HomeMy WebLinkAbout1998-01-29 Minutes•
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MINUTES OF THE FIRE PENSION BOARD
A meeting of the Fayetteville Firemen's Pension and Relief Board
was held on Thursday, January 29, 1998, at 11:00 a.m., in room
326 of the City Administration Building, 113 W. Mountain,
Fayetteville, Arkansas.
PRESENT:
ABSENT:
Marion Doss, Bill Morris, Darrell Judy, Ron Wood, Pete
Reagan, and Deputy City Clerk Jane Heth.
Mayor Fred Hanna
CALL TO ORDER
Marion Doss called the meeting to order.
MINUTES
Reagan, seconded by Wood, moved to approve the minutes of the
December 11, 1997, meeting. The motion passed unanimously.
PENSION LIST
There were no changes to the pension list.
Reagan, seconded by Wood, moved to approve the pension list for
February, 1998. The motion passed unanimously.
INVESTMENT REPORT
Richard Yada and Curtis Williams of Merrill Lynch were present to
review the portfolio performance.
Yada reported that New Mexico Capital gave a return last year of
16.970. It probably under -performed the market a little, but is.
not bad for a conservative portfolio.
The income account was up 6.380. Keeping money available will be
even more critical now that the DROP program is in place.
The Keystone Account had a 30o return rate, which is excellent.
Yada gave an update on the Select 10 Program. To try to get some
diversification, we put some money into the Dow, United Kingdom,
Japan, and Hong Kong high-quality stock funds. The Dow and
United Kingdom are excellent. Hong Kong was excellent until
about November. Japan never has done anything. We will not
renew the Japan. Hong Kong will probably bounce back with a
vengeance. We are down about $39,000.
We have 46.% of our assets in the stock market. Fixed Income has
470. Cash is 61. One percent is in the "other" category. We
are almost right on our target.
• Keystone is managing 14% of our portfolio. New Mexico Capital
Management has 42%. Our income account is 44%.
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Yada reported the actuary will be run as of the end of 1997. It
should be back by August. He reviewed the last one done in 1995,
before we approved the DROP and benefit increases. Then, we were
sound in all categories. For the short-term test, we have to
have $173,000 coming into the account, plus enough to reduce the
unfunded liability of the plan. We are not supposed to be fully
actualized until 2003. We have used up the cushion we had. The
total liability of the plan is $9,045,983 and assets at the time
were $8,897,000. The unfunded liability was only $148,000. He
reviewed the insurance turn backs over the last three years and
the local millage. The investment return for 1993 was 10.9%,
1994 was 6.9%, and 1995 was 13.4%. 1997 will probably have a 7%
to 8% rate of return range.
Yada explained that we try to diversify our investment styles as
we do our investments. The two styles of investing are growth
and value. Keystone is a growth style. New Mexico is a value
style.
Reagan asked about replacing Japan.
Williams replied we have to have global diversification. We need
to find the most efficient and least troublesome way of doing it.
OLD BUSINESS
VOLUNTEER PAY
Reagan reported he requested information from the Pension Review
Board regarding what other cities pay their volunteers. He has
not received an answer yet.
OSBORN, CARREIRO & ASSOC., INC. LETTER
Reagan suggested writing a letter to Cathyrn Hinshaw of the PRB
about a letter dated October 3, 1997, from Osborn, Carreiro &
Associates that was not received by the board until recently.
This was regarding 1996 DROP Interest Rate Certification.
Doss explained he'd been told by Cathyrn Hinshaw that a copy of
this letter had been sent earlier and may have been misdirected.
In the future, it should come addressed to the board.
NEW BUSINESS
ATTORNEY GENERAL OPINIONS
Reagan stated that in the future he would like to see Attorney
General opinions before the pension board meeting. It was
decided the City Clerk would provide each board member with
information like this in the agenda packet. These opinions will
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be discussed at the nekt meeting.
LIST OF DROP PARTICIPANTS
Doss reported that the finance department sends him a list. of
DROP participants and their investments. He sends a copy of it
to them. He suggested keeping the originals in the City Clerk's
office. He turned the originals over to the Clerk.
NCPERS
Reagan stated he'd received information on the National
Conference on Public Employee Retirement Systems (NCPERS).
Membership would be $100 annually. They send out a monthly
monitor of what is happening on Capitol Hill. They have a
conference once a year. Their mission statement• states they were
formed over 50 years ago to take a stand against mandatory social
security coverage for public employees. He stated the annual
conference would be held in Denver in April.
Reagan moved to join NCPERS. Wood seconded. The motion carried
unanimously.
Reagan offered to be considered as a delegate to the Denver
conference. It was thought this would be paid for by the pension
fund.
Judy moved to send Reagan to the conference. Reagan seconded.
The motion carried unanimously.
DROP FORM
Doss reported that Marilyn Crammer has prepared a form showing
the formula used for the DROP, which is available for anyone who
is interested in it.
TWENTY-YEAR CERTIFICATE
A twenty-year certificate was signed for Eddie Bachman.
ADJOURNMENT
The meeting adjourned at 12:06 p.m.