01/22/2002
TRUSTEES OF THE EMPLOYEES' PENSION FUND MEETING
CITY OF CLEARWATER
January 22, 2002
Present: Ed Hart Vice-Chair/Trustee
Whitney Gray Trustee
Hoyt P. Hamilton Trustee
William C. Jonson Trustee
Absent: Brian J. Aungst Chair
Also present: William B. Horne II City Manager
Pamela K. Akin City Attorney
Paul O'Rourke Human Resources Director
Cynthia E. Goudeau City Clerk
Patricia O. Sullivan Board Reporter
The Chair called the meeting to order at 9:19 a.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:
A correction to the City Manager’s title was noted.
Trustee Jonson moved to approve the minutes of the January 7, 2002, meeting, as
motioncarried
corrected. The was duly seconded and unanimously.
contract with 3 Bridge Capital
ITEM #3 – Terminate as a large cap value equity manager
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For the year ending September 30, 2001, 3 Bridge has performance in the 99
percentile with 98% of large capital value equity managers outperforming them. During the
last year, the Pension Investment Committee has been concerned about 3 Bridge Capital and
has reduced the money they manage on three separate occasions. On October 31, 2001, 3
Bridge had $24,480,169 under management, down from $85,236,247 on October 31, 2000.
Earlier this year, the Trustees added large cap manager, Capital Guardian, with the
intention to terminate 3 Bridge Capital if they did not improve their performance. The plan’s
financial advisors and Pension Investment Committee recommended termination of the
contract with 3 Bridge Capital at this time. The contract with 3 Bridge Capital requires the City
to give 30 days written notice of termination. Staff recommends funds from 3 Bridge Capital
be divided between Ark Asset Management, deep discount large cap value, and Capital
Guardian, large cap relative value, such that after distribution Ark Asset Management and
Capital Guardian will have approximately the same amount of money under management.
In response to a question, Cash and Investments Manager Steve Moskun reviewed the
deliberate process followed when choosing or changing Pension Plan money managers.
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Trustee Gray moved to terminate the contract with 3 Bridge Capital as a large cap
value equity manager and that the appropriate officials be authorized to execute same. The
motion carried
was duly seconded and unanimously.
ITEM #4 – Approve expenditure of not to exceed $5,000, at $210 per hour, to law firm of
Chistiansen & Dehner
for updating and modifying existing money management contracts
The Pension attorney should review the Employee’s Pension Plan investment
contracts: 1) Money Managers: a) Aeltus Investment Manager; b) Ark Asset Management; c)
Denver Investment Advisors; d) Invesco Global Asset Management; e) Putnam Investments; f)
EPW Investment Management; g) Sirach Capital Manager; and h) Vanderbilt Capital Advisors;
2) Investment Advisory, Equity - EPW Investment Management; 3) Performance Measurement
– Callan Associates; and 4) Safekeeping: a) Sun Trust and b) State Street.
While legal counsel has approved all of these contacts, some are more than 20 year
old and need updating. Pension Attorney Lee Dehner believes he can update all of these
contracts for a fee of not to exceed $4,000. He would not review the 3 Bridge Capital contact,
which is being terminate, and Capital Guardian, which he already has reviewed. The current
$50,000 budget for legal services is sufficient to cover this expenditure.
In response to a question, Mr. Moskun said changes are specific to each contract.
Trustee Hamilton moved to approve an expenditure of not to exceed $5,000, at $210
per hour, to the law firm of Christiansen & Dehner for updating and modifying existing money
management contracts, and that the appropriate officials be authorized to execute same. The
motion carried
was duly seconded and unanimously.
ITEM #5 – Other Business
Human Resources Director Paul O’Rourke expressed thanks, on behalf of his family,
for condolences they had received from the City.
ITEM #6 - Adjournment
The meeting adjourned at 9:24 a.m.
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