HomeMy WebLinkAboutDocumentation_Pension General_Tab 02_08/02/2010 SY�OPSIS OF J01�9T hV�E�T9�lG OF �HE C�E�lE�L ��PLOY�ES' PENSIOt�
�OARD A�D �HE PU�LIC �eq�E� OF�BCERS PE6�S10� �OAR� �iELD �A�
3, 2010
�. Presentation �ras rnade by Pete Prior with �enefits 11SA.
2. Presentation was rnade by Scott �aur and Denise I1�cNeill of Resource
Centers.
3. Pension Coordinator i�AcVNilliams reported fihe Village Nlanager had
indicated it was not a mandate that the boards take on a third party
administrator, but an oppor�unity to explore alternative options to provide
this service; he wanted to assure that things continue to run effectively
and economically.
�. The Boards discussed current �expenses versus those of the proposed
firms and the additional items the firms could offer.
5. The �oards expressed preference for Resource Centers as a 4hird party
administrafior.
6. Due diligence was discussed. The following ifems �rere brought up:
0 A�oard rnember and/or someone from the i/illage familiar wifih the
technology being used should visit the third party administrator to see if in
�ctioro.
� �o4h Boards should falk with the firrn's references vvho had used
their systems for 2-3 years to see their thinking on adaptability, flexibility,
and troubleshooting fo see howi they had handled problerns.
� Talk fo people who had used this service, both on fhe
adminis4rative side; and atso at the participant level—which might be done
by the FIR Department.
� The �oards should make sure there vvas an ifemized list of fhe third
party administrator's responsibilities, and then compare and contrast with
where they might get some of those services either internally within the
0lillage or perhaps vvith the current outside service providers.
� Clarify with the actuary that in the future statements would come
from fihe third party administrator instead of requests from the actuary.
� To the ex4ent there was overlap of internal functions, to make sure
it was seamless and there were not additional people involved.
�ynopsas of Joi�t �eeting of �'he Ge�eral �mpioyees' �ensio� �oard �n� tE�e
���lic Safefy Officers' Pensi�n �oard held �d�y 3, 20� 0
Page 2
o �t was importara4 the �oards stay linked to fihe i�illage in ferr�s of
ongoing participation and corrimunication.
� Clarifiy responsibilifies and how the third party administra4or vvould
interact with other providers such as the actuary, etc.
7. �oth Boards voted to sef up a committee to perform due diligence.
Secretary D'Ambra was chosen to be the committee member representing
the Public Safety Officers' Pension; Board fVlember Terzakis was chosen
to be fihe comrnittee rriember representing the General Employees"
Pensian. One or tvvo representatives from the Village who currently
perFormed the vvork vvere to accornpany these committee members.
�. Consensus �as fo hold a joint meefing in 6-8 �nreeks or sooner ifi fihe
committee vvas ready for the boards 4o hear an update; coordinating vvith
those onrho were traveling.
9. The i/illag� �I�rk's �ffi�� �v�� tQ �oor�inate th? joi�t mee#�r�g.
END OF� SYfVOPSIS
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�'�QtJESl°A PU�LIC S�4FE OFFICER�
AND GEIVE17,e4L EMPLOYEES'
PEfVSl�IV TRl1S°T FtJIVD �OAFtDS
Nlay 3, 2010
9e Call T� �rcfee �nd 63081 �ail
The Tequesta General Employees Pension Trust Fund Board of Trustees and
the l"eques4a Public Safiety Officers Pension Trusf Fund Board of Trustees held a
joint meeting at the Tequesta Village Hall, 345 Tequesta Drive, Tequesta,
Florida, on Monday, Nlay 3, 2010. The meeting was called to order at 11:41 a.m.
A roll call was taken by Recording Secretary Betty Laur. General Employees'
Pension Board Members in attendance at the meeting were: Chair Michael
Rhodes, Board Member �eanna IUlayo, Board Member Michelle Gload, and
Board Mesrnber John Terzakis. Secretarlr Carl Hansen v�ras absent from the
meeting. Public Safety Officers' Pension Board Nlembers in attend�nce at the
rneeting were: Chair Ed Sabin, Secretary Frank D'Ambra, Board Member R�y
�'iblin, and Board �llember Robert Your�g. 8oard �Jier�ber David �ooper was
ab5ent from the meeting. Also ir� attendance were Attorney Bonni Jensen,
Daniel Johnson with Bogdahn Consulting LLC, Pension Coordinator Lori
n/IcWilliams, and �etty La�ar, Ftecording Secretary.
�1. �pprova� �f �genda
nII�TIOIV BY PUBLIC S�►FE`TY OF�IC�RS' PENSIONI �OAFZD:
Nlcation was made by �oard IVlember Giblin, secondecB by �oard Merr�be�
�oung, to appro�e �he agencfa as subm�t#ed AAO$90�i C�PE'i�CI �y �IPi�BI�I'i"iOI�S
�0� VO�,
NIOTIOBV �Y GENEI�L EAAPLOYEES' PEIdSION BOARDe
nllotion �nras made by Board Member AAayo, secondecf by �oarcf AAerr�ber
`Terzalcis, to approve the agenda a� submi#tede Nlotior� carr�ed by
�nanirnous 4�0 vot�.
911e Presentation�
� o ��nefits 11Se4
Nlr. Pete Prior of Benefits USA provided a history of his firm, started in 1997,
which now had ten empfoyees, and described his background. Their mission
vvas to provide the best service possible, regardless of what it would take. Fle
was available 24/7 except when in a meeting. Services were listed in the
presentation book. Backup vvas provided for the actuary; monthly financials were
done on an accrual basis. Financial planning seminars were provided for
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�articipants; their company h�d relationships vvith sevePal fir�arrcial planners.
Their website allo�red secure individual access and they vvould post vuhatever the
�oard needed. Their ovvn administratiora software had been created through
which ernployees �nrould be able to log on to do their own calculafiions for difFerent
scenarios. A module would be added so that their company would be r�otified
through the Social Security Death Index when a participant passed away. In
response to a question, Mr. Prior indicated almost all plans he worked writh did
annual actuarial evaluations. Discussion ensued regarding behind-the-scenes
work �nd communication with consultants between quarterly rr�eetings. Two
people vvere assigned to every client, one principal and one backup. Contact
v+rith the `/illage would be maintained. AAeeting packets with backup were
provided to the Trustees a week prior to meetings and fhat was posted on their
website. nllr. Prior indicated a lot of time vvas spenfi communicating with
participants �nrhen they were ready to retire. Beneficiary forms were updated
annually. Fees were $1,500 per month; initial set-up would be approximately
�1,000. This fee was predicated or� the assumption that one administrator
would be hired for both plans. The Boards could choose spec�c services and
the fees would be adjusted. A list ofi items was provided which would assure a
��uoQth transiti�n. �llr. Prior advised al! his clients �rere self-fundir�g; n�ne h�d
purchased annuities for funding retirements. Pension Coordina�tor McWilliams
read a lisfi of duties currently performed by the Village staff; Mr. Prior confirmed
all of those would be provided. Records would be shipped to his office and
maintained according to State records laws; they did not dispose of any records
vuithout consulting vvith the Board. Procedure for paying bills and obtaining Board
rriember signafures was discussed. Attorney Jensen advised that Benefits US�a
v�rould replace all services for the pension boards now done by Village
employees. Mr. Prior concluded his presentation by stating kudos to the Boards
for the rnost �nrell-funded plans he had ever ssen.
ao Resource Centers
�lr. Scott �aur and Denise AAcNeill with Resource Centers provided a power
point presentation. Mr. Baur advised their first office had been in Tequesta; they
vuere now located in Palm Beach Gardens with a total of 15 employees plus a
second office on the west coast. Administration ofi the pension plans was
divided into administrative activities, focusing on the people side, and record
keeping, focusing on the information side. A diagram was provided to show both
sides of their job going from Board level to participant level. They would not
�ake over duties performed by consultants or change how the plans operated in
any substantial way. Basic administration was described for both the people side
and the information side. Their office communicated primarily electronically.
Communication was critical in operation of the plan, both with the Boards and the
participants. l"heir office made many disbursements and they were very familiar
with all tax requirements. A very systematic approach was used for tracking
benefits and keeping up writh participant information. Accounting and other
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functior�s done on behalf of plans cn�ol�ed segregation �f duties to avoid �r�ud.
Ms. NlcNeill discussed the importance of an organized approach being used by
4h� Adrninistrator, and the importance of the Board and the parficipants having
access to the information and being able to communicate with the Administrator.
They vvould be a contact for everyone, and they understood how the plan played
a part in the lives of participants. Good practice was discussed. Nlr. Baur
discussed their flexibility fior communicating on the web, and it would be up to the
�oard as to hovv they would like to utilize it. Their fee quote included all seniices
�nd they would work with the �oard on whicP� senrices were needed. Setting up
the systems for the Village would be charged by their programmer and would be
a one-time $2,500 for each plan. Benefit calculations were systematic with
review by the actuary. Participants could change things like their retirement date
online for different scenarios but could not change other information. Other
services by the programmer if needed later would be approved by the Board
ahead of time and the cost passed through to the Board. Fiow their computer
systems had evolved and their disaster procedure and recovery time were
described. Everything vvas backed up and rnirrored to their west coast office and
to an employee in IVorth Carolina. A very intensive Type Two SAS 70 audit of
$heir firrn was conducted� i�lr. �a�r �d��s�d they did not destroy records tha�
vuere part of the vvork history of participants, they did clean them out and archive
them. The medical records request fee was for disability retirement applications,
which took a huge amount of time. Their fee increases would be systematic
srnall increases so as not to have fio aslc for large increases because none had
been given over several years. They wouid typically have tvvo people to service
each clien$, wi4h one being the primary contact. Their firm had retained their
initial staff since they were hired. Pension Coordinator iVlcWiiliams poinfed out
4he fee schedu{e on the handout was inconsistent with that shawn on the power
point presentation; if was confirmed that the packets had the correct informafion.
IVIr. Bauer indicated their fimm �ow had 63 or 64 clients, 90% or rnore vvere public
rnur�icipal plans.
9!!a New �usin�s
3e Di�cussion by �oarci� regarding hiring a"fherd Par�
Adrninistrator
Pension Coordinator McVVilliams advised that in February the Village IVlanager
had asked her to suggest fio both pension boards that they look for an
ir�dependent pension administrator to handle all pension related needs and
aspects, both administrative and financial. The Manager betieved this was an
appropriate time to do this as the plans had grown over fhe years and the Village
Clerk's duties had recently been expanded. In an effort to assist both boards, the
Village had handled the administrative functions for many years, but the needs of
the boards had become more expansive and now might be the best time to make
this move_ Additionally, both she, as Village Clerk and Pension Coordinator, and
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the i/illage �anager, belie�ed fhe functions of the pension boards should be
independent of the Village and by mixing the roles of the pension �nd Village
they often became cloudy. She reported fhat \Oillage 11Aanager Couzzo had
pointed out the i/illage was subsidizing the cost for sfaff to coordinate and
administratively run fhe pension boards, and fhey should be funded by the
respective boards, thereby keeping them separate and independent. The
Manager mentioned the v�orkload of staff had increased with smaller staff, and
the equivalent of f�o full-time positions were being lost due to downsizing.
Pension Coordinator nAcWilliarns reported the Village Manager had indicated this
was not a mandate fhafi the boards take on a fhird party adrr�inistrator and was
nof a directive from hirn, but an opportunity for the boards to explore alternative
options to provide this seniice. He wanted to assure that things continued fio run
effectively and economically.
Chair Sabin indicated that annualizing the proposed fees, fhey probably came to
approxirnately $12,000 per year. Currently, invoices wrere received for �e�
Laur's services, since al! other services provided by the Village were not billed fo
the boards. Pension Goordinator I�cWilliams clarified that Betty provided 7-1/2
hours per week working for both boards, p[us �4tendance ?t meetings �nd
preparation of minutes, and that did not include fllls. McUVilliams' time and
Deanna Mayo's time helping out, because they were paid by the Village. The
Pension Coordinator advised the minutes were more detailed than those
provided for the ilillage Gounci! and the preparation was more complicated fhan
one might think, since they were provided in detail because of the nature of the
pension boards. She poin4ed out that one meeting had gone from 8:30 a.m. to
5:30 p.m. Chair Sabin noted 4he services prabably totaled $7,000-$8,000
annually for fihe Public Safiety Board; and it was probably close to that for the
General Employees' �oard. The fees proposed firom the third parfy
administrator would be approximately �12,000 annually, so it would cost more,
but they vvvould provide rriore senrices. Pension Coordinator fVlcWilliams noted
the Village 11�anager had suggested if the Boards felt it appropriate they might co-
ming{e their options, using Betty's services for certain things, Finance for certain
things, and the third party administrator for certain things. He was also not
asking that a decision be made today. Board Member Mayo indicated she felt
sorne of this was to relieve nAs. nAcWilliam's work load and asked if �eity might
be interested in taking on some of Ms. McWilliam's duties, adding to the hours
she worked. Ms. Laur responded she would not want to work too many more
hours since she had other commitments. Pension Coordinator McWilliams
indicated she felt a big par# of this was with mixing the roles of staff members
with a pension position they became cloudy—she as the Pension Coordinator
could not provide benefit calculations and had never attempted to do so, but a
third party administrator could do that. Secretary D'Ambra commented it was
not just fiinancial comparisons—with a third party administrator they would get a
whole package of services and more than currentiy provided. If they made a
mistake, they had insurance as backup, and the fact that they put themseives
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through the sAS 70 a�dit spoke to their �bilities arad profe�sionalisr�. Chair
Rhodes comrraented there was a workload factor, a service irriprovemenf to the
participants, and an issue of overlap �nrith the HR side and the financial side and
�nrho within the Village �nras doing certain things and whether it v�ras best to keep it
inside, or to have a third party do it. Fie felt from the perspective of fhe General
Employees' Board if was important 4o have a link and some type of
communication betv�reen the Board and the Village. Fle asked how many of the
financial #unctions should stay or go outside; how rnany of the actuarial functions
should be retained. Board fVlember Terzakis he favored lefting the third party
administra4or do as much as possible because once you started trying to
separate, you coufd have problems. Rssuming their model ran extremely uvell
and efficiently, there v►sas not that much difference in the dollars, he would like 40
see some type of fink with the Village. Chair Rhodes commented if the link could
be seamless with numbers accessible to the third party administrator vvithout
additional vvork being put onto the shoulders of the Village financial team, that
�ras an important consideration. Secretary D'Ambra agreed, commenting with
the work subdivided as it was now, there was a much bigger chance of
something falling through the cracks, plus things that were not even being done.
A much better job of communicating vvith th� participan#s shQUld be done, an�
�his would be enhancement of services. Board Member Young asked under the
current division of the work who vvould represent the Village in case of an audit
by Department of Revenue or the IRS. Attorney Jensen advised the Department
of Labor would not audit; but the IR� could, and it would be the �oard's
responsibility to bring the inform�tion together for them.
Discussion ensued regarding the two firms which had rr�ade presentations. !#
vvas the consensus ofi both boards they liked the second firm. Chair Sabin noted
the boards seemed to r�vvan# t� rnove forward jointly—they could �nake a decision
to go ahead now�, but there vvere likeiy next s#eps they v�ranted to do as due
diligence, inctuding getting back and confirming with the Village Manager. Some
things that came to his mind were if they had this technology, someone whether
a Board member and/or someone vuith the Village who might have some interest
in seeing this in a,ction should go see it. Chair Rhodes suggested both Boards
talk with the thie party administrator's references v�ho had used their systems
�vvo or three years ta see their thinking on adaptability, flexibility and
troubleshooting to see how they had handled problems. Talk to people who had
used this service, both on the administrative side and also at the participant fevel,
if possible--this might be done by the HR department. On-site due difigence
should also be conducted.
Chair Sabin indicated he agreed with Board Member Terzakis, and the third party
administrator had provided a proposa{ but the Boards should make sure there
was an itemized list of their responsibilities, and then compare and contrast with
vvhere they might get some of those services either internally within the Village or
perhaps vuith the outside service providers today. 9t should be clarified with the
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actuarge tha$ in the future sfater�ents �nrould c�me from the third party
adrninistrator ins4ead of reques4s from the actuary--the Board should make sure
they had spoken to the actuary. The actuary mighf say thaf was clear but they
aiso did another piece of it, and that should be made clear. Chair Rhodes noted
on the internal function to the extent fhere vvas overlap fo rriake sure it was
seamless—there wrere not additional people involved. Chair Rhodes agreed i4
vvas best not to pick and choose so long as there were not adverse internal
consequences. He felt it was important to be linked to the i/illage. Secretary
D'Ambra commented the Village was the plans' sponsor. Chair Rhodes clarified
he rrieant in terms of ongoing participation and communication.
Secretary D'Arnbra volunfeered to do the due diligence on behalf of the Public
Safety Officers' Board; �oard Iulember Terzakis volunteered to da fihe due
diligence on behalf of the General Employees' Board.
nAOTtON �lr PlJBLIC S�►FETY OFFICEI2S' PEIVSIOIV �OARDe
nAotion was rnade by Board lNernber Giblin, seconded by �o�rd nAernber
Young, to set up a cornrnittee to p�rforrn due diligencee Motion carried ��
unanirnous 4-0 reotee
fVIOTION �Y GENER�►L EMPLOYEES' PENSIOIV BC3AFtDo
6Vlotion �nra� made by Board Member Mayo, seconded by �oa�rd AAerr�ber
Gload, to set up a cornrnittee to perforrn clue diligencee Nlo#ion c�rraed b�
unanimous 4-0 wotee
9t was clarified that the Secretary D'Ambra was the corrimittee r�nember
representing the Public Safety �fficers' Pension Board and that Board Member
Terzakis was the committee member represenfiing the General Employees'
Pension Board. Chair Sabin expressed his opinion if would be helpful to have
one or two representatives from the Village administration who currently
performed the vvork to aiso attend, and it was suggested the Village Manager
appoint the two staff members.
Ghair Sabin commented there could always be a special join� meeting of both
boards or this could vvait until the next quarterly meeting, depending on timing.
�oard �Aember D'Ambra favored accelerating the process, with due diligence in
the next 2-3 weeks if that could be done with Board Member Terzakis' schedule,
and if so, then the �oards could meet again in 4-6 weeks.
Board I�Aember Sabin stated what the Boards would like, in addition to this new
provider and seeing and getting clarification, and that responsibility is internal
with the Village to clarify responsibitities as well as how they might interact with
other providers such as the actuary, etc. Chair Sabin indicated it would be
wonderful if the target meeting date could be 6-8 weeks out, or sooner if they
�►rere ready for the boa,rds to hear an update, coordinating with those who were
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firaveling. Secretary D'Arnbra indicated he woul� be traveling in June and July.
�aard Member Giblin indicated he �vould also be out. Chair Sabin noted
everyone was in and out, and the r�eeting would need to be coordinated.
Pension Coordinator RAcWilliams stated her office could coordinate thaf ineeting.
�90 Any Other Nla�tters
There �ere nc� other r�atters to come before the �oards.
�9a �oanrr�unicatiorns F�om �6tezens
There vvas no c�rnmunicatior� from citizens.
�l�e �djournrr�ent
Ther� be�ng no furth�r business �o corr�e before the �oard� the meeting
was adjourned at 1 a47 perv�e
Respec�Fully submi#ted,
�e4#y Lata�
Recording Secretary