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Home My WebLink AboutRetirement Committee - Minutes - 04/06/2000Generaomployees Retirement Plan • City of Fort Collins FORT COLLINS GENERAL EMPLOYEES RETIREMENT COMMITTEE APRIL 6, 2000, MEETING MINUTES COUNCIL LIAISON: Mayor Ray Martinez COMMITTEE MEMBERS PRESENT: Jim Hume, 221-6776 Terry Van Cleave, 221-6321 Alan Krcmarik, 221-6788 Susan Lehman, 221-6813 Dottie Nazarenus, 204-4429 Approved on May 4, 2000 ABSENT: One Committee position vacant due to Kevin Westhuis' resignation OTHERS PRESENT: Mark Sanford, Watson Wyatt Worldwide, the Plan's actuarial firm Vincent Pascale, Deb Weedman (Staff Support — Human Resources) Greg Tempel, (Staff Support — Legal) Julie Depperman, (Staff Support — Investments) Sue Wilcox, (Staff Support — Clerical) Bill Switzer. Plan Member CALL TO ORDER: Chairperson Jim Hume called the meeting to order at 1:20 PM. ITEMS OF NOTE: Two Plan members applied for the vacant Committee position: Michele Hays -Johnson and Bill Switzer. Mayor Martinez and another Council member are interviewing the applicants. The City Clerk's Office expects City Council will appoint a new member before the May 4 meeting. Jim apologized for missing the last meeting and thanked Terry Van Cleave for doing a great job as chair. By letter, Jim resigned from the GER Committee effective after the May 4, 2000, meeting. APPROVAL OF MINUTES: Alan Krcmarik distributed the revised draft of the minutes for the March 2, 2000, meeting. After one amendment, Jim moved that the minutes be approved as amended. Susan Lehman seconded the motion, which passed unanimously (5-0). DISCUSSION TOPICS: 1. GER PLAN MEMBER (S) COMMENTS: No comments. 2. DRAFT VALUATION REPORT MAIN POINTS: Mark Sanford distributed copies of the draft Valuation Report for 1-1-2000. He noted the significant return on investments received by the GER Plan in 1999 was enough to change the projected contribution rate to 4.265% from its current 4.5%. The projected contribution rate for 2001 is 3.2%. Additional costs of Phase II of the New Pay Plan partially File}p{{5¢�Gmjm�jto�y. Fort Collins, CO 80522-0580 • (970) 221-6788 • FAX (970) 221-6782 GERC Meeting Minutes April 6, 2000 Page 2 of 4 offset the investment gains. The audited figures will not be available for at least another month, but any adjustments should be minor and the Plan's outlook is very favorable. Mark noted the Plan will recognize only 20% ($776,656) of the 1999 investment gains this year. The Plan will realize the remainder of the gains over the next four years. Another interesting point was that the average age of Plan participants increased significantly due to the final conversion to the MPP of those Plan members hired in 1998. CONCLUSION AND NEXT STEPS: Alan will provide Watson Wyatt with the audited figures when they are available. Staff will check the 1999 minutes for reference to anticipated contribution rates. [Post meeting note: The Committee recommended 4.8%, however, the final budget set the contribution rate at 4.5%.] 3. EDUCATION PLAN FOR EQUITY BETWEEN FULL-TIME — PART-TIME EMPLOYEES MAIN POINTS: Jim distributed copies of the revised Issues Letter. After considerable discussion, the Committee agreed that the issue is difficult to explain in a letter, so staff will send a simple letter to state the problem, along with attachments to illustrate it. Then, the Committee will invite all Plan members to attend an information session to receive a full explanation and have an opportunity to ask questions. Susan explained grouping the education sessions in locations convenient for the Plan members would result in 11 different presentations. This would require a large time commitment from GERC members who make the presentations. Staff will arrange some sessions to include workers going off shift and those coming to work. These sessions would have to be no more than 30-45 minutes long. A suggestion was made to create a video of the basic information that a Committee member could present and then answer questions. Mark offered the services of his company to help prepare the presentation or to review the materials. CONCLUSION AND NEXT STEPS: Alan offered to rewrite the issue paper and attach a simple example of the proposed calculation changes. He will do this in the next two weeks and distribute it to the Committee and staff for comments. 4. BENEFIT CALCULATIONS AFTER JANUARY PAY ADJUSTMENTS MAIN POINTS: Deb Weedman described the current system of calculating benefits, which has not always included mid -year pay changes. Alan noted that the calculations as outlined in the Plan and currently used are based on a monthly benefit, while the City moved to every two weeks (bi-weekly) pay period many years ago. This mismatch of actual time periods paid and those used in the calculations makes the calculation more difficult and potentially less accurate. The Committee discussed various options for dealing with the monthly and bi-weekly. Alan stated the JD Edwards System can handle the data and as long as it is correct when entered, reports should be correct. Since the old Moore payroll system will go away later this year, there is some urgency to this research. Possible methods include hiring a temporary worker to research the data, running all the needed reports from the Moore system and filing them, and paying to keep the Moore system intact for a while. Alan and Deb will determine how the new financial system tracks the pay types and amounts used to calculate the GERP benefit. Alan will also review the data history available. Mark said he would be able to put mid -year pay changes in the software for calculating the benefit. The • GERC Meeting Minutes April 6, 2000 Page 3 of 4 Moore system contains the actual base salary data for the last five years. For most employees, the highest 60 months of salary is also the most recent 60 months, so data is probably on the Moore system tapes. For deferred vested members, staff calculated the salaries at the time they left City employment. Researching their pay records may involve checking microfiche pay records for each individual. Mark suggested either changing the Plan to fit the current procedures or changing the procedures to fit the Plan, but either way, he recommended keeping it as simple as possible. CONCLUSION AND NEXT STEPS: Deb, Julie, and Alan will meet to continue to work on this item and report at the next meeting. 5. FINAL COST OF LIVING ADJUSTMENT IMPLEMENTATION REPORT MAIN POINTS: Alan noted that in 1999 City Council appropriated $754,700 to implement the COLA for current retirees. He said the actual final cost was $635,726. He suggested that the GERC return the $119,000 difference through an appropriation ordinance. These funds do not appear in the Valuation Report. CONCLUSION AND NEXT STEPS: Alan will draft an appropriation ordinance for the May meeting. 6. UPDATE ON BENEFICIARY DESIGNATION FOR DECEASED MEMBER Greg Tempel contacted the attorney for the family of the deceased member and reported that negotiations are continuing on setting up the trust to receive the lump -sum benefit. CONCLUSION AND NEXT STEPS: Greg asked that the topic be placed on the May agenda. 7. OTHER BUSINESS A. DOMESTIC RELATIONS ORDER Greg reported the Committee has received information regarding a new domestic relations order (DRO) concerning a retirement benefit for Robert Kratz. He will review it and report to the Committee next month. This document was prepared in 1998 and is not on the forms or in the format recently approved by the GERC. Greg recommended that no disbursement of funds be authorized until after his recommendation is made in May. CONCLUSION AND NEXT STEPS: Alan moved to direct staff to not disburse any GER Plan funds to Mr. Kratz until the validity of the domestic relations order is established. Jim Hume seconded the motion, which passed unanimously (5-0). B. CITY COMMISSIONS CHAIRPERSONS LUNCHEON City Manager John Fischbach invited Jim Hume to attend a luncheon with other City commissions chairpersons. It was held in a roundtable forum that allowed the 25 people attending to discuss mutual interests. Jim said that Information Technology is creating a web page for the Boards and Commissions to make more information about the boards and commissions available. Jim said the Manager plans to have two or three meetings a year for the chairpersons. C. RFP FOR ACTUARIAL SERVICES GERC Meeting Minutes April 6, 2000 Page 4 of 4 Jim reported that the Request for Proposal (RFP) for actuarial services for the GERP has garnered three responses so far. There were five responses in 1994 and he hopes they will equal that number this time. D. LAST MEETING Jim said that since he has formally submitted his resignation from the GERC, May would be his last meeting. He thanked the members for the time and effort they have contributed and said he would continue to support the work of the Committee. SCHEDULE FOR NEXT REGULAR MEETING: The next regular meeting will be Thursday, May 4, 2000, at 1:15 PM in the Council Information Center (CIC) of City Hall West. The agenda will include: 1. Citizen Participation and Plan Member Comments 2. Consider approving the April 6, 2000, minutes 3. Finalize Plan of Action for Full-time — Part-time Education Sessions 4. Benefit Calculations After January Pay Adjustments Discussion 5. COLA Repayment Ordinance 6. Update on Beneficiary Designation for Deceased Member 7. First Quarter Investment Reports 6. Other Business ADJOURNMENT: Jim adjourned the meeting at 3:15 PM. GERC AND GERP WEB PAGE ADDRESS: hfto7//www.ei.fort-collins.co.us/CITY HALUBOARDS COMMISSIONS/RETIREMENT/index.htm FUTURE MEETING SCHEDULE: The Committee normally meets at 1:15 p.m. on the first Thursday of each month in the Council Information Center, City Hall West. The next scheduled meeting will be Thursday, May 4, 2000, at 1:15 PM. The Committee will hold remaining meetings for 2000 as shown below: THURSDAY, MAY 4, 2000 THURSDAY, JUNE 1, 2000 THURSDAY, JULY 6, 2000 THURSDAY, AUGUST 3, 2000 THURSDAY, SEPTEMBER 7, 2000 THURSDAY, OCTOBER 5, 2000 THURSDAY, NOVEMBER 2, 2000 THURSDAY, DECEMBER 7, 2000