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FIRE PENSION AND RELIEF FUND
AGENDA
AUGUST 31, 2000
A meeting of the Fayetteville Fire Pension and Relief Fund Board will be held on August 31, .
2000 at 11:00 a.m. in Room 326 of the City Administration Building located at 113 West
Mountain Street, Fayetteville, Arkansas.
1. Approval of the minutes.
2. Approval of the pension list
3. Investment report
4. Wayne Watts: request to have $272.50 per month be paid to Ms. Jean Kay Watts from the
pension fund.
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MINUTES OF A MEETING
OF THE
FIRE PENSION AND RELIEF FUND BOARD
JULY 27, 2000
A meeting of the Fayetteville Fire Pension and Relief Fund Board was held on July 27, 2000 at
11:00 a m in Room 326 of the City Administration Building located at 113 West Mountain
Street, Fayetteville, Arkansas.
PRESENT: Mayor Hanna, Marion Doss, Darrell Judy, Ron Wood, City Clerk Heather
Woodruff, and Richard Yada with Merrill Lynch.
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ABSENT: John Dill and Pete Reagan
MINUTES
Mr. Judy moved to approve the minutes. Mr. Wood seconded the motion. Upon roll call the
motion carried unanimously.
PENSION LIST
Ms. Woodruff stated the "Drop Date" had been added to second page of the pension list.
• Mr. Judy moved to approve the pension list. Mr. Wood seconded the motion. Upon roll call the
motion carried unanimously.
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INVESTMENT REPORT
Mr. Richard Yada, Merrill Lynch, stated the fund had made it over the thirteen million dollar
mark. The Merrill Lynch Private Portfolio Group was at $2,901,678.00. They had moved some
of the money to the Mercury Private Portfolio Group. The MLP Group was up 8.29% through
the end of June, which was good. The Mercury Private Portfolio Group was started May 15,
2000 at $2,384,371. They were up 6.22%. The Income Account was up 3.16% and Ashland was
still down 4.83%. Last month they were down 9.7%. They have made a move back up. The
Dow Jones was down 8.47%. The S&P 500 was down less than 1%. It made the Merrill Lynch
and the Mercury look impressive compared to those two. numbers. The Long Term Treasuries
were up 9.68%. The High Grade Corp. was up 2.51%. The longer term treasuries were moving
up.
Ashland contained 19% of their assets. Merrill Lynch Asset Management had 22%, Mercury had
18%, and the Income Account had 41% or their assets. 42% of their money was in fixed income.
,1% in cash, 1% in other, and 56% in equity. The equity allocation had gone up when they
transferred money from the Merrill Lynch Private Portfolio group and moved it over to the
Mercury account. When they moved nearly half of the money to Mercury (they were 100%
equity) they had thrown their asset allocation over 50%. Their investment policy had them at a
50% maximum in equity. He would like to have the board vote to allow them to stay at that
• point until the next meeting. The board could discuss moving the maximum equity allocation to
60% at the next meeting.
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Mr. Wood moved to moved to leave their distribution of their funds as they are at present
until the next meeting, then vote on raising the percentage they would allow in their equity
funds. Mr. Doss seconded the motion. Upon roll call the motion carried unanimously.
In response to questions from Mr. Judy, Mr. Yada stated they were at 65% on the growth style
investment and 35% on value style. The value style had not been a favorite for a while, but he
thought it would turn around one of these days.
Meeting adjourned at 11:20 p.m.
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Robert J Gladwin, P. A.
Attorney at Law
140 East Buchanan
. P.O. Box 888
Prairie Grove, AR 72753
August 21, 2000
Fayetteville Firefighters Pension Fund
c/o Ms. Heather Woodruff
Fayetteville City. Hall
113 West Mountain
Fayetteville, AR 72701
Re: Wayne Watts
Dear Ms. Woodruff:
Telephone 501 846-2185
Fax 501 846-3362
e-mail: rgladwin@nwark.com
This letter is to request that you place a request by Wayne Watts on the Fayetteville
Firefighters Pension Fund board agenda for Thursday, August 24, 2000. Mr. Watts
. requests that the sum of $272.50 per month be paid to Jeanne Kay Watts directly from
the pension fund. Mr. Watts is required to pay that sum to his ex-wife pursuant to an
Order of the Chancery Court of Washington County, Arkansas.
Again, I would respectfully request that this matter be placed on the agenda for
Thursday,. August 24th If you should have any questions please do not hesitate to
contact me.
RJG/dsc
cc: ' Jan Judy
Robert J. Gladwin
Attorney at Law
RECEIVED
AUG 2 2 2000
CnY OF FAYETTEVILLE
CITY CLERICS OFFICE
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Robert J Gladwin, P. A.
Attomey at Law
140 East Buchanan
P.O. Box 888
Prairie Grove, AR 72753
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August 22, 2000
Fayetteville Firefighters Pension Fund
c/o Ms. Heather Woodruff
Fayetteville City Hall
113 West Mountain
Fayetteville, AR 72701
Re: Wayne Watts
Dear Ms. Woodruff:
Telephone 501 846-2185
Fax 501 846-3362
e-mail: rgladwin@nwark.com
•
I recently forwarded a letter concerning Mr. Samuel Wayne Watts' pension fund checks.
• I have enclosed a copy of the Order entered in his case for your reference. If I need to
do anything further, please do not hesitate to contact me. "
RJG/dsc
Enclosure
Sincerely,
Ro ert . Gladwin
Attorney at Law
RECEIVED
AUG 2 4 2000
CIT" OF FAYETTEVILLE
CITY CLERK'S OFFICE
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46
IN THE CHANCERY COURT OF WASHINGTON COUNTY, ARKANSAS
SAMUEL WAYNE WA1 IS
VS.
JEANNE K. WATTS
NO. E-99-2085
PLAINTIFF
DEFEND
77 -
ORDER
ORDER i s
? rn
Now on this L(rday of March, 2000, comes on the parties, the Plaintiff appearing * o -o
rn
person and by his attorney, Robert J. Gladwin, the Defendant appearing in person and by h', o Y
ss -
attorney, Ronald Woodruff, and upon the pleadings, statements of counsel, and other facts and z cn
matters before the Court the Court doth find:
1. That the parties have entered into a Settlement Agreement in the above styled
cause of action.
2. That the parties are owners as tenants in common of the followmg described real
property located in Washington County, Arkansas to -wit:
Lot numbered eight (8) in block numbered one (1) of the Red At Subdivision II of the
final plat of the re -plat of lots 1-9 of block one (1) in Red Arrow number one (1) and lots 7-
18 in block one (I) of Red Arrow number two (2) subdivision to the City of Fayetteville,
Arkansas, as per plat of said subdivision on file in the Office of the Circuit Clerk and Ex -
Officio Recorder of Washington County, Arkansas.
3. That the parties will list the above-described property for sale through a mutually
agreeable real estate agent at a mutually agreeable price. Upon the sale of the property, the
Defendant, Jeanne K. Watts, shall receive the sum of $25,000.00.
4. That the remainder of the proceeds after all expenses and closing costs are paid
shall be divided equally between the parties.
IT IS THEREFORE CONSIDERED, ORDERED, ADJUDGED AND DECREED that
the parties shall list the above described property for private sale though a mutually agreed upon
real estate agent at a mutually agreeable price for a period of not less than six months. Upon the
sale of the above-described property the Defendant, Jeanne K. Watts, shall receive the sum of
$25,000.00. The remaining proceeds after payment of all expenses and closing costs shall be
divided equally between the parties. Each party shall be responsible for their own costs and fees in
this action.
ITIS SO ORDERED.
CHANCELLOR
APPROVED AS TO FORM AND CONTENT:
r y
Ge,J' /
ROBERT J. GLAD , Attorney for the Plaintiff
ALDG.W
ch--) ; Aft
DRUFF, Attorney for the Defe/rV
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IN THE CHANCERY COURT OF WASHINGTON COUNTY, ARKANSAS
SAMUEL WAYNE WATTS
VS.
JEANNE K. WATTS
NO. E-99-2085
PLAINTIFF
DEFEND
3
ORDER =
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Now on this Jpday of March, 2000, comes on the parties, the Plamtiffappearinga a
A
person and by his attorney, Robert J. Gladwin, the Defendant appearing in person and by I4 o
- _ _ter. _._._�� a .
attomey, Ronald Woodruff, and upon the pleadings, statements of counsel, and other facts and cn
matters before the Court the Court doth find:
1. That the parties have entered into a Settlement Agreement in the above styled
cause of action.
2. That the parties are owners as tenants in common of the following described real
property located in Washington County, Arkansas to -wit:
Lot numbered eight (8) in block numbered one (1) of the Red Arrow Subdivision II of the
final plat of the re -plat of lots 1-9 of block one (1) in Red Arrow number one (1) and lots 7-
18 in block one (1) of Red Arrow number two (2) subdivision to the City of Fayetteville,
Arkansas, as per plat of said subdivision on file in the Office of the Circuit Clerk and Ex -
Officio Recorder of Washington County, Arkansas.
3. That the parties will list the above-described property for sale through a mutually
agreeable real estate agent at a mutually agreeable price. Upon the sale of the -property, the
Defendant, Jeanne K. Wafts, shall receive the stun of$25,000.00.
4. That the remainder of the proceeds after all expenses and dosing costs are paid
shall be divided equally between the parties
IT IS THEREFORE CONSIDERED, ORDERED, ADJUDGED AND DECREED that
the parties shall list the above described property for private sale through a mutually agreed upon
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real estate agent at a mutually agreeable price for a period of not less than six months. Upon the
sale of the above-described property the Defendant, Jeanne K. Watts, shall receive the sum of
$25,000.00. The remaining proceeds after payment of all expenses and closing costs shall be
divided equally between the parties. Each party shall be responsible for their own costs and fees in
this action.
IT IS SO ORDERED.
"1"•••7"''''
� r-
APPROVED AS TO FORM AND CONTENT:
oete�t-,
ROBERT J. GLAD , Attorney for the Plaintiff
CHANCELLOR
ALD G. WO
DRUFF, Attomey for the Defe+l'
• Robert J Gladwin, P. A.
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•
Attorney at Law
140 East Buchanan
P.O. Box 888
Prairie Grove, AR 72753
August21, 2000
Fayetteville Firefighters Pension Fund
c/o Ms. Heather Woodruff
Fayetteville City Hall
113 West Mountain
Fayetteville, AR 72701
Re: Wayne Watts
Dear Ms. Woodruff:
Telephone 501 846-2185
Fax 501 846-3362
e-mail: rgladwin@nwark.com
This letter is to request that you place a request by Wayne Watts on the Fayetteville
Firefighters Pension Fund board agenda for Thursday, August 24, 2000. Mr. Watts
requests that the sum of $272.50 per month be paid to Jeanne Kay Watts directly from
the pension fund. Mr. Watts is required to pay that sum to his ex-wife pursuant to an
Order of the Chancery Court of Washington County, Arkansas.
Again, I would respectfully request that this matter be placed on the agenda for
Thursday, August 24th If you should have any questions please do not hesitate to
contact me.
RJG/dsc
cc: Jan Judy,
•
Robert J. Gladwin
Attorney at Law
RECEIVED
AUG 2 2 2000
CITY OFFAYETTEVILLE
CITY CLERICS OFFICE
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•
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Robert J Gladwin, P. A.
Attorney at Law
140 East Buchanan
P.O. Box 888
Prairie Grove, AR 72753
August 22, 2000
Fayetteville Firefighters Pension Fund
c/o Ms. Heather Woodruff
Fayetteville City Hall
113 West Mountain
Fayetteville, AR. 72701
Re: Wayne Watts
Dear Ms. Woodruff:
•
Telephone 501 846-2185
Fax 501 846-3362
e-mail: rgladwin@nwark.com
I recently forwarded a letter concerning Mr. Samuel Wayne Watts' pension fund checks.
I have enclosed a copy of the Order entered in his case for your reference. If I need to
do anything further, please do not hesitate to contact me.
RJG/dsc
Enclosure'
•
Sincerely,
Robert J. Gladwin
Attorney at Law
•
RECEIVED
AUG 2 4 2000
CITY OF FAYETTEVILLE
CITY CLERK'S OFFICE
PR B ARKANSAS FIRE & POLICE PENSION REVIEW BOARD
MEMORANDUM
TO: Local Police and Fire Pension Plans with Deferred Retirement
Option Plans (DROP)
coittr
FROM: Cathym E. Hinshaw
Executive Director
DATE: July 27, 2000
P.O. DRAWER 34164
LITTLE ROCK, ARKANSAS 72203
TELEPHONE: (501) 682 - 1745
FAX: (501) 682 - 1751
email: info@lopfi-prb.com
website: www.lopfi-prb.com
The Arkansas Fire and Police Pension Review Board (PRB) met on June 27, 2000. The PRB discussed that it has been found that
not all cities with the Deferred Retirement Option Plan (DROP) were administering the DROP within the guidelines of PRB Rule
#10. This letter is intended to remind plans with DROP of some items that could cause problems if the Rule is not followed.
The first item to note is that section 4 of Board Rule #10 states that a copy of the administrative rules must be on file with the PRB
•Some plans have made changes to their rules and have not filed their updated administrative rules with the PRB One way this has
happened is with the police plans being able to extend the DROP to 10 years. Most police plans have apparently adopted this
extension but have not filed updated rules with the PRB. A new law was passed in the last legislative session, which allowed cities
over 20,000 to credit employee contributions differently when on DROP. All cities under 20,000 should have made this change and
cities over 20,000 should have told the PRB IF they made this change.
The second area of concern is in the handling of DROP accounts once a person leaves active employment. Section 10 of Rule #10
states that the DROP account should be distributed at the end of the DROP period as either a lump sum or a life annuity. The rule
does allow other equivalent annuity forms as defined by local rules. It appears, based on the information filed by the plans for
December.31, 1999, that several plans are allowing the DROP accounts to remain as a type of savings account. This is not in •
compliance with Board Rule #10 and has can lead to some other possible problems.
The fust resulting problem is that some plans have allowed partial withdrawals on the DROP account It is our understanding that
lump sums from pension plans are tax deferred if they are deposited in an IRA as a rollover. The practice of partial lump sums could
render the entire DROP account taxable immediately.
The second resulting problem is that some plans have allowed the DROP accounts to be used as collateral on loans. Anytime an
account is used as collateral it could become subject to other legal processes. The police code (section 24-11-417) and the fire code
(section 24-11-814) have prohibitions against the pension funds being subject to legal process. The practice of using DROP accounts
as collateral is not in compliance with the Arkansas Code.
Please understand that the PRB cannot and is not attempting to give tax advice in issuing this letter. The PRB is an administrative
body and as such wishes to point out areas of concern and the possible problems as they are currently understood by the PRB If you
desire to have tax advice on any of these issues, please seek the advice of a qualified tax accountant or attorney.
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ARKANSAS FIRE & POLICE PENSION REVIEW BOARD
RECEIVED
JUN 0 9 2000
ACCTG. DEPT.
Memorandum
P O. DRAWER 34164
LITRE ROCK, ARKANSAS 72203
TELEPHONE (501) 682-1745
FAX: (501) 682-1751
To: Local Police Pension and Relief Funds with DROP Plans
Local Fire Pension and Relief Funds with DROP Plans
From: Cathyrn E. Hinshaw, Executive Director
,n
Arkansas Fire and Police Pension Review Board
Re: Police and Fire Pension Funds Eligible for Act 1457 Benefits
Date: June 5, 2000
Act 1457 of 1999 changed the way local pension funds with Deferred
Retirement Option Plans (DROP) credit employer and employee contributions.
For your reference, a copy of the Act is attached. In summary, the
Act requires municipalities with a population of twenty thousand (20,000)
persons or less, whose pension funds have the DROP, to credit all
municipal matching contributions to the pension fund for members on DROP,
and credit the full employee contribution to the DROP. The Act makes this
crediting method optional for municipalities with a population of over
• twenty thousand (20,000).
If you fall into the category of one of the cities in which this
change is required, we would appreciate your faxing confirmation of your
compliance with the Act to us at (501) 682-1751. We would also like a
faxed confirmation if your pension board has made this change at its
option.
Concerning a related matter, we would appreciate all Police Pension
Funds with DROP which have extended their DROP period from five (5) to ten
(10) years, to confirm for us that this extension has been granted by the
City in which the Pension Fund is located. Again, please use our fax
number - 501-682-1751 - to send us a copy of the City ordinance or
resolution by which your Police DROP period was extended to ten years.
Please direct all questions to Ms. Cathyrn Hinshaw, Executive
Director of the Arkansas Fire and Police Pension Review Board, at
(501)682-1745.
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Thank you for your assistance in this matter.
attachment: Act 1457 of 1999
CC w/o attachment: Arkansas Fire and Police Pension Review Board
Act 1457 Acrs OF ARKANSAS 6149
SECTION 4. All laws and parts of laws in conflict
with this act are hereby repealed.
/s/ Vess
APPROVED: 4/1511999
ACT 1457
"AN ACT TO AMEND ARKANSAS CODE 24-11-
434(d) CONCERNING THE ARKANSAS PO-
LICE OFFICERS' DEFERRED OPTION
PLAN; TO AMEND ARKANSAS CODE 24-11-
8.10(d) CONCERNING ARKANSAS FIRE
FIGHTERS' DEFERRED OPTION PLAN;
AND FOR OTHER PURPOSES"
Subtitle
"AN ACT TO CONCERNING THE ARKANSAS
POLICE OFFICERS' AND FIRE FIGHTERS'
DEFERRED OPTION PLANS"
BE 17' ENACTED BY THE GENERAL ASSEMBLY
OF THE STATE OF ARKANSAS:
SECTION 1. Arkansas Code 24-11-4.14 (d), con-
cerning the Arkansas Police Officers' Deferred Option
Plan, is amended to read as follows:
"(d)(1) When a member begins participation it the
Arkansas Police Officers' Deferred Option Plan, the
conbtution of the police officer and the employer
contribution shall continue to be paid .
(2)01) Municipal In a mtSicipality having a
population of over twenty thousand (84000) Persons,
miasicipai matching cmatributions for employees who
elect the Arkansas Police Officers' Deferred Option
Plan shall be credited equally to the policemen's
pension and relief fund and to the Arkansas Police
Officers' Deferred Option Plan, or at the opthon of the
local pension and relief {sand board oftrustees, credit-
ed in the manner provided in subdivision (d)(8)B).
tam ae " -' W =deg Sass y aloud
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