HomeMy Public PortalAbout2022-03-01_Pol and Fire Meeting_MinutesCITY OF CRESTVI EW
POLICE OFFICERS' El FIREFIGHTERS' EMPLOYEES PENSION TRUST FUND
PENSION BOARD OF Ti;'USTEES
QUARTERLY MEETING MINUTES
198 N. Wilson Street
Crestview, FL 32536
TRUSTEES PRESENT:
Tuesday, March 1, 2022, at 2:30pm
Andrew Schneider, Chair
Corey Winkler, Secretary
Ellis Conner
David Griggs
Dan Krusenklaus
FRUSTEES ABSENT: None
OTHERS PRESENT:
Tyler Grumbles, AndCo Consulting
Stu Kaufman, Klausner, Kaufman, Jensen, & Levinson
Drew Ballard, Foster & Foster
Kim Kilgore, Foster & Foster
Justin Hildebrand, Agincourt Capital Management
Pat O'Hara, Agincourt Capital Management
1. CaII to Order — Andrew Schneider called the meeting to order at 2:30pm.
2. Roll Call -- As reflected above.
3. Welcome to new Trustee
a. Dan Krusenklaus, Commission appointed trustee
i. Dan Krusenklaus introduced himself to the board.
4. Public Comments — None.
5. Approval of Minutes
a. November 30, 2021, quarterly meeting
The minutes from the November 30. 2021, quarterly meeting were approved, upon motion by David
Griggs and second by Ellis Conner: motion carried 5-0.
6. Reports (Attorney/Consultants)
a. Agincourt Capital Management, Justin Hildebrand and Pat O'Hara, investment Manager
i. Quarterly report as of December 31, 2021
1. Pat O'Hara introduced himself to the board. Pat gave an overview of the
firm and team makeup, commenting they manage over $7.8 billion in
investments.
2. Pat O'Hara reviewed their current clients commenting $500 million in
assets were added last year.
3. Pat O'Hara reviewed the Treasury Yield Curve (TYC) which summarized
the negative total returns across for all maturities especially the longer
maturity bonds.
4. Pat O'Hara commented the lower end of quality bonds did the best last
year and so far, this year higher quality bonds were doing the best.
5. Pat O'Hara commented the current portfolio value was $7,020,974 at the
end of the quarter.
6. Pat O'Hara review the investment performance. The gross earnings for
the quarter were -0.44% outperforming the benchmark of -0.51%. The
trailing returns for the 1, 3, 5, 7 and 10-year periods were-1.28%, 4.12%,
3.24%, 2.91%, and 2.92°I0. Since inception (6/30/2007) returns were
4.14%, outperforming the policy benchmark of 3.63%.
7. Pat O'Hara commented the underperformance happened mainly during
the first quarter of last year.
8. Justin Hildebrand reviewed the investment process on setting up their
investment strategies. Justin reviewed the sector management, security
selection and yield curve/duration management. Justin commented the
portfolio characteristics yield advantage with high quality bonds,
diversified and lower volatility. Justin further commented the strategy had
a defensive duration for the portfolio.
9. Justin Hildebrand reviewed the macro factor analysis, corporate
sector/rating, sector overweight/underweight and mortgage sector
analysis.
10. Justin Hildebrand reviewed the investment strategy overview.
11. Dan Krusenklaus asked about the current loss to the fund. Pat O'Hara
commented they were looking forward to higher yields. Pat further
commented unfortunately this past year was tough and was now dealing
with the war in Ukraine and interest rates going up,
b. AndCo Consulting, Tyler Grumbles, Investment Consultant
i. Quarterly report as of December 31, 2021
1. Tyler Grumbles reviewed his role as the investment consultant for the
Fund. Tyler commented they recommend on how and what to invest in
and find investment managers for the Board to considered. Tyler stated
they charge a flat fee, and they had no fee arrangements with the
investment managers in the Fund's portfolio.
2. Tyler Grumbles reviewed the firm makeup and commented they had
currently $123 billion in advisement with the bulk of their business with
public pension plans. Tyler commented AndCo reinvested 100% of their
profit back into the company.
3. Tyler Grumbles reviewed the market environment during the past quarter
commenting only a few stocks did very well during the quarter and the rest
of the market did ok.
4. Tyler Grumbles reviewed the Treasury Yield Curve showing short-term
bonds went up and longer -term bonds stayed flat or went down.
5. The market value of assets was $28,187,082. The asset allocation by
asset class for the fund was Domestic Equity at 42.60%, International
Equity at 13.70%, Domestic Fixed at 24.90%, Non -Core Fixed at 4.70%,
Infrastructure at 3.60%, Real Estate at 8.20%, and Cash at 2.30%. Tyler
Grumbles commented how the Investment Policy Statement (IPS) keeps
them in line for their long-term goal.
6. Tyler reviewed the financial reconciliation for the quarter with around a
$1.2 million gain.
7. The gross earnings for the quarter were 4.63% underperforming the
benchmark of 5.03%. The trailing returns for the 1, 3, 4, and 5-year periods
were 14.46%, 15.68%, 10.41%, and 11.40%. Since inception (10/01/1994)
returns were 8.24%, outperforming the policy benchmark of 8.30%.
8. Tyler Grumbles reviewed each of the investment managers performance
and commented the need to watch their longer period performance.
Investment Policy Statement update
1. Tyler Grumbles commented the only change made to the current IPS was
the assumed rate of return would not be shown as an actual percentage
to eliminate the updates needed every time the rate changed.
The Board voted to approve the Investment Policy Statement as presented. upon motion by Corey
Winkler and second by David Griggs; motion carved 5-0.
2. Stu Kaufman stated the IPS would need to be filed with the State. Kim
Kilgore commented she would take care of this.
c. Foster & Foster, Drew Ballard, Board Actuary
i. Actuarial services fee letter
1. Drew Ballard reviewed his role as the actuary and commented his job was
to calculate the cost to fund the benefits of the Plan. Drew looked at the
core services provided, current charges and fees needing to be increased.
Drew reviewed the only time the Actuary used the hourly rate fee was for
an item other than the regular services they provided. Drew further
commented all service items including the hourly rates listed would be
adjusted annually based on the Consumer Price Index for All Urban
Customers (CPI-U) rate. Drew stated the proposed changes would be
effective October 1, 2022, and first adjustment for CPI-U would be
effective on October 1, 2023.
The Board voted to approve the increase in actuarial fees as presented, upon motion by Corey
Winkler and second by David Griggs; motion carried 5-0.
2. Stu Kaufman commented he would produce the fee addendum for the
Chair to sign.
d. Klausner, Kaufman, Jensen, & Levinson, Stu Kaufman, Board Attorney
i. Legal/Legislation updates
1. Stu Kaufman commented he represented public plans and reviewed his
role as the attorney for the plan.
ii. Special Tax Notice update
1. Stu Kaufman reviewed the Special Tax Notice given to members who
received a lump sum disbursement from the Fund. Stu commented the
required minimum distribution age was raised by the Fed to age 72. Stu
also reviewed the exceptions to the 10% additional income tax on early
distributions of retirement funds. Stu commented a public safety officer
would need to be at least Age 50 at the time of separation from
employment to receive an exception to the 10% additional income tax on
lump sum disbursements.
iii. Legislative update
1. Stu Kaufman commented the legislation session would end on March 11th
and no bills had passed affecting pension plans.
2. Stu Kaufman reviewed pending legislation that would make COVID an
ILOD disability presumption. Stu commented the bill did not make it out of
committee, so it did not pass.
3. Stu Kaufman commented the Florida Retirement System changed the
DROP period for Special Risk from 5 to 8 years and the State was
expected to approve.
4. Stu Kaufman briefly reviewed a bill related to PTSD and Workers'
Compensation with PTSD claims. Stu commented PTSD claims would
have to be filed within 60 days from the time diagnosed.
5. Stu Kaufman commented a disability application had been received by his
office for Frank Van Schmidt. Stu reviewed the disability process and when
the board would determine if the disability was permanent and if the
member was totally disabled to do his job as a police officer. Stu
commented once all medical records and documents were received, he
would bring them to the board to review.
6. Stu Kaufman reviewed the Sunshine Law and fiduciary duties of the
trustees of the Fund.
7. New Business
a. Andrew Schneider commented some municipalities had opted out of the Social Security
plan and could that be an option for the City of Crestview. Stu Kaufman commented once
you opt into the Social Security plan you could not opt out.
8. Old Business — None.
9. Consent Agenda
a. Payment ratification — Warrants #17 and #18
b. Invoices for approval — None
c. Fund activity report for November 24, 2021, through February 22, 2022
The Board voted to approve the Consent Agenda as presented. upon motion by Ellis Conner and,
second by Corey Winkler: motion carried 5-0.
10. Staff Reports. Discussion and Action
a. Foster & Foster, Kim Kilgore, Plan Administrator
i. Kim Kilgore reviewed the upcoming educational opportunities available to the
Board. Kim commented the FPPTA Annual Conference would be held June 26-
29, 2022, in Orlando, Florida.
11. Trustee Reports. Discussion and Action — None.
12. Adiournment - The meeting adjourned at 3:56pm.
13. Next Meeting — June 7, 2022, at 2:30pm.
Re ctfully subitted by:
4.4_5�-
Kilgori `Ian : ministrator ndrew Scyi'neider, Chair
Date Approved by the Pension Board:
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