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HomeMy WebLinkAbout2000-03-30 Minutes• • MINUTES OF A MEETING OF THE FAYETTEVILLE FIRE PENSION AND RELIEF FUND BOARD MARCH 30, 2000 A meeting of the Fayetteville Fire Pension and Relief Fund Board was held on March 30, 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, Pete Reagan, Marion Doss, Darrell Judy, Ron Wood, Administrative Services Director John Maguire, and Deputy City Clerk Gina Roberts. Absent: John Dill. MINUTES Mr. Pete Reagan moved to approve the minutes. Mr. Marion Doss seconded the motion. Upon roll call the motion carried unanimously PENSION LIST Mayor Hanna noted a correction needed to be made on the Pension List. Mr. Lonnie Napier needed to be added to the Drop Employee List. Mr. Reagan moved to approve the list as amended. Mr. Judy seconded the motion. Upon roll call the motion carried unanimously. INVESTMENT REPORT Mr. Richard Yada, Merrill Lynch, presented the investment report for 12/99 to 2/29/00. The Private Portfolio Group was down 1.55% for the year. The portfolio had approximately 40% fixed income. As interest rates continued to go up the fix income would hold down a little. The Income Account was up almost 1% for the year. Ashland was down 8.10% for the year. Compared to the Dow Jones, which was down 11.7% during the same time period. The S&P 500 was down 6.83%. The Private Portfolio Group was a mixture of stocks and bonds and was down 2%. Treasuries for the long term were up 4.95% for the year The bond portion was up and the stock portion was down. The Income Account up almost I% was predominately a bond account, so it was up. In the month of March they had paid out two drop participants a total of $177,000 from the account. Mr. Reagan asked when the money from the Insurance Tumback was going into the account. He noted they were late receiving the money and questioned when the money had been transferred from their account to Merrill Lynch. Mr. Maguire stated it had been transferred out of the pension account. • Mr. Maguire asked on the Ashland Fund how did they get paid. Were they paid on their transaction fees only? • Mr. Yada stated they were paid an annual fee of .7%. They were paid quarterly. Mr. Reagan asked about the change moving from Private Portfolio to Mercury. Had the transaction happened yet? Mr. Yada stated they had just received the final paper work yesterday. And the process should be starting today. They were going to be moving half the account to Mercury from the Private Portfolio Group. In reference to questions from the last meeting on Investment Policy, in 1998 Merrill Lynch had wanted to know if the Pnvate Portfolio Group had the authority to manage the account on a discretionary basis. He presented a letter from Mr. Rose and a management agreement. Mr. Yada noted the short term interest rates were higher than the thirty year interest rates. Normally the thirty year interest rates were higher. Usually when this happened the interest rates were going to come down. Mr. Maguire asked, even thought the contract was unsigned, this was the contract? Mr. Yada stated Merrill Lynch had signed it in August 1998. This was when they changed money managers from New Mexico Capitol Management to Private Portfolio Group. Mr. Maguire stated in trying to get his hand around the fees RCMA booklet that the contract had • been torn out and a sheet in it that specified the fees in it. Which fee basis were they on? • Mr. Yada stated the RCMA was an account which all these accounts had to go into. It was called a retirement cash management account. It was in a rap fee account. Normally, the Income and Ashland account would have an annual fee of $150 per year, plus transaction fees. Mr. Maguire clarified the transaction fees were still involved and not the amount. Inside Ashland, were there transaction fees? Mr. Yada replied Ashland traded through a desk in New York. Their standard commission rate was the standard minus 40% discount. He thought they were doing some transactions lately. OTHER BUSINESS Mr. Doss asked if a statement had been sent out on the Drop Account yet. He had spoken with Accounting and they would be preparing a statement on the Drop Account for the individuals. Mr. Reagan stated he thought elections would be held next month. Meeting adjourned at 11:30 a.m.