11/17/2003
TRUSTEES OF THE EMPLOYEES' PENSION FUND MEETING
CITY OF CLEARWATER
November 17, 2003
Present: Brian Aungst Chair
Hoyt Hamilton Vice-Chair/Trustee
Whitney Gray Trustee
Frank Hibbard Trustee
William C. Jonson Trustee
Also Present: William B. Horne II City Manager
Garry Brumback Assistant City Manager
Pamela K. Akin City Attorney
Richard Ebelke Assistant Human Resources Director
Cynthia E. Goudeau City Clerk
Brenda Moses Board Reporter
The Chair called the meeting to order at 9:04 a.m. at City Hall.
To provide continuity for research, items are in agenda order although not
necessarily discussed in that order.
2. Approval of Minutes: October 13, 2003
Trustee Jonson moved to approve the minutes of the October 13, 2003, meeting,
as recorded and submitted in written summation by the City Clerk to each Trustee. The
motioncarried
was duly seconded and unanimously.
3. Request for acceptance into membership: Pasquale Calabrese, Joel Conklin,
Frank McCollister, Freda Dixon, Billie Kirkpatrick, Verl Emrick, John Stone, Lynne
Johnson, Robert Lane, Suzanne Wakefield, Charles Thornton, Niki Cushing, Sherry
Watkins, Christianna Kretschmann, Robert Reagan.
Assistant Human Resources Director Richard Ebelke presented the
recommendation of the PAC (Pension Advisory Committee) to approve membership for
employees: Pasquale Calabrese, Joel Conklin, Frank McCollister, Freda Dixon, Billie
Kirkpatrick, Verl Emrick, John Stone, Lynne Johnson, Robert Lane, Suzanne Wakefield,
Charles Thornton, Niki Cushing, Sherry Watkins, Christianna Kretschmann, and Robert
Reagan.
Trustee Gray moved to accept the recommendation of the Pension Advisory
motioncarried
Committee. The was duly seconded and unanimously.
4. Regular Pension(s) to be granted: Ezekiel Taylor, John Richter, and Kenneth
Emerson.
Mr. Ebelke presented the recommendation of the Pension Advisory Committee
that Ezekiel Taylor, John Richter, and Kenneth Emerson be granted regular pensions
under Section(s) 2.393 and 2.397 of the Employees' Pension Plan as approved by the
Pension Advisory Committee.
Pension Trustees 2003-11-17 1 11/17/03
Ezekiel Taylor, Solid Waste Equipment Operator, Solid Waste Department, was
employed by the City on September 26, 1973, and his pension service credit is effective
on that date. His pension will be effective October 1, 2003. Based on an average salary
of approximately $38,304 per year over the past five years, the formula for computing
regular pensions, and Mr. Taylor's selection of the 100% Joint & Survivor Annuity, this
pension will approximate $31,082 annually.
John Richter, Senior Planner, Public Works Department, was employed by the
City on July 5, 1977, and his pension service credit is effective on that date. His pension
will be effective November 1, 2003. Based on an average salary of approximately
$61,250 per year over the past five years, the formula for computing regular pensions,
and Mr. Richter's selection of the 100% Joint & Survivor Annuity, this pension will
approximate $43,047 annually.
Kenneth Emerson, Wastewater Treatment Plant Operator C, Public Utilities
Department, was employed by the City on December 6, 1973, and his pension service
credit is effective on that date. His pension will be effective January 1, 2004. Based on
an average salary of approximately $37,867 per year over the past five years, the
formula for computing regular pensions, and Mr. Emerson's selection of the 50% Joint &
Survivor Annuity, this pension will approximate $29,466 annually.
These pensions were approved by the Pension Advisory Committee on October
9, 2003. Section 2.393 (p) provides for normal retirement eligibility when a participant
has reached age 55 and completed twenty years of credited service, has completed
thirty years of credited service, or has reached age 65 and completed ten years of
credited service. Mr. Richter qualifies under the 20 years of service and age 55 criteria.
Mr. Taylor qualifies under the 30 years of service criteria. Mr. Emerson qualifies under
the 20 years of service and age 55 and 30 years of service criteria.
Trustee Hibbard moved to grant regular pensions for Ezekiel Taylor, John
Richter, and Kenneth Emerson, as approved by the Pension Advisory Committee. The
motioncarried
was duly seconded and unanimously.
5. Approve the contract with Dodge & Cox as fixed income managers for the
Employees’ Pension Plan.
The Trustees previously authorized Callan Associates to conduct a search for a
fixed income manager.
The following is a list of fixed income managers that Callan recommended to the
Investment Committee:
Dodge & Cox (D&C)
Western Asset Management Co. (WAMCO)
Pacific Investment Management Co. (PIMCO)
Baird Advisors
Banc One Investment Advisors
Black Rock
Barrow, Handley, Mewhinney & Strauss, Inc
Deutsche Asset Management
Evergreen Investments
Pension Trustees 2003-11-17 2 11/17/03
Hartford Investment Management Co.
Richmand Capital Management
Weiss, Peck & Greer
Wells Capital Management
After reviewing the information provided on the above managers, the Investment
Committee ranked the managers and conducted interviews with the top three firms listed
above.
Based upon the interviews, Dodge & Cox and Western Asset Management were
ranked as the top two firms. Representatives from the Investment Committee visited the
top two managers. Dodge & Cox is a bit more conservative in their investment style and
the committee felt that Dodge & Cox fit better into the city’s goals and objectives.
The Investment Committee recommends to the Trustees that they hire Dodge &
Cox. The Investment Committee recommends that Dodge & Cox be funded at $75
million with the funds coming from the Northern Trust Lehman Index Fund. The Northern
Trust Lehman Index Fund is where the funds were placed after the termination of EPW
and Sirach.
Dodge & Cox charges a money management fee based upon the amount
invested and will result in the fee of .25 of 1% for $75 million. Additional amounts above
the $75 million will be charged at .15% of 1% up to a total of $135 million. We estimate
the fees to be approximately $200,000 annually and will vary based upon the market
value of the funds managed. This fee is consistent with industry norms.
Klausner and Kaufman, the Plan's Attorney's have reviewed the contract.
Trustee Hamilton moved to approve the contract with Dodge & Cox as fixed
motion
income managers for the Employees’ Pension Plan. The was duly seconded
carried
and unanimously.
6. Other Business – None.
7. Adjourn
The meeting adjourned at 9:06 a.m.
Pension Trustees 2003-11-17 3 11/17/03