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CITY OF PARK RIDGE POLICE PENSION FUND
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Pursuant to public notice, a regular quarterly meeting of the Board of Trustees of the Park Ridge Police Pension Fund was held on Tuesday, October 26, 2010 at 10:00 a.m. at City Hall, 505 Butler Place, Park Ridge, Illinois. Call to Order: President Laura Kappler called the meeting to order at 10:20 a.m. Present were trustees Laura Kappler, Tom Ahlbeck, Carl Brauweiler and Robert Kristie. Trustee Duane Mellema was absent. Also in attendance was Brian LeFevre from Sikich LLP, Mary Tomanek from Morgan Stanley Smith Barney, Charlie Atwell, the Board’s attorney and Jim Hock the city manager. Investment Report: Mary Tomanek gave an overview of the economy and mentioned there is political uncertainty related to the tax rates that will be in effect in the future. She also mentioned it is likely Greece will default on its debt. Regarding quantitative easing by the Federal Reserve, she felt that it has caused the rally, but is concerned that it will lead to a weak environment for the stock market going forward. The asset allocation of our portfolio was also reviewed. The mix between fixed income and equities was compared to what historically has been the most advantageous for both risk and reward. Our investment advisor, based on their review of our portfolio, recommended that $750,000.00 of the Atalanta Sosnoff Large Core fund be transferred to the Madison Mid Core fund. A motion was made by Robert Kristie and seconded by Thomas Ahlbeck to approve the $750,000.00 transfer from the Atalanta Sosnoff Large Core fund to the Madison Mid Core fund. A roll call vote was taken: “Yeas” – Kristie, Brauweiler, Ahlbeck and Kappler. “Nays” – none. The motion was unanimously approved. Trustee Ahlbeck reviewed the fixed income portfolio. He discussed the advantages of shortening the average life of the portfolio and the reinvestment of available funds. Our advisors at Smith Barney do not see a rate increase until late into 2011 by the Federal Reserve. The trustees reviewed the maturity of a fixed income security and how to reinvest the proceeds. It was determined by the Board that given the low interest rate environment the proceeds be invested in the equity portion of the portfolio. It was discussed whether the proceeds should be invested during a stock market pull back or systematically invested over a specific period of time. Also discussed was the investment into specific equities or mutual funds with higher paying dividends that would yield more, but not be as growth oriented. The Board indicated that they did not prefer this investment alternative. On a motion by Trustee Ahlbeck and seconded by Robert Kristie the Board advised the investment advisor to transfer $1,000,000.00 from the fixed income portfolio to the equity portfolio. $750,000.00 should be allocated to the Cambiar Large Value fund and $250,000.00 to the Madison Mid Core fund. The funds are to be invested over the next three months, with a third of the proceeds being invested at the end of each of the next three months. A roll call vote was taken: “Yeas” – Kristie, Brauweiler, Ahlbeck and Kappler. “Nays” – none. The motion was unanimously approved. Accounting Firm: Brian LeFevre from Sikich LLP presented the financial statements for the quarter ending September 30, 2010. This included a review of the balance sheet, income statement, investment holdings and allocation of investments. The trustees expressed their interest in an investment allocation graph illustrating investment in equities and mutual funds separately. This would assist in monitoring that the legal requirements are maintained within the portfolio. There was also a general discussion regarding the possibility of including an additional schedule in the financial statements. A motion was made by Thomas Ahlbeck and seconded by Carl Brauweiler to approve the financial report as presented. A roll call vote was taken: “Yeas” – Kristie, Brauweiler, Ahlbeck and Kappler. “Nays” – none. The motion unanimously carried. Approval of Expenditures: A motion was made by Carl Brauweiler and seconded by Laura Kappler to approve the expenditures for the prior three months as detailed in the attached report amounting to $634,383.15. A roll call vote was taken: “Yeas” – Kristie, Brauweiler, Ahlbeck and Kappler. “Nays” – none. The motion was unanimously carried. Patrick Duggan Matter: The board attorney received a letter from the Park Ridge Police Chief regarding the testimony of Officer Duggan’s ability to operate a fire arm. The letter is being reviewed by the attorney for the City of Park Ridge. William Bacon Matter: The board is concerned that the pensioner is currently working in another similar position while claiming a disability pension. They want to determine that it is proper that he continues to receive the pension. Related to Officer Bacon, a motion was made by Robert Kristie and seconded by Laura Kappler to direct our attorney to take the appropriate action to determine that the pension is properly being paid. The Wonder Lake Police Department is to be contacted through a freedom of information act request asking if Officer Bacon is employed by the Wonder Lake Police Department. In addition, a request should be made for a copy of his job application, position with job description, a copy of last pay stub with year to date wages and any other information deemed appropriate and necessary by our attorney. Training/Conference: The Trustees of the Park Ridge Police Pension Fund are required to attend continuing education. The time spent at the meeting is a form of continuing education with an investment advisor, an attorney and an accountant all in attendance. This meeting should be considered qualifying continuing education. Robert Kristie reported that he and Duane Mellema will be attending certified pension training in January 2011 offered by the Illinois Public Pension Fund Association. Carl Brauweiler attended an ethics workshop presented by the ICPAS (Illinois CPA Society). Trustee Brauweiler also plans on attending the Institute and Advanced Seminar for Treasurers co-sponsored by the Illinois Municipal Treasurers Association and Eastern Illinois University. Update on Employment, Contribution Rollover, Death and Disability: The following was reported by Laura Kappler:
A motion was made by Laura Kappler and seconded by Thomas Ahlbeck to approve the refund of contributions to former officer Sean Dorsey. A roll call vote was taken: “Yeas” – Kristie, Brauweiler, Ahlbeck and Kappler. “Nays” – none. The motion unanimously approved. Actuary Report: The Trustees discussed the anticipated receipt of the Actuary Report. After the report is received a request for a Municipal Compliance Report will be made. The Trustees discussed concerns regarding the projected salary increases and the rate of return on investments. The Trustees would like to review the alternatives prepared by the actuary to determine that the board is requesting the correct amount be levied. It was discussed how the actuary uses statistics to reflect the movement of interest rates and equity returns over time. The next regular quarterly meeting is scheduled for January 25, 2011 at 10:00 a.m. Adjournment: A motion by Robert Kristie and seconded by Thomas Ahlbeck to adjourn the meeting at 12:50 p.m. unanimously carried.
Respectfully submitted,
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Approved by the Board of Trustees on January 25, 2011
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