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HomeMy WebLinkAboutRetirement Committee - Minutes - 12/13/2001Retirement Plan • GENERAL EMPLOYEES' RETIREMENT COMMITTEE DECEMBER 13, 2001, MEETING MINUTES Approved on January 10, 2002 COUNCIL LIAISON: Mayor Ray Martinez COMMITTEE Susan Lehman, 221-6813 Michele Hays -Johnson, 416-2158 MEMBERS Bill Switzer, 221-6713 Alan Krcmarik, 221-6788 PRESENT: ABSENT: Terry Van Cleave, 221-6321 Dottie Nazarenus, 204-4429 OTHERS Julie Depperman (Finance) Greg Tempel (City Attorney's Office) PRESENT: Debbie Weedman (Human Resources) Vincent Pascale(Human Resources) CALL TO ORDER: Chair Susan Lehman called the meeting to order at 1:57 p.m. Four members of the Committee were present constituting a quorum. PLAN MEMBER COMMENTS: No comments at this meeting. APPROVAL OF MINUTES: Alan Krcmarik handed out the minutes for the November 1 meeting. Bill Switzer moved approval of the minutes and Michele Hays -Johnson seconded the motion. The Committee approved the minutes unanimously (4-0). DISCUSSION TOPICS 1. RETIREMENT PHILOSOPHY The Committee Members present did not have any items to discuss on this topic. 2. CHANGING THE METHOD OF BENEFIT CALCULATION Susan received an e-mail message from Dottie Nazarenus. She provided a copy of the message to everyone present at the meeting. In the message, Dottie expressed her concerns about the planned change to the method of calculating the benefit of Plan Members. She suggested that the actuary should provide more information about the expected cost of the changes. She also suggested that different scenarios be developed for discussion with the Committee and eventually the Council. 215 North Mason Street • 2nd Floor • P.O. Box 580 • Fort Collins, CO 80522-0580 • (970) 221-6788 • FAX (970) 221-6782 . General�ployees' Retirement Committee Dsber 13, 2001, Meeting Minutes Page 2 of 3 Susan stated that the change is intended to bring more equity to the calculation of the benefits. The actuary indicated that the costs would be minimal. Staff is to complete the analysis of all Member's data and report back to the Committee. Bill stated that he did not think this is an enhancement of the Plan benefits, any additional costs would likely be very small, if any. Staff will respond to Dottie regarding her concerns. The Committee will not complete this change until the results of the data are available. If the results contain a surprise about the costs or any other factors are not acceptable, then the Committee can reconsider the direction it is heading. Enhancements to the Plan and contributions rates are determined finally by the Council. The actuarial reports suggest that we are in the 4.5% range and will be in the same range, regardless of the change in how benefits are calculated. 3. MONTHLY INVESTMENT UPDATE Julie Depperman provided a summary of the Plan portfolio through November of 2001. At the end of November the total value of the assets was $31.2 million. The fixed income portion of the portfolio had a yield of 5.98% for the year. Within the mutual fund portion, the domestic mutual funds were down 10.8% and the international funds were down 23.3%. The weighted return for the year through November was-5.83%. The market has substantially recovered the losses experienced right after the September 11 terrorist attacks. The national economy is officially in a recession. The economists indicate the recession began in March 2001. 4. OTHER BUSINESS Actuary's Response to Performance Issues: At the November meeting, the Committee and the Actuary discussed performance expectations. Nancy Wagner had provided a written response to the issues that the Committee had identified. When there have been disagreements about the billings, Nancy has reduced the bill. She did feel, however, that the service contract was somewhat ambiguous. After some discussion, the Committee felt that its interpretation was correct. The Committee believes that Nancy needs a more knowledgeable (about public pensions) back-up person to attend meetings in her absence. Susan asked if the Committee was ready to redo the request for proposal process and select a new actuary or continue with Milliman. Alan thought that we should not change the actuarial service provider at this time. The Committee and staff have been through the first year of the contract and there are many transition issues. He suggested that we should continue with Milliman for the second year and monitor the performance. Staff will also continue to monitor the billings. They have been accurate in the recent months. Staff will also review the contract to make sure that any rate increases conform to the contract. Handouts: Alan handed out two documents from the City Clerk's office regarding board and commission responsibilities. The first, Meeting Responsibilities, provides the guidelines that apply to the Committee. The second handout summarized Ordinance No, 131, 2001, which describes how the Committee may conduct executive sessions. Duplicate Payments: Alan informed the Committee that the Finance Department had made duplicate single sum payments to three former Members of the Plan. Staff has recovered the extra payments from two of the former Members and is working on the remaining one. Filename: GminDec2001 • GeneralANployees' Retirement Committee DMWber 13, 2001, Meeting Minutes Page 3 of 3 Meeting location: The Committee decided that it will continue to meet at the City Hall Council Information Center. This location has been the official meeting place for several years and the Committee found that it was the most convenient for the Members to attend. Adjournment: The Committee adjourned at 3:15 p.m. SCHEDULE FOR NEXT REGULAR MEETING The next regular meeting of the Committee will be on January 10, 2002, at 1:30 p.m. in the Council Information Center of City Hall. The tentative agenda includes: Welcome to New Committee Member Plan Member Comments Approval of the prior meeting minutes Retirement Philosophy Status Report on the Change in Calculating Retirement Benefits Annual Report Annual Investment Update Other Business GENERAL EMPLOYEES' RETIREMENT PLAN WEB PAGE: The web page is under construction. Future Meeting Schedule: The regular meeting time for the Committee is at 1:15 p.m. on the first Thursday of each month. The regular location is the Council Information Center at City Hall. For 2002, the Committee has scheduled the meetings as shown below: January 10 April 4 February 7 May 2 March 7 June 6 July 11 October 3 August 1 November 7 September 5 December 5 Filename: GminDec2001