HomeMy WebLinkAboutMinutes synopsis_Pension Joint_02/02/2009SYNOPSIS OF JOINT MEETING OF PUBLIC SAFETY OFFICERS PENSION
BOARD AND GENERAL EMPLOYEES PENSION BOARD ON 2/2/09
Minutes of the Joint Meeting of both boards with the Village Manager held
on 12/10/08 were approved.
2. Actuary Steve Palmquist discussed the following items:
• Plan Assumptions vs. Actual Returns
• Mortality tables Utilized for Actuarial Reports vs. Current
Trends
• Future Plan Contributions Based on Market Conditions and
Economic Trends
• Actuarial Considerations of all Income Affecting Pension
Payouts and Liabilities
• Revising Actuarial Assumptions Based Upon Modified
Forecasts and Models
3. Comments from the public and staff were made.
4. Mr. Palmquist outlined his proposal for an impact study and estimated
costs, which he was to email to Pension Coordinator McWilliams by the
end of the week, and he estimated completion of the impact study could
be between the middle and end of March, 2009.
5. Consensus of both boards was when they heard from Pension
Coordinator McWilliams with Mr. Palmquist's written proposal, she would
coordinate a special meeting of both boards for their consideration of
approval of the proposal.
END OF SYNOPSIS
JOINT TEQUESTA PENSION BOARD OF TRUSTEES MEETING
GENERAL EMPLOYEES PENSION TRUST FUND
AND
TEQUESTA PUBLIC SAFETY OFFICERS PENSIONTRUST FUND
MEETING MINUTES
February 2, 2009
I. Call To Order And Roll Call
A joint meeting of the Tequesta General Employees' Pension Trust Fund Board
of Trustees and the Tequesta Public Safety Officers' Pension Trust Fund Board
of Trustees was held at the Tequesta Village Hall, 345 Tequesta Drive,
Tequesta, Florida, on Monday, February 2, 2009. The meeting was called to
order at 10:00 a.m. A roll call was taken by Ed Sabin, Chair of the Public Safety
Officers" Pension Board. In attendance at the meeting were: Public Safety
Officers' Pension Board Members: Chair Ed Sabin, Board Member Ray Giblin.
Board Member Ken Nielson, and Board Member Robert Young. Secretary David
Cooper was absent from the meeting. General Employees' Pension Board
Members: Chair Michael Rhodes, Secretary Carl Hansen, and Board Member
Archie C. Mangum, Jr. Board Member Deanna Mayo and Board Member
Michelle Gload were absent, attending the FPPTA Trustees' School. Also in
attendance were Attorney Bonni Jensen, Senior Accountant Monica Rahim,
Finance Director JoAnn Forsythe representing Village Management, Brian
Bacardjiev with Bogdahn Consulting, LLC, Steve Palmquist with Gabriel Roeder
Smith and Company, Mike Dana of Dana Investment Advisors, and Tony Brown
of Rockwood Capital Advisors. Pension Coordinator Lori McWilliams was also
absent, attending the FPPTA Trustees School. Chair Sabin noted the Village
Manager was not present, but was available if needed.
I1. Approval of Minutes
MOTION:
General Employees' Pension Board Secretary Hansen made a motion to
approve the minutes of the joint meeting of both boards held on December
10, 2008. Board Member Young seconded; motion carried by unanimous
vote.
III. Discussion by Steve Palmquist
• Plan Assumptions vs. Actual Returns
• Mortality tables Utilized for Actuarial Reports vs. Current
Trends
• Future Plan Contributions Based on Market Conditions and
Economic Trends
• Actuarial Considerations of all Income Affecting Pension
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 2
Payouts and Liabilities
• Revising Actuarial Assumptions Based Upon Modified
Forecasts and Models
Mr. Palmquist provided a review of discussions which had gone on for a year
regarding funding the pension plans. He explained the plans were defined
benefit plans, meaning the plans had made promises to the members of the
plans regarding how much their pensions would be if they met certain
requirements. Those promises would come to fruition as people met their
respective retirement dates. It was not known in advance how much those
promises were worth, so the actuary looked at the benefits in the plans and then
figured out how much was needed to put into the plans each year in order to
meet those future promises. Looking at an individual employee who made
$30,000 annually starting out, he knew if that person stayed until retirement age
her pension would be based on how much service she had and how much her
pay would be in the last few years of working. The actuary made an estimate of
how much the pay increases would be until retirement, to estimate how much the
pension would be. Being defined benefit plans, the plans paid pensions for life.
That was a major factor in determining the cost of the plan. The actuary's first
guess was how much the benefit would be and his second guess was how long
the benefit would be paid. In order to figure out how long the benefit would be
paid, mortality rates were used to provide that estimate. Over the years when
money was building up, the actuary made an estimate of how much those funds
would earn over time. Those earnings would replace the amount contributed by
the Village; therefore, the more earnings the pension funds had, the less the
Village would have to pay in the future and vice versa. Mr. Palmquist advised
there were studies that showed, over extended periods of time, that benefit
payouts were covered 75% by the earnings of the funds, not by contributions
going in, so the earnings were extremely important.
Mr. Palmquist reported he had arrived early and had answered questions at the
Public Safety Officers' Board meeting that morning. One question had been
what happened when you had investment losses. His response in the case of
the Public Safety Officers' plan, was that investment earnings for the fiscal year
ending 9/30/08 were minus 11.8%, or half a million dollars in loss, compared to
zero. The loss from an actuarial standpoint was more than $500,000, because
they were expecting a positive 8%. At the beginning of the fiscal year there had
been $4 million, and 8% would have been $300,000+ that was expected.
Because $300,000 to the positive was expected and actual was $500,000 to the
negative, the actual investment loss was $800,000 from an actuarial standpoint.
That $800,000 loss was spread out over the average future working life of the
members of the plan. For the Public Safety Officers' plan, that was a factor of
10%; so 10% of that loss would be added to the Village's contribution if an
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 3
October 1, 2008 evaluation was done. For the General Employees' plan, that
factor was closer to 9%; they started out fiscal year 2008 with a million dollars,
their return was negative 17%. A positive of $80,000 had been expected;
converting the negative 17% into dollars might be $150,000, or roughly a
$250,000 loss, so the Village cost would go up roughly $22,000.
Mr. Palmquist explained there were also other factors, such as if more
employees than expected terminated during the year that would help offset that
investment loss. Pay increases for General Employees had been less than
expected; but pay increases for Public Safety Officers had been greater than
expected, which would produce another negative. Mr. Palmquist's point was
there were a lot of other things the actuary looked at besides just investment
earnings to determine the required contribution.
Chair Ed Sabin asked what other pension plans that had an 8% earnings target
had done during the present economic crisis. Mr. Palmquist responded that 8%
was still the most common assumed rate of return; several of his clients-
certainly not the majority-had gone to 7-1/2%, and he only had three clients that
were currently below 7-1/2%. The problem with lowering that rate now was the
plans already had investment losses to make up, and also if the rate of return
were lowered that made the cost go up as well. While he would really like all his
clients to lower their assumed rates of return, he was not the one who had the
money to pay for that, and it was going to be very difficult to pay back in the next
several years. Although many plans would like to reduce their rate, he doubted
that they would do it at this time.
Secretary Carl Hansen commented everyone was going to suffer from this
economic crisis, and asked if it could be expected that whatever loss there was
to the pension plans could be made up by the Village or by employees so that
employees would not suffer during their retirement. Mr. Palmquist responded
that if nothing was changed in the plans, the Village was making up the cost over
time. If one were talking about employees sharing in the pain, you were getting
into collective bargaining, and he suspected that would be near the top of the
agenda for collective bargaining all over Florida. Mr. Palmquist advised that
while there were losses in the Village plans, not to lose sight of the fact that they
were starting from a very strong position. Both plans were very well funded and
had relatively low employer costs. If one compared the 8% or 9% of pay cost of
the Public Safety Officers' plan with others around the State, you would see that
was very low in comparison-most cities were paying 20%-30% of pay in
pension costs for their Public Safety employees. For the General Employees,
the Village was paying about 6% of pay, which was also low compared to other
General Employee groups, and he cautioned not to lose sight of the fact that the
Village was starting from a strong position.
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 4
Chair Sabin asked if it was fair to say the State FRS plan had larger losses that
the Village's Public Safety Officers' plan for the most recent quarter. Mr.
Palmquist responded he had no numbers, but the State valued its plan on a June
30 year instead of September 30, so their last valuation on June 30, 2008
included a 12-month period that was not as bad as the period following,
therefore, their 7/01/08 actuarial report showed very little change in required
contributions. He suspected that when they looked at the 7/01/09 report with
massive losses, that it would be a much different story. The 7/01/08 report told
all the entities that paid into FRS what to pay starting 7/01/09, so it would not be
until 7/01/10 that there would be a significant cost increase for the FRS covered
employers. The investment earnings rate for FRS was 7.75%.
Mr. Palmquist recalled he had talked to both boards several months ago about
the fact that sooner or later the mortality tables being used for funding purposes
needed to be changed. He estimated that changing to the most recent tables,
for the Public Safety Officers' plan would make the Village's cost go up 2%-3% of
payroll, and for the General Employees' plan it would go up 1 %-2% of payroll.
The reason that was important was the pensions were paid for the life of the
retirees, and it was important not to understate how long those pensions would
be paid. Chair Sabin asked why the tables had not been changed. Mr.
Palmquist explained that even though the tables currently used were 26 years
old, newer tables had not been much different, but what would make the cost go
up was that static tables would no longer be used. New tables would be
constructed differently to anticipate future improvements in mortality-in
essence, there would be a separate mortality table for each year of birth, so
people born in 1950 would have slightly higher mortality rates than those born in
1951, 1952, and so on. That was what would make the cost go up.
Secretary Hansen commented if someone wanted to retire earlier, they would get
reduced benefits, and asked if the cost would be more for those who chose to
retire early. Mr. Palmquist explained there was a penalty of 3% for each year
one retired before normal retirement date; the full actuarial penalty would be 7%-
8%. In essence, the Village would be making up for that subsidized early
retirement benefit. The Village would be paying for that subsidy, and one of the
actuarial assumptions was how many people would utilize the early retirement
provision. It remained to be seen how many actually did utilize that provision.
Chair Michael Rhodes asked for clarification whether the increased cost of 1 %-
2% for the General Employees plan was affected by the mortality tables. Mr.
Palmquist explained that if the current tables were replaced by the 2000 tables,
there would not be much change; the change would be in going forward from
2000 until each person's demise.
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 5
Chair Rhodes commented on the example given earlier of the impact of
investment losses to next year's contribution, and asked how that would change
if funding were done on a smoothing basis. Mr. Palmquist responded that had
come up at the Public Safety Officer's board meeting, so he would use those
figures as an example-the difference between their expected return of positive
8%, or $300,000, and their actual of minus $500,000 equaled an $800,000 loss.
In the absence of the smoothing method you would figure 10% of the $800,000.
With the smoothing method, you would take the first 20% of $800,000 and
recognize 20%, or $160,000, this year. You would take 10% of the $160,000 as
the cost increase. You would have another $160,000 each year for five years or
so-those were not exact numbers, but gave an idea of how it would work. If
there were a positive investment return, it would be treated the same way.
Mr. Palmquist commented regarding future plan contributions based on market
conditions and economic trends, that Finance Director Forsythe had indicated the
Village definitely had less revenue coming in than in previous years, and with
pension costs going up, something had to give. His guess was the Village was
in good financial shape, but that was something the boards would have to ask
Finance Director Forsythe.
Mr. Palmquist commented going back to the asset smoothing issue, if that
method were used, the resulting asset figure being used must be within 20% of
market; and with the stock market going down quickly and deeply, one could
easily come up with a situation where the asset figure turned out to be more than
20% higher than market. In that case, you had to lower down to 120% of market,
and that differential could not be smoothed out over five years. In the 10/01/2008
valuations he had done to date, no one was outside the 20% boundary, but
unless there was a dramatic turnaround between now and when he did the 2009
valuation, he suspected that the 20% corridor would be breached, and therefore
there would be a double whammy of investment losses which would have to be
made up the following year. In the example of the $800,000 loss, there would
be another $800,000 loss in the 2009 fiscal year. In calculating the assets under
the smoothing method, the asset value would be more than 20% than the market
value. If the number that was ended up with was $5 million but the assets were
still only $4 million, $5 million divided by $4 million was 124%., so the 124%
would have to be reduced far enough to get to 120%, which would be $4.8
million; therefore, $200,000 could not go through the smoothing method-it had
to go directly to the 10%. Mr. Palmquist commented that if money were
unlimited he would like to change mortality rates, lower the assumed rate of
return, and increase the salary increase assumption that was being used for
Public Safety-all of which would increase the cost.
Chair Sabin commented when the boards met with the Village Manager, there
had been discussion about authorizing an impact study, which would be sort of a
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 6
baseline of where the funds were today and what was being done; Mr. Palmquist
was also talking about a baseline and how it could be influenced by different
things and how to plan, and the impact of that. Chair Sabin commented there
also had been a dialogue about whether the Village would consider a defined
contribution plan versus defined benefit plan.
Mr. Palmquist confirmed that everything discussed so far today applied to a
defined benefit plan. With a defined contribution plan, one knew how much
money was going into the fund each year. Using an example of 8% going into
the plan every year, what was not known was what that would produce as a
retirement benefit at the end. The defined benefit plan defined what the final
benefit was, and that was worked toward over time; the defined contribution plan
indicated what was going in but you did not know what you would get at the end.
In defined contribution plans, from 2002 through 2007 people were adding 20% a
year; now everyone had really been hurt. Usually when an employer went from
a defined benefit plan to a defined contribution plan, all the new hires went into
the defined contribution plan, and current employees were given a choice
whether to go into the defined contribution plan. Another option would be to shut
down the defined benefit plans and have a defined contribution plan for all
employees going forward. Mr. Palmquist reported that the Town of Lake Park
had done that, but there had not been enough money to pay all benefits earned
by the firefighters and they had been told by the Florida Supreme Court their
obligation was to cover all accrued benefits of the plan. Tequesta plans would
therefore have to be made whole; as of a year ago both plans had asset values
that exceeded plan termination benefits, but it was unknown if that was still the
case. Attorney Jensen advised that the decision of whether or not to terminate a
plan was a municipal function-not a function of this board. Once the decision to
terminate had been made, the operation of terminating was a board function, so
the board had the obligation to decide how to distribute the assets. There were
three options available to distribute the assets: (1) create a substitute trust fund
to pay the benefits for the retirees; (2) operate it as a frozen type plan; (3) pay
the money out in lump sum payments or purchase an annuity. The level to
which the municipality had to fund the benefits depended upon the way that the
plan was terminated. The Lake Park Police pension fund was actually
terminated before the firefighters plan, but they had created a substituted trust
fund and were able to pay out the assets to active members in a lump sum, and
they continued the plan on an on-going basis as a substituted trust fund to pay
the retiree benefits. The municipality funds those retiree benefits using an
annual actuarial evaluation, just as Tequesta did. Chair Sabin commented he
did not believe, unless the boards felt otherwise, that was within the scope of
analysis of questions for Mr. Palmquist and his firm, but the point had come up in
the dialogue with the Village Manager, when all options were presented. Chair
Sabin indicated he believed today's direction was to give guidance to the
actuarial firm as to what type of analysis the boards would like to see.
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 7
Mr. Palmquist advised that mortality rates and assumed rate of investment return
would apply to both General Employees and Public Safety plans; the salary
increase assumption would only apply to Public Safety. Mr. Palmquist clarified
he had only 2 or 3 clients below 7-1/2%, and 8-10 clients who had lowered their
assumed rate of return-a couple of which actually were doing it step-by-step,
going down a tenth of a point per year over an extended period of time.
Chair Sabin asked if in the areas of possible focus whether Mr. Palmquist would
be able to see incremental effects of individual items, which Mr. Palmquist
confirmed that he would. Board Member Mangum asked what the long-term
exposure would be if the rate of return dropped to 5% actual. Mr. Palmquist
responded we had seen what happened in one year-a significant increase in
the amount the Village had to pay into the funds, and if over an extended period
of time the rate of return was not achieved, then it was a problem that would
have to be dealt with; the Village's contribution would rise each year it was not
met, and if it continued to happen then the rate would have to be reduced.
Board Member Mangum indicated he considered 8% too high for the next few
years. Mr. Palmquist acknowledged that for the past fiscal year and four months
into this new fiscal year, the Village's contribution would be higher. Mr.
Palmquist explained it was also spread over future working life, and under the
present aggregate funding method for the plans one was allowed to spread
everything over 12-15 years; another common funding method, entry age normal
method, allowed it to be spread over 30 years, which could be used, and would
have no effect on the funding ratio but would have an effect on the required
contribution. Chair Sabin confirmed with Mr. Palmquist that it could go to
underfund the plans-underfunded within the guidelines allowed under the law--
and would have to be made up over time. Mr. Palmquist reported that both of the
Village's plans as of 10/1/07 were over 100% funded, but as of 10/1/08 he
thought the General Employees plan still would be, but did not think the Public
Safety Plan would be; however, the funded ratios were very strong compared to
other plans.
Chair Rhodes asked if 8% return was still common; Mr. Palmquist explained it
was still common within their firm's clients and also around the country-that
there was no rush to change it because at this time there was also a loss to be
made up that would be compounded.
Chair Sabin asked Mr. Palmquist's thoughts on an impact study. Mr. Palmquist
responded a study could be done that would show the effects of each item that
had been discussed, both separately and combined; and he knew that the Public
Safety Officers' board had not authorized annual valuations but he was afraid if
his firm did a study based on the 10/1/07 assets and employee data, it would not
help very much. Therefore, he recommended if they were going to authorize a
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 8
study that it be done on 2008 data or hold off until 10/1/09 and do all the studies
based on 10/1/09 data. Chair Sabin asked if 12/31/08 data could be used. Mr.
Palmquist responded they could use the member information as of 10/1/08,
which was already in their system, and the asset data as of 12/31/08, which
would still give a good comparison.
Board Member Nielson commented the Board's obligations did not change
regardless of which funding method was used; Mr. Palmquist agreed,
commenting the amount of benefits was going to be the amount of benefits, and
his firm was trying to give it their best guess as to the value of those future
benefits and what parameters to use to determine that value. Board Member
Nielson commented another known item was the employees' contribution.
Council Member Arena asked, under the 30-year payback program mentioned if
a lump sum could be paid to reduce the amount. Mr. Palmquist explained it
could be paid that way-the more it was reduced early, the less that would have
to be paid later. Council Member Arena asked if there were an emergency
clause in defined benefit pension plans anywhere that in the event the bottom fell
out, the employee contribution rate was automatically increased until things got
better. Mr. Palmquist responded he used to have 3 or 4 plans and now had only
one where the city contributions and the employee contributions were both
variable. Different formulas could be created-one was if the city's cost
exceeded a certain percent of payroll, then the excess over that would be shared
equally by the city and the employees. Using an example of 10% threshold, if it
went up to 12%, then the city would assume the first 10% and add 1 % for a total
of 11 %, and members would assume 1 %, which was something that could be
done. When it dropped back to 10%, then the city would pay.
Chair Sabin commented the discussion had identified four areas that could totally
change-Council Member Arena was talking about the required contribution level
of the Village, and if changes were made to any assumptions such as smoothing,
aggregate, etc., that contribution level could change. There would have to be
clear definitions on assumptions and changes and how it was shared, etc., and
that would be pretty complex. Council Member Arena commented he was
thinking outside the bubble, because it was an out of the bubble problem. Mr.
Palmquist commented he had mentioned the Village cost compared to other
plans was fairly low; if the Village were to put in a minimum contribution, so that
in good years that minimum was more than the actuarially required amount, that
little extra would build up over time and really help out. As an example, Mr.
Palmquist commented for Public Safety, the Village was paying about 9%; they
might put in no less than 12% every year. Board Member Giblin commented on
the amount the Village had paid in the past. Both Chair Rhodes and Chair Sabin
suggested it would be very interesting to go back 5 years or to the plans'
inception to see how much the Village had contributed each year, and in addition
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 9
to compare that to other plans, in order to set benchmarks where things had
been, to help determine what to do going forward. Council Member Arena
expressed his opinion that setting a minimum Village contribution right now would
not do much since they were trying to catch up, and they should wait until it went
to zero. Mr. Palmquist responded he had heard talk recently that if an employer
had some cash available, now was the time to buy, while the market was low.
Mr. Palmquist clarified that the contribution rate would never go to zero.
Discussion ensued.
Village resident Frank D'Ambra commented regarding defined benefit plans
paying retirement for life and defined contribution plans not doing that. Mr.
D'Ambra advised that with a defined contribution plan one had a set amount
going in and received a specific amount in a lump sum at retirement; in a defined
benefit plan the way it was guaranteed for life was either the Village continued to
self fund the benefit, or they could purchase an annuity which would provide the
income. In a defined contribution plan, the individual had that same option to
purchase an annuity at the time of retirement to provide an income stream for
life, and that income stream could either be a flat amount or could include
inflation clauses and other things. Therefore, options at retirement were similar
between the two types of plans, and people who retired back when the market
was good might have done better being in a defined contribution plan. Mr.
D'Ambra commented on benchmarking against other municipalities or other
governmental entities, that municipalities and State programs did not have a
reputation of being the best managed programs, and suggested being very
careful comparing our well-run pension plans to other plans. Chair Sabin
commented those were good points, and clarified that the plan's investment
monitor did benchmark against other investment managers and was going to get
further data outside municipal plans.
Finance Director Forsythe advised the Village Manager had asked her to attend
in his place, and advised he and staff had discussed the items under discussion
for a few years; and in 2001 there had been discussion of the potential of moving
to a defined contribution plan. There had been a time when the Village
contribution for the police had been zero. Ms. Forsythe expressed her opinion
this could not be looked at in a vacuum-the past must be considered to see the
whole picture. As an accountant, she wanted to see firm hard numbers, but was
unsure how to accomplish that. She agreed with Mr. Palmquist that during this
volatile environment the boards should have annual actuarial evaluations in order
to determine the annual contribution rate.
Chair Sabin suggested the actuary work with staff to get history on the
contributions and see what percentage of the total Village budget that was so
staff could see not just funding requirements, but how it impacted the Village.
Finance Director Forsythe commented staff could get information from the annual
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 10
comprehensive financial reports, and could look there first. Chair Sabin
commented perhaps staff could determine what the contribution percentage
should be, and the boards needed to understand the overall impact of the
pension plan.
Chair Sabin commented there had been discussion by the Public Safety Officers'
board at their meeting that morning about having annual actuarial evaluations in
order to have more timely figures, but at the same time considered smoothing,
which would take the number and reduce the impact, and determined that at
least going into this joint meeting that board did not see the need or value of
having annual actuarial evaluations, but left open in this case and from time to
time when there might be a need to have a special study or an interim one done
rather than locking in having an actuarial evaluation. Finance Director Forsythe
noted that when things were coming in as expected, there was less risk in
moving forward with the same assumptions, and Mr. Palmquist usually provided
projections for the current year and the next two years to use, to see what
contributions should be, but currently looking at the 2007 evaluation might not
help the Village in moving forward.
Mr. Palmquist was asked to summarize his recommendations for an impact
study.
Mr. Palmquist recommended an impact study with the following items: Looking
at costs and liabilities for each item discussed as far as assumptions, both with
the aggregate method and the alternate entry age normal method; provide
surveys of the percentage of plans that used each method to provide a comfort
level that others were doing the same thing; and smoothing. They would provide
for a few years back the required and actual contributions that were relatively
easy to find; those were included in Mr. Palmquist's actuarial evaluations, but he
did not have the percent of pay going back, which would be relevant. For Public
Safety, the report would include investment earnings, mortality rates, and salary
increases. For General Employees, the study would include investment earnings
and mortality rates. For both plans: smoothing method and changing the
funding method. Completion of the study was estimated by the middle to end of
March, 2009. Mr. Palmquist indicated he would send an email to Pension
Coordinator McWilliams by the end of this week of his proposal and stating the
cost, but ballpark would be $3,000-$4,000 for the General Employees and a little
more than that for the Public Safety plan. For both plans, Mr. Palmquist would
use the December 31, 2008 asset value.
Consensus of both boards was when they heard from Pension Coordinator
McWilliams with Mr. Palmquist's written proposal, she would coordinate a special
meeting of both boards for their consideration of approval of the proposal.
Joint Meeting Minutes of Board of Trustees of Public Safety Officers' Pension
Trust Fund and General Employees' Pension Trust Fund
February 2, 2009 11
V. Adjournment
There being no further business, the meeting was adjourned.
Respectfully submitted,
,~~~~ ~
Betty Laur
Recording Secretary