HomeMy WebLinkAboutRetirement Committee - Minutes - 10/07/2004City of Fort Collins
General Employees' Retirement Committee
GENERAL EMPLOYEES' RETIREMENT COMMITTEE
October 7, 2004, MEETING MINUTES
Approved as amended on November 4, 2004
COUNCIL LIAISON: Mayor Ray Martinez
COMMITTEE Jim O'Neill, Vice Chair, 221-6779 Bill Switzer, 221-6713
MEMBERS Dottie Nazarenus, 204-4429 Alan Krcmarik, 221-6788
PRESENT: Michele Hays -Johnson, 416-2158
MEMBERS Susan Lehman, Chair, 221-68�
ABSENT: 3A
OTHERS Pat Kahle (Actuary, Milliman USA)
PRESENT: Greg Tempel (City Attorney's Office)
Debbie Weedman (Human Resources)
Julie Depperman & Ann Wardle (Finance)
CALL TO ORDER: Jim O'Neill called the meeting to order at 1:53 p.m.
PLAN MEMBER COMMENTS: The Committee reserves this place on the agenda to
receive comments from Members of the Plan or the public. There were no comments.
APPROVAL OF MINUTES: Minutes of the August 5, 2004, and September 2, 2004,
meetings were distributed. No corrections were made to either of the minutes. Alan
Krcmarik moved approval of the August 5, 2004, minutes; and Michele Hays -Johnson
seconded the motion. The Committee approved the August 5 minutes unanimously
(5-0). Bill Switzer moved approval of the September 2, 2004, minutes; and Alan
Krcmarik seconded the motion. The Committee approved the September 2 minutes
as written unanimously (5-0).
DISCUSSION TOPICS
1. Plan Philosophy: There were no comments on Plan Philosophy.
2. Update on Summary Plan Description: The Committee continued to review
the Summary Plan Description Handbook. The changes that were suggested are
highlighted in the attachment to these minutes.
The Committee completed the first review of the handbook. Debbie Weedman will
make the proposed changes and send it out to the Committee and staff so that they
can come prepared next month to give any final additional changes.
General Employees' Retirement Committee
October 7, 2004, Meeting Minutes
Page 2 of 3
3. Monthly Investment Report: Julie Depperman distributed and reviewed the
Investment Report for the quarter ended September 30, 2004. During the quarter
there was a lot of volatility in the markets. The total market value of the Plan was
$34,037,140, and the return year-to-date was 1.87% for a gain of about $625,000.
The Standard & Poor's 500 Index ("S&P 500 Index") touched it's low -point for the
year in August. The domestic mutual fund portion of the Plan's portfolio gained
2.69% year to date and outperformed its benchmark, the S&P 500 Index, by 245
basis points. The Plan's international mutual funds increased 1.8% year-to-date.
News impacting the markets during the quarter included the Federal Open Market
Committee increased the federal funds interest rate one-half point to 1.75%. Oil
prices climbed 34% in the third quarter, and the three hurricanes negatively impacted
the general economy. Julie said it is hard to predict the direction of the market,
analysts expect the stock market to be very choppy until the results of the November
election are known.
In the September quarter, Plan inflows included City contributions of $171,068 and
investment earnings of $132,000. The Plan expenses for the quarter included
$370,778 in lump -sum distributions, $285,359 in retirement payments, and $1,241 in
administrative expense. Julie said that lump -sum distributions in this market are
actually good, because we are not earning 71/2% on the funds.
4. Other Business: On behalf of the Plan, Alan submitted a budget request for
increased funding in next year's budget. At this time, the additional funds were not
included in the 2005 budget. Without additional funding, the gap between the future
value of liabilities and assets will widen next year with the five-year smoothing
method used to value the Plan. As in the past two years, if there are extra
appropriations available at year-end, they could possibly be used as additional funding
for the Plan.
Bill asked if the funds were available to close the Plan. Based on recent reports from
the actuary, there is enough money to pay all Members a lump -sum distribution but
not enough to purchase annuities for Plan Members. Greg said the City has a
contractual obligation to follow the Plan; he indicated that the City is legally obligated
to pay those who have retired, and the deferred -vested Members have pension rights
and have met the vesting requirements.
Alan said he would like the Annual Report and update of the Work Plan to be on the
November agenda.
Adjournment: Bill Switzer motioned that the meeting be adjourned, and Dottie
Nazarenus seconded the motion. The Committee adjourned at 3:27 p.m.
Filename: 2004 GMIN 10 07 Final.doe
General Employees' Retirement Committee
October 7, 2004, Meeting Minutes
Page 3 of 3
TOPICS FOR NEXT REGULAR MEETING
The next regular meeting of the Committee will be on November 4, 2004, at 1:45
p.m. in the Council Information Center of City Hall. The tentative agenda includes:
Plan Member Comments
Approval of Minutes
Plan Philosophy
Update on Summary Plan Description
Monthly Investment Report
Annual Report and Update of Work Plan
Other Business
GENERAL EMPLOYEES' RETIREMENT PLAN WEB PAGE: The General Employees'
web page can be found at www.fcaov.com/citvclerk/retirement.i)hp. The Committee's
2003 Annual Report, 2004 Work Plan, and monthly minutes are available at this site.
2004 Meeting Schedule:
The regular meeting time for the Committee is at 1:45 p.m. on the first Thursday of
each month. The regular location is the Council Information Center at City Hall. For
2004, the Committee has scheduled the meetings as shown below:
my ' (eaneeled) October 7
August3 November 4
Geptem beF 2 December 2
Filename: 2004 GMIN 10 07 Final.doc