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HomeMy WebLinkAbout2003-01-30 MinutesFireman's Pension and Relief Fund Board Meeting January 30, 2003 Page 1 of 5 MINUTES OF A MEETING OF THE FIREMAN'S PENSION AND RELIEF FUND BOARD JANUARY 30, 2003 A meeting of the Fayetteville Fireman's Pension and Relief Fund Board was held on January 30, 2003 at 11:00 am in Room 326 of the City Administration Building located at 113 West Mountain Street, Fayetteville, Arkansas. Present: Ronnie Wood, Pete Reagan, Danny Farrar, Marion Doss, Robert Johnson, Heather Woodruff, Sondra Smith and Kit Williams. Absent: Mayor Coody Assistant Chief Doss presided the meeting. Minutes: Mr. Reagan moved to approve the minutes. The motion was seconded by Mr. Johnson. Motion carried unanimously. Pension List: Marion doss asked if there were any changes to the Pension List. Heather Woodruff stated there were no changes yet, but there were four people that wanted to be added to DROP. Kit Williams said that when we have minors, like the Skelton's drawing, we need to have something in place to insure that if they are getting an exemption because they are going to school, that we are getting documentation every semester that they are actually full time students and still eligible to get the benefits. Ms. Woodruff said that she had gotten an affidavit from Kelly Skelton's school this year. Mr. Williams wanted to know if that was in the fall or just recently. Ms. Woodruff said that she got one just a week or so ago and that she had received one in the spring and this past fall. Mr. Williams said that was what we needed. Ms. Woodruff said she has not received anything at the end of the semester showing that she had stayed enrolled for the entire semester. She asked if we needed that or if we just needed to show that she was enrolled at the beginning of the semester. Fireman's Pension and Relief Fund Board Meeting January 30, 2003 Page 2 of 5 Mr. Williams said it is really up to the board and that he thought they had probably done enough just to cover the law but if the board wanted further documentation they could request it. All it says is enrolled as a full time student. She doesn't really have to pass I guess as long as she stays enrolled. I think when she turns 23 she is no longer eligible for benefits. The benefits would then transfer to her sister that is younger as long as she is in school. Mr. Williams said as far as the board is concerned it does not really matter except that they need to make sure the funds are going to the correct person. Mr. Reagan said we need to make sure we know their cut-off dates especially with Heather leaving. Mr. Williams said we need cut-off dates for both of the Skelton's because eventually both Kelly and Kimberly Skelton will be too old and out of school. Mr. Doss said we need to make sure we have their birthdates. Ms. Woodruff said that we have a copy of their birth certificates. Mr. Johnson moved to approve the pension list. The motion was seconded by Mr. Reagan. Motion carried unanimously. Approval of four people to the DROP list: Teddy O'Neal Joey Pierce Glenn Shackelford Marshall Mahan Mr. Doss said Teddy O'Neal would like to change the date on his DROP form to April 1, 2003. Mr. Reagan asked if he notified us in writing. Mr. Doss said he was suppose to come by today. He called the City Clerk's office and he called Mr. Doss. Mr. Reagan said he would need to fill out another application form with the correct date on it. Sondra Smith asked if we could have him mark through the date and initial it rather than have him fill out another form. Mr. Reagan asked if the application had to be notarized. Mr. Doss said it does not. Fireman's Pension and Relief Fund Board Meeting January 30, 2003 Page 3 of 5 Mr. Reagan felt it would be better to have him fill out a new form because the pay amount will also change. Mr. Reagan moved that we remove Teddy O'Neal's name from the DROP application per his verbal request and that he submit a new application at a latter date. The motion was seconded by Mr. Farrar. Motion carried unanimously. Mr. Reagan moved that we add Joey Pierce, Glenn Shackelford and Marshall Mahan to the DROP list. The motion was seconded by Mr. Woods. Motion carried unanimously. Mr. Doss said all the amounts have been checked by the accounting department. Investment Report: Elaine Longer of Longer Investments, Inc. gave a summary of the attached investment report. The first page of your report is a summary of your portfolio appraisal as of December 31, 2002. Your equity exposure is about 40% you have about 1% in a foreign stock fund so your total equity exposure is about 41%. This compares to your policy guidelines of 25% to 50%. You are still a little under weighted in equity. If you look at the net difference between your total exposure and what your fillers are you are really at about 28% stock. The weighted average "S&P" rating of 3.2 would indicate that you are close to an A- S&P rating on the weighted average total on the portfolio. Your amended policy calls for it to be a weighted average of B+ or better which would be 4.0 on our scale. A copy of the finalized investment policy is also included. Elaine asked if the board is ready for Longer Investments to present full reports at the Fire Pension quarterly meetings and provide a portfolio appraisal and a list of contributions and distributions for the monthly meetings. The Board said that would be okay. Ms. Longer said if you have questions on the monthly reports to call them. Mr. Reagan asked how the reports would be sent. If they could submit them electronically. Ms. Longer said they can deliver them to the City Clerk's office. The Board thanked Longer Investments for their attendance and their good work. Fireman's Pension and Relief Fund Board Meeting January 30, 2003 Page 4 of 5 Other Business: Mr. Williams said the board had selected two lawyers that are working together, Charles Stutte and Mark Martin to represent you against Merrill Lynch in a potential suit. Mr. Williams was hoping that he would have a contract to bring to the Board, but he has not been able to get in touch with them. Mr. Williams said he would like the Board to agree to some general terms and he could then get with them. He would also like the Board to authorize the mayor to sign a contract as the Board's representative if the terms are met by them. The terms that they had with the individuals were a straight one third percent. I would rather offer them a contract that would be twenty five percent if it does not have to go to trial. If it should go to trial then use the standard one third percent. If it has to be appealed then you add a little more, maybe thirty six percent, I would not add a lot more than that. If this is satisfactory to you then that is what I would offer to them and you would not have to have another meeting to approve it. I would also like to try to negotiate with them that on a contingent contract if you lose then you do not have to pay any attorney fees, but they technically can ask us to pay their cost, which could be substantial. I would like to ask them to waive the cost, these cost would be deducted if we win, they would be taken off the top and then you would do the division of whatever the percentage would be. Mr. Reagan said is that normal practice. Mr. Williams said it can be. He thinks it is unlikely that this will be settled without a trial. He would like to have this provision in there. Mr. Reagan asked Mr. Williams so you are asking us to allow you to make that offer. Mr. Williams said yes. If it does go to appeal you may end up paying a higher percentage under my scenario. It would be easier to have them just charge one third percent all away across. Mr. Williams stated that in his letter to them he also stated that they should represent only you, that the Board here is the statutory representative of all the pensioners and that the claim is yours as a group that you are the representative and that they should not pull out other pensioners. You are assigned and have a duty to the pensioners, it was your terms that they violated, and you should be the plaintiff and not individual pensioners. This is something you should insist on with your attorneys that are representing you so that they have no conflict by representing someone else in this case. Mr. Reagan said that is an excellent idea and he thought we should do that. I think you should be able to negotiate the best deal for us. Mr. Williams said he just wants some kind of authority. I do not want some lead way in this. I do not feel comfortable in negating the best deal. If you will allow me to negotiate in these ranges people can check to see what my authority is. I would like some definite guidelines from you. Fireman's Pension and Relief Fund Board Meeting January 30, 2003 Page 5 of 5 A discussion followed on what cost could be incurred and what the Board's options are. Mr. Williams said he would like to have a time frame that they must approve the contract and that if they do not approve it by the deadline then we would look at the other person that applied. Mr. Williams said we just need to move forward. Mr. Reagan asked if in their RFQ if it said that they would charge thirty three percent. Mr. Williams said yes. The two changes he is suggesting is that if they are not successful they are not going to charge for their cost and that this will be an exclusive contract. Mr. Reagan moved to have Mr. Williams contact them and offer them up to thirty three percent, waiving the cost if they are not successful and that this be an exclusive contract. The drop dead date will be February 14, 2003 and to authorize the mayor to sign the contract under these terms. The motion was seconded by Mr. Woods. The motion carried unanimously. Mr. Reagan asked if the affidavits had been sent out yet to the Pension List. Ms. Woodruff said they would be sent in February. Mr. Reagan said elections will be in May. Mr. Doss said the letters for elections need to go out before April. The Board thanked Ms. Woodruff for serving on the Board. Meeting adjourned at 11:55 AM The next meeting will be February 27, 2003 at 11:00 AM in Room 326 of the City Administration Building.