HomeMy WebLinkAbout1998-05-28 MinutesMINUTES OF
FIRE PENSION BOARD
A meeting of the Fayetteville Firemen's Pension and Relief Board was held on Thursday, May
28, 1998 at 11:00 a.m. in room 326 of the City Administration Building, 113 W. Mountain,
Fayetteville, Arkansas.
Present: Mayor Hanna, Marion Doss, Pete Reagan, Ron Wood, Darrel Judy, and Heather
Woodruff.
Absent:
CALL TO ORDER
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Mayor Hanna called the meeting to order.
APPROVAL OF MINUTES
Mr. Reagan requested an excused absence from the last meeting. He was attending a conference.
With the requested change, he moved to approve the minutes.
Mr. Judy seconded the motion.
The motion carried unanimously.
PENSION LIST
Ms. Woodruff noted Larry Freedle had been added to the pension list.
Mr. Reagan moved to approve the pension list.
Mr. Wood seconded the motion.
The motion carried unanimously.
INVESTMENT REPORT
Mr. Yada, Merrill Lynch, explained the investment report through the end of April. He noted
there was a growth from December 31, 1997 from 11.1 million to 11.8 million. All investments
were doing well. The income account was a defensive account If interest rates were to come
down it should preform better.
In response to comments from Mr. Reagan, Mr. Yada explained the Japanese Yin was going
down compared to the American dollar.
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May 28, 1998
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Mr. Williams felt the trend would continue. He explained Japan was an export driven country,
which had to make their currency cheaper than the dollar to support their economy. He thought
it could cause the other Asian currencies to devalue, which was a concern because to would
affect our economy in a few months. The trade numbers released two weeks ago were worst than
people had expected. Southeast Asia was not buying our goods. They could not afford them.
Another round of devaluation would make the US currency and products more expensive in
relation to theirs and would further weaken the economy. The US growth had been driven by
internal investments and exports.
Mr. Reagan asked when they planned to pull out of Japan.
Mr. Yada replied they had not renewed the January Series. Overall, the pension fund continued
to grow. They were in the 8% range for the first four month of this year, which was ahead of the
overall program. The plans original projection had been to hit 10 million by 1999. They were
currently near 12 million. They should be receiving their actuary report between June and
August. He suggested the retirement plan provide individual retirement plans for the firemen.
Merrill Lynch had custom financial plans which would cover net worth, income taxes, education
plans. spouse protection. This retirement planning would help set each individual's goals. The
plans would go into detail for each individual. The cost for each plan was $250.00. He felt
every individual should have a retirement plan to help make financial decisions. Once the plan
was done for an individual it was down loaded into their computers and they owned it from then
on. They could change any of the parameters as time went on, if an individuals situation
changed.
Mr. Reagan asked if there was a one time fee?
Mr. Yada replied there would be no charge to update. There was normally no need to update,
unless there was a large inheritance or a divorce.
Mr. Reagan thought it was a good idea. He suggested sending a letter with the retirement checks
to the retirees to see if they were interested.
Mr. Williams did not believe some of the retirees had a need for the full financial plan. They
could do a retirement analysis for free.
Mr. Yada stated they would have to meet with each person individually.
Mr. Doss liked the idea and thought they should send an informational letter out to all the
firemen.
Mr. Reagan asked Mr. Yada to compose an informational letter so they could send it out with a
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May 28, 1998
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questionnaire.
Mr. Williams stated they would need an hour and half for each person of their turn around time
would be four to six weeks.
Mr. Reagan moved to table the item, until they could send out letters and get more information.
Mr. Wood seconded the motion.
Mayor Hanna requested the retirement date of each fireman be added to the pension list. He
• suggested the month and year be added next to the name.
OLD BUSINESS
Mayor Hanna reported the result of the election for the retired position. Darrell Judy had
received 20 votes; and Carl Springston had received 16 votes
Mr. Reagan moved to reelect Darrell Judy.
Mr. Wood seconded the motion.
The motion carried unanimously.
NEW BUSINESS
Mr. Reagan stated he had attended NCEPERS conference in Denver. He presented a booklet
which summarized the conference. He believed it was a great benefit to be a member of the
organization. Their main goal was to keep track of Municipal and State pension systems and
how the legislator affected them. He recommended they stay an active member of the
organization.
Mayor Hanna stated there was a strong effort being made to remove the State's property tax. He
questioned how it would affect the fireman retirement.
Mr. Reagan thought they received approximately $200,000 a year from the tax.
Mayor Hanna questioned the affect on the retirement plan if they were to loose those funds.
Mr. Reagan stated if the property tax were to get on the ballot and passed the retirement plan
would be out of approximately $200,000 a year.
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May 28, 1998
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Mayor Hanna stated their interest was small compared to the millage that went to the schools.
He did not want people believing the schools would be the only one affected. It would not affect
the Fayetteville because they had removed their millage, but a lot of cities used the millage for
their operations. He questioned where those cities would get their money. There were some
small cities that did not have a sales tax base.
Mr. Reagan asked Mr. Yada to work up an idea of how it would affect their pensions in the long
term.
Mr. Reagan stated there were some cities which did not have as good of a pension plan as
Fayetteville, and they were receiving a full mill for both the Firemen and the Police.
For other business, Mr. Reagan moved to send a letter to all the senators supporting the RAP
Act.
Mr. Judy seconded the motion.
The motion carried unanimously.
The meeting adjourned at 11:50 a.m.
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