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HomeMy WebLinkAboutDocumentation_Pension General_Tab 3_12/15/1997 • 7, • VILLAGE OF TEQUESTA • Post Office Box 3273 • 357 Tequesta Drive (? „ 9 Tequesta, Florida 33469-0273 • (561) 575-6200 A Fax:(561)575-6203 Cq CO TEQUESTA EMPLOYEES' PENSION TRUST FUND BOARD OF TRUSTEES MEETING SEPTEMBER 22, 1997 • I. CALL TO ORDER AND ROLL CALL The Tequesta Employees' Pension Trust Fund Board of Trustees held a regularly scheduled meeting at the Village Hall, 357 Tequesta Drive, Tequesta, Florida, on Monday, September 22, 1997. The meeting was called to order at 9: 05 A.M. by Chairman Ron T. Mackail. A .roll call was taken by Betty Laur, the 'Recording Secretary. Boardmembers in attendance at the meeting were: James B. Trube, Allan Oslund, and Thomas G. Bradford. Also in attendance were Finance Director Bill Kascavelis and Staff Accountant Jennifer West. Boardmembers Shawn Thurmond, Carl Hansen, and William Sharpless were absent from the meeting. II. APPROVAL OF AGENDA Boardmember Oslund made a motion to approve the agenda as submitted. Boardmember Bradford seconded the motion. The vote on the motion was: Ron T. Mackail - for Allan Oslund - for Tom Bradford - for James Trube - for The motion was therefore passed and adopted and the Agenda was approved as submitted. I BOARD OF TRUSTEES TEQUESTA EMPLOYEES' PENSION TRUST FUND MEETING MINUTES SEPTEMBER 22, 1997 PAGE 2 III. APPROVAL OF MINUTES A) Tequesta Employees' Pension Trust Fund Board of Trustees meeting minutes for May 19, 1997 Boardmember Bradford made a motion to approve the agenda as submitted. Boardmember Oslund seconded the motion. The vote on the motion was: Ron T. Mackail - for Allan Oslund - for Tom Bradford - for James Trube - for The motion was therefore passed and adopted and the minutes were approved as submitted. IV. STANDING. REPORTS Al Approval of New Applicants for Participation in Plan (April - August 1997) : B. Pauletti, Ron Kelley B) Approval of Beneficiary Changes None. C) Request for Withdrawal of Funds April - August, 1997 (D. Gustafson, Damian Peduto) Boardmember Bradford made a motion to approve the new applicants, the beneficiary changes, and withdrawal of funds. Boardmember Trube seconded the motion. The vote on the motion was: Ron T. Mackail - for Allan Oslund - for Tom Bradford - for James Trube - for 4 J BOARD OF TRUSTEES TEQUESTA EMPLOYEES' PENSION TRUST FUND MEETING MINUTES SEPTEMBER 22, 1997 PAGE 3 The motion was therefore passed and adopted. V. STATUS REPORT OF THE EMPLOYEES PENSION TRUST FUND (Bill Kascavelis, Finance Director) A. Report of Employee/Employer Contributions and Custodial Statements (Jennifer West, Staff Accountant) Staff Accountant Jennifer West reported that supporting documentation had been provided for April through July, 1997. The two deposits in transit reported at the last meeting were now listed and all others transactions were accounted for and reconciled. B. Florida Municipal Pension Trust Fund Quarterly Review - June 30, 1997 Finance Director Bill Kascavelis reported total investment returns for the quarter ending June 30, 1997 were 11.1%, on fixed income 3. 6%, and on equity 20.1*, slightly above the S&P 500 for the same period. An investment summary report was provided showing total funds of the Florida Municipal Pension Trust Fund. Mr. Kascavelis reported that a breakdown for Tequesta' s fund was not available. Boardmember Bradford made a motion to approve the Report of Employee/Employer ' Contributions and Custodial Statements as well as the staff report on the Florida Municipal Pension Trust Fund Quarterly Review. Boardmember Trube seconded the motion. The vote on the motion was: Ron T. Mackail - for Allan Oslund - for Tom Bradford - for James Trube - for t • BOARD OF TRUSTEES TEQUESTA EMPLOYEES' PENSION TRUST FUND FETING MINUTES SEPTEMBER 22, 1997 PAGE 4 The motion was therefore passed and adopted. C. Review of Correspondence prepared on behalf of Board of Trustees by Finance Director and correspondence received: 1) STI Capital Management, 5/22/97 2) Loomis, Sayles & Company, L.P., 5/22/97 3) Florida Municipal Pension Trust Fund, 5/22/97 4) Gabriel, Roeder, Smith & Company, 5/23/97. 5) Florida Municipal Pension Trust Fund, 9/16/97 6) State of Florida, Division of Retirement, 6/5/97 7) Florida Municipal Pension Trust Fund, 6/25/97 8) Loomis, Sayles & Company, L.P., 8/20 & 9/9/97 Finance Director Kascavelis referred to item (8) in which Peter Van Beuren suggested items for discussion at today' s meeting of determining whether to select a custodial bank or broker, and review of investment guidelines. Boardmember Bradford . made a motion to approve correspondence as presented. Boardmember Oslund seconded the motion. The vote on the motion was: Ron T. Mackail - for Allan Oslund - for Tom Bradford - for James Trube - for The motion was therefore passed and adopted. VI. Review of Discussion Regarding Pension Plan Financial Management and Administrative/Actuarial Services A) Custodial Bankers/Broker selection and investment guidelines (Peter Van Beuren, Vice President and Senior Partner, Loomis, Sayles & Company, L.P. ) BOARD OF TRUSTEES TEQUESTA EMPLOYEES' PENSION TRUST FUND MEETING MINUTES SEPTEMBER 22, 1997 PAGE 5 Mr. Van Beuren commented that Finance Director Kascavelis had sent their firm a copy of the League' s investment guidelines, and that Loomis Sayles & Company considered those guidelines as not adequate for this municipality. . Mr. Van Beuren explained that he had submitted some suggestions, which although were not tailor-made for the Village, provided ideas on how to simplify and broaden the investment guidelines to more specifically fit the Village's situation. Mr. Van Beuren commented that Mr. Palmquist of Gabriel, Roeder, Smith & Company could probably provide more insight on this matter. Mr. Van F euren commented that the Florida Municipal League' s guidelines lacked certain benchmarks for the Village's account, which because of its size could not invest in a full range of fixed income investments. Mr. Van Beuren explained that Loomis Sayles had indicated the Merrill Lynch intermediate fund index as a benchmark which would include only higher quality fixed income investments. In response to a question from Chairman Mackail regarding how the investment policies of the Florida Municipal League were not in the best interests of the Village, Mr. ' Van Beuren explained that because the League acted as a master trustee for all participants that they had greater flexibility than the Village might want at this point. Mr. Palmquist responded to .Boardmember Bradford's question regarding State Statutes limitations on amounts that could be invested in stocks that in both Chapter 175 and 185 there was a 30% limitation on stocks, but that the Village could pass an ordinance to override that limitation and could also override all of the quality restrictions, some of which were extremely conservative. The only thing that could not be overridden by local ordinance was the restriction on international securities. Mr. Van Beuren explained that the guidelines in his letter were only suggestions and he would not want the Board to adopt those guidelines as presented. Finance Director Kascavelis suggested that he meet with BOARD OF TRUSTEES TEQUESTA EMPLOYEES' PENSION TRUST FUND MEETING MINUTES SEPTEMBER 22, 1997 PAGE 6 Mr. Palmquist and Mr. Van Beuren to formulate various proposals for the Board of Directors to consider. Boardmember Oslund questioned the status of the three pension funds, to which Finance Director Kascavelis responded that at the present time the. Village was still under the guidelines of the Florida League of Cities, that new appropriate guidelines must be formulated; and that although accounting was done for three separate funds, investments were anticipated to be from one account. Mr. Oslund questioned whether the new guidelines would need to be presented to the Village. Council. Mr. Palmquist advised that if 50% equities was the only limitation in the current documents that if the Board wished to go higher then the Village Council would have to amend the ordinance. Chairman Mackail expressed his preference that Mr. Kascavelis and Mr. Van Beuren have the ability to create goals and objectives, with the Board to review same, and he did not believe any change was warranted until the goals and objectives were formulated. Mr. Van Beuren provided a handout containing a comparison of brokers versus banks as custodians. The report Compared Citibank, which had no transaction fees, with Bank of New York, which charged $14 per transaction. Brokers compared were Prudential Securities, Paine Webber, Edward Jones, and Legg Mason. Mr. Van Beuren discussed the merits of each and explained that although any one would be good, he expressed preference for Prudential Securities, located in North Palm Beach, since Loomis Sayles & Company had worked with that firm for a long time. Mr. Palmquist commented that the only concern with using a brokerage firm instead of a bank was that reports were not as detailed and clear as bank custodial reports, and gave as an example the fact that brokers did not keep track of the cost value of any securities. Mr. Van Beuren explained that his firm_ did track that information. Chairman Mackail expressed his opinion BOARD OF TRUSTEES TEQUESTA EMPLOYEES' PENSION TRUST FUND MEETING MINUTES SEPTEMBER 22, 1997 PAGE 7 that good reports were needed for accountability and so as to not create an unfunded balance. Mt. Van Beuren explained that Loomis Sayles would send a breakdown of each trade to the Village if a broker was used; and that if a bank was chosen that this information would probably be included in the bank' s statement and also Gabriel Roeder Could track it. Mr. Palmquist commented that broker statements were not as easy to follow as bank statements and that he was not sure about whether sufficient tax information would be provided by a broker regarding payments to participants in the fund; however, a broker would not charge as much so that the Fund could save money in the beginning and possibly switch to a bank later. Discussion ensued. Chairman Mackail concluded that because of the small size of the Village fund that it might be appropriate to go with a brokerage at first. Chairman Mackail commented that the Village wanted good administration and a good portfolio, and that Mr. Palmquist would review the reports. Chairman Mackail explained that in the past, Boardmember Sharpless had reviewed reports closely. Ms. West inquired whether it would be better to remit funds to the broker once a month than bi-weekly. After discussion, Ms. West was requested to continue bi-weekly remittances. Boardmember Bradford made a motion to select Prudential Securities of North Palm Beach based on Peter Van Beuren's suggestion. Boardmember Oslund seconded the motion. The vote on the 'motion was: Ron T. Mackail - for Allan Oslund - for Tom Bradford - for James Trube - for The motion was therefore passed and adopted. B) Administrative/Actuarial Review (J. Stephen Palmquist; BOARD OF TRUSTEES TEQUESTA EMPLOYEES' PENSION TRUST FUND MEETING MINUTES SEPTEMBER 22, 1997 PAGE 8 Gabriel, Roeder, Smith & Company) Mr. Palmquist explained that no actuarial review was available as yet, and that he would be working on a report as of October 1, 1997, which would take some time to complete. VII: ANY OTHER MATTERS There were no other matters to come before the Board. VIII. ADJOURNMENT Chairman Mackail moved that the meeting be adjourned. Boardmember Trube seconded the motion. The vote on the motion Was: Ron T. Mackail - for Allan Oslund - for Tom Bradford - for James Trube - for The motion was therefore passed and adopted and the meeting was adjourned at 9:48 A.M. Respectfully submitted, AL4Z.-7". Betty Laur • Recording Secretary A BOARD OF TRUSTEES TEQUESTA EMPLOYEES' PENSION TRUST FUND MEETING MINUTES SEPTEMBER 22, 1997 PAGE 9 ATTEST: Joann Manganiello Village Clerk DATE APPROVED: