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HomeMy WebLinkAbout2010 01 26 Consent 201 Approval Of The November 18, 2009 Special Meeting Minutes CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING NOVEMBER 18, 2009 CALL TO ORDER The Board of Trustees Special Meeting of Wednesday, November 18, 2009, was called to Order at 6:31 p.m. by Chairperson Maria Fair in the Commission Chambers of the Municipal Building (City Hall, 1126 East State Road 434, Winter Springs, Florida 32708). Roll Call: Chairperson Maria Fair, present Vice Chairman Vernon Rozelle, Jr., arrived via telephone call at 6:47 p.m. ..r"a Board Member Ben McMahan, present it_a Board Member Max Swaim, present Board Member Barbara Watkins, present via telephone call The Invocation and Pledge of Allegiance was led by Chairperson Fair. PUBLIC INPUT No one spoke. In reference to Retirement Plan Specialist, Inc. Board Member Ben McMahan asked City Manager Kevin L. Smith, "Did we make any progress on contacting our former Actuary for services that we had some questions about Manager Smith replied, "I did send her an email because I did want to, in writing; communicate to her that the Board had selected a new Actuarial firm and wanted to advise her of that. And also let her know that we would not need her to prepare the Actuarial Valuation for the proceeding Fiscal Year." Board Member McMahan mentioned that he would like for Manager Smith to continue to pursue the situation and Manager Smith responded, "I intend to." Chairperson Fair talked briefly about the written letter from Gabriel, Roeder, Smith Company, the firm who was requested by the Florida Division of Retirement, Bureau of Local Retirement Systems to review the materials provided by Retirement Plan Specialists, Inc. Continuing, Chairperson Fair mentioned, "Sandra Turner is not an Actuary," and suggested, "Therein lies a little bit of some issue as well, so I think that it may be advisable to discuss that with the City Attorney." CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING NOVEMBER 18, 2009 PAGE 2 OF 5 Manager Smith remarked, "I certainly hoped that I was able to have a conversation with Ms. Turner and discuss this issue and not have to resort to consulting the City Attorney." Manger Smith remarked, "I would also add that I think it further supports Board made the correct decision in recommending a new Actuary firm to the City Commission." Discussion ensued regarding Gabriel, Roeder, Smith Company moving forward with Actuary services. Manager Smith then added, "I will consult with the City Attorney. I will make an additional attempt to follow up with Ms. Turner." Ei Discussion. Manager Smith informed the Board that the City of Winter Springs is in the process of procuring a Contract with the new Actuary firm, Gabriel, Roeder, Smith Company. Vice Chairman Vernon Rozelle, Jr. joined the Special Meeting in progress via telephone at 6.•47 pm. REGULAR AGENDA REGULAR 600. Office Of The City Manager Requesting The Board Of Trustees Review Re- Balancing Of Assets Proposition(s) From Bogdahn Consulting, LLC. Mr. Dave West, Bogdahn Consulting, LLC, 4901 Vineland Road, Suite 600, Orlando, Florida: introduced his colleague, Mr. Tyler Grumbles. Mr. West reviewed a presentation entitled "City of Winter Springs General Employees Defined Benefit Plan Trust Investment Program Rebalancing" presentation and pointed out that the "Portfolio Rebalancing" page provided background on the reasoning behind the Investment Policy Statement (IPS). Mr. West noted, "Right now, we have the Policy set up with ranges for the asset classes and a target allocation that we're trying to stay reasonably close to over time. Obviously, it is that target allocation that is the most efficient allocation as expected return and risk, that we need to get, or hopefully hit with a reasonably high probability." Continuing, Mr. West summarized, "What you have represented here are the various rebalancing methods," and added, "The `Threshold Rebalancing', is the most efficient rebalancing method in our opinion." Discussion. Next, it was conveyed that the page entitled, "IPS (Investment Policy Statement): Asset Class Target Ranges was an excerpt from the City's Policy for the Board of Trustees. CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING NOVEMBER 18, 2009 PAGE 3 OF 5 Furthermore, Mr. West reviewed the "Allocation By Manager" page and clarified that the "Updated" column under "American Staple Value" should read `October 30, 2009', not `September 30, 2009'. Vice Chairman Rozelle ended his telephone call at 6:58 p. m. Discussion. In regards to the rebalancing, Mr. West communicated to the Board, "The only area that would incur some cost would be Dalton Greiner, [Hartman, Maher Co., LLC] and that would be the acquisition process of their purchasing additional equities." It was then explained by Mr. West that, "Basically we would be estimating Dalton Greiner's [Hartman, Maher Co., LLC] cost to be about, fifty (50) Basis Points all in for them to put that money to work. In dollar terms, the total cost of this transition, or rebalancing would be the three thousand, seven hundred, fifty dollars ($3,750.00) based on estimated transaction cost only coming from Dalton Greiner, [Hartman, Maher Co., LLC]." Board Member Watkins stated, "If it is only going to cost thirty seven hundred [dollars] ($3,700), then I don't have a problem with it." Board Member Barbara Watkins ended her telephone call at 7: 03 p.m. Further discussion. Mr. West reiterated from the October 27, 2009 Meeting, "The real estate fund is the only fund that makes a distribution. The International Equity Fund, the Galliard Bond Fund reinvest the dividends and bond coupons. So, the American Realty [Advisors] Fund is the only one that we are actually getting a monetary distribution the purpose of that, again was to be able to control the allocation of that space." Continuing, Mr. West specified, "Our standing firm recommendation right now, is to not allocate any additional capital to the real estate space." Chairperson Fair and Board Member McMahan affirmed that is what American Realty Advisors recommended during their presentation last month. Mr. West reported, "If we had reinvested, the additional dollar decline was about sixty one hundred dollars ($6,100.00). If we had reinvested those dividends back into the real estate funds, it would have been a net loss for this period," he added, "We'd like to continue to review that space on a quarterly basis with you." Discussion ensued regarding quarterly rebalancing using net contribution proceeds and the information presented by the Bogdahn Group. "I MAKE A MOTION THAT WE ADOPT THE RECOMMENDATION THAT THE BOGDAHN GROUP HAS MADE FOR REBALANCING." MOTION BY BOARD MEMBER McMAHAN. CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING NOVEMBER 18, 2009 PAGE 4 OF 5 MR. WEST ADDED, "OUR RECOMMENDATION, THUS THE DESIRE TO MAKE THAT A MOTION WOULD BE TO EXECUTE THE WRITTEN RECOMMENDATION OF THIS SUMMARY REPORT, NUMBER ONE (1), AND NUMBER TWO (2), TO RESUME THE TARGET ALLOCATION DIRECTION THAT'S IN PLACE WITH THE CUSTODIAN, FOR NET CONTRIBUTIONS PRO RATA ON A QUARTERLY BASIS PER THE POLICY TARGETS, ""X:0 EXCLUDING AMERICAN REALTY [ADVISORS]." ,..d BOARD MEMBER McMAHAN NOTED, "THAT WOULD BE MY MOTION." G SECONDED BY BOARD MEMBER MAX SWAIM. DISCUSSION. or VOTE: BOARD MEMBER SWAIM: AYE CHAIRPERSON FAIR: AYE BOARD MEMBER McMAHAN: AYE MOTION CARRIED. Tape 1 /Side B Discussion ensued regarding the Basis Points. In reference to the next Board of Trustees Regular Meeting, Chairman Fair asked Mr. West, "Do you have a recommendation what Manager we should have Mr. West suggested, "Either Lateef [Investment Management, LP] or Voyager [Asset Management, Inc.]. I thought maybe Voyager [Asset Management International] might be most relevant." The Board Members agreed with contacting Voyager Asset Management, Inc. and having Lateef Investment Management, LP as a back up presenter at the next Regular Meeting. Manager Smith commented, "The Meeting being on January 26 [2010] that should be right about the time that GRS (Gabriel, Roeder, Smith Company) is completing our Actuarial Report for the previous Fiscal Year," and added, "Assuming they have it completed by that Meeting, I would obviously ask them to be here to present. Assuming they are not able to, I would ask the Board that we not wait to our next Regular Meeting, ninety (90) days away." Chairperson Fair stated, "Let us go ahead and set something up. In the event they are not done by that Meeting; let us absolutely do a Special Meeting." Manager Smith remarked, "You will see them at your next Regular Meeting or I will report back to you on the status and ask for a scheduling of date for a Special Meeting." CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING NOVEMBER 18, 2009 PAGE 5 OF 5 ADJOURNMENT Chairperson Fair adjourned the Special Meeting at 7:23 p.m. RESPECTFULLY SUBMITTED: GAYLE COUTANT ASSISTANT TO THE CITY CLERK NOTE: These Minutes were approved at the 2010 Board of Trustees Regular Meeting.