06/18/2012TRUSTEES OF THE EMPLOYEES' PENSION FUND MEETING MINUTES
CITY OF CLEARWATER
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Present: Chair/Trustee George N. Cretekos, Trustee Doreen Hock-DiPolito,
Trustee Paul Gibson, Trustee Bill Jonson, and Trustee Jay Polglaze.
Also Present: William B. Horne II - City Manager, Jill S. Silverboard - Assistant City
Manager, Rod Irwin - Assistant City Manager, Pamela K. Akin - City
Attorney, Rosemarie Call - City Clerk, and Nicole Sprague - Official
Records and Legislative Services Coordinator.
To provide continuity for research, items are in agenda order although not
necessarily discussed in that order.
1. Call to Order — Chair George N. Cretekos
The meeting was called to order at 9:06 a.m. at City Hall.
2. Approval of Minutes
2.1 Approve the minutes of the Mav 14, 2012 Pension Trustees meetinq as
submitted in written summation bv the Citv Clerk.
Trustee Bill Jonson moved to approve the minutes of the May 14, 2012 Pension
Trustees meeting as submitted in written summation by the City Clerk. The motion was
duly seconded and carried unanimously.
3.
3.1
Pension Trustee Items
rove the new hires for acceptance into the Pension Plan as listed.
Name. Job. Class. & Dept./Div .
Andrea Fisher, Parking Enf. Specialist/Engineering
John Ryder, SW Equip. Oper./SW-General Services
Tracy Loibl, Crime Scene Technician/Police
Dustin Purcell, Parks Services Tech. I/Parks & Rec.
Mark Parry, Planner 111/Planning & Development
Terrance Elkins, Parks Service Tech. I/Parks & Rec.
Hire Date
4/9/12
4/10/12
4/23/12
4/23/12
4/23/12
4/23/12
Pension
Eliq. Date
4/9/12
4/10/12
4/23/12
4/23/12
4/23/12
4/23/12
Pension Trustees 2012-06-18 1
Trustee Doreen Hock-DiPolito moved to approve the new hires for acceptance into the
Pension Plan as listed. The motion was duly seconded and carried unanimously.
3.2 Approve the request of emplovee Karen Dombrowski, Police Department;
Steven Jackson, Solid Waste/General Services Department; Donald Ford, Police
Department; E. Joanne Bunton, Librarv Department; Robert Paqano, Police
Department; Michael Sahr, Police Department; John Zeqzdrvn, Police
Department; and Georqe Koder, Police Department, for a reqular pension as
provided bv Sections 2.397 and 2.398 of the Emplovees' Pension Plan.
Karen Dombrowski, Administrative Support Manager, Police Department, was
employed by the City on April 12, 1982, and her pension service credit is effective
on that date. Her pension will be effective August 1, 2012. Based on an average
salary of approximately $61,460 per year over the past five years, the formula for
computing regular pensions, and Ms. Dombrowski's selection of the Joint and
Survivor Annuity, this pension will approximate $51,197 annually.
Steven Jackson, Production Control Coordinator, Solid Waste/General Services
Department, was employed by the City on November 16, 1981, and his pension
service credit is effective on that date. His pension will be effective October 1,
2012. Based on an average salary of approximately $65,817 per year over the
past five years, the formula for computing regular pensions, and Mr. Jackson's
selection of the 100% Joint and Survivor Annuity, this pension will approximate
$55,453 annually.
Donald Ford, Custodial Worker, Police Department, was employed by the City on
May 4, 1992, and his pension service credit is effective on August 3, 1992. His
pension will be effective September 1, 2012. Based on an average salary of
approximately $29,379 per year over the past five years, the formula for
computing regular pensions, and Mr. Ford's selection of the 100% Joint and
Survivor Annuity, this pension will approximate $15,581 annually.
E. Joanne Bunton, Library Assistant, Library Department, was employed by the
City on April 23, 2001, and her pension service credit is effective on April 20,
2002. Her pension will be effective July 1, 2012. Based on an average salary of
approximately $23,997 per year over the past five years, the formula for
computing regular pensions, and Ms. Bunton's selection of the Joint and Survivor
Annuity, this pension will approximate $6,726 annually.
Robert Pagano, Police Aide, Police Department, was employed by the City on
May 24, 1999, and his pension service credit is effective on September 21, 2002.
Pension Trustees 2012-06-18 2
His pension will be effective October 1, 2012. Based on an average salary of
approximately $24,503 per year over the past five years, the formula for
computing regular pensions, and Mr. Pagano's selection of the Joint and Survivor
Annuity, this pension will approximate $6,738 annually.
Michael Sahr, Police Major, Police Department, was employed by the City on July
12, 1982, and his pension service credit is effective on that date. His pension will
be effective June 1, 2012. Based on an average salary of approximately $99,311
per year over the past five years, the formula for computing regular pensions, and
Mr. Sahr's selection of the 100% Joint and Survivor Annuity, this pension will
approximate $80,520 annually.
John Zegzdryn, Police Sergeant, Police Department, was employed by the City on
November 4, 1985, and his pension service credit is effective on that date. His
pension will be effective May 1, 2012. Based on an average salary of
approximately $89,077 per year over the past five years, the formula for
computing regular pensions, and Mr. Zegzdryn's selection of the 100% Joint and
Survivor Annuity, this pension will approximate $63,918 annually.
George Koder, Police Lieutenant, Police Department, was employed by the City
on December 30, 1991, and his pension service credit is effective on that date.
His pension will be effective June 1, 2012. Based on an average salary of
approximately $103,102 per year over the past five years, the formula for
computing regular pensions, and Mr. Koder's selection of the 100% Joint and
Survivor Annuity, this pension will approximate $57,258 annually.
Section 2.397 provides for normal retirement eligibility when a participant has
completed thirty years of credited service, has reached age 55 and completed
twenty years of credited service, or has reached age 65 and completed ten years
of credited service. Section 2.397 also provides for normal retirement eligibility
when a participant has completed twenty years of credited service or has reached
age 55 and completed ten years of credited service in a type of employment
described as "hazardous duty" and further defines service as a Police Major,
Police Sergeant, and Police Lieutenant as meeting the hazardous duty criteria.
Ms. Dombrowski and Mr. Jackson qualify under the thirty years of service criteria.
Mr. Ford qualifies under the age 55 and twenty years of service criteria. Ms.
Bunton and Mr. Pagano qualify under the age 65 and 10 years of service criteria.
Mr. Sahr, Mr. Zegzdryn, and Mr. Koder qualify under the hazardous duty criteria.
Trustee Jay Polglaze moved to approve the request of employee Karen Dombrowski,
Police Department; Steven Jackson, Solid Waste/General Services Department; Donald
Ford, Police Department; E. Joanne Bunton, Library Department; Robert Pagano,
Police Department; Michael Sahr, Police Department; John Zegzdryn, Police
Department; and George Koder, Police Department, for a regular pension as provided
Pension Trustees 2012-06-18 3
by Sections 2.397 and 2.398 of the Employees' Pension Plan. The motion was duly
seconded and carried unanimously.
3.3 Approve the recommended pension plan administrative expenditures for fiscal
vear 2013, totalinq $332,000.
The Employees' Pension Plan does not have a legally required annual budget.
However, the Trustees must approve all expenditures. The following are routine
expenditures that staff is requesting approval of for the sake of administrative
efficiency.
The recommended expenditures for fiscal 2013, as detailed on the attachment,
reflect a$3,500, or 1.04%, decrease from the fiscal 2012 expenditures of
$335,500. This decrease is due to a net decrease in General Fund employee
costs to administer the plan.
Printing and binding expenditures are for the State statutorily required annual
information distribution to pension plan members.
Postage expenditures are for necessary mailings, including the annual information
distribution to plan members.
Membership dues reflect annual dues for the Florida Public Pension Trust
Association.
Training and travel are for the estimated costs of pension training, including
fiduciary training for trustees and Pension Advisory Committee (PAC) members.
This is a not-to-exceed amount given the uncertainty regarding which trustees and
PAC members will elect to attend conferences during the year.
Reimbursement to the General Fund is for the cost of the oversight and
administration of the Plan, and is recognized as revenue to the General Fund.
This reimbursement covers the services provided by Human Resources, Payroll,
and Finance personnel.
The firm of Klausner, Kaufman, Jensen and Levinson serves as the plan's
pension attorney. Annual attorney fees also include medical bills for medical
services authorized by the Pension Advisory Committee. Medical services totaled
$10,056 for fiscal year 2011, and current fiscal year 2012 (thru May 31) total
$1,750.We are including budget for a Referendum for proposed pension plan
changes.
Pension Trustees 2012-06-18 4
Money manager, safekeeping, actuary, and pension investment consulting fees
are all governed by contracts approved by the Trustees and are not included in
this approved budget.
Trustee Paul Gibson moved to approve the recommended pension plan administrative
expenditures for fiscal year 2013, totaling $332,000. The motion was duly seconded
and carried unanimously.
3.4 Approve the termination of Aletheia Research and Manaqement, a larqe cap
value manaqer for the pension plan; approve the transfer of the terminated
manaqer's funds to the plans other larqe cap value manaqer, the Northern Trust
Russell 1000 Value Index Fund; and authorize staff to conduct a search for a
new larqe cap value manaqer.
The pension plan's investment committee is recommending the termination of
Aletheia Research and Management on the basis of poor perFormance. Per the
pension plan's investment policy, managers are expected to perform in the upper
50t" percentile (i.e. 1 St to 50t" percentile) of comparable money managers over a
minimum of a three-year period and a maximum of a five-year period. The large
cap value market performance results for Aletheia as of March 31, 2012, as
reported by the plan's performance measurement consultant, Cap Trust, are as
follows:
Th
Aletheia
Research
Investment Return As Of Indicated Date (%l:
R1000 Value Benchmark
3/12 12/11 9/11 6/11 3/11
19.03 11.50 (2.07) 0.72
22.82 11.55 (1.52) 2.28
Three-year Peer Group Rankinqs as Of Indicated Date (percentile):
3/ 12 12/ 11 9/ 11 6/ 11 3/ 11
2.38
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Pension Trustees 2012-06-18 5
Aletheia Research
R1000 Value Benchmark
$$ tn 86tn
68 tn 85tn
92nd $$tn
89tn 79m
73 �d
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As part of the termination process of Aletheia staff will do some rebalancing of the
total portfolio allocation, with the balance of the monies transferred to the plan's
other large cap value manager, the Northern Trust Russell 1000 Value Index
Fund.
Staff will work with Cap Trust, the pension plan's performance measurement
consultant, to conduct a search for a new large cap value manager.
In response to questions, Cash Investment Manager Steve Moskun said a large cap
value fund refers to the investment in large companies with underpriced stock value.
The plan needs a large cap value manager who will do better than the benchmark. Mr.
Moskun reviewed the manager selection process.
Trustee Bill Jonson moved to approve the termination of Aletheia Research and
Management, a large cap value manager for the pension plan; approve the transfer of
the terminated manager's funds to the plans other large cap value manager, the
Northern Trust Russell 1000 Value Index Fund; and authorize staff to conduct a search
for a new large cap value manager. The motion was duly seconded and carried
unanimously.
4.
5.
Other Business - None.
Adiourn
The meeting was adjourned at 9:20 a.m.
Attest
City Clerk
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Chair
Employees' Pension Plan Trustees
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