Loading...
HomeMy WebLinkAboutMinutes - 07/10/2012 - Police Pension BoardJuly 10, 2012 Police Pension Board of Trustees Meeting A meeting of the City of McHenry Police Pension Board of Trustees was called to order at 3:30 PM by President Jeffrey Foerster. Other board members present: Jon Meyer, Robert Roske, and Ormel Prust. Absent: Daniel Kreassig. Others present: Gary Karshna, Capital Gains, Inc.; Jim Schmidt, LPL Financial; Finance & Accounting Manager Carolyn Lynch; and recording secretary Marci Geraghty. Public Input None. Approval of Minutes Prust made a motion, seconded by Meyer to approve the minutes from the April 10, 2012 board meeting as presented and to hold them for audit. All ayes, motion carried. Consideration of Draft Board of Trustees Administrative Rules Foerster reported, as discussed at the last meeting board attorney Dick Puchalski's office was asked to prepare an Administrative Rules documents as required by state statute. A draft of the document was included in the meeting packets. Foerster noted a change on page 14 — state statute does not require the board to appoint a vice-president and assistant secretary — those positions will be eliminated from the document. Meyer inquired about the "Refund" policy indicated on page 35 of the document. Foerster stated the regulation is written in the document as mandated by state statute. The document outlines regulations and procedures for all functions of the police pension board including meetings, elections, investments, and hearings as highlighted below: ✓ A semi-annual review of executive session minutes shall be performed by the board. This will occur in January and July. ✓ A semi-annual review of the investment policy shall be performed by the board. This will occur in April and October. ✓ Designated time for Public Input is required on all meeting agendas. ✓ Pending legislation will require meeting notices to contain specific information about items scheduled for consideration. ✓ A roll call vote should be taken for all motions made by the board involving the expenditure of pension funds. Meyer made a motion, seconded by Roske to approve the Board of Trustees of McHenry Police Pension Fund Administrative Rules as amended. Ayes: Meyer, Prust, Foerster, Roske Absent: Kreassig Abstain: None Motion carried. Annual Election of Board Officers Board President: Roske nominated Jeffrey Foerster. Roske made a motion, seconded by Meyer to close nominations. All ayes, motion carried. Ayes: Meyer, Prust, Roske, Foerster Absent: Kreassig Abstain: None Motion carried. Board Secretary: Meyer nominated Robert Roske. Prust made a motion, seconded by Meyer to close nominations. Ayes: Meyer, Prust, Foerster, Roske Absent: Kreassig Abstain: None Motion carried. Roske made a motion, seconded by Prust to appoint Jeffrey Forester as Board President. Ayes: Meyer, Prust, Foerster, Roske Absent: Kreassig Abstain: None Motion carried. I-.- Meyer made a motion, seconded by Prust to appoint Robert Roske as Board Secretary. Ayes: Meyer, Prust, Foerster, Roske Absent: Kreassig Abstain: None Motion carried. It was the consensus of the board to appoint Jeffrey Foerster President and Robert Roske Secretary of the Police Pension Board of Trustees for 2012/13. Treasurer Report Lynch presented the Treasurer Report for the period ending June 30, 2012. Total value of cash and investments was $17,193,723.56. Lynch reported $595,000 was received from property taxes. Lynch recommended a possible investment of cash collected through property taxes be considered by the board at the next meeting. Motion by Meyer, seconded by Roske to approve the Treasurer Report for the period ending June 30, 2012 as presented and to hold it for audit. Ayes: Meyer, Prust, Foerster, Roske Absent: Kreassig `- Abstain: None Motion carried 2 Investments a) Capital Gains, Inc.: Gary Karshna provided a report on fixed income assets for the period ending June 30, 2012. He reported the fixed income portfolio is performing well. The low risk, high yield strategy is outperforming the benchmark Barclays Intermediate Government Bond Index over the past 12 months. The escalating sovereign debt crisis in Europe is creating uncertainty in the financial markets. During times of uncertainty, investors sell stocks and invest in US government bonds. We will continue to monitor the impact the European debt crisis may have on global financial markets and adjust the fixed income portfolio accordingly. In June, one muni bond and one corporate note matured producing $400,000 in cash for reinvestment. The proceeds were used to purchase a FNMA note with a 2.65% yield and two corporate notes with yields of 1.18% and 2.17% with final maturity dates of five months and five years respectively. Portfolio Market Valuation $9,027,409 Portfolio Book Valuation $8,799,937 Karshna stated the fund is positioned primarily in high yield, short term securities. As interest rates rise the market value of the fixed income securities in your portfolio declines. a) LPL Financial: Jim Schmidt of LPL Financial presented the equities report for the period ending June 30, 2012. Value of the fund is $7,739,647. Schmidt reported the Ivy Asset Strategy fund performed badly this period. With elections pending, there is not much potential to make money. Schmidt noted the current strategy is to buy and hold. American Funds continues to perform well and keep up with the world market. A comparison by fund was distributed to the board. The comparisons provided a breakdown of top equity holdings for each fund along with geographic breakdown by region, sector breakdown of equities, and average annual total returns. Application for Participation in Police Pension Fund Newly hired officer Ryan Lusmann filed an application to join the police pension fund. Lusmann was hired on June 25, 2012 and is currently attend the Suburban Law Enforcement Academy. Roske made a motion, seconded by Meyer to approve the application as presented. Ayes: Meyer, Prust, Foerster, Roske Absent: Kreassig Abstain: None Motion carried. Approval of Annual Pension Increases Annual pension increases as regulated by state statute were presented to the board for approval for retired officers William Brogan and Jeffrey Foerster. �— President Foerster called for a roll call vote. Meyer aye Roske aye 3 Prust aye Kreassig absent Foerster abstain Motion carried. Consideration of Investment Strategies This matter was tabled. Consideration of Fiduciary Liability Insurance As reported at the April meeting, Foerster obtained quotes from additional vendors to compare coverages for Fiduciary Liability Insurance. After some discussion, it was the consensus of the board to authorize a contract with Mesirow Financial for Fiduciary Liability Insurance through ULLICO Labor Protection Group effective 8/1/12 for the annual fee of $3,900. President Foerster called for a roll call vote: Roske aye Prust aye Foerster aye Meyer aye Kreassig absent Motion carried. Public Pension Training Update Trustee Prust has four hours of state mandated training to complete. The board discussed various options for which training can be completed. One option is to log into the IIFA members center (www.IPPFA.org) and select presentations. PowerPoint presentations and videos from past conference and seminars are available for review on the site and count towards training credits. Semi -Annual Review of Executive Session Minutes Foerster reported Board Attorney Puchalski does not authorize release of executive session minutes at this time due to current/pending litigation. Roske made a motion, seconded by Meyer to accept the recommendation from board counsel not to release executive session at this time. Ayes: Meyer, Prust, Foerster, Roske Absent: Kreassig Abstain: None Motion carried. Escbach Application for Disability Appeal Update Foerster reported there was nothing to report at this time. The case is still pending in the Appeals Court. 11 Bills for Approval Meyer made a motion, seconded by Roske to approve the following bills as presented: Illinois State Compliance Fee: $3,375 Capital Gains: $4,941 President Foerster called for a roll call vote: Prust aye Foerster aye Meyer aye Roske aye Kreassig absent Motion carried. Adjournment Roske made a motion, seconded by Meyer to adjourn the meeting. Ayes: Meyer, Prust, Foerster, Roske Absent: Kreassig Abstain: None Motion carried. The meeting was adjourned at 4:32 PM. Next meeting is October 9, 2012. Respectfully submitted, A I Marci Geraghty Recording Secretary 5