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HomeMy WebLinkAbout2003-06-26 MinutesFireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 1 of 14 MINUTES OF A MEETING OF THE FIREMAN'S PENSION AND RELIEF FUND BOARD June 26, 2003 A meeting of the Fayetteville Fire Pension Board was held on June 26, 2003 at 11:00 a.m. in Room 326 of the City Administration Building located at 113 West Mountain Street, Fayetteville, Arkansas. PRESENT: Mayor Coody, Doss, Reagan, Farrar, Johnson, Wood, Treasurer Sondra Smith, Kim Cooper with Longer Investments, Attorneys Chuck Stutte, Mark L. Martin and Ken Kieklak, Staff and Members of the Audience. Mayor Coody called the meeting to order. Report from Attorneys Chuck Stutte and Mark L. Martin: Mark L. Martin: When we met last we brought you up to date on the results of our investigation and we projected that we would be here today giving you a final accounting of losses sustained by the Pension Board. We have continued down that road, we don't have final figures on that but since that time we have discovered some information that we feel would be good news to this board. Not only do we have in our opinion a cause of action against the stock broker Merrill Lynch and of course we have brought you up to date on our investigation with regards to losses substained by the Pension Board with regards to inappropriate investments, unauthorized investments, and out and out fraud. Chuck is going to speak a little more about the continuing investigation in that regard. Since we meet last we have been exploring other potential causes of action that this Board needs to be aware of and we have found that in 1995 they passed a private security reform act, which enables stock holders to bring class action lawsuits against corporations for SEC violations. Since that time there have been a number of class action lawsuits in this country brought by boards and funds to recover for fraud, inappropriate investments, insider trading, that kind of thing. Our cause of action is against Merrill Lynch for the inappropriate investment that we are talking about and the losses that this board has substained as a result of that which are substantial, but you also need to be aware that there is a different level and a higher level of liability which we believe that this board has sustained losses. We have been in contact with a law firm that does simply SEC litigation and from what we have discovered there are about five in the country and we have asked them to go ahead and run a search on the securities that this board has had to find out if there have been class action lawsuits for which there may be a potential recovery. Since 1999 there have been approximately 40 class action lawsuits which have involved securities that are a part of this Fayetteville Fire Fighters Pension Fund. As far as we can tell at this point in time no one has taken action on behalf of this board to recover the funds that have been set aside in these class action lawsuits, that is not to say that all 40 have resulted in some type of recovery or settlement, but we do know that Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 2 of 14 there is a number of those class action lawsuits that have resulted in sums of money for which this board should have been entitled to recovery. How do you get your money, there are a number of ways to do it. Number one you take action as a lead Plaintiff involving these SEC violations and there is a recovery at any number of stages or if you are not the lead Plaintiff, but you are part of the effected class, then once the fund is established then there is a procedure that must be followed to get your portion of the recovery. There are at least 40 of these class action lawsuits. This is something that needs to be explored, we are certain that there are monies there that should have been recovered. The question comes down to this, who has the responsibility of finding out if these settlements have occurred or these judgments have occurred. It is generally the responsibility of the custodial bank and there may be an additional cause of action against the custodial bank for not having pursued these class action sums. Just to give you an example of some of the most recent there was a settlement by Sprint which was announced in April 7 of 2003 of 6 billion dollars, there was a settlement from Campbell Soup announced February 6 of 2003 in the sum of 35 billion dollars. We know that there are two other class action lawsuits which have been filed and those are very close to settlement or judgment and those sums should also be substantial. That is not to say that this Board is going to receive those sums of money but they are certainly entitled to receive their portion of the losses as a result of these class action lawsuits. We are exploring an optional cause of action against the custodial bank it may or may not be Merrill Lynch we don't have that information but we are going to explore that. We would also like to continue down this road and pursue the SEC potential cases which we feel could result and probably will result in substantial sums recovered for this organization. Our case, the one that we started with against Merrill Lynch and that is under the cause of action that we prescribed we continue to pursue that and again Chuck is going to talk a little bit about the accounting procedure we have, we hoped to have that information here today for you, but frankly we got onto this other theory of liability and we wanted to be sure that we were thorough and we do expect to have that as well as the information on this SEC case by the next meeting. To pursue the SEC causes of action will require one of two things, either filing claims against, first of all exploring these class action lawsuits, determining if there have been recoveries, if so how much, then what portion belongs to this organization, some of them may be a matter of filing claim forms, some of them may be a matter of filing lawsuits, but again this is an area that we want to pursue and we have discovered to best represent you in this regard, it would be in this Board's interest to allow us to associate this SEC law firm of Cauley, from Little Rock, Arkansas and that is all they do. They are plugged into a data base with other stock broker companies where they monitor these class action lawsuits on a daily basis so they know before anybody else when these lawsuits are filed, when these cases are settled, when they come to judgment, where the lawsuits need to be filed and since we met last we have been in contact with this law firm to discuss that on your behalf and what we would like is your permission to associate this law firm to pursue the SEC cases and with regards to attorneys fees what we would like is your permission to negotiate some arrangement with that law firm where we could continue to represent you on all the cases for no increase of attorneys fees. That is one of the things that we are asking you today to allow us to pursue this to associate this firm to work with us so we can make a maximum recovery for you and what we will do is we will work with that law firm to Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 3 of 14 work out an arrangement where again the attorney fee that we have agreed with the Board there will be no additional cost to you, but we do need your permission to do that. We would like to be put on the agenda for the next meeting so that we can report back to you about how much is involved in these class action lawsuits, how much money we are looking at and the best course to pursue these either by filing claims for the judgments that are there or potential litigation on behalf of this Board. Mayor Coody: I have some questions. When you say custodial bank and it may or may not be Merrill Lynch, define custodial bank. Mark L. Martin: The stock broker is the broker and then the money is held in a bank and that's simply the keeper of the funds. Sometimes there will develop a situation where no one has taken responsibility for filing these claims. It is our opinion that it should be the bank that is ultimately responsible for filing these claims. There was a recent article in the Wall Street Journal that discussed the amounts of money that have not been claimed which have been subject to class action lawsuit in terms of hundreds of millions of dollars, have ended up in funds created by class action lawsuits and no claims have been filed. Generally it's the responsibility of the custodial bank to be checking into this and to be filing claims, but we find a lot of them simply don't do that, don't know they are suppose to do it, or don't take responsibility. Mayor Coody: So Merrill Lynch is a big enough organization, could they have been the custodial bank. Mark L. Martin: Possibility, we don't know that, but that is something we certainly will pursue and if they are and there is a separate cause of action against Merrill Lynch in that regard, that is something we certainly would want to pursue. Mayor Coody: These pots of money, let's just say 100 million bucks in a left over class action money that hasn't been claimed, we wouldn't be able to get any kind of punitive's out of it, it would just be to cover the losses and legal fees, is that the best we could hope for? Mark L. Martin: That's the best we could hope for, to recover the portions that have been set aside. The problem there is some of these class action lawsuits are old, there are some that are set up where if claims are not filed, then the money is simply disbursed among the people that do claim, or in some instances the money is turned over to charities, so as we speak today we don't know the status of that, but we are going to get answers. Mayor Coody: You mentioned people that have setteled these lawsuits or the potential to settle some lawsuits, if you mention those outfits in particliar are those investments that this Board made that was outside the policy of investments? Chuck Stutte: Here is what I think happens on those claims, the securities, like class actions going against these various companies, stock manipulation, misrepresentation to Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 4 of 14 the shareholder, these class action suits have gone on, they will admit they manipulated price or they failed to report certain things or losses occurred, class action gets settled in some cases and then there is a fund that is subject to people sending out notices that there is a class action settlement, if you want to opt in or opt out. If you want part of that settlement they will give you a claim form if you do have shares of stock for whatever period of time you are submitting in. This form that we have been visiting with, what they mostly do is monitor these particular funds to see which investments that we had and if there is an active class action they monitor so we know where we are at in that particular class action lawsuit, if they are older class action settlements and there are settlement funds available and no claims have been processed for your fund, then we proceed to file a claim and recover that money on that behalf'. This is what I think and we are also investigating, Merrill Lynch would have funds and should have been advising the Board whenever there was any notice of these class action suits. There should have been some kind of notice coming to the Board or to the broker or somebody should have been monitoring on behalf because they are initially looking after these funds. They had fiducially duty to do this reporting, I suspect that some of these lawsuits particularly on the larger ones where Merrill Lynch would have known whatever the claim was, they had huge investments far beyond what this claim is, it would be to their advantage not to process or file for individual investors, so the pot of available recovery funds for either them or clientele would be larger, because that is how these funds work, they set aside what they think is the total amount of damage and then they will see how many people actually file their claims and invariably not everybody is getting full recovery and then that left over there may be subsequental disbursements or it is more for those that pursue it. As such, going down this avenue is beyond the scope of what we have been on our initial contract authorized to do. We are pursuing a claim against Merrill Lynch, in looking at the investments that you had, not only is Merrill Lynch probably not, we will wait and see if they processed and ever accounted for recovery of funds, but probably has not advised you that these class action suits existed and probably have not passed on information, again that is something we are investigating. To the extent that the Board has investments and would have a claim on various levels of class action suits against individual companies we would like to pursue that avenue of action on behalf of the Board to collect those funds from this other source having the same arrangement as the contract that we have pursuing Merrill Lynch, so in essence expand the scope of what defendants we can pursue to cover losses that you would be entitled to. The associations that we have talked with at these other securities firms would be of no additional attorney fees attached it is under the same contingent fee. Mayor Coody: Explain to me how that works no additional attorney's fees when you go with this other firm. Mark L. Martin: I talked to them about the SEC litigation and what we have decided is that all law firms can work together on this project and all adding substantial contribution to the project, and in such cases lawyers associate other law firms and work together basically as a team all agreeing to split the agreed upon attorney's fees. Mayor Coody: So we work on a contingency? Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 5 of 14 Mark L. Martin: It will still be a contingency fee, it will still be a third and basically the law firms will agree on relative divisions. Mayor Coody: 30 — 35 billion dollars is probably enough to work pretty hard. Chuck Stutte: We don't know that we are necessarily required that if we contact another attorney that we want to help, as part of the team on recovery, we still have the same contract, in this respect because we will be disclosing different investments that the funds have that some extent may or may not be confidential, before disclosing the funds position to other firms we would like to at least let you know we are doing and what we are trying to look at on your behalf. To the extent that we are looking at different causes of action and possibly other defendants we would like to ask permission to broaden the scope of our representation. Mark L. Martin: I do not want to mislead you. This group is not going to receive 35 billion dollars but a relative portion. The question that you had these cases that are subject to class action lawsuit on a SEC level is there also a potential recovery on the stock broker level and we think very likely. Pete Reagan: So you are estimating between 20 and 30 million, you said 35 is a little too high. Mark L. Martin: Give us an opportunity to get the specifics. As Chuck said where we are today is basically identifying these additional causes of action. I think with what we have identified I think we have all causes of action identified, and we would like to continue moving in that regard. You have given us permission to bring action against Merrill Lynch, you have not given us permission to pursue a SEC case and we are asking for your permission to do that as well as to associate this firm that will work with us on an associate basis. Mayor Coody: What questions do you guys have? Robert Johnson: Would it not be feasible for this firm in Little Rock to save you guys hours time wise. Mark L. Martin: Basically every lawyer will be contributing a different portion of the litigation and that is fairly common in our business for law firms to associate with each other and determine who will handle what part of the project. Mayor Coody: What I would suspect might happen instead of saving these guys hours the more they discover of additional causes the more work load that generates, of course that means a bigger potential pot at the other end, but I can see where having more lawyers may get big fast on our end but so might the potential returns as far as recovery goes. Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 6 of 14 Mark L. Martin: That is accurate. Pete Reagan moved that we expand the scope of their investigation to include possible SEC violations on behalf of the Fire Pension Board. Robert Johnson seconded. Chuck Stutte: The only clarification, I think you all understand this but when we say there may not be additional attorney's fees, there could be additional attorney's fees if we were to get more money, but the percentage will remain the same. In other words we are all going to find a way to agree to the same contingency fee that we agreed when you originally hired us at. Mayor Coody: So it is no more extra damage on our part. Chuck Stutte: Exactly. Mayor Coody: Any other questions or comments on this. We have a motion and second to let these guys expand into the area of which they have requested. The motion carried unanimously. Mark L. Martin: We would like the opportunity to appear before you 30 days from now. Pete Reagan: If you get you information earlier, we can meet earlier. If you will keep us advised on that. Mayor Coody: Thanks. Approval of the minutes: Pete Reagan: Does anyone have any additions, deletions or corrections? Ronnie Wood moved to approve the minutes of the May 29, 2003 meeting, Danny Farrar seconded. The Motion carried unanimously. Approval of the pension list: Pete Reagan: Larry Freddie has been taken from the drop account and put on the retirees. I noticed that he doesn't have an employee number. Is there a reason for that? Sondra Smith: I will check on that. Pete Reagan: I think that is the only change to the Pension List isn't it Sondra. Sondra Smith: That is the only change I noticed. Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 7 of 14 Robert Johnson moved to approve the Pension List. Pete Reagan seconded. The motion carried unanimously. Investment Report: Kim Cooper, Longer Investment: This is normally not our regularly scheduled month but I wanted to come and bring the report that we usually distribute. Elaine would have liked to have been here, but she had a dental appointment that she could not reschedule. I will deliver this report then if you have any questions related to the meeting on Tuesday that you would like me to have Elaine address, I can take those back to her. The reports that I gave to you are the portfolio appraisal to show you where you stood at the end of May. Your account total value is listed on page 7 it is $9.839 million, right now your stock asset allocation is 33.6%, that is your stock and your stock mutual funds, that is just about mid-range of your investment policy which is 25-50% stocks. The balance of the account bonds in fixed income investment, your corporate bonds are about 12% of your portfolio, your government bonds, agencies, CD's are 36.5% and the current yield on your portfolio is 3.7%, working that up to 4% as we do some more fixed income investments, you still have about 8.6% in cash, that is just being held for other investment opportunities. The next page is just your contribution and withdraw report. Your May distribution was $66,000 and withdrawals since we started managing the account have been $515,000. The last page is just a performance summary through the end of May, year to date through May 31st your account was up 4.6% total, your stocks were up 8.6%, your accumulative return since we started managing the account last year has been 2.3% on equity, 8.2% on your bonds and 3.4% total. There was a question at the meeting the other day as to what your account had done year-to-date and through the close of last week your account is up $560,000, that is a total of 6% year to date, 12% on stocks year- to-date, but as we can see that all can change very quickly, both up side and down side. Pete Reagan: In reference to what our attorneys said is our custodial bank, which is in Chicago, do they do that type of thing. Kim Cooper: Yes, Northern Trust files any time there is a class action lawsuit, Northern Trust files those on your behalf. We take it upon ourselves to get confirmation from them that they have done that for you. Pete Reagan: So Mark mentioned Sprint or whatever the other one was. Kim Cooper: The only problem would be it would only be related to securities since your account was transferred there. So if there was a lawsuit regarding a stock that you had held while you were at Merrill Lynch then we would not know about it, even if it were filed currently, Northern Trust wouldn't be aware of it. Mayor Coody: Thank you for coming today. Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 8 of 14 Kim Cooper: Were there any questions, do you want me to stay related to the meeting. Pete Reagan: How mad are you going to be at us? Kim Cooper: We are not mad at all or in any way, we want whatever is best for firemen and your retirees, that is our best interest too, we understand that you have to do what's best for the people that you represent. Danny Farrar: Whatever happens I think that you and Elaine should know that this Board appreciates very much what you have done for us. Kim Cooper: I appreciate that. The thing that we wouldn't want since this goes to a public forum like the City Council we wouldn't like to have any negative repercussions on the fact that it is being moved with Longer Investments name associated with it and I don't know if that is something that the Board can do a resolution on or how that works. Pete Reagan: I think that if it does happen that your names should be mentioned as, if it is alright with you all, as doing an excellent job for us. Marion Doss: I think the figures speak for themselves they came up, plus the fact that you discovered some things for us. Kim Cooper: I appreciate that and once you have an opportunity to have a discussion, if you have any questions for us, just call me, we will be glad to do whatever you need. Pete Reagan: You are welcome to stay, but we are going to discuss what our options are, as shown in our minutes we have probably 60-70 beneficiaries of our fund that are retired that we would like to seek input from. I personally would like to call a meeting of all of them and if we could get you or Elaine to attend that just to answer questions, we would love to have you there. Kim Cooper: Just let me know when you want to do it. Pete Reagan: Okay. Kim Cooper: Thank you very much. Mayor Coody: Steve do you know roughly what investment of return the State has on investments like this. I wonder if we are out performing them where we are. I know that doesn't offset the potential liability over the long haul, I'm hoping they are having as good luck as we are. Steve Davis: I don't have that information from the State. Pete Reagan: Steve can you contact Kathryn and ask her what the last 10 year performance, I am sure they can ship us a chart real easy. They have some real good Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 9 of 14 money managers and they stay on top of it, I think they have seven different money managers. Old Business: NCPERS membership: Sondra Smith: I just wanted to let you guys know that we have filled out the application for that so we should be members of that organization rather quickly. Pete Reagan: Thank You. New Business: Insurance premium check: Sondra Smith: You received a copy of the insurance premium check. Pete Reagan: This is a rollover from the Act 833 funds that are not portioned out. Act 833 is a portion of your fire insurance premium is taxed and that goes into a fund at the Department of Emergency Management that allows fire departments to apply for grants from that fund and at the end of the year the way I understand it, there is money left in that fund because departments didn't meet certain criteria to apply for it and that money that is left over if your pension fund is not actuarially sound that money is divided up per capital. Is that the way you understand it Steve? Steve Davis: This is the first time I have ever seen a check like this so I didn't know how that worked. Mayor Coody: So if you don't apply for grants that money goes into the pension fund? Pete Reagan: No, we applied for and received grants from our Act 833 funds, it is the rest of the departments in the State, a lot of small rural departments that don't apply for grants and there is money left in this pot. Mayor Coody: So if they don't apply for grants the money goes into the pension fund. Pete Reagan: If the fund is not actuarially sound as part of a supplement. Marion Doss: That Act 833 money there are only certain things that can be used for, it's real tight. A discussion followed on the Act 833 money. Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 10 of 14 Marsha Farthing Pension Plan Memo: Sondra Smith: There is a copy attached to your agenda, and I mailed everyone on the Board a copy. Also attached are the questions that were asked at the LOPFI meeting. I have requested a copy of the video tape from that meeting so that if you do choose to have future meetings about this and involve all the pensioners you can show that tape if you so choose. Does anyone have any questions on the letter that accounting has sent out or the LOPFI Plan. Pete Reagan: I have some concerns, I know Steve is looking out for our best interest and so is Marsha, I just hope that we are going to be able to include the $412,000 in the actuary that is going to be performed. Steve Davis: It is, the folks that are doing the actuarial study, they had a similar number for this year's insurance turn back to go to the old plan, so they are aware of that and they are factoring that into their future calculations. We should have that cash flow report back within the next 2-3 weeks and as soon as we get it back we will distribute it to both Pension Boards. Pete Reagan: The reason we are asking for that cash flow actuary study is to see what it is going to cost per percentage of payroll. Steve Davis: This one was to confirm or to provide information for both pension plans to see where they are likely to be through the life beneficiaries. Because we have between the two plans we have $9 million plus in unfunded liability, we want to make sure we know what the cash flow number is because the cash flow number is the one that was used to increase the benefits for both pension plans up to the 90% level, so we want to make sure that same analysis was run to look at future payouts to see if the pension plans are going to run out of money or when they are going to run out of money, so that everybody would be able to make a better informed decision. Pete Reagan: If we are able to recoup, say 3 '/2 to 4 million from Merrill Lynch on the fire pension side and we are 4 million under funded, that is going to put us back in good graces or close to it. Steve Davis: Yes, it will have a positive impact. We would have to factor that information back into the acturarys and have them run another analysis. Pete Reagan: We all know how the legal system works so it may be four years down the road before we wind up with any money in our hands. Just for the purpose of looking at the scope of that, say we recover $4 million and we are $4 million under funded, that puts us back to 100% and we are being managed by LOPFI and there is no one else paying into the fund, it is a totally closed fund, Danny is retired and everyone is off of DROP, there is no more money going into the old plan and the beneficiaries of this plan are going to start dying off, what are the two possibilities of one increasing benefits again Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 11 of 14 with LOPFI, I think that that would have to be approved by City Council before it went to LOPFI. The other thing is what happens to the final monies. Steve Davis: My understanding about the way the system works is when the plans go down to Little Rock, LOPFI will set a contribution rate for the City based on the active employees that will actually make the old plan actuarially plan as well as the current younger plan. So if there is a settlement that generates money for the fire pension fund it will go to LOPFI for the credit of this pension fund and it will reduce the percentage of contribution the City would have to pay on the active payroll probably. What Kathryn said Tuesday, is any money left over in the closed fire pension plan that LOPFI was administering would flow over to the new fire LOPFI Plan that LOPFI is managing. Eldon Roberts: That is what I heard her say too, one of the police officers asked when the last beneficiaries on the pension plan passes away and there is money left where does that go and her answer was, just as Steve said, it goes over to LOPFI for that City's portion of contribution to the police or fire plan. Steve Davis: It will still go to cover the Fayetteville local firefighter's retirement old plan or new plan or Fayetteville police officer retirement old plan or new plan. Eldon Roberts. I think I see the question you are asking Pete, later on down the road let's say both plans opt to go to Little Rock to LOPFI Pension system, and then later on your plan becomes financially sound or a lot more financially sound that it is now, or actuarially sound, are there any provisions for you all then to get benefit increases and the way I read that you would have to come back to the City and bargain with those folks on that. I don't think it is a given that you would be given an increase on your benefit, but I think you would have to come back and bargain with the City. Steve Davis: One of the things about moving the plans to LOPFI is the benefit increase, I guess is to address any loss that may occur due to inflation, if you all ask and the City Council agrees there is a provision to do a COLA so that loss of purchasing power would be addressed somewhat through that provision. Pete Reagan: That is currently what's in the LOPFI's new firefighters and police officers, is the 3% compounded COLA. Steve Davis: That is correct. It was a 3% simple, but now it is a 3% compounded. Marion Doss: That $4 million you mentioned is that just a theoretical amount, I have not heard any dollars about. Mayor Coody: They are talking about a $4 million loss that occurred. Now was that $4 million, I think that was questionable Merrill Lynch misbehavior resulted in what could be a $4 million dollar loss, that is not total loss of the entire program, I don't think. Pete Reagan: That is the way I understood it. Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 12 of 14 Marion Doss: The only thing that I could think of, a couple of years ago our fund was worth $12.5 million and now about $9.5, so the question is, is that mismanagement or the stock market in general. I think we are guessing at what we might be able to recoup. Steve Davis: As this Board puts together their thoughts on the request to City Council if you want to move the plan to Little Rock for management, you could provision in there if you get a favorable settlement you would like to have this revisited and that makes it a conditional statement that if it happens that it is kind of an automatic and you don't have to come back to City Council after the fact, to say that we would like to amend it now. That would be pre -approved that if we get a settlement we want to have our benefits looked at. That way whenever the legal system works it magic then it is automatic. Pete Reagan: I think the police were very forward in wanting to seek a COLA in theirs. My guys that I have talked to are very interested in doing that also. If there is an extra $4-5 million dollars out there that our fund is worth and the economy turns around after the election, and then if there are $4-5 million dollars in the fund that we can use for benefits for retirees, then I think we should have that availability to do that. Steve Davis: That is something I think you should out in the initial document, it makes it a lot easier to come back and revisit, because there is no guarantee on the composition of City Council some year in the future. From a scheduling standpoint I would hope to take whatever Resolution there is to City Council sometime in August, so that we can get all this paperwork settled before we run into the fourth quarter of 2003 and the auditors are back here and we are faced with having to make a decision on the actuarial liability. There is a possibility on the fire fund that we might have to do that this year, if we could avoid that this year we would like to. Mayor Coody: You want to get this question about Council approval on revisiting the retirement on potential light of any settlement, get that taken care of before August. Steve Davis: My request is to have any decision to move the pension plan to Little Rock to City Council, any retiree benefit as a result of a lawsuit recovery, plus any COLA adjustment that you may pass, have it all wrapped up in package so that we can present this to the City Council sometime in August. Pete Reagan: Eldon are you all meeting on the 17th Eldon Roberts: Yes Pete Reagan: Are you going to invite your retirees. Eldon Roberts: I contacted Sondra after the meeting Tuesday, some of the Board members asked me to have her send a letter to all our retired people stating that we are going to meet the 17th and that they are welcome to attend and what the topic of the Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 13 of 14 conversation is going to be. We didn't want to mail it in the checks because it could not leave them enough lead time so it should go out this week. Sondra Smith: I Plan on having it out Friday. Pete Reagan: Where are you going to meet on the 17th Eldon? Eldon Roberts: Here, but I don't know how many people are going to show up. Steve Davis: The issues that the Police Pension Board and Fire Pension Board have if it is this LOPFI issue we might do a joint meeting and have Kathryn show up, and maybe do it at the Town Center. You are looking at about 100 retirees on the police and the fire. Pete Reagan: I can see where we could possibility having 30-40. Eldon would you have a problem with us doing a joint one? Eldon Roberts: I am not on the Pension Board any longer, so I do not feel comfortable speaking for them. We have no representation from the active side. Sondra Smith: I can check with the Police Pension and see if that would be a problem. Pete Reagan: Eldon, Rick and I talked after the last meeting and I drew this up as a basic form letter to send out to our retirees and see if they would be interested in knowing what is going on with this and I think our members need to be informed in an open form and be able to ask questions. I would encourage us as a Board to see if we can have a joint information meeting with the Fayetteville Police Pension Fund. Sondra Smith: These meetings are open to the public and they can attend. Pete Reagan: Is everyone okay with the letter. A discussion followed on a possible date and time for an informational meeting with LOPFI. Sondra Smith: What we might could do is check with Kathryn to see if she can come on that date, have the Police Pension meeting before and have her scheduled to come in after the Police Pension meeting or right before it and involve both departments and the pensioners for the meeting with her and then break away for the Police Pension meeting. Marion Doss: That is what I was thinking, I think it would be great if we could get Kathryn to come and also if Steve could be there because I think people are going to have questions. Sondra Smith: I will call Kathryn to see if she will be available on July 17 and I will check to see if Steve Davis will be available on that day. The Police Pension will meet at 1:30. Fireman's Pension and Relief Fund Board Meeting June 26, 2003 Page 14 of 14 A discussion followed on a date and time. Sondra Smith: I will set it up for July 17 in Room 219 at 10:00 for the Fire Pension and 1:30 for the Police Pension. Eldon Robert: The City has the right to do I believe with our pension plans without a vote of the Board of Trustees, but I would hope that we could iron out something that we could all live with and enter into this mutually agreeable. I really have concerns about where we are going if we try to keep these plans and manage them ourselves. This guarantee of not having our benefit cut, I don't care if I never get another raise, I would love to but if I don't that's okay. A discussion on transferring the fund to LOPFI and how the Resolution should read. Sondra Smith: I might suggest that you make a list of questions for Kathryn when she comes, I will compile the questions if you get them to me before she comes. Skelton Letter on Enrollment: Sondra Smith: I sent a letter to Kimberly Skelton that just graduated from high school about proof of enrollment for the college semester or her benefits would be cut. I also send a letter to Kelley Skelton that we need to have proof of enrollment from her before the fall semester. Senate Bill 43 House Bill 1061, 1122, 1218, 1223, 1226, 1228, 1239, 1254: Pete Reagan: If you have any questions on the bills attached to you agenda, please bring them to the next meeting. The one on the 10 year DROP you will get some questions on that from the active guys, that DROP cannot be extended by this board until the fund is declared actuarially sound. Larry Freedle's Drop Payment: Pete Reagan: His DROP distribution check is $209,474. Can someone explain what the total draw down for the June Pension is. Ronnie Wood moved to adjourn. Robert Johnson seconded. Meeting Adjourned at 12:20 P.M.