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PENSION
.. ... (TRUSTEES)
.,Board of Trustees of the Empl~yees'
, Pension Fund
, 'Minutes
"Date
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ACTION AGENDA - TRUSTEES OF THE EMPLOYEES' PENSION FUND MEETING
July 14, 2003
ITEM #1 - Call to Order - 1 :37 p.m.
ITEM #2 - Approval of Minutes:
ACTION:
Approved as submitted.
ITEM #3 - Request for Acceptance into Membership: Dylan Newell; 'Joshua .
Baxter; Brian Frank; Jennifer Cunningh~m; Robert Ramos; Justin Nieves; Mike Ward;
, Scott Pettay; Daniel Angove; Peter Eichner; Franklyn Golpl; Michael Kirkpatrick; Richard
DeCastro II; Liberian Miles and Erik Soderlund.
ACTION:
Approved.
ITEM #4 - Reqular Pensions to be qranted:, John Slack: Robert W. Repp. Jr.: arid
William McClure II.
ACTION: ' Approved.
ITEM #5 - Approve the contracts with Atlanta Capital Manaqement Co.. LLC and
Systematic Financial Manaqement. Inc.. as small cap equity managers for the
Emplovee's Pension Plan.
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ACTION:
Approved.
ITEM #6 - Other Business - None'.
ITEM #7 - Adiourn - 1 :41 p.m.
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Action Agenda Pension Trustees 2003-0714 '
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TRUSTEES OF THE EMPLOYEES' PENSION FUND MEETING
CITY OF CLEARWATER
July 14, 2003
Present:
Brian Aungst
Hoyt Hamilton '
Whitney Gray
Frank Hibbard
William C. Jonson
Chair
Vice-ChairlTrustee
Trustee
Trustee
Trustee
Also Present:'
Garry Brumback
Pamela K. Akin
Joe Roseto
Cynthia E. Goudeau
Brenda Moses
Assistant City Manager
City Attorney
Human Resources Director
City Clerk
Board Reporter
The Chair called the meeting to order at 1 :37 p.m. at City Hall.
To provide continuity for research, items are in agenda order although not
necessarily discussed in that order,
ITEM #2 - Approval of Minutes:
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Trustee, Jonson moved to approve the minutes of the June 16,2003; meeting, as
recorded and submitted in written summation by the City Clerk to each Trustee. The
motion was duly seconded and carried unanimously.
ITEM #3 - Request for Acceptance into Membership
, Human Resources Joe Roseto presented the recommendation of the PAC
(Pension Advisory Committee) to approve membership for employees: Dylan Newell;
Joshua Baxter; Brian Frank; Jennifer Cunningham; Robert Ramos; Justin Nieves; Mike
Ward; Scott Pettay; Daniel Angove; Peter Eichner; Franklyn Golpl; Michael Kirkpatrick;
Richard DeCastro II; Liberian Miles and Erik Soderlund.
Trustee Hamilton moved to accept the recommendation of the Pension Advisory
Committee. The motion was duly seconded and carried unanimously.
ITEM #4 - Regular Pensions to be Qranted: John Slack: Robert W. Repp, Jr.; and
William McClure II.
John Slack, Police Captain; Police Department. was employed by the City on
June 12, 1978; and his pension service credit is effective on that date. ,His pension will
be effective July 1, 2003.
Based on an average salary of approximately $68,552 per year over the past five, ,
, years, the formula for computing regular pensions, and Mr. Slack's selection of the 1000/0
Joint & Survivor Annuity, this pension will be approximately $46,520 annually.
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Robert W. Repp, Jr., Police Lieutenant, Police Department, was employed by the
City on June 18. 1973, and his pension service credit is effective on that date. His
pension will be effective June 1, 2003.
Based on an average salary of approximately $78,711 per year over the past five'
years, the formula for computing regular pensions, and Mr. Repp's selection of the 1000/0
Joint & Survivor Annuity, this pension will be approximately 563,703 annually. '
, William McClure II, Firefighter, Fire Department, was employed by the City on
August 27, 1973, and his pension service credit is effective on that date. His pension
will be effective June 1. 2003.
Based on an average salary of approximately $48,412 per year over the past'five
years, the formula for computing regular pensions. and Mr. McClure's selection of the
1000/0 Joint & Survivor Annuity, this pension will be approximately $39,781 annually.
These pensions were approved by the Pe,nsion Advisory Committee on June 3,
2003. Section 2.393 (p) provides for normal retirement eligibility when a participant has
completed twenty years of credited service in a type of employment described as
"hazardous dutt and further specifically defines service as a Police Captain, Police
Lieutenant, and Firefighter as meeting the hazardous duty criteria. Mr. Slack, Mr. Repp,
and Mr, McClure qualify under the hazardous duty criteria.
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Trustee Gray moyed that John Slack, Robert W. Repp, Jr., and William McClure
II be granted regular pensions under Sections 2,393 and 2.397 of the Employees'
pension Plan, as approved by the Pension Advisory Committee. The motion was duly
seconded and carried unanimously. '
ITEM #5 - Approve the contracts with Atlanta Capital Management Co.. LLC and
Systematic Financial Manaqement, Inc.. as small cap equity managers for the
Employee's Pension Plan.
The Trustees previously authorized Callan to conduct a search for a small cap
value equity manager.
, The following is the list of small cap value equity managers that Callan
recommended to the Investment Committee:
Ark Asset Management Co., Inc.
Atlanta Capital Management Co. LLC
, Systematic Financial Management
Boston Partners Asset Management
Chartwelllnvestment Partners
Northpointe Capital
After reviewing information provided on the above managers, the Investment
Committee ranked the managers and conducted interviews with the top three. Staff also'
visited the top three managers.
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The Investment Committee recommends to the Trustees that they add two small
cap equity managers. Atlanta Capital and Sys,tematic are firms that are on the opposite "
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ends of the small cap value spectrum. Atlanta Capital invests in smafl cap firms that are
of high quality and tend to be well known. The annual turnover rate for Atlanta Capital's
portfolio is about 400/0. Systematic invests in small cap firms that had a positive earnings'
surprise and positive free cash flow. The firms in Systematic's portfolio tend to be
lesser~known firms. The annual turnover rate of Systematic's portfolio is about 1700/0.
Both firms consistently out perform their benchmark, the Russell 2000 Value Index:
Atlanta Capital charges a management fee of .70/0. Systematic charges a
management fee of 10/0. Both fees are in line with industry standards given their
investment styles. '
The Investment Committee recommends that each manager be funded with $15
million. The source of the funding will be determined at the time of funding. At that time
the entire portfolio will be rebalanced and the funding will come from parts of the portfolio
that are over funded., '
In response to a question. Cash & Investments Manager Steve Moskun said
Atlanta Capital Management has less volatility than Systematic. Together, they would
provide the pension plan higher returns. The investment amount is to be evenly split'
between the two managers. '
Trustee Hamilton moved to approve the contracts with Atlanta Capital
Management Co., LLC and Systematic Financial Management, Inc. as small cap equity
managers for the Employe,es' Pension Plan. The motion was duly seconded and
carried unanimously.
ITEM #6 - Other Business - None,
ITEM #7 - Adiourn
The meeting adjourned at 1:4 ~ p.m.
Chair
Employee's Pen Ion Plan Trustees
Attest
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jl.!'t....'City Clerk . , ' ,
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