HomeMy WebLinkAbout1990-02-22 Minutes•
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MINUTES OF A MEETING OF THE FIRE PENSION BOARD
A meeting of the Fayetteville Fire Pension and Relief Fund Board of Trustees was
held on Thursday, February 22, 1990, at 1:30 p.m. in Room 326 of City Hall.
PRESENT: Fire Chief Mickey Jackson, Secretary Sherry Thomas, Firemen
Mike Bonaduce, John Dill, and Pete Reagan, and Retiree Carl
Springston.
ABSENT: Ex -Officio Treasurer Scott Linebaugh
Also present was Curtis Williams of Merrill Lynch.
CALL TO ORDER
The meeting was called to order by Mickey Jackson.
MINUTES
Reagan stated that on the last page of the minutes for January 25, the wording
should be changed from •It occurred while lifting an MVA' to •It occurred while
lifting AT an MVA'. Reagan, seconded by Springston, made a motion to approve
the January 25, 1990 minutes as corrected and the January 8, 1990 minutes. The
motion passed unanimously.
INVESTMENTS
Curtis Williams stated the market value on the balanced account was down from
$615,970 to $576,965. The stock market for the month of January was down 5.9%.
The bond market was also down about 3%. Both portfolios have been impacted.
By having RNC on a no buy restriction for the past several months, the fund was
in a much higher cash position, so there was no loss on the cash as there would
have been if it had been invested. They do not expect any significant
improvement in the stock market in the near future. They expect a little rally
phase but for it to go lower for a while. Basically, the performance is down
because of the activity in the market.
On the fixed income account, the CD roll was started. They have maturities for
May, June, August, September, November, December, and February, so there are 7
months of the CD roll in place. The lowest yield was 8.10 on one CD, and the
others are all 8.15 and 8.2. Merrill checked rates locally on these the date
we purchased them, and the rates ranged from 7.35 to 7.65. Hopefully within two
months, the CD roll will be completely established. They will buy one CD per
month with a 12 month maturity.
Williams further stated that Merrill Lynch does expect interest rates to
stabilize slightly lower.
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February 22, 1990
Dill asked how Roxbury was holding out in this market. Williams stated they have
a high quality blue chip portfolio so the pure equity account will perform very
much like the equity side of the balanced account. The bonds lost 3% while the
stocks were down about 6%. On our portfolio, the stocks were only down about
4 1/2 to 4 3/4%. Both of the portfolios have cash positions that is very good
when the market is going down. So the total portfolio has performed much better
than the market.
Curtis stated there was a problem in the investment guideline that was caught
by Roxbury. In the equity portion of the investment guideline, it is stated that
equities should be rated 'A' or better by Standard & Poore. That should have
been related only to the bonds of a company not the equity. 'A' is the highest
rating that Standard & Poore gives an equity. 'AAA' is the highest in bonds.
We have given a bond rating to our equities, and we really do not want to
restrict the managers to an S&P rating on stocks, but we do on bonds. It would
effectively take us out of the stock market. The bond rating has been addressed
on the bond side of the guideline, so this portion of the guideline should be
deleted. Williams stated this was a housekeeping item and does not have to be
handled at this meeting.
Roxbury wants a clarification of the investment policy. They would like for
the Board to give them a letter stating 'Concerning the equity portfolio of the
Fayetteville Fireman's Pension Fund, there are no restrictions other than the
Arkansas statutes on the Sullivan Principles and no foreign stocks except for
ADR's in the equity account.' They have a very difficult time separating their
function as to asset allocation and that type of thing. With this letter, we
are telling them that their only function is to manage that portfolio, however
they want to within the guidelines.
Bonaduce asked what ADR's were. Williams stated they were American Depository
Receipts. They are shares representing foreign companies but are traded on the
American exchange. They are actually American securities which represent shares
of foreign stocks. They are very commonly traded.
Reagan, seconded by Bonaduce, made a motion to approve and send the letter to
Roxbury. The motion passed unanimously.
Williams stated there was a client questionnaire that needs to be completed that
basically all of the information is known but just needs a signature. Secretary
Sherry Thomas signed the questionnaire, and Williams stated he would complete
it, and if he had any questions, he would call.
Williams stated he had a letter from Roxbury that will allow the fees to be paid
out of the account and a letter from Merrill Lynch allowing them to respond to
this letter. He stated he had drafted a letter from the Fayetteville Pension
Fund instructing Merrill to respond. This is what the pension board has
previously stated how they want the fees handled.
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February 22, 1990
ROY SRELTON RETIREMENT
Jackson stated the Board had decided at their last meeting to send Skelton to
a respiratory specialist for an indepth exam. The Board had asked that Skelton
see Dr. Butler, but Dr. Butler recommended Dr. Duncan. Jackson stated the crux
of the report from Dr. Duncan is that Skelton's respiratory problems are probably
less than the Board had assumed. Some of the quotes are 'he has tobacco
bronchitis without any significant evidence of obstructive lung disease,
essential hypertension, exogenous obesity, and chronic nervous disorder.' He
stated Skelton had some diminished lung vital capacity, but it was not severe
and it was the type that if he quit smoking and go on some type of exercise
program, he could probably gain some of that back. In summary, Dr. Duncan stated
he is not terribly disabled from that standpoint. Jackson stated he asked Dr.
Duncan about the stress related anxiety. Dr. Duncan stated Skelton was an
extremely nervous and anxious person, but that was not in his realm of expertise
and recommended examination by a psychiatrist if you want to delve into that area
deeper.
Jackson stated he asked Dr. Baker to come to this meeting so he could answer any
questions that the Board has for him. He told him that the Board was not asking
him to come to make any kind of statement in particular, but he may do that if
he desires.
Bonaduce stated the question he had is the stress factor and how it relates to
being specifically job caused. He asked Dr. Baker if he felt beyond a shadow
of a doubt that Skelton's job has caused his stress.
Dr. Baker stated there was no doubt that his job has aggravated his condition.
He stated there were several examples of this type of job related condition such
as driving a car with an osteoarthritis neck. If he gets bumped from behind,
that car wreck did not cause the neck but certainly aggravated the neck injury.
He stated the courts have stated this is automobile related or accident related.
Roy is a very interesting individual to work with, and he has worked with him
for many years during his professional life. He feels Roy has a personality
disorder that has been markedly aggravated by his employment and the situation
he perceives and that has been present. Dr. Baker stated at times he has seen
aggressiveness, evidence of being extremely passive, areas of depression,
extremely compulsive, areas of paranoia. This is a mixed type of personality
disorder similar to the ADD --the attention deficit disorders --a hyperactive
individual, that talks continually, has to be the center of attention, refusal
to accept discipline, and displays offensiveness. I do not know that you all
caused Roy, but there is no doubt in his mind professionally that it was
certainly aggravated by the environment that he has lived in. He is the easy
person to tease and harass. Because of all of this, Roy smokes three packs of
cigarettes a day, over eats, doesn't exercise, and doesn't take care of himself.
He does not function well, he guesses, as a fireman, and he sure does not
function well as a husband or as a social person or as a father. He is restless,
he doesn't sleep, he has to make every decision and be involved in every aspect
of his life. You ask if this is a result or is it service connected. He stated
he has no doubts in his mind that it is service connected. He stated as a
physician he has not handled this matter well, and he suspects, by looking
through records, that the Fire Department has not handled Roy well either. Dr.
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February 22, 1990
Baker stated that Dr. Phil Duncan made a good 20-30 minute examination of Roy's
respiratory condition, but he has not lived with him 30 some odd years as he has
to be able to make a determination condition. He felt Dr. Duncan stating that
Roy had a 15% disability to his lungs was a significant lose. All of this is
part of the package we call Roy Skelton. Dr. Baker stated he has treated Roy
for many years and all along Roy has complained of many of these same conditions.
He feels Roy is not a 'put on' because of the many years of extreme symptoms.
He feels that Roy is disabled and that his condition has been aggravated by his
work. He feels his physical condition contributes to his disability and is a
result of his anxiety and tension. Whether that comes from smoke or from the
environment he has worked under all of these years, he does not really feel that
it will make a difference. The end result is the same.
Dill asked how long Dr. Baker had been taking care of Roy. Dr. Baker stated
about 25-30 years.
Bonaduce stated he did not feel that Roy was trying to cheat the pension fund.
He feels that Roy is eligible for retirement, but the question the Board has is
if Roy's stress and his personality disorder beyond a shadow of a doubt caused
from his employment only.
Dr. Baker stated the aggravation of the condition is 100% caused by his job.
Bonaduce asked if Roy could be placed on another job, and if under different
conditions and stress if Roy would be the same or will leaving fire service cure
Roy's condition. Dr. Baker stated he did not feel leaving will cure Roy.
Dill asked if Roy had always been like this no matter what he was doing. Dr.
Baker stated his condition has progressively gotten worse as does many people
with diseases, such as a diabetic, a cardiac, an arthritic, etc. Dill agreed,
but stated if he had hired a diabetic, he would not say that after 20 years of
employment, the job caused the person to be a diabetic.
Dr. Baker stated that was correct, and the job did not cause Roy Skelton to be
Roy Skelton, but it brought forth some of the characteristics. An example might
be a condition that was affected by weather, wet, hours, stresses, and tensions.
He believes these types of conditions have aggravated and brought forth Roy's
condition.
Jackson asked if the Board were to state that they did not believe Roy's claim
that his COPD, obesity, and hypertension are job related because they feel this
came from his personal habits, but the Board is concerned about the stress
anxiety issue which might leave the door open for a line of duty disability
retirement, would there be any benefit by a psychological evaluation.
Dr. Baker stated the physician could put labels on Roy's condition. Dr. Baker
felt it was just a matter of what the Board wanted to do. Dr. Baker stated he
wrote his initial letter regarding Roy because of his chronic and acute anxiety
reactions that has made this man not able to be a fit, employable member of a
skilled, hi -tech team.
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February 22, 1990
Springston stated even though he has not worked with Roy for several years, he
has continued to be around him. He stated he did not feel Roy has changed any
from the time he started work.
Bonaduce asked if Dr. Baker definitely feels like this job has aggravated Roy's
stress but not necessarily caused it. Dr. Baker stated he feels Roy has a
personality disorder, and no one really knows what causes it. Whether the
Fayetteville Fire Department caused Roy to be an obsessive, compulsive, paranoid
individual is questionable, but it certainly aggravated the condition and brought
it forth. But, no, the Department did not cause his personality disorder, or
other people's diabetes, arthritis, etc., that they retire with. Dr. Baker
stated if this theory was followed, then the only people who could retire
medically would be those that had an acute injury at work, and in his years of
experience, he does not think this is quite so. He does not think this is the
intent of the statute.
Dill stated there was a disability retirement and a line of duty disability
retirement. The line of duty is designed specifically if you get hurt on the
job or contract a disease from the job, then you are eligible to receive the
extra retirement money.
Dr. Baker stated if that was so, then by definition the aggravation of a pre-
existing condition is not line of duty, then the decision has been made. If that
is not the true intent of that definition, then the Board has to define it. He
felt by defining it as only a job injury, then a pretty tight precedent is being
set.
Dill stated he smoked, paced and is always active, has lung damage but is not
sure this qualifies him for disability. Dr. Baker stated that Roy's retirement
is not being based on his smoking, shortness of breath, etc., it is being based
on his inability to function as a team. This was the reason he wrote the letter
for Roy. He thinks Roy's reaction to some rumors is the most classic example
of things that moat people just do not do and is not the way they function as
a constructive, healthy member of a team.
The Board expressed their appreciation to Dr. Baker for attending the meeting
and for his help in the matter.
Jackson stated Roy has submitted his resignation effective February 15 for a line
of duty disability retirement. Jackson told him that he was entitled by law to
the retirement, but the Board had to decide whether or not he qualified for a
line of duty retirement. This is what the Board now has to decide.
Reagan, seconded by Bonaduce, made a motion to have a 5 minute recess.
Jackson called the meeting back to order.
Reagan, seconded by Dill, made a motion to deny Roy Skelton's request for a line
of duty disability retirement.
Jackson stated that given the discussion he has had with Roy and from the
beginning telling him that if he qualified and if he could produce the
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February 22, 1990
documentation that was necessary to validate his request for a line of duty
disability retirement, he would have his support. Jackson stated he did not feel
the documentation has been submitted to a satisfactory degree, however, he is
really hung up on the question of his stress related anxiety and whether or not
it is related to his job. Given the discussion he has had with Roy and where
the situation stands as of today, he will be abstaining from the vote.
Reagan stated it was his belief that the state statute governing the 65% line
of duty disability was put in there for the purpose of supplementing a disability
income for a firefighter who was seriously injured on the job, for example,
falling off a building, crushed back, broken legs, etc. He does not believe that
this request falls under that line of injury, and because of these reasons, he
will be voting to deny Roy's request.
Upon roll call, the motion to deny the disability request passed by a vote of
5 - 0 - 1, with Jackson abstaining.
Bonaduce made a motion to grant Roy Skelton a 50% disability retirement,
effective February 15, 1990.
There was some discussion whether or not Skelton should be granted a regular
retirement or a disability retirement. Reagan stated the difference in the two
was that the disability retirement is set up for someone who does not have in
20 years but becomes disabled while still employed.
Dill stated he thought that a disability retirement might enable Roy to receive
his social security quicker or help him in that regard. However, he does not
want to grant a disability retirement unless Roy has requested it.
Bonaduce stated he would amend his motion to read that Roy be granted his normal
retirement. Reagan seconded this motion.
Upon roll call, the motion passed by a vote of 6 to 0.
DARRELL JUDY RETIREMENT REQUEST
Jackson stated Judy has made a request to the Board that his retirement be
changed from a regular 1/2 salary to a line of duty disability at 65% of salary.
Jackson gave the Board members a copy of correspondence from Jerry Rose, the City
Attorney, which states that 'Mr. Judy retired from the Department on May 16,
1988, after 20 years on the job. He performed his duties until his retirement.
Mr. Judy now asserts that he could have qualified for line of duty disability
retirement and wishes to now apply for that status retroactively. ACA 24-11-
819 Al states in a pertinent part that a firefighter must show that he is
physically or mentally totally incapacitated for the further performance of any
suitable duty. Although there may be a number of other reasons why Mr. Judy may
not change his status after his retirement, the fact of his performing his duties
up to the date of his retirement in 1988 is conclusive proof of his not being
totally incapacitated. The fact that after his retirement he may have become
unable to perform duties is simply irrelevant to the issue of his ability to
perform while he was employed by the Department.'
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February 22, 1990
Reagan stated that Judy's doctor never released him to return to work performing
his normal duties, and he was assigned to Station 5 on restricted duty. He
stated it was a documented fact that Darrell did hurt his back on the job, but
when he retired he did not request disability or line of duty disability. For
that reason, he made a motion to deny Judy's request.
Dill stated he would have been more in favor of it if Darrell has applied for
it at the time he had retired. He seconded Reagan's lotion.
Upon roll call, the motion to deny a retroactive line of duty disability
retirement for Darrell Judy passed by a vote of 6 to 0.
PENSION LIST
Thomas pointed out that there were several changes by retirees making changes
in their income tax withholding. This list is for March, but it will include
the retirement pay for Skelton from February 15 to 28 as well as his March
benefit. Skelton's retirement benefit is 1/2 salary plus $60 for longevity pay.
Jackson stated Skelton's monthly salary is $1,975.71 .
Bonaduce, seconded by Dill, made a notion to approve the pension list.
The motion passed unanimously.
ADJOURNMENT
The meeting adjourned at 2:48 p.m.