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05/13/20131. Call to Order 2. Approval of Minutes PENSION TRUSTEES AGENDA Location: Council Chambers - City Hall Date: 5/13/2013- 1:00 PM 2.1 Approve the minutes of the April 15, 2013 Pension Trustees Meeting as submitted in written summation by the City Clerk. � Attachments 3. Citizens to be Heard re Items Not on the Agenda 4. Pension Trustee Items 4.1 Approve the request of the new hires for acceptance into the pension plan as listed. � Attachments 4.2 Approve the request of the following request of employees Martyn H. Baker, General Services/ Fleet Maintenance Department; Leland Bryant, Public Utilities Department; Mark Tranter, Gas Systems Department; and Jeffrey Voss, Planning and Development Department for a regular pension as provided by Sections 2.416 and 2.424 of the Employees' Pension Plan. � Attachments 4.3 Ratify and confirm the retainer agreement between Saxena White, P.A. and the Employee Pension Plan of the City of Clearwater � Attachments 4.4 Annual review of the Employees' Pension Plan investment performance for the calendar and plan year ended December 31, 2012. � Attachments 5. Other Business 6. Adjourn Pension Trustees Agenda Council Chambers — City Hall SUBJECT / RECOMMENDATION: Meeting Date:S/13/2013 Approve the minutes of the Apri] 15, 2013 Pension Trustees Meeting as submitted in written summation by the City Clerk. SUMMARY: Review Approval: Cover Memo Item # 1 Attachment number 1 \nPage 1 TRUSTEES OF THE EMPLOYEES' PENSION FUND MEETING MINUTES CITY OF CLEARWATER ,�pa°i � � �� Present: Chair/Trustee George N. Cretekos, Trustee Paul Gibson, Trustee Doreen Hock-DiPolito, Trustee Bill Jonson, and Trustee Jay E. 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. Unapproved -� 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 1:32 p.m. at City Hall. % 2. Approval of Minutes 2.1 Approve the minutes of the March 18, 2013 Pension Trustees meeting as submitted in written summation by the City Clerk. Trustee Bill Jonson moved to approve the minutes of the March 18, 2013 Pension Trustees meeting as submitted in written summation by the City Clerk. The motion was duly seconded and carried unanimously. 3. Citizens to be Heard re Items Not on the Aqenda — None. 4. Pension Trustee Items 4.1 Accept the Actuary's Report for the Employees' Pension Plan for the plan year beginning January 1, 2013. Per the actuary report dated January 1, 2013, a minimum City employer contribution of $19.6 million, or 26.33% of covered payroll, is required for fiscal Pension Trustees 2013-04-15 Item # 1 Attachment number 1 \nPage 2 year 2014. This is a decrease of $1.3 million over the fiscal 2013 required contribution of $20.9 million, or 27.97°/o of covered payroll. The decrease in the required contribution is primarily due to savings from the changes to the pension plan effective January 1, 2013, partially offset by increased costs due to changes in plan assumptions, along with an investment loss due to a 5.5% investment return on the actuarial value of assets. The savings from the change in plan benefits, effective January 1, 2013, totaled approximately $4.9 million. These savings were offset by an increase in the required contribution due to the assumptions changes, also effective with the January 1, 2013 actuarial valuation, totaling $2.3 million. Finally, the final year of the "phase-in"; of the calendar 2008 investment losses resulted in an investment return of 5.5%, based on the actuarial value of assets„ versus the assumed rate of 7.5% (gross of fees). This negative investment return perFormance increased the required employer contribution, and further offset the $4.9 million savings, by approximately $1.3 million. � The calendar year 2012 investment return was 13.92% gross of fees, versus the assumed rate of 7.5% gross of fees. This resulted in an improvement in the investment return based on the actuarial value of assets from 4.46% for the prior year to 5.50% for the current year valuation. This is the final year of the five year "smoothing", or amortization, of the 2008 investment losses (negative 27.01 % return). Calendar 2009 thru 2012 investment returns were 30.93%, 17.50%, (0.32)%, and 13.92%, respectively. If the plan meets its assumed rate of return of 7% net of fees for calendar 2013, investment gains will lower next year's required contribution to approximately 21 % of covered payroll per the actuary's estimate. The plan's credit balance, which reflects actual contributions in excess of actuarially required contributions for prior years, decreased from $6,565,156 to $6,343,864 during calendar 2012. This $224,000 decrease was the result of budgeting to use approximately $625,000 of the credit balance for fiscal 2013 contributions, offset by interest earnings on the credit balance. The Plan's funded ratio is 92.2% versus 97.4% for the prior year. The funded ratio after the plan design changes had improved to 101.2%. However the changes in the plan assumptions increased the unfunded actuarial accrued liability by approximately $66 million (amortized over 30 years) resulting in the decrease in the funded ratio to 92.2°/o. For comparability to other plans, the actuary notes in the report that the current funded ratio is 88.9% based on the more commonly used Entry Age Normal funding method. The Actuarial Value of Assets exceeds the Market Value of Assets by $47.0 million as of January 1, 2013. If Market Value had been the valuation basis, the required contribution rate would have been 21.24% of covered payroll. Pension Trustees 2013-04-15 2 Item # 1 Attachment number 1 \nPage 3 Gabriel, Roeder and Smith representative Peter Strong reviewed the actuary report. He expressed a concern regarding the Plan's contribution volatility, which is based on the size of the market value of assets to the size of covered payroll. The Plan's market value of assets is currently $735 million, but covered payroll is $74 million. The Plan's contribution volatility is 9.89 as of January 1, 2013. Mr. Strong expressed a concern if the Plan's market value of assets dropped 5%; impacting approximately 50% of covered payroll. He suggested the Trustees consider buying annuities through an insurance company, when the interest rates go up to remove liabilities and assets and decrease the assets-payroll ratio, or conducting a asset liability study. In response to questions, Mr. Strong said the City has a mature plan. A mature plan refers to the point when the ratio of retirees and active members remain constant. The recent assumptions changes are more conservative, allowing for a more sustainable and a well-funded plan. 4.2 Determine Trustees' expected rate of return for the pension plan's investments for the current year, for each of the next several years, and for the long term thereafter. Florida Statutes 112.661(9) requires an annual determination of expected rates of return be filed with the Florida Department of Management Services, with the plan's sponsor, and with the consulting actuary. Staff is recommending the current plan investment rate of return assumption of 7.0%, net of investment-related fees, as the expected annual rate of return for the current year; for each of the next several years, and for the long term thereafter. Trustee Doreen Hock-DiPolito moved to determine 7.0% as the Trustees' expected rate of return for the pension plan's investments for the current year, for each of the next several years, and for the long term thereafter. The motion was duly seconded and carried unanimously. 4.3 Approve the request of the new hires for acceptance into the Pension Plan as listed. Name, Job. Class, & Dept./Div . Dwayne Randall, Parks Serv Tech I, Parks and Rec Dept Clifton Whitaker, Solid Waste Worker, Solid Waste Dept Mark Snurr, Licensed Electrician, GS/Solid Waste Dept Pension Trustees 2013-04-15 Pension Hire Date Elig. Date 01 /28/2013 01 /28/2013 01 /28/2013 01 /28/2013 02/11/2013 02/11/2013 3 Item # 1 . Attachment number 1 \nPage 4 Mercedes McBride, Police Comm Oper Trainee, Police Dept 02/25/2013 James Blackwell, Police Comm Oper Trainee, Police Dept Jamie Duplain, Police Comm Oper Trainee, Police Dept Paige Szymaniak, Police Comm Oper Trainee, Police Dept Jeremy Curvan, Police Officer, Police Department Scott Penna, Police Officer, Police Department Daniel Marschel, Police Officer, Police Department 02/25/2013 02/25/2013 02/25/2013 02/25/2013 02/25/2013 02/25/2013 Stacie Gonzalez, Cust Service Rep, Customer Service Dept 02/25/2013 02/25/2013 02/25/2013 02/25/2013 02/25/2013 02/25/2013 02/25/2013 02/25/2013 02/25/2013 Tony Gordon, Solid Waste Worker, Solid Waste Dept 02/25/2013 02/25/2013 Trustee Jay Polglaze moved to approve the request of the new hires for acceptance into the Pension Plan as listed. The motion was duly seconded and carried unanimously. 4.4 Approve the request of employee John Cavaliere, Police Department for a regular pension as provided by Sections 2.416 and 2.424 of the Emplo� Pension Plan. John Cavaliere, Police Officer, Police Department, was employed by the City on September 24, 1990 and his pension service credit is effective on that date. His pension will be effective April 1, 2013. Based on an average salary of approximately $80,653.64 per year over the past five years, the formula for computing regular pensions, and Mr. Cavaliere's selection of the 100% Joint and Survivor Annuity, this pension will approximate $48,859.44 annually. Section 2.416 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. Mr. Cavaliere qualifies under the hazardous duty criteria. Trustee Paul Gibson moved to approve the request of employee John Cavaliere, Police Department for a regular pension as provided by Sections 2.416 and 2.424 of the Employees Pension Plan. The motion was duly seconded and carried unanimously. Pension Trustees 2013-04-15 4 Item # 1 � Attachment number 1 \nPage 5 4.5 Approve the City of Clearwater Employee Pension Plan as lead plaintiff in litiqation against Maxwell Technologies, Inc regarding investment losses to the Plan: retain Saxena White. P.A. as leaal counsel in this reaard and authorize staff to negotiate a retainer agreement with Saxena White, P.A. In December 2011, the City Employees' Pension Plan Trustees approved contracts retaining Kessler, Topaz, Melzer, and Cheek, LLP, and Saxena White, P.A., to provide monitoring of securities in the Pension Plan investment portfolio in connection with claims for damages suffered by the Pension Plan, at no cost to the PIan.Saxena White has recommended that the Pension Plan move for lead plaintiff status in a litigation action against Maxwell Technologies, based in San Diego, California. Maxwell develops, manufactures, and markets products and services for purification and information technologies and power-conversion systems and components. Maxwell has announced it must restate its financial statements by millions of � dollars because it recognized revenue prematurely, that the company lacked internal controls, and was notified it was no longer in compliance with NASDAQ listing rules. The company auditor subsequently resigned because it could no longer rely on management representations. This has devastated Maxwell's common stock price resulting in a loss of 44% in the value of such stock since March 7, 2013. The Clearwater Employee Pension plan has sustained losses in excess of $220,OOO.Pursuing lead plaintiff status will serve to ensure the Trustees and Plan administrators are fulfilling their fiduciary responsibilities while conveying a strong message to the public and corporate world that the City is doing its due diligence in ensuring that the Plan assets are protected. The cost of litigation will result in no out of pocket expenses to the Plan and the retainer agreement will stipulate as much. Trustee Bill Jonson moved to approve the City of Clearwater Employee Pension Plan as lead plaintiff in litigation against Maxwell Technologies, Inc regarding investment losses to the Plan; retain Saxena White, P.A. as legal counsel in this regard and authorize staff to negotiate a retainer agreement with Saxena White, P.A. The motion was duly seconded and carried unanimously. 5. Other Business — None. �,, Pension Trustees 2013-04-15 Item # 1 6. Adiourn The meeting was adjourned at 2:12 p.m. Attest City Clerk Attachment number 1 \nPage 6 � � Chair Employees' Pension Plan Trustees Pension Trustees 2013-04-15 6 Item # 1 Pension Trustees Agenda Council Chambers — City Hall SUBJECT / RECOMMENDATION: Approve the request of tbe new hires for acceptance into the pension plan as ]isted. SUMMARY: Pension Name, Job. Class, & Dept./Div. Hire Date Eli�.Date Wayne Nelson, Public Utilities Asst Tech, Public Utils Dept 03/11/2013 03/11/2013 Matthew Woloschek, Sr. Systems Programmer, IT Dept 03/11/2013 03/11/2013 Daniel O'Malley, Building Inspector Tech, Planning Dept 03/25/2013 03/25/2013 Peter Tanner, Sr. Systems Programmer, IT Dept 03/25/2013 03/25/2013 Clyde Walls, Solid Waste Equip Oper, Solid Waste Dept 03/25/2013 03/25/2013 Brian Stees, Solid Waste Equip Oper, Solid Waste Dept 03/25/2013 03/25/2013 Ariel Banacki, CS Account Rep, Cust Service Dept 03/25/2013 03/25/2013 Review Approval: Meeting Date:S/13/2013 Cover Memo Item # 2 Pension Trustees Agenda Council Chambers — City Hall Meeting Date:S/13/2013 SUBJECT / RECOMMENDATION: Approve the request of tbe following request of employees Martyn H. Baker, General Services/ Fleet Maintenance Department; Leland Bryant, Public Utilities Department; Mark Tranter, Gas Systems Department; and Jeffrey Voss, Planning and Development Department for a regular pension as provided by Sections 2.416 and 2.424 of the Employees' Pension Plan. SUMMARY: Martyn R. Baker, Mechanic Fabricator, General Services/ Fleet Maintenance Department, was employed by the City on May 17, 1993 and his pension service credit is effective on that date. His pension will be effective June 1, 2013. Based on an average salary of approximately $61,775.34 per year over the past five years, the formula for computing regular pensions and Mr. Baker's selection of the Life Annuity, this pension will approximate $34,042.56 annually. Leland Bryant, Water Distribution Supervisor I, Public Utilities Department, was employed by the Ciry on November 24, 1986 and his pension service credit is effective on that date. His pension will be effective June 1, 2013. Based on an average salary of approximately $57,963.39 per year over the past five years, the formula for computing regular pensions and Mr. Bryant's selection of the 50% Joint and Survivor Annuity, tbis pension will approximate $38,232.72 annually. Mark Tranter, Gas Supervisor, Gas Systems Department, was employed by the City on May 9, 1983 and his pension service credit is effective on that date. His pension will be effective June l, 2013. Based on an average salary of approximately $66,107.24 per year over the past five years, the formula for computing regular pensions and Mr. Tranter's selection of the 50% Joint and Survivor Annuity, this pension will approximate $51,671.76 annually. Jeffrey Voss, Building Construction Inspector, Planning and Development Department, was employed by the City on May 31, 1988 and his pension service credit is effective on that date. His pension will be effective June 1, 2013. Based on an average salary of approximately $59,175.24 per year over the past five years, the formula for computing regular pensions and Mr. Voss's selection of the Life Annuity, this pension will approximate $36,614.64 annually. Section 2.416 provides far normal rerirement eligibility when a participant has coinpleted twenty years of credited service or has reached age 55 and completed ten years of credited service in a type of employment described as "non—lazardous duty". Messrs. Balcer, Bryant, Tranter and Voss qualify under the non—hazadous duty criteria. Review Approval: Cover Memo Item # 3 Recommend approval of the following request of employees Martyn H. Baker, Maintenance Department; Leland Bryant, Public Utilities Department; Mark Department; and Jeffrey Voss, Planning and Development Department for provided by Sections 2.416 and 2.424 of the Employees' Pension Plan. Attachment number 1 \nPage 1 General Services/ Fleet Tranter, Gas Systems a regular pension as Martyn H. Baker, Mechanic Fabricator, General Services/ Fleet Maintenance Department, was employed by the City on May 17, 1993 and his pension service credit is effective on that date. His pension will be effective June 1, 2013. Based on an average salary of approximately $61,775.34 per year over the past five years, the formula for computing regular pensions and Mr. Baker's selection of the Life Annuity, this pension will approximate $34,042.56 annually. Leland Bryant, Water Distribution Supervisor I, Public Utilities Department, was employed by the City on November 24, 1986 and his pension service credit is effective on that date. His pension will be effective June 1, 2013. Based on an average salary of approximately $57,963.39 per year over the past five years, the formula for computing regular pensions and Mr. Bryant's selection of the 50% Joint and Survivor Annuity, this pension will approximate $38,232.72 annually. Mark Tranter, Gas Supervisor, Gas Systems Department, was employed by the City on May 9, 1983 and his pension service credit is effective on that date. His pension will be effective June 1, 2013. Based on an average salary of approximately $66,107.24 per year over the past five years, the formula for computing regular pensions and Mr. Tranter's selection of the 50% Joint and Survivor Annuity, this pension will approximate $51,671.76 annually. Jeffrey Voss, Building Construction Inspector, Planning and Development Department, was employed by the City on May 31, 1988 and his pension service credit is effective on that date. His pension will be effective June 1, 2013. Based on an average salary of approximately $59,175.24 per year over the past five years, the formula for computing regular pensions and Mr. Voss's selection of the Life Annuity, this pension will approximate $36,614.64 annually. Section 2.416 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 "non-hazardous duty". Messrs. Baker, Bryant, Tranter and Voss qualify under the non-hazardous duty criteria. Item # 3 Pension Trustees Agenda Council Chambers — City Hall Meeting Date:S/13/2013 SUBJECT / RECOMMENDATION: Ratify and confirm the retainer agreement between Saxena White, P.A. and the Employee Pension Plan of the City of Clearwater SUMMARY: The Pension Trustees approved the City of Clearwater Employee Pension Plan as lead plantiff in litigation againist Maxwell Technologies, Inc at the April 15, 2013 Pension Trustee meeting. This litigation will focus on the recovery of investment losses sustained by the plan caused by Maxwell's mismanagement. The Plan Administrator stated at that time that a retainer agreement would be agreed to with Saxena White, P.A. The attached agreeinent states that this firm is retained to pursue damages and other relie£ It goes on to state that the Attorney's will advance all expenses, the Pension Plan is not liable to pay any litigation expenses, and recovery of costs and expenses is contigent upon a recovery being obtained. Review Approval: 1) Human Resources Cover Memo Item # 4 RET��F'R A.GREEMEI^�T T�tis Ttetainez' A��een�cnt �aveins the retenti�Fi c�� 5axena i�hite, P.�. ("�axena W��ite„ �.r the "Aitarneys"} hy the Emplr�yees' Pensinn �'1an afthe Ci#y of Glearwater ("Cleai-�vater" or "Clienf"} whc} 1�as �utl�c�z-i�ed the Attn�t�eys to prosecut� claims az=tsing aut af purch�se af �axwell Technol�gies, �nc. securiiies ("Liti�;ation"), I. SCQPE (3F SERVICES A. llpon �xccution af this Agreement by �axena White, tt�e Attortae�rs are retair�ed tn provide legal se�`vices for t��e pur�as� of seekin� da��aa�es and atlaer r•elief in the Litigation. Clzekx� �rovides auth�ri�ation tt� seek ap�Qint�ent as Leaci Plainiiff iz� thc class aciion, �.vhile t�ae Attorneys tivill seek to �e a}�pointed C:lass �'�unsel. If this occurs; the Liiigatia� w�ll be pxas�ctated as a cla�s actic�za. B. Tlie T1ead P�aintiff will manitar, rcvie�u and participate wi�h tl�e Attr�rneys in ihe prosecutio� af the L.itxgaCiran. '�e Attarneys shall ct�nsult with the Lead Plainti£� and �,ead Plaintiff's counsel, I�iaus�ie�- & Kaufrnan, cc�x�cerning a11 majar substantive rrtatters related to the Litig�tion, incluc3ing, but not li�nited tE�, the initial and axx�ended cornplaints, c�zspasitive motir�ns su�h �ts the mt�tic�t� ta disrniss, anc$ rne�iatic�n �rzci settlement. C. The Attorneys shali pz'avade sufficient resourees, includin� attorney tii�� an�i �;apital F�z' pay.rnnent af cc�sts and cxpen�es, tr� �rigorously �rr�secute the Liti�ation. D. Any rec�vexy tivrll be [iividec� �mang Clie�t and Class Membez`s oa� a pro rata basis based oi� the reco�ni2ed �oss by each Client and C�ass Member as ca�culate�i by a dat�rzag� atlocation plan, wh�ch �Till be prepared by a�nancia� ex�aez�, pro�ided to the Leacl Plaintiffs, �Se subject tc� the �ourt's a�Sproval and will aecount far such factors as si-r.e of stocl� awnership, da#e of purehase, d�te of �ale � and con�ianued hc�ldings, if any. m � II. C�NTINGE�IT �EE AG1�E.�MENT � � f�,. Tl1e Atic�r�teys shall aduance al� �x��;r�ses in th� Liti�atic�n. Except as pra�ided in sectian IV.� below, t}a� �lient is nQt li�'ble t�r �ay any af the exp�nses caf the Litigation, �,�hether attozx�eys' Fees �z� casis. F�ecovery of costs and otl�er expcn��s is ccantingenY upon a recovery being obt�in�d, If ��a recavez'y is �btai3ied, Client u�ill owc nothi��g fa�- casts �nd a��er expenses. 13. Thc sule contin�ency upon which �"�ttc�rl�cys shail be compei�sat�d i:; a��ec�very iri ihe Litigation, whether by settlement crr judgrnent. �ampcnsation s��all be deierr�ined �y the �flurt, plus reasonable disbuA'senients in the Litig�ti�n. ia�ena White shall not see�C maxe t��an azte-tI'r� of the s�tilement as its fee, s�b�ect ta Co�ari ativard. "Disbuxse��ents" shall in�lude but not b� lirnited to tra�el ex��enses, tele��e�ne, copying, fax tra�a�t�ission, depasitiQ��s, ��vesti�aiors, i�zterest, t��ssengers, m�d�atin� expenses, cnrnputer research fecs, court fees, ex�a�rt fees, ather coi�sultatifln fees and �a��a�ega� cxpenses. G. In tt�e event that the Liiigation is re�alved by settlement under tez�s involvin� any "in-kind'" p��zt�ent, such as stock, the con�in�er�t �f'ee agreement s3�a11 apply tc� SL1Ci1 ��lI]-IC1�1C�1tl �ifl�F'i1�B]k. III. GE�IERAL REQ�IREPv�EIrTTS A. Cl�ent uncierstands tl�at Saxena �JV�iitc �-nay, if necessary, wax°k with otta�r law �rms to jrzntly prosecute this Liti�ation, In the ev�nt of su:ch affiliation, the Att�rn�:ys ��vill c�btain �dvance consent frorn Client. B. Client agr�es to coc�perate �n fk�� prasecution of the suit inelur,iing providin� ciocuznez�ts to substantiate the �lient's claim, and tc� �cooperate in prar�i�izng discover� information, including a deposition if z�ecessary. IU. 7"ERMINAT�ON A. Cliei�t �nay terin�nate ihis A�eement as to any Attr�rneys, with t�r w�ithaui cause and without ��na�tY, bY prc�viding the Ai#omeys with �vritten n�tice r�f tcrmination. Attorneys may terminate thzs agreernent v�Tit�i or without cause and �vithout penalty, by providi.ng Clien# witl� writte� natice of texxx�ix�ation if �h� Claent tai�s tc� co�perate in the prc�s�cutian of this �ctic�n or such othcr z°e�son as may h� approved upas� applicatian to the C�rurt. B. Tf the Attorneys are tertninate.c� for at7y reasoz�, ,P,,tfc�rneys shali be en#itled to bc� �aid st�ch Gpmpensation as might l�e ��ayable to ihen� in accordanee i�rith this Agreement, u=Izen any recovery in the Liti�at�on pursuant to II ab�`ve is obtained. � tif. I'��TICF m � A. A1l iioticcs ta he giti�en hy tl�e parties �ereto shall be zza writing and sei�t �� follaurs: � 'I'0 THE ��I�NT Empl�yees' Pensinn Pla�n �f tl�.e City of Cle�a•water George �1. Cretekos, Cixaixxa�an � C�� outh Myrtle �venue Clean�ater, FL 3375�i TC) ATTORNEYS Steiart Kaufrna�l �lausner c�c Ka��man 1 aQ59 I�iarthwest � `` Court �lantatioll, FL 333�4 Maya Saxen� Saxz��a '�hite P.r'1. 2�}24 Narth Federal Hi�laZ�ray, Suita 257 Saca R�ton, FL 334� 1 �. Any actiinns arising aut of this Agr�ement shall be �overned by ti�e laws of Florida. �C. This agre��ncnt, alang with tlie si�rted Certification �nd Authorzzation af Leati Plaintiff; sets fc,rth the entire Agreement �S�tween the parties, and supe��sedcs all other Qral az written provisions. A�eeci, this � ciay o�'Apxal, 2�}13. 5ign�ture. � � � h/iaya xena �Sarer�a �'hite P.� — �+�or, �+1 e�� ,.� Sig,nature: � Gear�e t'�i. Crci[ekas, Chair�nan Er��pdoy�ES' �'et�sion Flrrr� of th� Cfty af Ct'e�ir��r�t.�r- � m � � � Pension Trustees Agenda Council Chambers — City Hall Meeting Date:S/13/2013 SUBJECT / RECOMMENDATION: Annual review of the Employees' Pension Plan investment performance for the calendar and plan year ended December 31, 2012. SUMMARY: This is the annual presentation on the investment performance of the Employees' Pension Plan for calendar and plan year ended December 31, 2012. For the last calendar year, the plan had a return of 13.89%, versus a custom benchmark of 13.17%. This is a return of 0.72°/o over the benchmark and a return of 1.54% over the median public pension plan, placing the plan in the 14� percentile of public pension plans per the Wilshire Public Plan Sponsor Universe. For the last three calendar years, the plan has a return of 10.14% (annualized) versus a benchmark of 9.50%. This is an excess return of 0.64% over the benchmark and placed the plan in the 1 St percentile of public pension plans for this three—year period. There was one change in money managers over the past year — the termination of Alethia Research and M�agement, a large cap value equity manager. Alethia was replaced with two managers, Eagle Capital and Manning and Napier, who were funded early in calendar 2013. All of the current managers in the plan are performing as expected given their stated investment strategies and investment styles. Type: Current Year Budget?: Budget Adjustment Comments: Current Year Cost: Not to Exceed: For Fiscal Year: Other None Budget Adjustment: to Annual Operating Cost: Total Cost: None Review Approval: 1) Office of Management and Budget 2) Legal 3) Clerk 4) Assistant City Manager 5) City Manager 6) Clerk Cover Memo Item # 5 c� �+L 'o�f �, � � �• � • _ I Q 1' i. � � � 1 Y � t ,. - _ � - � _ " t� IPl d�i�'�t '�� t� �� i � � . ~ � t � .' . � � r'�- �� J � 1t o ear�Nater _.....� ..��: � ��f�� °�� 1 r � � � �-� � . ,�� . _� ..� � �� d � � �� I � � �� n U � ��'�,.�'-+-�1�� ..� � � �� J C!' 1 L �, . y � 1 .f�"t.. -- '. L°� .i . -_ 3�. 4�, t 4 FJ . ... - � '�..��'.� .. �e __z_ -' "4'15�:: �'�;.r' _ � �hl.+r'� =� �,�-.z.'- ' _ ' ' `y, . , ��I�:: - ❑ � ; � �r� � I � � � � • �� l. Item # 5 � �i�'��C�� i� �,��:�� ' � _ � ��I � ' � . , �� +L 4 �f _ -�' � � � �• 1 � L� � � �.� �' . ( _ � � � _ �1 . � � a er� a�r e a�r er ormance � Domestic E u it a v ■ Benchmark ■ Plus 18.37% 15.98% 2.39% , �� +L 4 �f _ -�' � � � �• 1 � L� � � �.� �' . ( _ � � � _ �1 . � � a er� a�r e a�r er ormance ■ I nternational E u it a y ■ Benchmark ■Minus 17.61 % 17.90% -0.29% , �� +L 4 �f _ -�' � � � �• 1 � L� � � �.� �' . 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