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HomeMy WebLinkAbout1994-07-21 - Agendas - Final FAYETTEVILLE T OF FAYETTEVILLE, ARKANSAS SHERRY L THOMAS, CITY CLERK TO : Police Pension B6ard Members _ FROM : - Sherry L . Thomas , City Clerk DATE : July 14 , 1994 SUBJECT : Next Meeting t The next regular meeting of the Police Pension Board is scheduled for 2 : $ 0 p . m . on Thursday , July 21 , 1994 , in Room 326 of the City Administration Building . Enclosed is copy of the minutes from the last meeting on April 21 , 1994 and an agenda for the July 21 meeting . a List : Mayor Fred Hanna Eldon Roberts Jerry Friend Clint Hutchens Hollis Spencer Dr . James Mashburn Treasurer Glyndon Bunton Elaine Longer Mike Kirkland • 113 WEST M NTAIN 72701 501 575-8323 FAX 501 575-8257 j I � • AGENDA POLICEMEN ' S PENSION AND RELIEF BOARD July 21 , 1994 2 : 30 p . m . City Hall Room 326 1 . Approval of the minutes of the April 21 , 1994 meeting 2 . Old Business 3 . New Business A . Report from Longer Investments B . Report from Mike Kirkland C . Other • 4 . Adjournment • • MINUTES OF A POLICE PENSION BOARD MEETING A meeting of the Police Pension Board was held on April 21 , 1994 , at 2 : 30 p . m . in Room 326 of the City Administration Building , 113 W . Mountain , Fayetteville , Arkansas . PRESENT : Eldon Roberts , Hollis Spencer , Mayor Fred Hanna , City Clerk Sherry Thomas , and City Treasurer Glyndon Bunton ABSENT : Dr . James Mashburn , Clint Hutchens , and Jerry Friend CALL TO ORDER The meeting was called to order by Eldon Roberts . MINUTES Spencer , seconded by Bunton , made a motion to approve the January 20 and February 15 , 1994 minutes . The motion passed unanimously . OLD BUSINESS MEDICAL RETIREES Roberts stated he felt it was fine to notify the medical retirees about an update from their doctors regarding their medical disabilities . However , it is the retiree ' s responsibility to notify this Board on an annual basis . Thomas distributed copies of a letter from Don Kilgore ' s physician regarding his medical disability . Bunton asked if there were any different requirements for a medical retiree and a line of duty disability retiree . Roberts stated he did not believe there were any differences . NEW BUSINESS MADISON INVESTMENT REPORT Kay Frank , Madison Investments , Madison , Wisconsin , attended the meeting and reported on the 1993 year end and the first quarter investments . She stated last April the economy was not very good . There were tax hikes , consumer confidence was down , and there was a general negative feeling in the country . But , both the stock market and the bond market were doing okay . The economy was still pretty strong in the fourth quarter of 1993 , but Madison was anticipating a change in the markets . So , they started to lighten maturities and to take more risk off the table . The portfolio is down . 6 of 1% as of March 31 , 1994 . Interest rates have risen , so • the markets have gone down . The average annual rate of return on the fund for the past 4 to 4 1/ 2 years has been about 9 % . ti • April 21 , 1994 Frank stated today the yield on treasury bills is a little over 7 % . The stock market has moved very far , very fast , so they are expecting a retracement of some of the loss in the market . They expect a small rally in the not too distant future . The federal bank has just begun to raise short term interest rates . The bond market may have an impact on the economy as a result of these increasing interest rates . However , Madison does predict there will be some volatility over the next year or two in the markets . They do expect to have a good year in 1994 . Bunton asked in order to take advantage of the anticipated rally , what securities would Madison be investing in . Frank stated they will be looking into selling some of the 3 year maturity treasuries and buying 30 year bonds when their returns increase . DEAN WITTER INVESTMENT REPORT Mike Kirkland stated there is $ 84 , 293 in cash , and the TCW balance as of March 31 , 1994 was $ 1 , 504 , 001 . The S & P was down 8 . 1 % , the Dow was down 9 . 4 % , and TCW was down 7 . 25% , which is a little better than average . Most of the drop happened in one month . The portfolio is split 65% in stocks , 35 % in bonds , and 5 % in cash . • Kirkland stated the stock market has recovered a little , and they expect it to increase a bit more . They also expect to see long term bonds earn around 7 . 5 % . He stated TCW ' s return over a 5 year period was about 14 % . TCW has had this account since August 19 , 1993 . Kirkland stated housing starts were up again in March , but they were flat in February . They do not think the higher interest rates will effect the jumbo mortgages that much , so they expect the housing starts to continue to grow , which is good for the economy and the investment markets . LONGER INVESTMENT REPORT Elaine Longer stated the bond market has gone down , and long term interest rates have moved up . The markets are currently in a transition stage . She stated the portfolio has 44 % in equities and 13 % in cash . She has been working on gaining buying power to be able to take advantage of increasing treasury bill rates . She has been buying some of the 6 % treasuries due in November , 1997 . The bond portfolio has 30 % in corporate bonds and 53 % in government bonds . The stock portfolio is split about 50 % in mid-cap stocks and about 50 % in the larger companies . Longer stated the portfolio is down 4 . 11 % for the first quarter of • 1994 . The total account return since inception is 8 . 33 $ . She stated there have been $96 , 708 in realized gains year-to-date . She r • April 21 , 1994 stated it has been some time since the portfolio has had a down quarter such as this one . The earnings of the companies in the stock portfolio continue to look good , so they are anticipating a growth in the returns for the balance of 1994 . Longer stated there may be another increase in the prime interest rate . She wants to be in a position to take advantage of the decline and have cash ready to make investments . OTHER BUSINESS Roberts stated elections will need to be held the first part of May because two of the positions come up for appointment . He stated he will call a meeting of the active members . Spencer stated he would contact the retirees regarding the retiree position . ADJOURNMENT The meeting adjourned at 3 : 35 p . m . • •