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Home My WebLink About2021-10-28 - Agenda - Final -OF FAYEr1F Lioneld Jordan Chairman -,t, � Pete Reagan Position 2 Retired Kara Paxton Secretary .,r Lonnie Napier Position 3 Retired Roy Cate Position 1 Retired '+ Ron Wood Position 4 Retired Gene Warford Position 5 Retired gRKANSP`' Firemen's Pension and Relief Fund Board of Trustees Meeting Agenda October 28,2021 A meeting of the Fayetteville Firemen's Pension and Relief Fund Board of Trustees will be held at 3:00 p.m. on October 28, 202I,via teleconference in Room 326 of the City Administration Building. (Joining the Teleconference Instructions are on the second page.) Call to Order Roll Call Garrison Financial: • Quarterly Reports ending 06/30/2021 and 09/30/2021 Approval of the Minutes: • Approval of the April 29th,a09,1 Meeting Minutes Pension List Changes: • None Approval of the Pension List: • November& December 2021, January, February, March and April 2022 Unfinished Business: None New Business: • Revenue and Expense Report 06/30/2021 and 09/30/2021 • Osborn,Carreiro&Associates,Inc.(Informational only: Estimated Premium Tax your Local Fire and/or Police Pension Fund(Local Plan)may receive when the 2022 Premium Tax distribution occurs.) • NCPERS Invoice Informational: 2022 Meeting Calendar • Next meeting April 28, 2022 • Note: All meetings are tentative and subject to change. The City meetings calendar is located on wv‘w.thvettevillc-ar.uov Teleconference Instructions: • External Callers dial (479) 718-7618 and you will be automatically connection. You will not hear anything upon connection, but the • conference participants will hear a beep for each new joined participant. • Internal Callers dial 7618 • • • 0111 GARRISON ASSET MANAGEMENT July 9,2021 Ms. Kara Paxton City of Fayetteville 113 West Mountain Street Fayetteville,Arkansas 72701-6069 Dear Ms.Paxton, Enclosed is your quarterly report for the quarter ended June 30,2021. The economic rebound continued in the 2"d quarter as global GDP finally bounced back to a pre-pandemic high. This marked the sharpest economic"V"shaped recovery in history,with a deep recession and rapid recovery all in the span of just five quarters. The International Monetary Fund(IMF)is forecasting 2021 global economic growth of 6.0%for 2021,which would mark the fastest pace of global growth in nearly 50 years. First quarter growth in the U.S.was strong at 6.4%with estimates for 2nd quarter growth at 9.4%. It's likely we have already passed the peak economic growth rate, but economists still expect continued growth in the 3rd and 4'quarters,albeit at a less robust pace. Inflation remains a concern for the markets,but fortunately we have seen some relief in raw material prices since the highs set back in May. As supply chain bottlenecks continue to improve,and labor market shortages decline as government assistance draws to a close,we hope to see the demand/supply imbalance settle back into a more normal range,which would moderate the pace of inflation in the back half of the year. Equities continued their strong performance in the 2"d quarter,with the S&P 500 gaining+8.55%. Real Estate and Technology were • the best performers(up+12.31%and+11.30%respectively)while Utilities(down-1.13%)and Consumer Staples(up+3.17%)were the weakest. Market valuations remain at elevated levels,but fortunately they did contract some over the quarter as sales and corporate earnings were strong. The fixed income markets seem to be stuck on the question of whether inflation will be"transitory." Fixed income markets will typically lead inflation expectations(prices down,yields higher)as a rule.Here's what I mean by"stuck." On the 10-year Treasury, yields began the year at.91%. They peaked exactly on March 31 at 1.74%,or the beginning of the second quarter. That would indicate that perhaps some inflation is in store.For the second quarter from the peak at the end of March, rates have fallen by.27%, or 27 basis points,to 1.46%,or down over 16%. Lower rates since March seem to call into question the permanent thesis on inflation going forward. For the second quarter the Bloomberg/Barclays Intermediate Government/Credit Index is up+.82%and VTD is down-1.06%. Inflation,the timing of less monetary and fiscal stimulus,and to what degree covid variants could upset the economy will be some of the issues the markets will grapple with in the second half of the year. Volatility could tick up in the coming months as we get a clearer picture of how the economy will move forward beyond the initial reopening demand spike.Continued improvement in supply chain throughput will help. Particularly in challenging market conditions,we're grateful for the trust you have given us over the years. We try to earn it and we sincerely appreciate your business. Should you have any questions please give us a call. Cordially, Kerry Bradley,CFA,MBA Equity Portfolio Manager Garrison Asset Management • 605 W.Dickson Street,Suite 201 •Fayetteville,Arkansas 72701 479-587-1045• 888-442-7637. 479-587-1257 Facsimile•www.GarrisonFinancial.com • Mil GARRISON ASSET MANAGEMENT • City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 Quarter Ending June 30, 2021 0 PORTFOLIO SUMMARY City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 June 30, 2021 • ■Cash&Equivalents 188,187.70 ■Account Fixed Income 1,462,343.19 • • Garrison Asset Management PORTFOLIO APPRAISAL City of Fayetteville Firemen's Pension &Relief Fund Charles Schwab#7851-1206 June 30,2021 Adj Unit Total Adjusted Market Pct. Unit Annual Quantity Security Cost Cost Price Value Assets Income _ Income Yield CASH AND EQUIVALENTS Schwab Bank Sweep 188,187.70 188,187.70 11 4 0 010 18 82 0.0 188,187.70 188,187.70 11 4 18 82 0.0 CORPORATE BONDS 50,000 IBM Corp 100.00 50,001.38 125.04 62,519.50 3.8 7.000 3,500.00 1.1 7.000%Due 10-30-25 Accrued Interest 583.33 0 0 50,001.38 63,102 83 3.8 3,500.00 1 1 MUTUAL FUNDS 12,366.035 Vanguard Admiral 12 13 150,025 00 11.45 141,591.10 86 0.110 1,360.26 1 0 Intermed-term Treasury 9,191.176 Vanguard Admiral 10 88 100,025 00 10.70 98,345.58 6.0 0.060 551.47 0.6 Short-Term Treasury 3,676.471 Vanguard Core Bond 20 41 75,025.00 21 37 78,566 19 4 8 0.260 955 88 1.2 Admiral Shares 3,046.112 Vanguard Intermed 24.63 75,025.00 25.60 77,980.47 4.7 0.580 1,766.74 2.3 Bond Admiral 8,453.085 Vanguard 11.83 100,025.00 1219 103,043.11 6.2 0.240 2,028.74 2.0 Intermed-Term Bond Index • 25,162.828 Vanguard Intermediate 10.39 261,463.57 10 20 256,660.85 15.6 0.240 6,039.08 2.4 Admiral 58,672.725 Vanguard Short-Term 10.86 637,204.87 10.96 643,053.07 39 0 0.210 12,321.27 1.9 Admiral 1,398,793.44 1,399,240.35 84 8 25,023.45 1.8 TOTAL PORTFOLIO 1,636,982.53 1,650,530.89 100.0 28,542.27 1.6 You should carefully compare this statement to the statement you receive from your custodian and notify us immediately of any discrepancies. III • Garrison Asset Management PURCHASE AND SALE City of Fayetteville Firemen's Pension &Relief Fund Charles Schwab#7851-1206 From 01-01-21 To 06-30-21 Trade Settle Unit Date Date Quantity Security Price Amount SALES 02-02-21 02-03-21 40,000 Schwab Govt Money Fund Investor 1.00 40,000.00 Shares 03-05-21 03-08-21 66,000 Schwab Govt Money Fund Investor 1.00 66,000.00 Shares 04-07-21 04-08-21 88,000 Schwab Govt Money Fund Investor 1.00 88,000.00 Shares 04-07-21 04-08-21 3,766.478 Vanguard Intermediate Admiral 10.03 37,765.18 04-07-21 04-08-21 3,711.089 Vanguard Intermediate Admiral 10.03 37,209.82 05-07-21 05-10-21 18,214.936 Vanguard Short-Term Admiral 10.98 199,975.00 468,950.00 • • 11110 Garrison Asset Management REALIZED GAINS AND LOSSES City of Fayetteville Firemen's Pension &Relief Fund Charles Schwab#7851-1206 From 01-01-21 Through 06-30-21 Gain Or Loss Open Close Cost Amort.or Date Date Quantity Security Basis Accretion Proceeds Short Term Long Term 02-02-21 40,000 Schwab Govt Money Fund 40,000.00 40,000 00 0.00* Investor Shares 03-05-21 66,000 Schwab Govt Money Fund 66,000.00 66,000.00 0.00* Investor Shares 04-07-21 88,000 Schwab Govt Money Fund 88,000.00 88,000.00 0 00* Investor Shares 09-29-20 04-07-21 3,766.478 Vanguard Intermediate 40,025 00 37,765.18 -2,259 82 Admiral 06-01-20 04-07-21 3,711.089 Vanguard Intermediate 38,561 43 37,209.82 -1,351 61 Admiral 06-01-20 05-07-21 18,214.936 Vanguard Short-Term 197,820 13 199,975.00 2,154 87 Admiral TOTAL GAINS 2,154,87 0.00 TOTAL LOSSES -3,611.43 0.00 470,406 56 0 00 468,950.00 -1,456.56 0.00 TOTAL REALIZED GAIN/LOSS -1,456.56 CAPITAL GAIN DISTRIBUTIONS 03-31-21 Vanguard Intermed-Term 355.03 Bond Index • 03-31-21 Vanguard intermediate 1,612 44 Admiral 03-31-21 Vanguard Intermediate 486.34 Admiral 03-31-21 Vanguard Admiral 236 19 Intermed-term Treasury 03-31-21 Vanguard Admiral 114 89 Short-Term Treasury 03-31-21 Vanguard Admiral 101.10 Short-Term Treasury TOTAL DISTRIBUTIONS 2,905 99 587.44 2,318.55 -869.12 2,318.55 TOTAL GAIN/LOSS 1,449 43 An'*'denotes an average cost transaction • Garrison Asset Management PERFORMANCE SUMMARY III GROSS OF FEES City of Fayetteville Firemen's Pension &Relief Fund Charles Schwab#7851-1206 June 30, 2021 PORTFOLIO COMPOSITION CHANGE IN PORTFOLIO Market Pct. Value Assets Yield Cash&Equivalents 188,187.70 11.4 0.0 Portfolio Value on 12-31-20 1,984,177.36 Money Market 0.00 0.0 - Accrued Interest 583.33 Account Fixed 1,462,343.19 88.6 1.8 Net Additions/Withdrawals -324,469.00 Income Account Equities 0.00 0.0 - Realized Gains -4,250.87 Account 0.00 0.0 - Unrealized Gains -23,503.52 Commodities Income Received 17,993.59 Change in Accrued Interest 0.00 Portfolio Value on 06-30-21 1,649,947.55 Accrued Interest 583.33 Total 1,650,530.89 100.0 1.6 1,650,530.89 TIME WEIGHTED RETURN • Annualized Quarter Year Last 12 Inception To Date To Date Months To Date Account 1.26 -0.37 1.42 5.36 Account Fixed Income 1.35 -0.45 1.58 3,16 Barclays Capital Intermed 0.82 -1.06 0.03 2.46 Govt/Credit All"Account" returns refer to your portfolio. Benchmark indexes are also listed for reference. All returns are reported as percentages. This report is calculated using industry-standard accounting and performance calculation methodologies and is generated by our Axys portfolio accounting software. Calculations are a time-weighted total return series based on monthly valuations, including all cash • and equivalents. All calculations are done based on trade date, employing the accrual method of accounting and include cash, interest,dividends and realized and unrealized gains and losses. Performance is adjusted to accurately reflect portfolio deposits and withdrawals. Results are presented after transaction costs but before management fees. Inception-to-date returns are annualized numbers, except for accounts under management less than one year. Unsupervised assets are excluded in performance calculation. At any given point in time an investment may be worth more or less than the original purchase price. Mil GARRISON ASSET MANAGEMENT July 9,2021 City of Fayetteville Firemen's Pension&Relief Fund Charles Schwab#7851-1206 113 West Mountain Street Fayetteville,AR 72701-6069 STATEMENT OF MANAGEMENT FEES III For The Period April 1 through June 30,2021 Portfolio Value as of 03-31-21 1,818,594 Portfolio Value as of 04-30-21 1,731,995 Portfolio Value as of 05-31-21 1,647,500 Portfolio Value as of 06-30-21 1,650,531 Average of 4 Months 1,712,155 1,712,155 @ 0.1500%per annum 642 Quarterly Management Fee 642 TOTAL DUE AND PAYABLE 642 This statement is for informational purposes only. As you requested, the fee will be automatically deducted from your account. Please be advised that it is the responsibility of the client to verify the accuracy of each fee calculation. The custodian will not determine whether the fee is properly calculated. Oil GARRISON • ASSET MANAGEMENT October 8, 2021 Ms. Kara Paxton City of Fayetteville 113 West Mountain Street Fayetteville, Arkansas 72701-6069 Dear Ms. Paxton, Enclosed is your quarterly report for the quarter ended September 30, 2021. The 3`d quarter saw some reversal in economic activity as the Delta variant swept across the globe causing pandemic-sensitive sectors to experience a pullback, mask mandates reinstated in hot spots, and some factories shut down overseas. Fortunately, it looks like we've seen the worst from this variant as new cases appear to have peaked with the trend going in the right direction. A number of other concerns also hit investors' list of things to worry about such as the collapse of Evergrande Group in China, the timeline of monetary tightening, and the ongoing debt ceiling negotiations. These concerns along with many thinking earnings, valuations and GDP growth were at or near peak levels, gave the markets a bit of indigestion in September. • Equities managed to eke out a small gain for the quarter in spite of a weak September showing. The S&P 500 index registered a gain of+.58%for the quarter after the -4.7% sell off in September. Financials and Communication Services were the best performers for the quarter up+2.29% and +1.4%while Materials and Industrials were the biggest laggards down -3.94% and -4.55% respectively. International stocks retreated for the quarter with developed markets declining-.33%and emerging markets off-8.03%, leaving year-to-date performance of+8.84% and -1.16% respectively. The bond market yield (as measured by the 10-year Treasury) ended the 3Q at 1.49%, having been in a range of 1.17% and 1.54%over the quarter. Rates rose (bond prices down) continually from their early-August lows through the end of the quarter. The YTD low in rates came on 1/4/21, with the highs being seen on 3/31/21 at 1.74%. The average market yield YTD was 1.41%, not much different than the end of the 3Q at 1.49%. Yields continue to be volatile. Because the market continues to experience volatility, yields alone are deceptive compared to the markets' actual total return performance, as measured by the Barclays Intermediate Government/Credit Index. For the quarter, the Index was essentially flat, showing a return of +.04%. YTD the Index was down -1.03%. • Garrison Asset Management 605 W. Dickson Street,Suite 201 •Fayetteville, Arkansas 72701 479-587-1045• 888-442-7637. 479-587-1257 Facsimile•www.GarrisonFinancial.com 1 The economic backdrop and fundamentals remain relatively favorable. Household and • business balance sheets are still in good shape and worker productivity is strong. Pent-up demand and supply chain disruptions are leading to pricing power in many industries which is translating into strong topline growth. As supply chains improve, pricing pressures should ease. However, excessive increases in the money supply due to pandemic relief, quantitative easing, and new government programs could pose a longer-term problem on the inflation front. Some recent action in the markets might lead one to believe fundamentals no longer matter. We strongly disagree and will continue to focus our investment thesis on long-term fundamentals that are real and measurable as they always prevail in the end. As we head into year end, it's always a good time to review your financial situation. We encourage you to think about your risk tolerance,time horizon, asset allocation, and life events. If any of that has changed, or you just want to visit, please let us know and we will be happy to meet and discuss. Cordially, et(AT Kerry Bradley, CFA, MBA Equity Portfolio Manager • Garrison Asset Management 605 W.Dickson Street,Suite 201 •Fayetteville, Arkansas 72701 479-587-1045• 888-442-7637. 479-587-1257 Facsimile•www.GarrisonFinancial.com • fir► GARRISON ASSET MANAGEMENT City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 Quarter Ending September 30, 2021 • PORTFOLIO SUMMARY City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 September 30, 202111.1° •Cash&Equivalents 193,256.50 ■Account Fixed Income 1,457,609.87 11100 • • Garrison Asset Management r PORTFOLIO APPRAISAL City of Fayetteville Firemen's Pension &Relief Fund Charles Schwab #7851-1206 September 30, 2021 Adj Unit Total Adjusted Market Pct. Unit Annual Quantity Security Cost Cost Price Value Assets Income Income Yield CASH AND EQUIVALENTS Schwab Bank Sweep 193,256 50 193,256 50 _ 11 7 0 010 19 33 0 0 193,256 50 193,256 50 11 7 19 33 0 0 CORPORATE BONDS 50,000 IBM Corp 100 00 50,001 32 123 13 61,566 30 3 7 7 000 3,500 00 12 7 000%Due 10-30-25 Accrued Interest 1,458 33 0 I 50,001 32 63,024 63 3 8 3,500.00 1 2 MUTUAL FUNDS 12,366 035 Vanguard Admiral 12 13 150,025.00 1 1 41 141,096 46 8 5 0 110 1,360 26 1 0 Interned-term Treasury 9,191.176 Vanguard Admiral 10.88 100,025 00 10 69 98,253.67 6 0 0 050 459.56 0.5 Short-Term Treasury 3,676 471 Vanguard Core Bond 20 41 75,025 00 21 33 78,419.13 4 8 0 260 955.88 1 2 Admiral Shares 3,046 112 Vanguard Intermed 24.63 75,025.00 25 47 77,584 47 4 7 0.570 1,736 28 2.2 Bond Admiral 8,453 085 Vanguard 11 83 100,025 00 12.13 102,535.92 6 2 0 240 2,028.74 2.0 Intenned-Term Bond Index IL, 25,162 828 Vanguard Intermediate 10 39 261,463 57 10 15 255,402 70 IS 5 0 240 6,039 08 2.4 Admiral 58,672 725 Vanguard Short-Term 10 86 637,204 87 10 93 641,292 88 38 8 0.200 11,734.54 1 8 Admiral 1,398,793 44 1,394,585 24 84 5 24,314.35 1.7 TOTAL PORTFOLIO 1,642,051.26 1,650,866.37 100.0 27,833.68 1.5 You should carefully compare this statement to the statement you receive from your custodian and notify us immediately of any discrepancies Garrison Asset Management goer PURCHASE AND SALE City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 From 01-01-21 To 09-30-21 Trade Settle Unit Date Date Quantity Security Price Amount SALES 02-02-21 02-03-2I 40,000 Schwab Govt Money Fund Investor 1.00 40,000.00 Shares 03-05-21 03-08-21 66,000 Schwab Govt Money Fund Investor 1.00 66,000.00 Shares 04-07-21 04-08-21 88,000 Schwab Govt Money Fund Investor 1.00 88,000.00 Shares 04-07-21 04-08-21 3,766.478 Vanguard Intermediate Admiral 10.03 37,765.18 04-07-21 04-08-21 3,711.089 Vanguard Intermediate Admiral 10.03 37,209.82 05-07-21 05-10-21 18,214.936 Vanguard Short-Term Admiral 10.98 199,975.00 468,950.00 111110 • • Garrison Asset Management %s REALIZED GAINS AND LOSSES City of Fayetteville Firemen's Pension &Relief Fund Charles Schwab #7851-1206 From 01-01-21 Through 09-30-21 Gain Or Loss Open Close Cost Amort.or Date Date Quantity Security Basis Accretion Proceeds Short Term Long Term 02-02-21 40,000 Schwab Govt Money Fund 40,000 00 40,000.00 0 00• Investor Shares 03-05-21 66,000 Schwab Govt Money Fund 66.000 00 66,000 00 0 00• Investor Shares 04-07-21 88,000 Schwab Govt Money Fund 88,000 00 88,000 00 0 00* Investor Shares 09-29-20 04-07-2 I 3,766 478 Vanguard Intermediate 40,025 00 37,765.18 -2,259 82 Admiral 06-01-20 04-07-21 3,711 089 Vanguard Intermediate 38,561 43 37,209.82 -1,351 61 Admiral 06-01-20 05-07-21 18,214.936 Vanguard Short-Term 197,82013 199,97500 2,15487 Admiral TOTAL GAINS 2,154 87 0 00 TOTAL LOSSES -3,611 43 0 00 470,406 56 0 00 468,950.00 -1,456 56 0 00 TOTAL REALIZED GAIN/LOSS -1,456 56 CAPITAL GAIN DISTRIBUTIONS 03-31-21 Vanguard Intermed-Term 355 03 Bond Index shr 03-31-2I Vanguard Intermediate 1,612.44 Admiral 03-31-21 Vanguard Intermediate 486.34 Admiral 03-31-21 Vanguard Admiral 236 19 Intermed-term Treasury 03-31-21 Vanguard Admiral 114 89 Short-Term Treasury 03-31-21 Vanguard Admiral 101 10 Short-Term Treasury TOTAL DISTRIBUTIONS 2,905 99 587.44 2,318 55 -869.12 2,318.55 TOTAL GAIN/LOSS 1,449.43 An'•'denotes an average cost transaction Garrison Asset Management . PERFORMANCE SUMMARY GROSS OF FEES40 City of Fayetteville Firemen's Pension & Relief Fund %my Charles Schwab#7851-1206 September 30. 2021 PORTFOLIO COMPOSITION CHANGE IN PORTFOLIO Market Pct. Value Assets Yield Cash&Equivalents 193,256.50 11.7 0.0 Portfolio Value on 12-31-20 1,984,177.36 Money Market 0.00 0.0 - Accrued Interest 583.33 Account Fixed 1,457,609.87 88.3 1.7 Net Additions/Withdrawals -325,111.00 Income Account Equities 0.00 0.0 - Realized Gains -4,250.87 Account 0.00 0.0 - Unrealized Gains -29,111.84 Commodities Income Received 23,704.39 Change in Accrued Interest 875.00 Portfolio Value on 09-30-21 1,649,408.04 Accrued Interest 1,458.33 Total 1,650,866.37 100.0 1.5 1,650,866.37 TIME WEIGHTED RETURN Annualized Quarter Year Last 12 Inception • To Date To Date Months To Date Account 0.06 -0.31 0.64 5.22 Account Fixed Income 0.06 -0.39 0.67 3.08 Barclays Capital Intermed 0.04 -1.03 -0.54 2.40 Govt/Credit All "Account" returns refer to your portfolio. Benchmark indexes are also listed for reference. All returns are reported as percentages. This report is calculated using industry-standard accounting and performance calculation methodologies and is generated by our Axys portfolio accounting software. Calculations are a time-weighted total return series based on monthly valuations, including all cash lir and equivalents. All calculations are done based on trade date, employing the accrual method of accounting and include cash, interest,dividends and realized and unrealized gains and losses. Performance is adjusted to accurately reflect portfolio deposits and withdrawals. Results are presented after transaction costs but before management fees. Inception-to-date returns are annualized numbers,except for accounts under management less than one year. Unsupervised assets are excluded in performance calculation. At any given point in time an investment may be worth more or less than the original purchase price. #11,1 • GARRISON ASSET MANAGEMENT October 9,2021 City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 113 West Mountain Street Fayetteville,AR 72701-6069 STATEMENT OF MANAGEMENT FEES spe For The Period July 1 through September 30,2021 Portfolio Value as of 06-30-21 1,650,531 Portfolio Value as of 07-31-21 1,661,196 Portfolio Value as of 08-31-21 1,658,945 Portfolio Value as of 09-30-21 1,650,866 Average of 4 Months 1,655,385 1,655385 @ 0.1500%per annum 621 Quarterly Management Fee 621 TOTAL DUE AND PAYABLE 621 This statement is for informational purposes only. As you requested, the fee will be automatically deducted from your account. Please be advised that it is the responsibility of the client to verify the accuracy of each fee calculation. The custodian will not determine whether the fee is properly calculated.