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HomeMy WebLinkAbout1998-04-16 MinutesI.n'—_•-- _,•- MINUTES OF THE POLICE PENSION BOARD A meeting of the Fayetteville Police Pension Board was held on April 16, 1998 at 1:00 p.m. in room 326 of the City Administration Building, 113 West Mountain Fayetteville, Arkansas. PRESENT: Eldon Roberts, Dr. Mashburn, Randy Bradley, Jerry Friend, Hollis Spencer, Ben Mayes, and Heather Woodruff. ABSENT: Mayor Hanna CALLED TO ORDER Elden Roberts called the meeting to order. MINUTES Mr. Spencer moved to approve the minutes from the January 15, 1998 meeting. Mr. Bradley seconded the motion. The motion carried unanimously. BUSINESS Mr. Roberts presented a letter from Catherine Henshaw from the Fire Pension Review Board the Little Rock. He had spoken with Ms. Henshaw in regards a benefit increase proposal. He had been informed that as of February 24, 1998 she had sent to the year end report the company conducting the actuary studies. It had been the first packet of material sent to the company. She expected the study to be complete within six weeks. When the report was returned to her, then the Board could request a benefit increase proposal. She would then contact the City Clerk for the money to process the request. He believed the first request was approximately $600.00 and $250 for the second request. The board was asking for two benefit increases. The Board had already sent the letter requesting the increase. INVESTMENT REPORT Ms. Kim Cooper and Teresa Ewing presented the investment report. She explained the combined account and the stock account. Mr. Friend questioned if the their portfolio had any Phillip Morris or any tobacco companies. Ms. Cooper replied none of the portfolio they managed did, but there was 710 Phillip Morris in the Combined account. She continued stating the largest holding for the account was Mobil. She reviewed all stock and bond accounts. The summary on the total combined account that they had managed for eight years. The average annual returns on the stocks has been 15.7%, bonds have averaged 7.6%, and the total average annual return was 10.5%. Which was net of all fees and all expenses. The total investment return had been $2,793,000.00. The total of the combined Longer Investments portfolio was 11.5 % year to date for the last five quarters. Dr. Mashbum asked for her opinion on Devoe. He questioned if all the bank mergers. Ms. Cooper replied their earnings today were below estimated earnings. Their stocks were down $1.50. The company had excellent management. They had a good capital structure. Ms. Teresa Ewing reviewed an account managed by Madison, which was held by Dean Whitter. It was a bond fund. In response to reports, Mr. Friend asked if the management fees were for Dean Whitter or Elaine Longer. Ms. Ewing replied the fees were for Madison, because they were the managers. It come out of the Dean Whitter Account. Mr. Roberts stated he had been concerned if the Board had been paying two fees. He believed they paid Dean Whitter and then Dean Whitter paid Madison. Ms. Cooper stated she had called and verified that it was the management fee. Mr. Robert noted the total fees for the pension fund's management fees was near $82,000 in total fees. In response to questions, Ms. Cooper stated if they were to consolidate their management with Longer Investments, then all of the money over six million dollars would be billed at .65%. The first three million would be billed at 1%. Any money over and above six million dollars would be billed at .65%. The fund was currently at 5.9 million. Mr. Friend stated he liked Ms. Longer's investment reports. They were very helpful and easy to follow. He suggested the Pension Fund move all their money to Longer Invest's. He felt they were paying too many people to manage their money. Mr. Roberts stated Ms. Longer felt comfortable handling the entire account because of her added personnel. Mr. Friend moved to transfer all the management to Ms. Longer. Dr. Mashburn suggested amending the motion to ask Ms. Longer if she was ready to handle the entire account. Mr. Ben Mayes explained the management fees were different because it cost less to manage a fixed income account than it did an entirely equity account. r Mr. Spencer seconded the motion. Mr. Friend question if Ms. Longer could provide a cash account to pay the retirees. Dr. Mashburn suggested meeting in a couple of weeks with Ms Longer to see if she was ready to take the entire account. Mr. Spencer stated he would like to visit with Ms. Longer before changing management. Mr. Friend withdrew his motion. Dr. Mashbum asked Mr. Mayes to set up a meeting with Ms. Longer on managing the entire account. Mr. Mayes set the next meeting for April 30, Thursday at 1:00 p.m. The meeting adjourned.