon motion by Corey Winkler and second by David Griggs; motion carried 4- 0. The board approved the October 1, 2020 actuarial valuation as presented, upon motion bv Corey Winkler and second by David Griggs; motion carried 4-0. The Board voted the Declaration of Returns for the Plan shall be 7.25% for the next year, the next several years, and the long-term. thereafter net of investment related expenses, upon motion by Ellis Conner and second by Corey Winkler; motion carried 4-0. ii. Online Member Portal demo 1. Drew Ballard gave a brief overview of the purpose of the portal and requested the plan administrator explain the process for members getting estimate and final benefit calculations. Kim Kilgore reviewed the process of having benefit calculations prepared for members and the time it takes. 2. Drew Ballard presented a live demo of the Foster & Foster portal and commented it was very customizable and user friendly. 3. Drew Ballard reviewed the benefits of the portal for the members and the administrator. 4. Drew Ballard commented the one-time implementation fee was $7,500 and the annual fee would be $8,500 for annual payroll updates or $12,500 for weekly payroll updates. Drew commented they would offer a 10% discount on the annual fee if the General Employees' Plan subscribed to the portal also. 5. The Trustees discussed the fees and the benefits to the membership. The Trustees would like to survey the membership to find out if they would utilize. Corey Winkler stated he would send a survey to the members of the plan. b. AndCo Consulting, Tyler Grumbles, Investment Consultant i. Quarterly Report as of March 31, 2021 1. Tyler Grumbles reviewed the market environment during the past quarter. 2. The asset allocation by asset class for the fund was Domestic Equity at 51.60%, International Equity at 13.30%, Domestic Fixed at 20.20%, Non -Core Fixed at 4.30%, Real Estate at 7.90%, and Cash at 2.70%. 2 3. Tyler Grumbles stated the Domestic Equity asset class was outside of the policy target and needed to be rebalanced back to target. The board approved for the Domestic Equity investments to be rebalanced back to target per the Investment Policy Statement (IPS), upon motion by Corey Winkler ad second by David Griggs; motion carried 4-0. The board approved to rebalance all asset classes back to target per the IPS, upon motion by Corey Winkler and second by David Griggs; motion carried 4-0. 4. Tyler Grumbles reviewed the financial reconciliation from the previous quarter with a beginning market value of $24,389,751 on January 1, 2021 and ending market value of $25,273,579 on March 31, 2021. Tyler further reviewed the financial reconciliation for the fiscal year with a beginning market value of $22,032,191 and ending market value of $25,273,579 as of March 31, 2021. 5. Gross earnings for the quarter were 3.61% outperforming the benchmark of 3.15%. The trailing returns for the FYTD, 1, 3, 4, and 5-year periods were 13.53%, 35.07%, 10.43%, 10.39%, and 10.46%. Since inception (10/01/1994) returns were 8.07%, underperforming the policy benchmark of 8.12%. 6. Tyler Grumbles reviewed each of the investment performance during the past quarter and commented Templeton Global had been struggling with trying to predict interest rates and then COVID caught them off guard. Tyler recommended on replacing Templeton Global. 7. Tyler Grumbles commented the rest of investments overall had been performing very well for the plan. ii. Multisector Bond Search 1. Tyler Grumbles reviewed the investment options to replace the Templeton Global Total Return Fund. Tyler presented the strategy investment names of Brandywine Global — Global Opportunities Bond IS, Loomis Sayles Bond N, and PIMCO Diversified Income Institutional. 2. Tyler Grumbles reviewed the management fees and investment minimums of each investment manager presented. 3. Tyler Grumbles reviewed the firm, strategy, team, and portfolio construction information on each investment presented for consideration. 4. Tyler Grumbles reviewed the current composition, statistics and sector allocation and the trailing performance and rankings of each of the investment managers presented. 5. Tyler Grumbles recommended PIMCO Diversified Income Institutional to be considered to replace Templeton Global Total Return due to much more of diversity approach without currency risk. The board voted to approve the replacement of the Templeton Global Total Return investment with PIMCO Diversified Income Institutional as recommended, upon motion by David Griggs and second by Ellis Conner; motion carried 4-0. c. Klausner, Kaufman, Jensen, & Levinson, Stu Kaufman, Board Attorney i. Records Management Liaison Officer (RMLO) Designation 1. Stu Kaufman reviewed the role of the Records Manager Liaison Officer for the plan and recommended the Plan Administrator Foster & Foster to fill this role. 3 The board designated the RMLO to be Foster & Foster. upon motion by Ellis Conner and second by David Griggs; motion carried 4-0. ii. Policy regarding contractual provisions for investment managers 1. Stu Kaufman commented his firm put together a policy for contractual provisions for investment managers. Stu commented he wanted to provide a document to all newly hired managers that outlined the provisions they would need to agree to in order to work with the Board. Stu reviewed each of the items which would be included in the policy. Stu confirmed the policy would not change any existing contracts. The board approved the policy regarding contractual investment managers as presented, upon motion by Ellis Conner and second by Corev Winkler; motion carried 4-0. iii. Updated Summary Plan Description (SPD) 1. Stu Kaufman reviewed the SPD was required to be updated and distributed to the members every two years. 2. Stu Kaufman reviewed the main changes were the cancer presumption provisions, maximum benefit per year increase to $230,000 and removal amount of days to file claims procedure before the board. The board approved the Summary Plan Description as presented, upon motion by Corey. Winkler and second by David Griggs; motion carried 4-0. iv. Financial Disclosure Forms 1. Stu Kaufman reminded the trustees their annual financial disclosures were due July 1 S' and any penalties for late filing would be paid by the trustee not the pension fund. v. Legislative Updates 1. Stu Kaufman commented there were no bills passed that impacted pension funds. Stu briefly reviewed SB84 which proposed closing the FRS defined benefit plan to future general employees which did not pass. 6. New Business a. Election of Fifth Trustee i. Kim Kilgore commented Corey Winkler's term on the board had expired October 27, 2020 and she could not find record of his reappointment. The board voted to elect Corey Winkler as the fifth trustee, upon motion by David Griggs and second by Ellis Conner; motion carried 3-0. b. Discussion of vacant Trustee seat, City appointed i. Kim Kilgore commented the City was still searching for a trustee to fill the vacant City appointed position on the board 7. Old Business — None. 8. Consent Agenda a. Payment ratification — Warrants #10 b. Invoices for approval — None c. Fund activity report for April 1, 2021 — June 1, 2021 The Board voted to approve the Consent Agenda as presented, upon motion by Corev Winkler and second by Ellis Conner; motion carried 4-0. The board voted to obtain one signature for authorization with Fifth Third Bank. upon motion by David Griggs and second by Ellis Conner; motioned carried 4-0. 4 10. Staff Reports, Discussion and Action a. Foster & Foster, Kim Kilgore, Plan Administrator i. Plan administration transition 1. Kim Kilgore reviewed the current administrator to Foster & Foster. Kim picking up member records and administrator tomorrow to discuss any ii. Cyber Liability Insurance renewal 1. Kim Kilgore stated the cyber insurance policy with Lloyds of London had increase in annual premium to $8,089.00. By consensus the board agreed not to renew the cyber policy with Lloyds of London due to the increase in cost. iii. SB534 posting requirements 1. Kim Kilgore stated the SB534 State required postings have been published to the City's website. iv. Upcoming educational opportunities 1. Kim Kilgore reviewed the upcoming FFPTA 37TH Annual Conference was on June 27th through the 30th in Orlando, FL. Kim commented she would register the trustees for the conference if they were interested in attending. 11. Trustee Reports, Discussion and Action — None. 12. Adiournment - The meeting adjourned at 3:55pm. 13. Next Meeting — August 31, 2021, at 2:30pm. Re cffully submitted by: Kilg.r-, P;.n Administrator Date Approved by the Pension Board: Appr ndrewv S hneider, Chairman transition from the prior commented she would be meeting with the prior pending items needed. g1131,bogi 5