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 23, 2012 at 10:00 at City Hall, 505 Butler Place, Park Ridge, Illinois.
Call to Order: President Laura Kappler called the meeting to order at 10:10 a.m. Trustee Kappler took a roll call. Present were trustees Laura Kappler, Tom Ahlbeck, Robert Kristie, Carl Brauweiler, and Duane Mellema. Also in attendance was Brian LeFevre from Sikich LLP, Mary Tomanek from Morgan Stanley Smith Barney and Charlie Atwell, the Board’s attorney.
Approval of Minutes: the Trustees reviewed the minutes from the July 24, 2012 meeting. Upon a motion made by Carl Brauweiler, seconded by Robert Kristie the minutes of the July 24, 2012 meeting were unanimously approved.
Investment Report: Mary Tomanek from Morgan Stanley Smith Barney presented the quarterly investment report. Ms. Tomanek reviewed the performance of the portfolio and the current equity strategy.
Ms. Tomanek reviewed the impact of QE3, which has had a significant impact on the short term portfolio. All the sectors are performing well including both our equity and bond portfolio. Morgan Stanley is predicting global rates cuts and growth in the future. We do not have any managers that have been downgraded.
Our investment advisor reviewed with the Board the use of passive versus active management. A passively managed portfolio will track an index. The active mangers do not always outperform the index and also have a larger fee. The investment advisor feels that the disadvantage to the fund is the downside or a bear market.
The cash flow of the fund was reviewed. The fund has a cash balance of about $1,000,000.00. The next maturity of an investment is in the year 2015. We are dependent on the levy to meet our cash flow requirements for the next couple of years.
The Board and its advisers reviewed the actuary and the related impact on the investments and accounting in particular. The actuarial options including the varying estimated returns and also the contribution of the city were reviewed.
A motion was made by Robert Kristie and seconded by Carl Brauweiler to approve the actuarial report dated September 14, 2012 for the year commencing May 1, 2012 as presented. A roll call vote was taken: “Yeas” - Kristie, Ahlbeck, Brauweiler, Kappler and Mellema. “Nays”-none.
A letter will be written to the city manager in respect to the levy requested for this year. Attached will be the actuary report, investment policy and municipal compliance report. A motion was made by Robert Kristie and seconded by Carl Brauweiler to approve the levy in the amount of $1,616,063.00 for this fiscal year ending April 30, 2013. A roll call vote was taken: “Yeas” – Kristie, Ahlbeck, Brauweiler, Kappler, and Mellema. :Nays”- none.
A motion was made by Robert Kristie and seconded by Carl Brauweiler to approve the investment report dated June 30, 2012 as presented. A roll call vote was taken: “Yeas” - Kristie, Ahlbeck, Brauweiler, Kappler and Mellema. “Nays”-none.
Accounting Firm: Brian LeFevre from Sikich LLP presented the financial statements for one month and the five-month period of the fiscal year ended September 30, 2012.
He reviewed the increase in value of investments during the quarter, the amount of bonds in the portfolio, sources of revenue, and the related expenses and pension payouts.
There is a concern that the pension payments have not been made to the plan for the newly hired officers. The board will determine with the city finance department regarding the required withholding. The accounting firm will also begin to record the names received as additional control.
A motion was made by Carl Brauweiler and seconded by Duane Mellema to approve the financial report dated September 30, 2012 as presented. A roll call vote was taken: “Yeas” - Kristie, Ahlbeck, Brauweiler, Kappler and Mellema. “Nays”-none.
Approval of Expenditures: A motion was made by Carl Brauweiler and seconded by Robert Kristie to approve the expenditures for the third quarter of 2012 as detailed in the attached report amounting to $764,095.14. A roll call vote was taken: “Yeas” - Kristie, Ahlbeck, Brauweiler, Kappler, and Mellema. “Nays”-none. The motion unanimously carried.
Disability Hearing: The Trustees reviewed the issues with a disability claim of Officer Juan Panizo. The hearing is to determine the reason that the claimant is still working full time. The purpose of the hearing is not to determine the substance of the case.
A motion was made by Robert Kristie and seconded by Duane Mellema that the date of the hearing was set for November 28, 2012 at 6:00pm at City Hall in the Mayor’s conference room. The motion was unanimously approved.
The Board’s attorney has provided the board with a revised application for their review.
Trustee Training: The Trustees reviewed that all members are compliant with the required training and also the ethics portion.
All of the board members are to provide the information to the Board that they have met the requirement for yearly training.
All of the board members except for Trustee Robert Kristie have completed the Open Meetings Act training as required. Robert Kristie will complete the training by the required completion date December 31, 2012.
A representative group of the board will attend the Illinois Public Pension Trustee Training in February. President Kappler will sign the board up for this training and submit required payment.
Other Business: Tom Ahlbeck noted that the investment report for the last meeting was not approved in the minutes for that reason, he made the following motion to approve the report.
A motion was made by Thomas Ahlbeck and seconded by Carl Brauweiler to approve the investment report dated March 31, 2012 as presented. A roll call vote was taken: “Yeas” - Kristie, Ahlbeck, Brauweiler and Kappler. “Nays”-none. Trustee Mellema abstained from voting because he was absent the last meeting.
Laura Kappler has filed the required documents electronically with the Department of Insurance.
Looking ahead to this year the quarterly meetings will be as follows: January 23, 2013, April 24, 2013, July 24th, 2013 and October 22, 2013. A motion was made by Trustee Kristie to accept these meeting dates, and seconded by Carl Brauweiler. All in favor motion passed unanimously.
Adjournment: A motion by Robert Kristie, seconded by Duane Mellema to adjourn the meeting at 11:50 a.m. unanimously carried.
Respectfully submitted,
Laura Kappler, President
Robert Kristie, Secretary
Approved by the Board of Trustees on Jan 23, 2013.
These minutes were prepared by Tom Ahlbeck and Laura Kappler.
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