HomeMy WebLinkAbout2006-07-20 - Agendas - Final Police Pension and Relief Fund Board of Trustees
Agenda
July 20, 2006
A meeting of the Fayetteville Policemen's Pension and Relief Fund Board will be held on July
205 2006 at 1:30 p.m. in Room 326 of the City Administration Building located at 113 West
Mountain Street, Fayetteville, Arkansas.
1. Roll Call
2. Approval of the Minutes
• Approval of the May, 16 2006 Meeting Minutes
3. Approval of the Pension List
• Approval of May, June and July, 2006 Pension Lists
4. Old Business
• Election Results — Jerry Friend was re-elected to the Board
• Letter to David Clark regarding the benefit increase
• Letter to Jody Carreiro regarding the benefit increase
• Letter to Survivor's regarding the benefit increase for survivor's
• Survivors Benefit Increase Calculation
• Letter to Jody Carreiro regarding the 3% COLA.
5. New Business
• Memo from Sondra Smith to Kit Williams regarding Spouse benefits
• Memo from City Attorney Kit Williams regarding Spouse benefits
6. Longer Investments
• Signed Investment Policy for your records
• Longer View
• Quarterly Report
• Monthly Investment Report
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Policemen's Pension&Relief Fund
Board of Trustees Meeting Minutes
May 16,2006
Page 1 of 10
Special Policemen's Pension and Relief Fund Board of Trustees
Meeting Minutes
May 16, 2006
A meeting of the Fayetteville Policemen's Pension and Relief Fund Board was held on May 16,
2006 at 2:30 p.m. in Room 326 of the City Administration Building located at 113 West
Mountain Street, Fayetteville, Arkansas.
Mayor Coody called the meeting to order.
Present: Mayor Coody, Eldon Roberts, Jerry Friend, Tim Helder, Dr Mashburn, Jerry
Surles, Sondra Smith, Kit Williams, Lisa Branson, City Clerk's office.
Approval of the April 13, 2006 Meeting Minutes.
Tim Helder moved to approve the minutes. Eldon Roberts seconded the motion. Upon roll
call the motion carried unanimously.
New Business
Election Process Discussion:
Kit Williams: I sent you all a memo after I heard that there was an issue involved here. I went
back and read the law, that's always a dangerous thing to do, and I found out that we haven't
been exactly doing it right. Number one I think there's only one position that's available now for
retired with the new 2005 law. The second issue it's my understand the way the procedure has
always been done is that there's just been a poll, they call up and say who do you want to vote
for and they keep a list and whoever the top vote getters are if there's one or two positions open
they get it. That is the established procedure the way I understand it. That doesn't mean that has
to be the procedure the board can change that. The board can take an affirmative step and say no
we want "Tim Helder" for position one "Jerry Surles" for position two. You can divide up in
positions if you want to but that's something that the board itself needs to move to do and take an
affirmative action to change that procedure. It really won't make any difference at all this year
because this year the way I understand there's only one position that's going to be open in the
retired ranks, so it's kind of all against all at that point. There needs to be another election and
the election will be, who you want to serve in this one position.
Tim Helder: How do we determine what that one position is because there is actually two?
Eldon Roberts: It won't make any difference because they both expire.
Policemen's Pension&Relief Fund
Board of Trustees Meeting Minutes
May 16,2006
Page 2 of 10
Kit Williams: Both of their terms are gone, so no one is really running for re-election or else
they are both running for re-election.
Tim Helder: I see so it's a spot.
Eldon Roberts: That's right it's a spot. You're right.
Kit Williams: We have not divided into positions before. The board can do that if you want to.
That's totally up to your discretion because the statute says a procedure to be chosen by the
board. Now when you have a lot of active members it actually requires you to have secret ballots
for the active, but the retired has always been as you all see fit. I don't know if this was ever
formally done or it just evolved into doing it that way but that seems to be the established
pattern. I don't think we need to change it until the board takes some official action.
Eldon Roberts: It just evolved into that because I have read the law and you have and other
people have. It didn't really spell out an exact procedure of how the retired people elected their
representatives. Hollis was on the board and I didn't get involved because I was active it didn't
make any difference and the rest of the retirees didn't care how they did their elections and they
opted to do this phone poll thing so people could nominate people over the phone. Ms. Murphy
would call and tell the rest of the members whose names had been brought up and they would
vote. They've done that for 4 or 5 years and I guess it's served well but now maybe we need to
change it.
Sondra Smith: This year it wasn't done that way. They were told they had to vote for either
Rick Hoyt, Jerry Friend, Jerry Surles, or Mr. Mitchell and its never been done that way before in
the past.
Eldon Roberts: Okay I don't know what they were told I didn't ask Margaret how she went
about it she's just been the one that's done it. I don't know how she did it.
Kit Williams: Regardless I think this one was a flawed election and we need to have another
one.
Tim Helder: I don't think that's right.
Eldon Roberts: Okay. Like you said this time it's going to be relatively easy we've just got one
spot open.
Kit Williams: It doesn't make any difference this year.
Eldon Roberts: Next year there will be three Tim, myself, and the new person that we are going
to elect to take Dr. Mashburn's place. Whatever we do we need to fix it today where when it
comes time to have an election for more than one position we've got something in place to cover
that.
Policemen's Pension&Relief Fund
Board of Trustees Meeting Minutes
May 16,2006
Page 3 of 10
Kit Williams: What's in place right now is this poll where there's no body nominated really or
everybody's nominated basically and they say who do you want to vote for and there's no
positions. If you want to make positions and someone says I'm going to run for position one
position two I guess there will be four positions at that point once Dr. Mashburn goes off, then
that needs to be something the board votes on and says that we want it by position. Eldon and
Tim's positions wouldn't be open now; we would have an end date for them of next year. Jerry
Friend and Jerry Surles positions would end this year. Dr. Mashburn's position would end next
year if you wanted to change it and do it by position. What do ya'll want to do, or do you want to
leave it the same?
Sondra Smith: We just need a set procedure in writing how it's going to be done because I
know this year it was done differently and Ms. Murphy had to be told how it was going to be
done. She wouldn't have done it differently unless someone told her to do it differently and I
didn't tell her to do it differently.
Kit Williams: The established procedure is there are no positions. If you want to make a
position then someone needs to make a motion that you do it by position.
Mayor Coody: What are the advantages and disadvantages of doing it either way?
Kit Williams: Don't ask me, I have no position on this.
Sondra Smith: Eldon didn't you tell me Ms. Murphy doesn't want to do the phone poll
anymore?
Eldon Roberts: Yes, she had mentioned she has done this for six or eight years and it's
something she has to do every year because elections come due every year for at least one retired
member. She just mentioned that she enjoyed doing it but she would like for someone else to
take over the responsibility.
Kit Williams: Will she not do it for this last election?
Sondra Smith: No.
Kit Williams: We need to have another one though.
Sondra Smith: We'll have to do it differently.
Eldon Roberts: I think this next one coming up we need to figure out how were going to go
about doing this in a more correct procedure. Tell me how the fire department's process works?
Sondra Smith: We send out a letter to each one of the pensioners and ask for nominations and
if there are two positions they can nominate two people. They have positions.
Eldon Roberts: Their positions are numbered.
Policemen's Pension&Relief Fund
Board of Trustees Meeting Minutes
May 16, 2006
Page 4 of 10
Sondra Smith: They send the secret ballot back to our office on those members nominated. I
don't have a vote on those members. Then when we go through the nominations and list
everyone that's been nominated. If there are ten people that's been nominated we list all of them.
Then we send it back out to the pensioners and tell them these people have been nominated and
then they vote.
Kit Williams: What if someone gets nominated for both positions?
Sondra Smith: That happened this time but we only had two people nominated and they were
nominated for both positions. So it didn't really matter.
Kit Williams: I can see that being a problem.
Sondra Smith: This is the first year that they have done positions. Before this year we just sent
out nomination forms and if they nominated five people then those people ran for the available
slots and the two with the most votes got elected.
Kit Williams: Really that was the way you all were doing it in the retired section too.
Eldon Roberts: In a round about way.
Kit Williams: The top vote getters as opposed to running for positions.
Sondra Smith: Which is a little bit easier, I think it is not as confusing for the pensioners
themselves if they know that they just vote for whoever they want to and they have two votes.
Next year they will have three votes.
Eldon Roberts: Instead of dividing it into position one, two, and three or whatever it's just if
three positions are open the three people that got the most votes fill those positions.
Kit Williams: That's the way it's been done.
Jerry Friend: That's the way it's always been done.
Kit Williams: But you're saying the fire people are changing that now.
Sondra Smith: They changed it this year and they assigned positions. This was the first year
they assigned positions.
Jerry Surles: Right off the bat they had a problem?
Sondra Smith: It was confusing to the petitioners because they had to vote for someone for
position one and someone for position two. If they get confused and write the wrong name on the
wrong line they've just reversed the two positions.
Policemen's Pension&Relief Fund
Board of Trustees Meeting Minutes
May 16,2006
Page 5 of 10
Eldon Roberts: If you don't assign positions then you couldn't have one person nominated for
two positions. Does that make sense?
Tim Helder: Yes.
Kit Williams: It would go to the top vote getters.
Sondra Smith: It would just be the top three and that's the way they have always done it in the
past and it's always worked really well.
Eldon Roberts: If you assign positions I can see how you could have the same person
nominated for each position.
Kit Williams: Yeah.
Eldon Roberts: So if you don't assign positions you can't have that problem and if you have
three positions the three top vote getters get the three positions.
Sondra Smith: Right.
Kit Williams: Do they allow each retiree to have three votes?
Sondra Smith: They only have two that expire each year.
Kit Williams: Okay.
Sondra Smith: They get two votes.
Kit Williams: But they have to be different people.
Sondra Smith: Right.
Kit Williams: Okay.
Eldon Roberts: Okay.
Jerry Surles: What we first do is send out the letter asking them to summit names and then
everybody will get all the names back on a form or something to vote for?
Sondra Smith: Yes. We do it to where I don't even have to know who they're nominating until
the forms are returned. I send the letters on City Clerk letterhead so I know that they can't run a
copy of it or run several copies and vote for the same person several times. They can tear off the
bottom or sometimes I just do a second sheet and give them a return envelope so all they have to
do is put it in an envelope, put a stamp on it and send it back in. We give them a deadline and
anything that comes in after that deadline we do not count. It doesn't matter to me how you do it
but we do need something in writing.
Policemen's Pension&Relief Fund
Board of Trustees Meeting Minutes
May 16,2006
Page 6 of 10
Eldon Roberts: I'm afraid that if we leave it as it is it's not going to fly. This board is getting
more involved and more concerned and watching every little angle and I'm afraid leaving it like
it is is not going to get it. It's too hard to ask 42 people over the phone who they want to
nominate and get that all together and try to get a vote. I just don't see how this is going to keep
working and were being watched closer now than we've ever been. I think we better get
something that's in writing more or less if it's tangible.
Tim Helder: You're going to be doing the same thing except it will be in writing. Right, you'll
send out the flyers we won't necessarily identify anybody. It's just we have an opening nominate
who you want in this position?
Kit Williams: I don't even know why you are going through a nomination process. I think you
should just send out a list of everyone and say vote for whoever you think should be on the
board.
Tim Helder: If there is one opening, write one name down off that list.
Sondra Smith: I would much rather do it that way myself because with the other way it's just
extra. work.
Eldon Roberts: I have no problem with that.
Sondra Smith: I have your pension list so all I would have to do is delete the two columns that
have the amount that is being paid so no wages are on it and just send that list out.
Eldon Roberts: If there is one position open then they can vote for whoever they want to. Then
all this comes back to your office and you tabulate the results.
Mayor Coody: Does that sound acceptable to all you guys.
Jerry Friend: Are you going to have the board members names on it?
Sondra Smith: Usually what I do in the cover letter is tell them how many positions are open, if
there are two positions open I tell them that there are two positions open and who is currently
serving in those positions and I put a list of all the board members.
Kit Williams: We need the board members on there because you couldn't be elected this time
"Tim" because you are already on the board.
Sondra Smith: I usually put the expiration date and the list of all the pensioners.
Mayor Coody: On the list of all the potential winners Tim's name wouldn't be on there for
example.
Sondra Smith: Well usually all the petitioners are on there but they've got the list of the board
and the ones that are currently serving.
Policemen's Pension&Relief Fund
Board of Trustees Meeting Minutes
May 16,2006
Page 7 of 10
Kit Williams: You need a little explanation.
Sondra Smith: You cannot vote for so and so.
Mayor Coody: You need a notation to where they wouldn't vote for Tim because he is already
on the board.
Sondra Smith: Because he is already serving on the board.
Eldon Roberts: Just a note that says this position that's up for election currently expires and
who holds this position.
Sondra Smith: Right.
Kit Williams: What do ya'll think?
Jerry Surles: Sounds like a winner to me.
Eldon Roberts: Before we vote on this what about the widow's they have not been allowed to
vote in the last several elections that Ms. Murphy has polled people for. I really think that's
probably correct but I want to know what everybody else thinks here. There are eight widows if I
counted correctly today. I really don't see that they are a member of this pension fund. It
mentions actives and retiree's but both of those words are referring to actives such as Frank
Johnson.
Kit Williams: He is the only one.
Eldon Roberts: Or retired such as us. I think spouses are just simply the spouse of a retired or
active member.
Kit Williams: I think that is correct. It says that in a matter you select.
Sondra Smith: So you can do it however you want to.
Eldon Roberts: I counted and there are still 42 of us retired police officers that are members of
the fund. I should think that would be enough to have sufficient elections for eight, nine, ten
more years, just by using the retired police officers themselves.
Sondra Smith: If you want to use retired police officers themselves then that will need to be in
the motion "that all pensioners are not allowed to vote."
Kit Williams: I wouldn't send it to the widow's.
Sondra Smith: Right but in our motion here today we need to specify that.
Jerry Friend: Have they voted in the past?
Policemen's Pension&Relief Fund
Board of Trustees Meering Minutes
May 16,2006
Page 8 of 10
Eldon Roberts: No.
Kit Williams: And they could not be on the board because it talks about retired members.
Eldon Roberts: They can't serve on this board and I don't think they can nominate anybody to
run for this board.
Tim Helder: I would say that would be the difference. If they are not eligible to serve on the
board then they probably shouldn't be able to vote. I think you are correct.
Sondra Smith: Do you have any females that are retired police officers?
Eldon Roberts: Yes we do and neither one of those have spouses but they wouldn't be
considered a spouse. They are a regular retired member.
Sondra Smith: I mean just for us so we would know that when we sent it out that they are
actually police officers.
Eldon Roberts: That would be Mary Mueller and Angela Munson those two people were
actually female police officers and they would be allowed to participate in the vote and be
nominated. The rest of the female names you see on there are probably going to be spouses of
retired police officers.
Mayor Coody: We have a motion is there a second?
Sondra Smith: What was the motion? -
Mayor Coody: The motion was to accept this proposal to send out the list.
Sondra Smith: Just to send out a pension list and not do nominations?
Eldon Roberts: Where do we get the part in about the widow's not being allowed to vote? You
said to amend this motion or vote on this motion.
Mayor Coody: We don't allow widow's to vote now do we?
Eldon Roberts: No.
Jerry Friend: Do we need to?
Eldon Roberts: No we don't.
Mayor Coody: Okay.
Sondra Smith: I would like that to be in the motion because we don't have a set procedure right
now.
Policemen's Pension&Relief Fund
Board of Trustees Meeting Minutes
May 16, 2006
Page 9 of 10
Mayor Coody: I see.
Jerry Surles moved to send out a written ballot to elect the Board members. Dr. Mashburn
seconded the motion. Upon roll call the motion carried unanimously.
Eldon Roberts moved for the survivors not to be allowed to vote in the elections, be on the
board, or make nominations. Jerry Surles seconded the motion. Upon roll call the motion
carried unanimously.
Kit Williams: If you give them a deadline to vote it has to be no later than the end of this
month, they are suppose to be selected this month. So you need to get your letter out and tell
them that we have to receive it or it must be postmarked before the end of this month.
Eldon Roberts: Is there any reason that this one time that we can't run it just a little bit longer?
4^
Kit Williams: It says May.
Eldon Roberts: I know that but we have waited to within 14 days of the end of the month.
Sondra Smith: I would think that if we get the letters out, we can get them in the mail probably
tomorrow and that would give them enough time.
Eldon Roberts: Okay.
Kit Williams: Since they have already been contacted once they probably already know who
they will vote for.
Eldon Roberts: So make it the end of the month, May 31St, to have it back to your office.
Sondra Smith: We put a return envelope in with it so all they have to do is put the ballot in the
envelope put a stamp on it and send it back.
Jerry Friend: Is the letter going to explain why they are voting again?
Sondra Smith: I think it should.
Kit Williams: Yes, it will be a short letter stating that there is really only one position open and
the procedure has been set-up by the Board to do it this way.
Eldon Roberts: Well that is right we have had to change the makeup of the Board because we
have learned we are in error by not having an active person on here. Just spell it out and we will
vote again.
Kit Williams: I have already talked to Chief Johnson. He said if it is the law he will do it.
Mayor Coody: Is there anything else we need to do on this.
Policemen's Pension&Relief Fund
Board of Trustees Meeting Minutes
May 16,2006
Page 10 of 10
Sondra Smith: No, because Dr. Mashburn will continue serving until his term ends next year.
Kit Williams: Frank Johnson will be on the Board coming up.
Dr. Mashburn: I have one more year?
Kit Williams: Yes.
Eldon Roberts: Until May of next year.
Dr. Mashburn: I submit my resignation effective of that time. I would like to serve the
remaining year.
Kit Williams: And the statute which I quoted does say that you shall serve until you are
replaced.
Mayor Coody: We need you. We aren't looking to get rid of you.
Eldon Roberts: You are not going to get out of here that easy. We are going to make you stay
in here until the end.
Sondra Smith: Thanks for meeting; I just did not want any laws broken.
Eldon Roberts: Next year when there are three positions open we will send out a letter and
people will vote for three people of their choosing, no nominations.
Kit Williams: There will be three won't there.
Sondra Smith: No nominations.
Eldon Roberts: No nominations. We just send out a letter and say you can vote for any three
people that you want to and then send it back in and the top three vote getters serve.
Sondra Smith: It will be by written ballot.
Kit Williams: There will be one retired representative on there that will not be eligible to run
because they will be serving.
Sondra Smith: Right, whoever gets elected this year.
Meeting Adjourned at 3:10 PM
POLICE PENSION FUND
May 2006 6800-9800 6800-9800
Month 5 5335-00 Backpay 5335-05 Future
EMP# NAME GROSS YTD Wages Suppl. Supplement YTD Suppl. Supplement Fed Tax ST. TAX NET
154 ALLEN, CHARLES 2,436.27 12,181.35 50.00 250.00 220.00 66.89 2,199.38
130 BAYLES, DON 1,496.28 7,481.40 50.00 250.00 1,546.28
107 BLACK, JOE P 1,061.02 5,305.10 50.00 250.00 100.00 20.00 991.02
147 BRADLEY, GERALD 4,543.40 22,717.00 50.00 250.00 940.53 217.32 3,435.55
139 BRADLEY, RANDALL 2,695.98 13,479.90 50.00 250.00 382.00 100.00 2,263.98
167 BROWN, JOHN 4,111.61 20,558.05 50.00 250.00 600.00 200.00 3,361.61
157 CARROLL,RONALD L 1,985.15 9,925.75 50.00 250.00 250.00 105.00 1,680.15
151 COLE, RUSTON 2,889.76 14,448.80 50.00 250.00 600.00 200.00 2,139.76
109 COOPER, ADRIAN 601.78 3,008.90 50.00 250.00 651.78
108 DENNIS, WARREN, No 2006 Affidavit" 3,893.52 150.00 0.00 4,043.52
160 DUGGER,GARY 2,982.13 14,910.65 50.00 250.00 300.00 120.00 2,612.13
140 FOSTER, BILLIE D. 3,023.23 15,116.15 50.00 250.00 300.00 120.00 2,653.23
148 FRIEND, JERRY 2,971.70 14,858.50 50.00 250.00 725.00 150.00 2,146.70
161 HANNA, JANICE 1,845.13 9,225.65 0.00 175.00 50.00 1,620.13
145 HANNA, MARK 734.93 3,674.65 50.00 250.00 784.93
162 HASKINS, IRENE 409.61 2,048.05 50.00 250.00 459.61
169 HELDER, TIM 5,502.99 27,514.95 50.00 250.00 750.00 250.00 4,552.99
180 HOYT, RICK 7,031.78 35,158.90 50.00 250.00 1,100.00 410.00 5,571.78
146 HUTCHENS, BERNICE 955.97 4,779.85 50.00 250.00 130.00 875.97
143 JOHNSON, CHARLES 2,314.54 11,572.70 50.00 250.00 42.67 2,321.87
103 JOHNSON, WENDELL 738.19 3,690.95 50.00 250.00 788.19
118 JONES, BOB 3,110.99 15,554.95 50.00 250.00 0.00 3,160.99
144 KILGORE, DONALD 1,929.00 9,645.00 50.00 250.00 19.72 1,959.28
129 LAWSON, FORREST 1,477.89 7,389.45 50.00 250.00 350.00 1,177.89
150 LITTLE, PATSY R 382.46 1,912.30 50.00 250.00 432.46
153 LORCH, DONNA 382.46 1,912.30 50.00 250.00 432.46
156 MARTIN, KENNETH 3,480.86 17,404.30 50.00 250.00 500.00 140.00 2,890.86
128 MCCAWLEY, LARRY 1,597.50 7,987.50 50.00 250.00 195.00 50.00 1,402.50
116 MCCHRISTIAN, MARIE 382.46 1,912.30 50.00 250.00 432.46
126 MCWHORTER, KAREN 530.00 2,650.00 50.00 250.00 580.00
136 MITCHELL, MICHAEL 2,172.96 10,864.80 50.00 250.00 150.00 2,072.96
141 MUELLER, ROSEMARY 1,945.46 9,727.30 50.00 250.00 1,995.46
158 MUNSON,ANGELA 3,957.16 19,785.80 50.00 250.00 500.00 183.00 3,324.16
112 MURPHY, JAKE 382.46 1,912.30 50.00 250.00 0.00 432.46
137 PERDUE, LARRY 2,189.34 10,946.70 50.00 250.00 200.00 25.00 2,014.34
164 PERSHALL, ROBIN 1,437.52 7,187.60 0.00 190.00 67.00 1,180.52
132 PHILLIPS, HOMER GENE 1,653.73 8,268.65 50.00 250.00 300.00 1,403.73
105 PRESTON, GEORGE DAVID 1,509.45 7,547.25 50.00 250.00 100.00 100.00 1,359.45
135 RICKMAN, LOREN 2,103.00 10,515.00 50.00 250.00 230.00 65.00 1,858.00
104 RIGGINS, RAYMOND C 1,573.54 7,867.70 50.00 250.00 125.00 25.00 1,473.54
183 ROBERTS, ELDON 7,050.02 35,250.10 50.00 250.00 1,244.00 400.00 5,456.02
159 SCHUSTER,JOHN H. 2,938.41 14,692.05 50.00 250.00 340.00 110.00 2,538.41
168 STANLEY, MELVIN 4,599.93 22,999.65 50.00 250.00 1,100.00 300.00 3,249.93
155 STOUT, BETTY 453.76 2,268.80 50.00 250.00 0.00 503.76
133 SURLES, JERRY 2,565.18 12,825.90 50.00 250.00 600.00 200.00 1,815.18
142 TAYLOR, DENNIS 1,945.46 9,727.30 50.00 250.00 110.00 0.00 1,885.46
106 UPTON, FRANKLIN 996.40 4,982.00 50.00 250.00 10.00 1,036.40
163 WATSON, RICHARD 7,442.56 37,212.80 50.00 250.00 1,950.00 400.00 5,142.56
149 WILLIAMS, JOYCE 1,329.93 6,649.65 50.00 250.00 217.07 1,162.86
134 WITT, DON 1,665.41 8,327.05 50.00 250.00 115.00 64.00 1,536.41
127 WOOD, PAUL J 1,490.17 7,450.85 50.00 250.00 0.00 1,540.17
115,006.92 578,928.12 2,400.00 0.00 12,150.00 0.00 15,098.60 4,200.60 98,107.72
6800-9800 6800-9800 6800-9800
5335-00 5335-05 5335-06 Total
Year to Date 463,921.20 9,750.00 0.00 473,671.20
"" Warren Dennis benefits stopped 3131/06, No 2006 Pension Affidavit
POLICE PENSION FUND
June 2006 6NO-9800 6800-9800
Month 6 5335-00 Backpay 5335-05 Future
EMP# NAME GROSS YTD Wages Suppl. Supplement YTD Suppl. Supplement Fed Tax ST. TAX NET
154 ALLEN, CHARLES 2,436.27 14,617.62 50.00 300.00 220.00 66.89 2,199.38
130 BAYLES, DON 1,496.28 8,977.68 50.00 300.00 1,546.28
107 BLACK, JOE P 1,061.02 6,366.12 50.00 300.00 100.00 20.00 991.02
147 BRADLEY, GERALD 4,543.40 27,260.40 50.00 300.00 940.53 217.32 3,435.55
139 BRADLEY, RANDALL 2,695.98 16,175.88 50.00 300.00 382.00 100.00 2,263.98
167 BROWN, JOHN 4,111.61 24,669.66 50.00 300.00 600.00 200.00 3,361.61
157 CARROLL,RONALD L 1,985.15 11,910.90 50.00 300.00 250.00 105.00 1,680.15
151 COLE, RUSTON 2,889.76 17,338.56 50.00 300.00 600.00 200.00 2,139.76
109 COOPER, ADRIAN 601.78 3,610.68 50.00 300.00 651.78
108 DENNIS, WARREN 1,297.84 7,787.04 50.00 300.00 0.00 1,347.84
160 DUGGER,GARY 2,982.13 17,892.78 50.00 300.00 300.00 120.00 2,612.13
140 FOSTER, BILLIE D. 3,023.23 18,139.38 50.00 300.00 300.00 120.00 2,653.23
148 FRIEND, JERRY 2,971.70 17,830.20 50.00 300.00 725.00 150.00 2,146.70
161 HANNA, JANICE 1,845.13 11,070.78 0.00 175.00 50.00 1,620.13
145 HANNA, MARK 734.93 4,409.58 50.00 300.00 784.93
162 HASKINS, IRENE 737.30 3,113.04 50.00 300.00 787.30
169 HELDER, TIM 5,502.99 33,017.94 50.00 300.00 750.00 250.00 4,552.99
180 HOYT, RICK 7,031.78 42,190.68 50.00 300.00 1,600.00 425.00 5,056.78
146 HUTCHENS, BERNICE 1,720.75 7,265.38 50.00 300.00 130.00 1,640.75
143 JOHNSON, CHARLES 2,314.54 13,887.24 50.00 300.00 42.67 2,321.87
103 JOHNSON, WENDELL 738.19 4,429.14 50.00 300.00 788.19
118 JONES, BOB 3,110.99 18,665.94 50.00 300.00 0.00 3,160.99
144 KILGORE, DONALD 1,929.00 11,574.00 50.00 300.00 19.72` 1,959.28
129 LAWSON, FORREST 1,477.89 8,867.34 50.00 300.00 350.00 1,177.89
150 LITTLE, PATSY R 688.43 2,906.70 50.00 300.00 738.43
153 LORCH, DONNA G 688.43 2,906.70 50.00 300.00 738.43
156 MARTIN, KENNETH 3,480.86 20,885.16 50.00 300.00 500.00 140.00 2,890.86
128 MCCAWLEY, LARRY 1,597.50 9,585.00 50.00 300.00 195.00 50.00 1,402.50
116 MCCHRISTIAN, MARIE 688.43 2,906.70 50.00 300.00 738.43
126 MCWHORTER, KAREN 954.00 4,028.00 50.00 300.00 1,004.00
136 MITCHELL, MICHAEL 2,172.96 13,037.76 50.00 300.00 150.00 2,072.96
141 MUELLER, ROSEMARY 1,945.46 11,672.76 50.00 300.00 1,995.46
158 MUNSON,ANGELA 3,957.16 23,742.96 50.00 300.00 500.00 183.00 3,324.16
112 MURPHY, JAKE 382.46 2,294.76 50.00 300.00 0.00 432.46
137 PERDUE, LARRY 2,189.34 13,136.04 50.00 300.00 200.00 25.00 2,014.34
164 PERSHALL, ROBIN 1,437.52 8,625.12 0.00 190.00 67.00 1,180.52
132 PHILLIPS, HOMER GENE 1,653.73 9,922.38 50.00 300.00 300.00 1,403.73
105 PRESTON, GEORGE DAVID 1,509.45 9,056.70 50.00 300.00 100.00 100.00 1,359.45
135 RICKMAN, LOREN 2,103.00 12,618.00 50.00 300.00 230.00 65.00 1,858.00
104 RIGGINS, RAYMOND C 1,573.54 9,441.24 50.00 300.00 125.00 25.00 1,473.54
183 ROBERTS, ELDON 7,050.02 42,300.12 50.00 300.00 1,244.00 400.00 5,456.02
159 SCHUSTER,JOHN H. 2,938.41 17,630.46 50.00 300.00 340.00 110.00 2,538.41
168 STANLEY, MELVIN 4,599.93 27,599.58 50.00 300.00 1,100.00 300.00 3,249.93
155 STOUT, BETTY 816.77 3,448.58 50.00 300.00 0.00 866.77
133 SURLES, JERRY 2,565.18 15,391.08 50.00 300.00 600.00 200.00 1,815.18
142 TAYLOR, DENNIS 1,945.46 11,672.76 50.00 300.00 110.00 0.00 1,885.46
106 UPTON, FRANKLIN 996.40 5,978.40 50.00 300.00 10.00 1,036.40
163 WATSON, RICHARD 7,442.56 44,655.36 50.00 300.00 1,950.00 400.00 5,142.56
149 WILLIAMS, JOYCE 2,393.87 10,107.46 50.00 300.00 217.07 2,226.80
134 WITT, DON 1,665.41 9,992.46 50.00 300.00 115.00 64.00 1,536.41
127 WOOD, PAUL J 1,490.17 8,941.02 50.00 300.00 0.00 1,540.17
120,166.09 705,551.22 2,450.00 0.00 14,700.00 0.00 15,598.60 4,215.60 102,801.89
6800-9800 6800-9800 6900-0800
5335-00 5335-05 5335.06 Total
Year to Date 705,551.22 14,700.00 0.00 720,251.22
POLICE PENSION FUND
July 2006 6800-9800 6800-9800
Month 7 5335-00 Backpay 5335-05 Future
EMP# NAME GROSS YTD Wages Suppl. Supplement YTD Suppl. Supplement Fed Tax ST. TAX NET
154 ALLEN, CHARLES 2,436.27 17,053.89 300.00 220.00 66.89 2,149.38
130 BAYLES, DON 1,496.28 10,473.96 300.00 1,496.28
107 BLACK, JOE P 1,061.02 7,427.14 300.00 100.00 20.00 941.02
147 BRADLEY, GERALD 4,543.40 31,803.80 300.00 940.53 217.32 3,385.55
139 BRADLEY, RANDALL 2,695.98 18,871.86 300.00 382.00 100.00 2,213.98
167 BROWN, JOHN 4,111.61 28,781.27 300.00 600.00 200.00 3,311.61
157 CARROLL,RONALD L 1,985.15 13,896.05 300.00 250.00 105.00 1,630.15
151 COLE, RUSTON 2,889.76 20,228.32 300.00 600.00 200.00 2,089.76
109 COOPER, ADRIAN 601.78 4,212.46 300.00 601.78
108 DENNIS, WARREN 1,297.84 9,084.88 300.00 0.00 1,297.84
160 DUGGER,GARY 2,982.13 20,874.91 300.00 300.00 120.00 2,562.13
140 FOSTER, BILLIE D. 3,023.23 21,162.61 300.00 300.00 120.00 2,603.23
148 FRIEND, JERRY 2,971.70 20,801.90 300.00 725.00 150.00 2,096.70
161 HANNA, JANICE 1,845.13 12,915.91 0.00 175.00 50.00 1,620.13
145 HANNA, MARK 734.93 5,144.51 300.00 734.93
162 HASKINS, IRENE 737.30 3,850.34 300.00 737.30
169 HELDER, TIM 5,502.99 38,520.93 300.00 750.00 250.00 4,502.99
180 HOYT, RICK 7,031.78 49,222.46 300.00 1,600.00 425.00 5,006.78
146 HUTCHENS, BERNICE 1,720.75 8,986.13 300.00 130.00 1,590.75
143 JOHNSON, CHARLES 2,314.54 16,201.78 300.00 42.67 2,271.87
103 JOHNSON, WENDELL 738.19 5,167.33 300.00 738.19
118 JONES, BOB 3,110.99 21,776.93 300.00 0.00 3,110.99
144 KILGORE, DONALD 1,929.00 13,503.00 300.00 19.72 1,909.28
129 LAWSON, FORREST 1,477.89 10,345.23 300.00 350.00 1,127.89
150 LITTLE, PATSY R 688.43 3,595.13 300.00 688.43
153 LORCH, DONNA G 688.43 3,595.13 300.00 688.43
156 MARTIN, KENNETH 3,480.86 24,366.02 300.00 500.00 140.00 2,840.86
128 MCCAWLEY, LARRY 1,597.50 11,182.50 300.00 195.00 50.00 1,352.50
116 MCCHRISTIAN, MARIE 688.43 3,595.13 300.00 688.43
126 MCWHORTER, KAREN 954.00 4,982.00 300.00 954.00
136 MITCHELL, MICHAEL 2,172.96 15,210.72 300.00 150.00 2,022.96
141 MUELLER, ROSEMARY 1,945.46 13,618.22 300.00 1,945.46
158 MUNSON,ANGELA 3,957.16 27,700.12 300.00 500.00 183.00 3,274.16
112 MURPHY, JAKE 382.46 2,677.22 300.00 0.00 382.46
137 PERDUE, LARRY 2,189.34 15,325.38 300.00 200.00 25.00 1,964.34
164 PERSHALL, ROBIN 1,437.52 10,062.64 0.00 190.00 67.00 1,180.52
132 PHILLIPS, HOMER GENE 1,653.73 11,576.11 300.00 300.00 1,353.73
105 PRESTON, GEORGE DAVID 1,509.45 10,566.15 300.00 100.00 100.00 1,309.45
135 RICKMAN, LOREN 2,103.00 14,721.00 300.00 230.00 65.00 1,808.00
104 RIGGINS, RAYMOND C 1,573.54 11,014.78 300.00 125.00 25.00 1,423.54
183 ROBERTS, ELDON 7,050.02 49,350.14 300.00 1,244.00 400.00 5,406.02
159 SCHUSTER,JOHN H. 2,938.41 20,568.87 300.00 340.00 110.00 2,488.41
168 STANLEY, MELVIN 4,599.93 32,199.51 300.00 1,100.00 300.00 3,199.93
155 STOUT, BETTY 816.77 4,265.35 300.00 0.00 816.77
133 SURLES, JERRY 2,565.18 17,956.26 300.00 600.00 200.00 1,765.18
142 TAYLOR, DENNIS 1,945.46 13,618.22 300.00 110.00 0.00 1,835.46
106 UPTON, FRANKLIN 996.40 6,974.80 300.00 10.00 986.40
163 WATSON, RICHARD 7,442.56 52,097.92 300.00 1,950.00 400.00 5,092.56
149 WILLIAMS, JOYCE 2,393.87 12,501.33 300.00 217.07 2,176.80
134 WITT, DON 1,665.41 11,657.87 300.00 115.00 64.00 1,486.41
127 WOOD, PAUL J 1,490.17 10,431.19 300.00 0.00 1,490.17
120,166.09 825,717.31 0.00 0.00 14,700.00 0.00 15,598.60 4,215.60 100,351.89
6800-9800 6800-9800 6800-9800
5335-00 5335-05 5335-06 Total
Year to Date 825,717.31 14,700.00 0.00 840,417.31
7ayletTyille
113WestMountain
NSAS Fayetteville, AR 72701
COPYTelephone: (479) 575-8323
Fax: (479) 718-7695
city_clerk@ci.fayetteville.ar.us
City Clerk/Treasurer Division
April 24, 2006
David Clark
Arkansas Fire & Police Pension Review Board
620 W 3rd Street, Suite 200
Little Rock, AR 72201
RE: City of Fayetteville Policemen's Pension and Relief Fund
Board of Trustees Benefit Increase
Dear David:
The Fayetteville Policemen's Pension and Relief Fund Board of Trustees moved to
approve an increase in survivor's benefits on April 13, 2006 from 50% to 90% of the last
amount received by the pension member. This increase was approved by the
Fayetteville Policemen's Pension and Relief Fund Board of Trustee's to begin on May 1 ,
2006.
I have enclosed a copy of the resolution regarding the benefit increase and a copy of
the meeting minutes. Please contact me if you have any questions regarding this
matter.
Sincerely,
Sondra Smith
Treasurer
Policemen's Pension and Relief Fund Board of Trustees
SS/
Enclosure
May 17, 2006
Mr. Jody Carreiro
Osborn, Carreiro & Associates, Inc.
One Union National Plaza, Suite 1690
124 West Capitol Avenue
Little Rock, AR 72201
RE: City of Fayetteville Policemen's Pension and Relief Fund
Board of Trustees Benefit Increase
Dear Mr. Carreiro,
The Fayetteville Policemen's Pension and Relief Fund Board of Trustees moved to
approve an increase in survivor's benefits on April 13, 2006 from 50% to 90% of the last
amount received by the pension member. This increase was approved by the
Fayetteville Policemen's Pension and Relief Fund Board of Trustee's to begin on May 1 ,
2006.
I have enclosed a copy of the resolution regarding the benefit increase and a copy of
the meeting minutes. Please contact me if you have any questions regarding this
matter.
Sincerely,
Sondra Smith
Policemen's Pension and Relief Fund Board of Trustees Treasurer
SS/
Enclosure
le
FILE 113 West Mountain
7ayve nRKnNsnsC.OPY
Fayetteville, AR 72701
Telephone: (479) 575-8323
Fax: (479) 718-7695
city_clerk@ci.fayetteville.ar.us
City Clerk/Treasurer Division
May 1 , 2006
Dear Pensioner,
The Fayetteville Policemen's Pension and Relief Fund Board of Trustee's moved
to approve an increase in survivor's benefits on April 13, 2006 from 50% to 90%
of the last amount received by the pension member. This increase was
approved by the Fayetteville Policemen's Pension and Relief Fund Board of
Trustee's to begin on May 1 , 2006 and has also been approved by the actuaries
and by the Arkansas Fire & Police Pension Review Board. Your May pension
check will include this increase.
If you have any questions you may contact a member of the Policemen's
Pension and Relief Fund Board of Trustees.
Sincerely,
Sondra Smith
Treasurer
Policemen's Pension and Relief Fund Board of Trustees
POLICE PENSION FUND
Survivors Benefit Increase - Start Date May, 2006
Employee # Name Old New
Pension Pension
Amount Amount
162 HASKINS, IRENE 409.61 737.30
146 HUTCHENS, BERNICE 955.97 11720.75
150 LITTLE, PATSY R 382.46 688.43
153 LORCH, DONNA G 382.46 688.43
116 MCCHRISTIAN, MARIE 382.46 688.43
126 MCWHORTER, KAREN 530.00 954.00
155 STOUT, BETTY 453.76 816.77
149 WILLIAMS, JOYCE 1 ,329.93 2,393.87
4,826.65 82687.98
3,861 .33 Difference
May 17, 2006
Mr. Jody Carreiro
Osborn, Carreiro & Associates;, Inc.
One Union National Plaza, Suite 1690
124 West Capitol Avenue
Little Rock, AR 72201
RE: City of Fayetteville Policemen's Pension and Relief Fund
Board of Trustees COLA
Dear Mr. Carreiro,
Eldon Roberts asked that I contact you about the 3% Temporary COLA that we are
currently paying our members. He sated that you are going to look at our Cash Flow
Report that was completed in 2005 and see if this COLA can be made permanent.
We just passed a benefit increase from 50% to 90% for survivors' that became effective
May 1 , 2006. 1 mailed you a copy of the resolution passed by the Board and the
meeting minutes regarding this benefit increase. This increase will need to be
considered when determining if the COLA can be made permanent.
I would like to know if there will be a charge for Mr. Robert's request and if so what that
amount will be. The Board will have to vote on any additional cost due to this request. I
would also like to know what the time frame is for completing Mr. Robert's request.
Please contact me if you have any questions regarding this matter.
Sincerely,
Sondra Smith
Policemen's Pension and Relief Fund Board of Trustees Treasurer
SS/
City Clerk Division
113 West Mountain
Tavyet"eii
Fayetteville, AR 72701
- � Ie Telephone: (479) 575-8323
ARKANSAFax: (479) 718-7695
S
city_jderk@ci.fayetteville.ar.us
Departmental Correspondence
TO: Kit Williams, City Attorney t�
FROM: Sondra Smith, City Clerk/Treasurer
DATE: May 22, 2006
SUBJECT: Policemen's Pension
At the April 13, 2006 Policemen's Pension meeting the Board asked for clarification on the
following:
1 . If a pension member remarries does his new wife qualify for benefits upon his
death or do they have to be married for a length of time before a new wife can
draw benefits.
2. Does a beneficiary of a pensioner continue to draw benefits if they remarry and
for how long after remarrying.
3. Do the benefits that are paid to a former spouse stop at the time of death of the
pension member.
I would like to have this information for the July 20, 2006 Policemen's Pension meeting if
possible.
Thank you.
FAYETTEVILLE
THE CITY OF FAYETTEVILLE, ARKANSAS
Krr WILLIAMs,CITY ATTORNEY
DAVID WHITAKER, ASST. CITY ATTORNEY
DEPARTMENTAL CORRESPONDENCE LEGAL DEPARTMENT
TO: Sondra Smith,, City Clerk
FROM: Kit Williams, City Attorney'
DATE: May 24, 2006
RE: Pension Questions
1 . If any police officer marries after retirement, that surviving spouse
may be entitled to a pension . . . if he or she has been married . . . at least (5)
years, if the board of trustees for the fund decides to extend this benefit . . .
and if the pension fund will be actuarially sound . . . ." A.C.A. §24-11-425 (d)
2. Benefits end with remarriage. A.C.A. §24-11-425 (g)
3. If a former spouse (divorced) is receiving benefits because of a
Qualified Domestic Relations Order, those benefits cease upon the death of
the beneficiary (the retired officer).
CITY OF FAYETTEVILLE, ARKANSAS
POLICEMEN'S PENSION & RELIEF FUND
INVESTMENT POLICY
PURPOSE: The purpose of this policy is to define the guidelines of the Policemen's
Pension and Relief Fund Board in selecting assets for the Policemen's Pension and Relief
Fund.
L Investment Objectives:
A. To protect the Fund's assets while insuring systematic and adequate funding
of plan distributions and benefits to participants and their beneficiaries.
B. To earn the highest possible total return (capital appreciation plus current
return), consistent with prudent levels of risk.
C. The long-term goal is to realize an average annual rate of return of 6% on the
Fund's total portfolio to satisfy actuarial projections. The board expects the
total fund, as well as each component, (i.e.: equity fund, balanced fund, fixed
income fund, etc.) to:
1. Perform in the top one-third of an evaluation services universe using a
Standard & Poor's Index;
2. Achieve a net return equal to the S & P 500 rate of return for
equities;
3. Achieve a net return, inclusive of fees, equal to the
Shearson/Lehman Government/Corporate Bond Index for
fixed income; and
4. Achieve a net return, inclusive of fees, at least equal to the
combination of the S & P 500 and Shearson/Lehman
Government/Corporate Bond Index for balanced funds.
II. Investment Guidelines:
A. Adherence to all applicable Arkansas Statutes is required, particularly A.
C. A § 24-10-401 through § 24-11-410 of 1987 as amended.
B. Investments and reinvestment shall be made in accordance with the
prudent investor rule as interpreted and defined by the Federal Employees
Retirement Income Security Act (ERISA) of 1974. This rule states that
in making investments, the fiduciary shall exercise the same judgment
and care which an institutional investor of ordinary prudence, discretion,
and intelligence exercises in the management of large investments
entrusted to it, considering probably safety of capital as well as probably
income.
1
C. If professional investment counsel is employed to execute transactions as
a money manager, the following is required:
1 . Investment counsel may be comprised of more than one
professional firm in order to segregate various duties and powers.
2. Investment counsel shall be registered with the Arkansas
Securities Department and/or the Securities and Exchange
Commission (SEC). Proof of current registration shall be made
annually to the Board.
3. Investment counsel shall be retained under contract awarded on
the basis of competitive bid. Award of the contract will not be
required to be solely on the lowest bid. All contracts shall include
a 30-day cancellation provision.
4. Investment management of the portfolio will be implemented on a
fully discretionary basis, once investment policy is approved by the
client. Transactions conducted in accordance with the investment
policy will take place without prior notification provided to the client
upon the execution of individual trades. Monthly statements issued by
the custodian will include a summary of all transactions. The
investment counsel shall have full power to hold, purchase, sell,
assign, transfer, or dispose of any of the moneys or investments of
the fund so long as such activities are in accordance with the
following guidelines:
a) No more than 2.5% of the fund's total assets valued at cost
may be invested in the equities of any one company or
affiliated group of companies. (Each telephone company
issuer shall be considered a separate & distinct issuer).
Rated equities purchased for the account will carry a
minimum Standard & Poor's rating of "B-". Non-rated
stocks will be assigned a rating less than B- for calculation of
the weighted average equity portfolio rating. The weighted
average rating of the equity portfolio must be equivalent to
a Standard & Poor's rating of "B+" or better.
b) No more than 11% of the fund's total assets may be
invested in any one-debt security of any one issuer or
intermediary. This does not apply to U.S. Treasury or
government guaranteed or agency debt securities.
c) Any fixed income securities shall carry a rating of
investment grade or better by Moody's or by Standard &
Poor's.
2
d) Short term investments shall consist of direct U.S.
Government obligations such as U.S. Treasury Bills,
repurchase agreements fully collateralized by U.S. Treasury
issues, certificates of deposit not to exceed $100,000 at any
national bank or federal savings and loan institution, and
corporate issues of one year maturity or less. Funds may be
held in U. S. government money market funds during
periods of purchasing securities.
e) Investment in international securities will be limited to
50% of the equity portfolio at cost. Investments in
international securities that are not exchange-traded
American Depository Receipts shall be made only after
securing approval by the majority of the Board at a
regularly scheduled meeting.
f) Options may be used for hedging purposes only.
5. Investments and reinvestment shall be made only in accordance
with the prudent investor rule, as interpreted by the Federal
ERISA of 1974.
6. Investment counsel shall provide the Board a written investment
policy and promptly provide the Board with subsequent policy
changes in writing. The policy shall adhere to guidelines as set
forth in this document.
7. Investment counsel shall file a written report with the Board, for
the period since the last report, setting forth the following:
a) All investments purchased and sold, all receipts and
disbursements and any other transactions concerning the
Fund's account on a monthly basis.
b) Cost and market value of all investment categories on a
monthly basis.
C) Current yield at market on a monthly basis.
d) Total investment return of the total Fund as well as
investment return by asset category for the most recent
quarter. This quarterly information should include year to
date and previous year return figures.
e) Average maturities of applicable securities on an annual
basis.
3
f) Comparison of actual asset allocation to established asset
allocation guidelines on a quarterly basis.
g) Short and long-term forecasts of economic conditions
which have an impact on investments at least quarterly.
h) Projected earnings for the Fund for the next annual period
at least quarterly.
i) A list of all transactions fees as cents per share and percent
of trade value and the total amount of transaction fees on a
monthly and year to date basis.
8. If the Board chooses to direct a specific investment activity, the
investment counsel shall be so notified in writing. The Board
must approve such action during a regularly scheduled meeting.
9. The investment counsel shall select brokers to handle transactions
on a competitive bid basis at least quarterly, with emphasis on
getting consideration of the level of service rendered and
performance of execution. A report of these bids and awards shall
be submitted to the Board quarterly.
III. Volatility and Liquidity:
A. Consistent with the desire for adequate diversification, this investment
policy is based upon the assumption that the volatility of the portfolio
will be similar to that of the overall market. Consequently, it is expected
that the volatility of the total portfolio, in aggregate, will be reasonable
close to that of a weighted composite of market indexes (e.g. Standard &
Poors 500 index for stocks and Salomon Brothers Broad grade index for
bonds).
B. While there is no immediate requirement for the investment managers to
maintain liquid reserves for payment of pension benefits, the Board of
Trustees will monitor the liquidity needs of the plan with the managers on
at least an annual basis. Current annual benefit payments are approximately
$1,188,000. This amount will be partially offset by contributions to the plan
from employees, employer match, state insurance premium tax turnback, and
local millage. Contributions to the plan totaled $628,724 in 2002.
IV. Asset Allocation/Diversification:
A. The maximum allocation of investment categories shall be 50% for
equities and the balance in fixed income and cash and cash equivalents.
4
B. A specific asset allocation shall be approved by the Board and shall be
segregated as a percentage for equities, fixed income and cash
equivalents. The specific asset allocation shall be reviewed at least semi-
annually with the investment counsel. Any changes shall be transmitted
to the investment counsel in writing. The allocation shall be within the
following guidelines:
1 . Cash and Cash Equivalents: 0% - 25%
Short term investments shall consist of obligations of the U.S.
Government, U.S. Agencies and corporate issues of one to three
year maturity or less, repurchase agreements, certificates of
deposit and the highest two grades of commercial paper.
Additionally, U.S. government money market funds may be
utilized.
2. Fixed Income: 25% - 65%
The quality of fixed income securities shall not be rated less than
investment grade by Moody's or Standard & Poor's. Any one
issue shall not exceed 11% of the fixed income portfolio at cost
without Board approval. Only after the Board has approved any
recommendation may the investment advisor take such action.
This does not apply to U.S. Treasury or government guaranteed or
agency debt securities. Whenever possible, call protection shall be
integrated into the portfolio to stabilize the current income and
marketability of the portfolio.
3. Equities: 35% - 50%
Managers shall have no restrictions as to the percentage of their
diversification except as follows: Equity investments in any
single issue shall not exceed 5% of the cost value of the total
equity portfolio. The Manager can operate outside the Equity
guidelines by not more that 5% with a report on the variance to the
Board at their next quarterly meeting. The Board will then authorize
or reject the variance for the next quarter.
C. The Board of Trustees recognizes the need for diversification of the plan
assets in order to minimize the risk of large losses. Consequently, the
total portfolio will be structured to maintain high levels of diversification,
consistent with prudent investment practices and with the Board's desire
to stress the principle of preservation of capital.
V. Monitoring the Performance of the Investment Process:
A. At least semi-annually, the Board shall review its investment
methodology, including the investment policy.
5
B. A five (5) year time frame shall be used to evaluate real investment
return.
C. If an investment counsel is employed, the manager's performance shall be
measured over a five (5) year time frame. Consideration shall be given
for investment market conditions during the period and adherence to the
Board's investment policy guidelines. If the Board so chooses, a review
of the money manager's performance over the cycle shall be made by an
independent third party.
D. Annually, the City Accounting Division shall prepare a schedule as
required by the Arkansas Pension Review board for actuary information.
E. The Board of Trustees may opt to employ a professional service to
perform regular investment performance analysis on the portfolio.
ACCEPTED:
City of Fayetteville Police Pension and Relief Board of Trustees
/ r a
Dan Coody, Mayor -Date Tim Helder Date
e rien ate Eldon Roberts Date
J es Mashburn Date J y Surl s Date
Sondra Smith Date
Longer Investments Inc.
Laine M. Lo er, resi nt / Date
6
Ar
kW
COMMENTS AND OUTLOOKS FROM LONGER INVESTMENTS INCORPORATED
July 179 2006
In the second quarter, we saw an increase During the five weeks ending July 3,
in volatility across all markets in response to a there were a total of 14 days of"80%
number of factors. The markets are,still action" on the New York Stock Ex-
adjusting to the new Federal Reserve chairman, change (NYSE). An 80% day is a day
Ben Bernanke, who has confounded the in which 80% or more of total volume
experts with confusing and sometimes conflict- is upside volume or downside volume.
mg statements (see "Federal Reserve Policy" An 80% day is indicative of extreme
below). Energy prices continue to move higher, sentiment, either positive(when
as do interest rates. Inflation fears are causing upward volume accounts for 80% or
skittishness in the bond pits. Add to the eco- more of the total) or negative (when
nomic uncertainties a rising geopolitical risk downward volume accounts for 80% or
with nuclear ambitions in Iran, an anti=Amen- more of the total). The Dow Theory
can regime in Venezuela, contested elections in newsletter reports that this is the
Mexico, missile tests in North Korea, as well greatest volatility seen in the Iast 55
as wars in the Middle East — and you have a years.
prescription for indigestion. • Bond interest rates increased 50 basis
points between March 31 and May 1,
In financial markets, a serious case of from 4.8% to 5.3%. In fact, in June
indigestion manifests itself as volatility. Con- bond pVices declined for nine straight
sider the following price actions in the second trading days for the first time since
quarter: 1974.
• Oil stocks (as measured by the Amex Sometimes I think money management
Oil Index, or XOI) dropped 15.6% should qualify as an extreme sport. I'm
from a peak on April 25 to a low on reminded of a quote from Warren Buffett. He
June 13, only to rise again,by 18%, in once said, "I would rather have a choppy 18%
the last two weeks of June. than a smooth 15%." Buffett makes it clear
• Gold peaked on May 12 at $722 per he'd rather have the higher return with the
ounce, and then fell 24% to a low of, attendant anxiety than have the more comfort-
$550 per ounce on June 14. able,but lower, smooth return.
• The Standard & Poor's 500 declined
.8% from peak to trough in the second Why is there.so much volatility of late?
quarter,while small-capitalization There are many factors. We are still in a credit
stocks declined by 14.5% and the tightening cycle that began in 2004. There is
NASDAQ declined by. 13%. considerable uncertainty about the new Fed
• Foreign stock markets declined as well, chairman, current Fed policy, and whether the
with the EAFE (Europe,Australasia, Fed will "go too far" in tightening interest rates,
Far East) index falling 15.9% and thereby precipitating a recession. The interest
emerging markets, as measured by rate level affects both the valuation applied to
EEM, an emerging markets index, stockmarket earnings (the price/earnings
losing 27% between May 11 and multiple) and the level of earnings, because
June 13. rising rates slow down economic growth. Until