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HomeMy WebLinkAboutRetirement Committee - Minutes - 10/10/1994FORT COLLINS GENERAL EMPLOYEES RETIREMENT COMMITTEE OCTOBER 10, 1994 MEETING MINUTES COUNCIL LIAISON: Ann Azari, Mayor COMMITTEE MEMBERS PRESENT: ABSENT: Jerry P. Brown Jacci Peterson Dennis Sumner Dave Meyer Alan Krcmarik (Member & Staff Support) OTHERS PRESENT: Sue Wilcox, Staff Support - Secretary Laurie Harvey, Staff Support - Employee Development Russ Proctor of The Wyatt Company, the City's new actuarial firm. Dave Agee, Staff Support - Accounting Edna Hoernicke, Accounting CALL TO ORDER: Chairperson Jerry P. Brown called the meeting to order at 1:15 p.m. in the 2nd Floor Conference Room of City Hall West on October 10, 1994. APPROVAL OF MINUTES: Dave Meyer moved to approve the minutes of the September minutes were approved unanimously. and Jacci Peterson seconded a motion 8, 1994 meeting as distributed. The ITEMS OF NOTE: The "Early Out" proposal will be presented to the Executive Lead Team (EL Team) on October 12th. Also the Standing Rules revised at the last meeting have been distributed. Sue will reserve the 2nd Floor Conference Room of City Hall West at 1:15 p.m. on the 1st Thursday of each month for GERC meetings. REVIEW OF DISCUSSION TOPICS: Jerry added the 1995 Work Plan to the agenda, and Edna Hoernicke asked to address the Committee about a request from a retiree for an advance payment on their retirement plan benefits. DISCUSSION TOPICS: MEMBER/CITIZEN COMMENTS: There were no comments. 2. INTRODUCTION OF RUSSELL PROCTOR OF THE WYATT COMPANY MAIN POINTS: Jerry introduced Russ Proctor, who will represent the Wyatt Company, the City's new actuarial consulting firm, at regular Committee meetings. Jerry said that the previous firm, William M. Mercer, Inc., preferred to turn things over to the new firm as soon as the Wyatt Company was chosen. There is some information still needed from Mercer, with some associated costs. Dave Agee will get an estimated cost of this work. Dave also drafted a letter to Don Mazanec expressing the Committee's thanks and appreciation for the many years of working together. All new correspondence and calculation requests, etc. will be sent to Russ at the Wyatt Company. Russ provided an outline of The Wyatt Company's programs and their strategies to meet the needs of the Committee and the City. Suggestions from the -1- Committee included: having Russ or another representative attend all GERC meetings; allow Russ to access the City's E-Mail system through a modem; clarification of the aggregate method versus the entry -age method of calcu- lating benefits; and streamlining the QUADRO (qualified domestic relations orders) process by meeting with Laurie Harvey from Human Resources, payroll representatives, and the assistant city attorney for personnel matters. In regard to costs, Russ stated that regular phone calls should not involve any extra cost; however, calls which require research could have a cost. In this case, Russ would estimate the cost and the GERC (through the chair- person) would then decide whether to proceed. To reduce the number of incidental calls to the actuary, it was agreed that the GERC chairperson (Jerry P. Brown), Finance Director Alan Krcmarik, Controller Dave Agee, Human Resources retirement representative Laurie Harvey, and staff clerical support person Sue Wilcox would be the main contacts with the actuary. In cases involving a cost, Jerry Brown will authorize the expense after Russ provides an estimate. Russ provided a chart of Wyatt Company personnel who will be working regularly with the GERC. They include Ken Jamison, the main back-up for Russ, and Mark Sanford, actuarial analyst. When Russ receives the information requested from Mercer, he will try to reproduce the 1994 valuation results. Work on the 1995 report will begin in February, with the draft copy of the report ready for GERC review one week before the May GERC meeting. Russ also reviewed the format for the valuation report. It was suggested that a "planning meeting" be scheduled between Russ and City representatives of the various departments involved in the valuation report. This could be held before the regular November GERC meeting. CONCLUSIONS/NEXT STEPS: Sue and Dave Agee will arrange HPDesk access for Russ. Sue will arrange a valuation report planning meeting prior to the November 3rd GERC meeting (SEE POST NOTE) and to include: Russ Proctor, Alan, Dave Agee, Laurie Harvey, Jerry Brown and Sue. Sue will also put a notice in the next issue of FortNotes about Wyatt Company being the new actuary. 3. UPDATE ON 457/MONEY PURCHASE PLAN (MPP) CHOICE AND EDUCATIONAL PRESENTATIONS MAIN POINTS: The draft materials for the education program were not available. The schedule of events is revised as follows: CHANGE FROM 457 PLAN TO MPP PLAN September 16 FortNotes article announcing change to offer MPP plan to classified employees. September 19-30 Draft of comparison guide, election form, and employee edu- cation presentation materials prepared by Wyatt Co. October 7 Meeting with City staff to review draft of material. October 20 Train -the -trainer session for employee education process. 6a October 21 Final draft of material. October 24-26 Education materials printed. November 1 Information packets sent to employees. November 7-21 Conduct employee meetings to discuss options, pros/cons, etc. December 12 Election forms due to Human Resources Department January 1, 1995 Change becomes effective for those electing MPP plan The education sessions will be held at the same time the Cafeteria Benefits sign-up period is being conducted, but they will be separate from those information sessions. CONCLUSION/NEXT STEPS: Work is continuing on the education/choice program. 4. REQUEST FOR ADVANCE PAYMENT OF RETIREMENT BENEFITS MAIN POINTS: Edna Hoernicke was present to ask the Committee to consider granting a request from a retiree (who wished to remain anonymous). The retiree wishes to receive his/her normal November retirement benefits in October in order to pay for a medical test which must be paid in cash. Requests which are received for an advance on a normal paycheck are routinely not allowed. The Committee members had a number of questions and discussed alternatives or other agencies that might be available to assist the retiree. The Committee offered to guarantee payment directly to the physician. The retiree was reluctant to put the request in writing as there was concern about confidentiality. CONCLUSIONS/NEXT STEPS: The Committee denied this request for an advance payment of retirement benefits because of the lack of a written request and theuncertainty that all other options had been explored by the retiree. 5. 2ND QUARTER 1994 INVESTMENT REPORT MAIN POINTS: Alan explained that the 2nd Quarter Investment Report was delayed because of a change in computer software used to track investments. It is anticipated that this change will allow the next quarterly report to reflect a blending of the rates of returns for mutual funds and non -mutual funds. Eventually the returns will reflect market value. The target rate of return for the GER Plan is 7.5%. The 2nd Quarter rate of return for non -mutual funds was 7.07% and the year-to-date rate is 7.23%, which reflects the stock market's position at its lowest point in 30 years. CONCLUSIONS/NEXT STEPS: The Committee recognizes that a long-term investment program has both ups and downs in the rates of return and the value of the investments. The members accepted the report as presented. The 3rd quarter investment report should be ready for the next meeting. Copies of the report 5�E can be obtained by calling Sue at -6788. 6. GFOA AWARDS PROGRAM MAIN POINTS: Alan explained that the Government Finance Officers Association (GFOA) has programs that recognize well -managed and high -achieving financial reports (CAFR), budget documents, and pension plans. The City's financial reports have received this recognition for the last seven years and the budget document has received it for the last 10 years. There is a list of 20 principals that govern pension plans, and the GERP would have to meet 11 of them in order to apply for the pension plan award. Some of these include: having written objectives and policies for investments, having written fiduciary standards and responsibilities, and conducting an independent review of the actuary every 10 years. CONCLUSIONS/NEXT STEPS: After discussion it was agreed to add this to the "items for future discussion" and possibly include it in the 1995 Work Plan. 7. 1995 WORK PLAN MAIN POINTS: December 1st is the deadline for submitting the Committee's work plan for 1995 to the City Clerk's Office. The Committee and staff brainstormed the following ideas for inclusion in the 1995 Work Plan: 1. Transition to new actuary. 2. Work with Human Resources to go to bid for a MPP/457 Plan administrator. 3. Explore more ways for employees to put additional dollars away for early retirement. 4. Explore options for health insurance for retirees. 5. Encourage Executive Lead Team (EL Team) to research the question of the affects of reduced early retirement benefits and possible relationship to injuries and Workers Compensation disability claims for employees. 6. Revisit the Rule of 80 in the last quarter of 1995. 7. Pursue meeting the GFOA award standards for pension plans. CONCLUSIONS/NEXT STEPS: Jerry will draft a work plan for GERC review at the next meeting. ITEMS FOR FUTURE DISCUSSION 1. Possible seminars or workshops to increase GER Committee members' knowledge of their roles and responsibilities. 2. GERP / Workers Comp / Disability Proposal to EL -Team 3. Method to Report Blended Yields (Bonds & Equities) on Investments 4. Rule of 80. -4- * 0 AGENDA & SCHEDULE FOR NEXT MEETING The next meeting will be Thursday, November 3rd at 1:15 p.m. in the 2nd Floor Conference Room of City Hall West. The proposed agenda will include: 1. Plan Member/Citizen Comments 2. Investment Report - 3rd Quarter, 1994 3. Update on Mercer -Wyatt transition. 4. Update on 457/MPP Plan education program and member vote. 5. "Early -out" update. 6. 1995 Draft Work Plan 7. Possible change in December & January meeting dates 8. Other Business ADJOURNMENT: The meeting was adjourned at 4:25 p.m. POSTNOTE: The planned Actuarial Report planning meeting has been deferred from November 3rd to a later date. MEETING SCHEDULE: The General Employees Retirement Committee meetings are normally held at 1:15 p.m. on the 1st Thursday of each month in the 2nd Floor Conference Room, City Hall West. The current meeting schedule for the next six months is as follows: THURSDAY, NOVEMBER 3, 1994 THURSDAY, JANUARY 5, 1994 THURSDAY, MARCH 2, 1994 -5- THURSDAY, DECEMBER 1, 1994 THURSDAY, FEBRUARY 2, 1994 THURSDAY, APRIL 6, 1994