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HomeMy WebLinkAboutDocumentation_Regular_Tab 05a_04/14/1994 .. i � . � ; �� ; VILLAGE OF TEQUESTA Posc Office Box 3273 • 357 Tequesta Drive � Tequcsta, Flonda 33469-0273 • (407) 575-6200 ' � � Fax: (407) 575-6203 s o . .�, � l tC~ COV T E Q U E S T A M U N I C I P A L F I R E F I G H T E R S P E N S I O N T R U S T F U N D B O A R D O F T R U S T E E S M E E T I N G M I N U T E S D E C E M B E R 8, 1 9 9 3 I. CALL TO ORDER AND ROLL CAI.L The Board of Trustees of the Tequesta Firefighters Pension and Trust Fund held its first scheduled meeting at the Village Hall, 357 Tequesta Drive, Tequesta, Florida, on Wednesday, December 8, 1993. The meeting was called to order by Village Manager Thomas G. Bradford at 10:00 A.M. A roll call was taken by Cheryl Mayer, the Recording Secretary. In attendance at the meeting were: Village Manager Thomas G. Bradford, Mayor Ron T. Mackail, Village Attorney John C. Randolph, Village Clerk Joann Manganiello, Fire Chief James M. Weinand, Finance Director Bill C. Rascavelis, Lieutenant Bill Davis and Firefighter Roy 011iff. II. APPROVAL OF AGENDA Mayor Mackail moved to approve tbe Aqenda. Lt. Davis seconded motion. The vote on the motion was: Thomas G. Bradford - for Roa T. Mackail - for Bill Davis - for Roy 011iff - for tbe motion was therefore passed and adopted and the Agenda was approved as submitted. III. INTRODUCTION OF BOARD OF TRUSTEES All Board members and staff personnel introduced themselves to one another. The Board members are Lieutenant William Davis, Firefighter Roy 011iff, Mayor Ron T. Mackail and Village Manager Thomas G. Bradford. I�T. OVERVIEW OF MUI�TICIPAL FIREFIGHTERS PENSION TRUST FUND Ordinance No. 460 was adopted by the Village Council on September 7th, 1993 and created the Pension and Trust Fund. R,�r:.. Parrr . Firefiqhtsrs P�nsion Board I�teeting Miautes December 8, 1993 Page 2 Both a Summary Plan Description and a detailed outline of the Plan is attached to�this Ordinance. Mr. Bradford explained that basically the Plan is a Contributory Plan whereby the city pays approximately 14.4� of the cost of the Plan based upon an actuarial study done by the actuarial firm that is used by the Florida League of Cities. It was based on certain assumptions about the beginning ages of the initial group of firefighters that work in Tequesta. Based on those calculations, they concluded that 14.4� of the firefighters' salary needed to be contributed by Tequesta and 5� by the firefighters themselves. Mr. Rascavelis, Finance Director, has taken steps so that the contributions of the firefighters are pre-tax income. The focus of today's meeting is to determine what the obligations of the Board of Trustees are. The sole and exclusive administration of the operation of this retirement < system put together for the benefit of the firefighters falls upon the Board of Trustees which will consist of five Trustees. Two of the Trustees have to be legal residents of Tequesta; Mr. Bradford and Mayor Mackail meet that requirement, as well as being the two that have been appointed by the Village Council. Mr. Bradford and Mayor Mackail were appointed by the adoption of Resolution No. 26-92/93 on September 7, 1993. Two other members have to be full-time firefighters; Lt. Davis and Roy 011iff ineet this. Lieutenant Davis and Mr. 011iff were appointed by their fellow firefighters on December 6, 1993. Ideas for appointing a fifth member will be discussed today. Each Board member will serve two years. A Chairman and a Secretary also need to be elected according to the Ordinance. The Secretary of the Board has to keep a complete Minute Book of the actions, proceedings and hearings of the Board. It takes three affirmative votes to make any binding decisions on the part of the Board. The Board will engage such actuarial accounting, legal and other services that are required to transact the business of the Retirement System. Any of these expenses and compensation of those persons are to be from the Retirement Fund. The � rates and contracts are determined by the Board. ' Mr. Bradford went over Page 6 of the Plan that lists some of the duties and responsibilities the Board has. Mr. Bradford questioned whether the hiring of a new firefighter has to come before the Board. Mr. Randolph said that was just an administerial function, and not to make decisions as to whether someone is hired and becoming a part of the Plan. Firefiqhters Pension Board Meeting Minut�s December 8, 1993 Paqe 3 The Board is to authorize all payments, whatever they may be, from the Fund. The disbursing agent has to be notified in writing of approved benefit payments and other expenditures arising through the Fund. Periodic actuarial studies have to be done according to State law and this Plan every two years. They have to make recommendations regarding any and all changes in provisions in the system which would go to the Village Council for consideration. Mayor Mackail stated this was basically a prototype Plan. Mr. Rascavelis stated this was a turnkey operation which is to hire personnel to handle the investment portfolio. The Florida League of Cities acts as the administrator of the Plan on the Village's behalf. They have selected a firm based out of Atlanta to handle the investment of the Fund for the Pension. The administrative functions will be handled by the Finance Director. The Finance Director will act as a fiduciary where he makes sure the payments and contributions are remitted according to the requirements of the Plan. They are deposited directly to the investment agency which is Nations Bank, and then directly to the investment firm that is handling the investment portfolio. Chief Weinand asked what the cost is. Mr. Kascavelis said it was less than 1 1/2$ of total fund assets. This is paid for out of the portfolio. Mayor Mackail requested to see that Agreement and exactly what they are going to do. � The Ordinance gave the Village the ability to use investment vehicles that are not customarily allowed to be used by pension funds. Mr. Rascavelis said the investors must invest in high-quality investments such as commercial paper that normally, governments do not invest in. Securities are of a high-grade nature. It is specified in the document exactly what their parameters are. Mayor Mackail expressed concern that costs do not eventually outweigh the benefits. Roy 011iff asked if there would be any additional cost to the Fund for switching,to other investments. Mr. Rascavelis said there was a fixed fee to switch. He will give everyone a copy of the Florida League of Cities Municipal Pension Trust Fund book, which answers many of these questions. Mayor Mackail pointed out that the Florida League of Cities has the best list of investors and that it could get costly to look outside the League to invest. Mr. Kascavelis went over his role in acting on behalf of the Board as fiscal officer of the Village. On a bi-weekly basis, Finance will withhold Federal ta�c and various agency Firefighters Pension eoard Meetinq Minutes December 8, 1993 Paqe 4 withholdings plus any miscellaneous withholdings an employee would request. After the pre-tax 5$ is withheld, the Village makes its contribution from the budgetary account for the Pension Fund that is within the Fire Department's budget. The Village calculates the total dollar payroll amount and multiplies that by 14.4� and then cuts a check in that amount. That check for 14.4� is paid to Nations Bank. They have the money before the employee gets his/her paycheck because funds are wired. When monies are deposited, Finance also sends a report of each employee listing their contributions of 5$ plus the 14.4$ Village contribution. This is sent to the Florida League of Cities for them to maintain their records of each individual firefighter. When an employee leaves and they are not vested, he/she is entitled only to his/her contribution, not the Village contribution. The'Florida League of Cities sends the employee the check, not the Village. Mr. Bradford asked if it was proper to have an audit of the Pension Fund as part of the overall Village audit. Mr. Kascavelis stated they are not separate and distinct audits. It will be reflected in the Village financials. Mr. Bradford then asked Mr. Randolph if the Board has the power to choose its own auditors. Mr. Randolph stated the Board could choose its own auditor, but that it probably would not be a good idea as it would be an added e�ense. Mr. Kascavelis stated that � the audit basically is just to confirm the assets and securities held and any charges to the Fund. Chief Weinand asked how contributions from the public which are put into the Plan are distributed back throuqh the Plan. � Mr. Randolph stated that it becomes an asset to the Plan, not an individual benefit of a firefighter. It will go towards the investments of the Plan, thus making the returns greater. Mr. Bradford asked how often an actuarial is done. Mr. Kascavelis stated it is done every two years. Mr. Bradford stated it says elsewhere in the Plan that an evaluation of the Plan must be made every-three years. Mr. Rascavelis will research this and let the Board know. Mr. Bradford wanted to know in terms of the selection of the actuarial, does the Board need to bring someone in early on or wait until two or three years. Mr. Randolph said to find out from the League. Roy 011iff had a question about whether those firefighters who have IRAs can still contribute to their IRAs since the 5$ contribution comes out of their paycheck before taxes. Mr. Rascavelis said they could. Mayor Mackail said that if Firefiqhters Peos eoard Meetinq Minutes December 8, 1993 Paqe 5 -------------------------- married and filing a joint return and adjusted gross income is $50,000, you have a pension and wife does not, there is a limit to the amount of IRA that can be contributed that year. You can put money into the IRA, but cannot deduct it on your tax return. Mr. Randolph stated that if the Board feels there would be a benefit to the Plan to propose an amendment, then it would be up to the Village to make a determination whether those changes would be made by Ordinance. . Chief Weinand asked, if after serving a two-year term, could all five Board members be changed. Mr. Randolph stated that as long as the Board keeps the Village Manager and the Mayor, that that would provide continuity. The Village Council appointed the Village Manager and the Mayor by Resolution on September 7, 1993. Chief Weinand will write Mr. Bradford a memo letting him know the dates Lt. Davis and Mr. 011iff were selected. The Board can make recommendations to the Village Council to amend the Plan as need be. Mr. Randolph expressed his feeling that as long as the Board remains with the League, they may not have much flexibility to amend the Plan. Mr. Rascavelis clarified for the Board that the Florida League of Cities is the administrator, Tri-State Pension Services is the professional administrator, Atlanta Capital Management Company is the investment manager, Nations Bank Trust Company is the � custodian and�Nations Bank Trust Company performs performance evaluations for each fiscal year. He also pointed out that each year, the FLC replaces members of various trust funds. He suggested that he would submit a name for consideration for appointment on the League's Board of Directors over Pension Trust Funds. He believes they are currently taking applications for the various trust funds that the League handles, one of which is the Pension Trust Fund. He will get this information for the Board. Mr. Bradford said he felt it would be a good idea for the Board members to attend the various seminars the FLC sponsors to learn more about the roles, functions and options that members may have. He will distribute this information to Board members as he receives it. • VI. ELBCTION OF CHAIRMAN AND SECRSTARZ OF THB BOARD PURSUAIiT TO SSCTI011 3, Z OF T8S PLAU Mr. Bradford felt the Board should wait on selecting the Chair and Secretary until the fifth member has been chosen. The Board concurred. Mr. Bradford felt there miqht be a benefit Firefighters Pension eoard Meeting Minutes December 8, 1993 Page 6 to having a resident of the Village as the fifth member. Mr. Randolph suggested getting a retired resident that has some experience in investment matters. The Board discussed advertising for someone, but decided that before doing that, everyone will just think about the various people they know in the Village. VII. ADTY OTHER MATTERS Mr. 011iff asked about health care after retirement. Mr. Rascavelis pointed out that under COBRA laws, they have the option to continue health care for 18 months at personal expense of the firef ighter . Mr . Bradford pointed out that the Florida Retirement System does not provide for health care coverage. Mr. 011iff suggested that perhaps more money could be deducted from they salary to pay into a plan. Mr. Rascavelis will get information from the FLC regarding health insurance coverage. Mr. Bradford suggested that the Board continue with quarterly meetings unless something important comes up. The Board concurred. VII. ADJOURAiMENT Mayor Mackail moved that the meeting be adjourned. Lt. Davis seconded the motion. The vote on the motion was: Thomas G. Bradford - for Ron T. 1��[ackail - for Bill Davis - for Roy 011iff - for� the motion was therefore passed and adopted aad the meeting was adjourned at 11:30 A.M. Respectfully submitted, . � � Cheryl ayer r Firefiqhters Pension Hoard Meeting IKinutes December 8, 1993 Paqe 7 -------------------------- ATTEST: /' oann Mangan' llo Village Clerk DATE APPROVED: