HomeMy WebLinkAbout2012-01-05 MinutesBoard Members
Mayor Jordan
Chairman
Sondra F. Smith
Secretary
Marion Doss
Position 1/Retired
Pete Reagan
Position 2/Retired
Dennis Mullen
Position 3/Retired
Ronnie Wood
Position 4/Retired
Special Firemen's Pension and Relief Fund
Board of Trustees Meeting Minutes
January 5, 2012
Page 1 of 6
Special Firemen's Pension and Relief Fund
Board of Trustees Meeting Minutes
January 5, 2012
A special meeting of the Fayetteville Firemen's Pension and Relief Fund Board of Trustees was
held at 3:00 PM on January 5, 2012 in Room 326 of the City Administration Building.
Mayor Jordan called the meeting to order.
Present: Dennis Mullens, Marion Doss, Pete Reagan, Ronnie Wood, Mayor Jordan, Kit
Williams, Sondra Smith, Lisa Branson, Trish Leach, and Garrison Financial.
Longer Investments & Northern Trust
• Longer Investments letter dated December 29, 2011
• Resolution 01-2012 authorized signors for Northern Trust Company
• Longer Investment authorized signors form
• Longer Investments letter of authorization to terminate investment advisor
agreement
• Longer Investment portfolio appraisal dated December 29, 2011
Garrison Financial & Charles Schwab & Company, Inc.
• Garrison Financial Corporation Firm Brochure
• Investment Management Agreement - Garrison Financial Corporation
• Investment Policy Statement - Garrison Financial Corporation
• Resolution 02-2012 authorized signors for Charles Schwab & Company, Inc
• Company Retirement Account Application - Charles Schwab & Company, Inc
• Certification of Trustee - Charles Schwab & Company, Inc
• Prime Brokerage Amendment ( Account Holder) - Charles Schwab & Company, Inc
• Transfer of Account Form - Charles Schwab & Company, Inc
• Schwab MoneyLink Electronic Funds Transfer Form - Charles Schwab &
Company, Inc
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Special Firemen's Pension and Relief Fund
Board of Trustees Meeting Minutes
January 5, 2012
Page 2 of 6
New Business:
Sondra Smith: In working with Kerry at Garrison Financial, Trish Leach, and several different
people we found out that on the Northern Trust account with Longer Investments we still have
Heather Woodruff, Mayor Coody and some old pension members on the account. The first thing
we have to do is get the Northern account corrected with the correct signers on the account
before the funds can be transferred to Schwab.
Kerry Watkins: The signers need to match.
Sondra Smith: They need to match from Northern Trust to Schwab. If they don't match its
going to be a headache to get it transferred. The first thing we received was a letter from Longer
Investments. I called Kim and she corrected the fourth paragraph, she had Mayor Jordan and
Amber Wood which was incorrect. It should have been Mayor Jordan and Sondra Smith, if you
choose to go that way.
Three years ago the board authorized Amber Wood as Deputy City Clerk to sign on transfers but
never authorized her to be on Northern Trust. They have a letter that they want us to sign that
says "as authorization to terminate the investment advisor agreement between Longer Inc. and
the above referenced account. "
Without talking to the board we did not know for sure who you wanted as authorized signers at
Northern Trust and Garrison Financial or Schwab. We went ahead and put Lioneld Jordan as the
Mayor and myself as the City Clerk Treasurer because the Mayor is chairman of the board and
I'm the secretary. If you choose to change that we can change the forms and put someone else in
there as the signers.
Kit Williams: We are just talking about Northern Trust.
Sondra Smith: Right now we are talking about Northern Trust. It says in Elaine Longer's letter
that they need a resolution from the board. I've completed a resolution from the board to change
the Northern Trust account and the City Attorneys office looked at it. Everybody seemed to be
okay with it. The only thing we don't know from you all is if you are okay with Lioneld Jordan
and Sondra Smith being on the account. If you are we need to approve the resolution.
Kit Williams: It is going to be a very short time. It is going to be on the account long enough to
get a transfer.
Pete Reagan moved to approve resolution 01-2012 to authorize Mayor Jordan and Sondra
Smith as signors for Northern Trust. Marion Doss seconded the motion. Upon roll the
motion passed 6-0.
Sondra Smith: That resolution will need to be signed. On the authorized signer's form that the
Mayor and I have to sign, you have to authorize someone from the board to okay our signatures.
As signors on this agreement for Northern Trust the Mayor and I can't approve the agreement. I
would like for someone to move that some from this Board sign the authorized signors page.
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Special Firemen's Pension and Relief Fund
Board of Trustees Meeting Minutes
January 5, 2012
Page 3 of 6
Marion Doss: I would suggest Pete sign. He has been on the board the longest.
Pete Reagan: That's fine.
Marion Doss made a motion to authorize Pete Reagan to sign the Northern Trust
authorized signors form approving Mayor Jordan and Sondra Smith. Ronnie Wood
seconded the motion. Upon roll call the motion passed 6-0.
Sondra Smith: Who do you want to sign to accept the termination letter?
Kit Williams: The Mayor as Chairman.
Sondra Smith: The other thing I received from Longer Investments is a copy of your
investment report dated December 29a'. It shows you have a total cost of $4.3 million and the
market value is $4.88 million. That is the approximate amount that will be transferred.
The next thing we have is the Garrison Financial Firm brochure. That form has information
about Garrison Financial. If you have any questions Kerry is here to answer them.
The next two things I'm going have everyone sign is the Investment Management Agreement.
We had a meeting and made several changes to it and I need to make sure everyone is okay with
the changes that were made. We all need to sign the Investment Management Agreement and
the Investment Policy Statement. I have looked it over and it looks like all the changes that were
requested at the meeting were made.
Mayor Jordan: Do we need to pass this?
Sondra Smith: They have already approved it as changed. Kerry made the changes for us.
Next is a resolution that is almost identical to the resolution for Northern Trust except it says
Charles Schwab Company. If you are okay with it then the board will need to approve the
Charles Schwab resolution and sign it.
Pete Reagan moved to approve resolution 02-2012 to authorize Mayor Jordan and Sondra
Smith as signors for Charles Schwab. Ronnie Wood seconded the motion. Upon roll call
the motion passed 6-0.
Sondra Smith: All the other documents Kerry might want to explain to you. We have a
company retirement account application, Certification of Trustee, transfer of account holder
form, and a Schwab money link form. I tried to put a copy of everything in your packet. The
company retirement form is asking for our taxpayer identification number and the plans taxpayer
identification number. There has been a problem with Northern Trust and Longer, they have a
different taxpayer identification number for our pension plan than what Trish and I have. We
went back and pulled old records and our records are correct and Longer's is incorrect. It's been
like that for years but we are going to go with the number we have on file and that we have been
filing everything with the IRS.
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Special Firemen's Pension and Relief Fund
Board of Trustees Meeting Minutes
January 5, 2012
Page 4 of 6
The first one wants our City taxpayer identification number for the plan. It is asking for
information about Lioneld and myself because you authorized us to sign and it shows Lioneld
and myself as agents. I don't think there is anything that the board as a whole has to sign on it.
Kerry Watkins: Not on that form.
Sondra Smith: But the Certification of Trust.
Kerry Watkins: Yes, the tax ID will have to be changed at Northern Trust in order for funds to
transfer. Once you get the resolution to Northern Trust and they change it to Lioneld Jordan and
you as signors or you can talk to Kim about getting them a W-9. That is typically what we use.
You just need a new W-9 form signed to say this is the correct tax ID and they will change it.
Sondra Smith: Okay, I will get with Trish and get a new W-9. Are there any questions on the
company retirement account application? The next one is the Certification of Trustee. It shows
the effective date of the trust. Is that January 1, 2012?
Kerry Watkins: The effective date of the trust? I think we were going to use the one you got
me that Mr. McGuire had found in 1924. I think what they are looking for is when the plan was
established.
Sondra Smith: I found some old documents stating it was established in 1924. Does that sound
correct?
Pete Reagan: Legislature passed it in 1921.
Kit Williams: The millage election would have been back that far?
Sondra Smith: We found minutes establishing the fund in 1924 and a memo stating it was back
in 1924.
Trish Leach: I don't believe the millage was back that far. I think we have seen old records
where there was no City contribution at one time.
Marion Doss: I remember seeing newspaper articles in about the mid fifties that they had a
millage election.
Kit Williams: I don't think the constitutional amendment allowing the millage was in existence
back then. There was a case that I remember vaguely questioning whether or not a pension plan
would be something that would be allowed. After that case is when the amendment to the
constitution was passed specifically providing for it but I can't give you the date.
Kerry Watkins: Typically we put in there when the plan is established. We have not had a plan
that was established this long ago. Schwab just puts it in their records. I don't think it is
anything legally binding as far as Schwab is concerned. When I spoke to Kim at Longer she had
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Special Firemen's Pension and Relief Fund
Board of Trustees Meeting Minutes
January 5, 2012
Page 5 of 6
given me the date of 6/18/86. She wasn't sure where that date came from or why that date was
there. I don't know if that was on the account title maybe when they took over.
Kit Williams: It could have been because she started with the police. That might have been the
date that she started.
Pete Reagan: That was the date we started investing in the stock market.
Sondra Smith: Yes, that wasn't the date of the establishment of the plan.
Pete Reagan: We went with Richard Yada out of Merrill Lynch and the police fund went with
Elaine.
Kit Williams: Is that when the law changed?
Pete Reagan: The law changed in 1985 and went into effect in 1986.
Kit Williams: So you could do other kinds of investments.
Pete Reagan: Right.
Sondra Smith: We have minutes to back up when the plan was established.
Pete Reagan: That's good.
Sondra Smith: If everybody is okay with the Certification of Trustee form then we will sign it.
The next form is a Prime Brokerage Amendment (Account Holder) and no one has to sign on
that but the Mayor and myself.
Pete Reagan: Can you give us a "Readers Digest" on that.
Kerry Watkins: This form will allow us to trade away from Schwab and have it delivered into
the account. For instance if we need to sell, and we don't do this activity on bonds, different
brokerages inventories are different and you get better prices at different purge houses so if we
needed to liquidate one of the bond holdings in the account that would allow us to trade it at
another brokerage house and have it delivered.
Pete Reagan: Do we need to sign that?
Sondra Smith: No, it just has a place for the Mayor and myself to sign. The next form is a
Transfer of Account form. It is another one the Mayor and I have to sign. You have authorized
us to sign.
Marion Doss: That's where it goes from Northern Trust to Schwab?
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Special Firemen's Pension and Relief Fund
Board of Trustees Meeting Minutes
January 5, 2012
Page 6 of 6
Sondra Smith: Yes, it shows you're transferring from Northern Trust. The last form is a
Schwab Money Link.
Kerry Watkins: That will allow us to electronically move funds from the Schwab account to
the Arvest checking account for the benefits to be paid out every month. For that to happen
every month without fees they call it a money link rather than a wire transfer. They charge fees
for wire transfers and this will allow us to do it electronically.
Paul Becker: Who is authorized to do that, you?
Kerry Watkins: Yes, you are authorizing Garrison to move the money. Basically it allows us
to move funds from the account that we manage to the account listed in this.
Paul Becker: It's a specific account?
Kerry Watkins: Yes, we have to include a voided check to the account it is going to go into.
That is all it allows us to do. Since the amount will vary every month Trish will call us with the
amount.
Sondra Smith: I think that is all the documents that we have. Does anyone have any questions?
Kit Williams: Thank you for getting all this done Sondra.
Pete Reagan: Yes, thank you.
Sondra Smith: Thank Kerry and Trish we have all been working on it.
Meeting adjourned at 3:40 p.m.
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