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HomeMy WebLinkAbout1990-02-22 Minutes• • • 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. • • • 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. • • • 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. • • • 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. • • • 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 • • • 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.' • • • 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.