HomeMy WebLinkAboutMinutes - 1/11/2022 - Police Pension BoardPolice Pension Board of Trustees
Regular Meeting Minutes
January 11, 2022
Call to Order
The regular meeting of the City of McHenry Police Pension Board of Trustees was called to order at 9:00
a.m. remotely via Zoom due to the COVID-19 pandemic.
Roll call:
Members present: President Jeffery Foerster, Cheryl Kranz, Officer Robert Beaudoin, Thomas Settles.
Members absent: Sergeant Nick Clesen. Others present: Monte Johnson, Carolyn Lynch, Gary Karshna,
James Schmidt.
Public Input:
No members of the public were present to offer comments.
Approve the October 12, 2021, meeting minutes; and the Special Meeting from May 10, 2019; and the
Special Meeting from December 16, 2021
A motion was made by Tom Settles and seconded by Cheryl Kranz to approve the minutes from October
12, 2021; May 10, 2019; and December 16, 2021. Roll Call Vote: 4-ayes: Jeff Foerster, Cheryl Kranz,
Officer Beaudoin, Thomas Settles. 1-Sergeant Clesen. Motion carried.
Presentation and motion to approve the Treasurer’s Report
City Treasurer Caroly Lynch explained that the value of the pension fund is now at $64.9 milliion. WE
have received all of the proeprty taxes due, which now only accounts for $640,000. A motion was made
by Tom Settles and seconded by Officer Beaudoin to approve the Treasurer’s Report as presented. Roll
Call Vote: 4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin, Thomas Settles. 1-Sergeant Clesen.
Motion carried.
LPL Financial Equities Report
Jim Schmidt reported that the markets have done well. Returns for 2021 were at 19.49%, which is an
increase of $7,380,463. Mr. Schmidt thanked the Board for trusting him with the funds for the last 25
years. He offered to volunteer on the Board moving forward as the State takes over the funds. Mr.
Settles asked how our return compared to the S&P, and it was noted that we did better some years and
not as good in other years, but overall we we weren’t as high because we had 25% in the international
markets, which were outpaced by tehe US markets for the last 20 years.
Capital Gains, Inc. Fixed Assets Report
Mr. Karshna reported that the returns for the fiscal year are about .46% with a book value of .80%. The
last twelve month has us sitting at .21%. Our total market value is at $17,296,327. He explained that the
bond markets should be improving as inflation and interest rates rise. Mr. Karshna also thanked the
board for the last 18 years and apprecaites that this has worked out for his business and for the pension
fund.
Approve Pension Increases
A motion was made by Cheryl Kranz and seconded by Tom Settles to approve the pension inceases as
prsented. Roll Call Vote: 4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin, Thomas Settles. 1-
Sergeant Clesen. Motion carried.
Approve portability request of Officer Zajac
Officer Zajac qualified to have her pension brought over day-to-day and nothing is owed to the pension
fund. A motion was made by Tom Settles and seconded by Officer Beaudoin to approve the portability
request of Officer Zajac. Roll Call Vote: 4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin, Thomas
Settles. 1-Sergeant Clesen. Motion carried.
Approve pension repayment plan for Officer Hernandez
Officer Hernandez had 39 days of unpaid leave, which can be paid to the pension fund to keep the time
missed. There is $811.20 owed to the fund, and it is proposed for an initial payment of $111.20 with
additional $100 payments until the amount is paid off. A motion was made by Cheryl Kranz and
seconded by Tom Settles to approve the pension repayment plan for Officer Hernandez. Roll Call Vote:
4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin, Thomas Settles. 1-Sergeant Clesen. Motion carried.
Approve the pension application of Zachary Diebold.
A motion was made by Tom Settles and seconded by Officer Beaudoin to approve the pension
application of Zachary Diebold. Roll Call Vote: 4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin,
Thomas Settles. 1-Sergeant Clesen. Motion carried.
Approve the lump sum payout of $49,424.70 to Mary Lee Eschbach
Ms. Eschbach left the pension system and is entitled to her contributions with no interest paid. A motion
was made by Tom Settles and seconded by Officer Beaudoin to approve the lump sum payout of
$49,424.70 to Mary Lee Eschbach. Roll Call Vote: 4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin,
Thomas Settles. 1-Sergeant Clesen. Motion carried.
Approve the disability pension of Sergeant Lumber
A motion was made by Cheryl Kranz and seconded by Tom Settles to approve the disability pension of
Sergeant Lumber. Roll Call Vote: 4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin, Thomas Settles.
1-Sergeant Clesen. Motion carried.
Motion to approve the payment of bills
Board members were sent a copy of the bills that are due and President Foerster read those bills aloud.
A motion was made by Tom Settles and seconded by Officer Beaudoin to approve the payment of bills
as presented. Roll Call Vote: 4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin, Thomas Settles. 1-
Sergeant Clesen. Motion carried.
Public Pension Trustee Training Update.
Cheryl Kranz is the only member left that needs to complete the training which must be done by April
31st.
Review and possible approval of IPOPIF Exhibit A Resolution Appoining Authorized Agents
President Foerster suggested that he and Sergeant Clesen be the authorized agents since they are
available at City Hall during normal business hours. The authorized agents are who the IPOPIF would
contact for handling issues with the new pension fund. A motion was made by Officer Beaudoin and
seconded by Cheryl Kranz to pass Exhibit A – A Resolution Appointing Authorized Agents with Jeff
Foerster and Sergeant Clesen the authorized agents. Roll Call Vote: 4-ayes: Jeff Foerster, Cheryl Kranz,
Officer Beaudoin, Thomas Settles. 1-Sergeant Clesen. Motion carried.
Review and possible aproval of IPOPIF Exhibit B Notice regarding Transfer of Investment Assets to the
Police Officers’ Pension Investment Fund
President Foerster reported that he talked to Laura Goodloe and she advised that we turn funds over to
the IPOPIF as requested on March 1st. There don’t appear to be any penalties for not doing so and there
is nothing that obligates us by statute. She suggests that the current lawsuits fighting against the fund
will not hold muster or pass, and that we would be delayinig the inevitable. We also are not a party in
the lawsuit even if it were to win. If the lawsuit held up, then assets turned over would probably be
liquidated and brought back as cash.
Mr. Karshna explained his issues with turning the money over now, and believes it would be best to hold
off until absolutely necessary. He worries that if money were to be returned to us and the market was
bad, then we could be in trouble or stuck holding cash that we wouldn’t want to invest. Cheryl Kranz
asked what other boards were doing ,and Mr. Foerster explained that most fire boards have turned their
money over, but we would be in the first group of police pension boards to begin. Nobody from the
police side starts until March 1st. Officer Beaudoin and Tom Settles stated that they want to wait until
absolutely necessary to turn over the funds, and they aren’t ready to do so on March 1st.
Exhibit B is the letter that we would send to the new fund declaring the date we intend to pass over the
funds. They have requested that date be March 1st, but the majority of the McHenry Police Pension
Boad do no agree with that timeline. A motion was made by Tom Settles and seconded by Officer
Beaudoin to wait until a future date to give notice of transfer of investments to the IPOPIF. Roll Call
Vote: 4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin, Thomas Settles. 1-Sergeant Clesen. Motion
carried.
Motion to approve a transfer of funds from equities or fixed assets by February 17 to reach a cash
balance of $1 million
Due to the previous motion to not turn assets over by March 1st, the pension board no longer needs to
transfer funds to reach a cash balance of $1 milliion. Treasurer Lynch does need, however, $600,000 to
pay bills through March and until the next pension board meeting on April 12th. A motion was made by
Tom Settles and seconded by Cheryl Kranz to aprove a transfer of funds from equities or fixed assets to
achieve a balance of $600,000 for the payment of bills. Roll Call Vote: 4-ayes: Jeff Foerster, Cheryl
Kranz, Officer Beaudoin, Thomas Settles. 1-Sergeant Clesen. Motion carried.
Semi-Annual Review of Executive Session Minutes
There is only one set of executive session minutes that has not yet been approved or released, and that
is of the recent hearing for Sergeant Lumber. No action will be taken on this set of minutes until the
next release date.
Additional Items for Discussion
President Foerster announced that he will contact the IPOPF to notify them that we will not turn over
funds by March 1st. Cheryl Kranz and Tom Settles will stop by the Police Department to sign the order for
Sergeant Lumber’s disability. If another meeting is needed prior to April for transferring funds to the
IPOPF, a special meeting might be called.
Motion to Adjourn
A motion was made by Tom Settles and seconded by Cheryl Kranz to adjourn at 9:58 a.m. Roll Call Vote:
4-ayes: Jeff Foerster, Cheryl Kranz, Officer Beaudoin, Thomas Settles. 1-Sergeant Clesen. Motion carried.
______________________________
Monte Johnson, Recording Secretary