Fresno County Board of Retirement s8

BOARD OF RETIREMENT FRESNO COUNTY EMPLOYEES’ RETIREMENT ASSOCIATION

May 2, 2012

Trustees Present:

Marion Austin Laura P. Basua Dr. Rod Coburn, III Franz Criego Eulalio Gomez Steven Jolly Phil Larson John Souza

Trustees Absent:

Vicki Crow

Others Present:

Regina Wheeler, Alternate Trustee Michael Kammel, Wurts & Associates Jeremy Watt, BlackRock Kelly Campbell, BlackRock Bob O’Leary, Oaktree Capital Francie Maletis, Oaktree Capital Susan Coberly, Senior Deputy County Counsel Becky Van Wyk, Assistant Retirement Administrator Elizabeth Avalos, Administrative Secretary

1. Call to Order

Chair Gomez called the meeting to order at 8:36 AM.

2. Pledge of Allegiance

Recited.

3. Public Presentations

Consent Agenda/Opportunity for Public Comment

Trustee Coburn pulled Agenda Items 4 and 10 for discussion.

A motion was made by Trustee Larson, seconded by Trustee Jolly to Approve Items 5-9 and 11-13. VOTE: Unanimous (Absent – Criego, Crow) 05/02/12 Regular Meeting Minutes 2

*4. Approve the April 16, 2012 Personnel Committee Meeting Minutes, April 18, 2012 Retirement Board Regular Meeting Minutes, and April 18, 2012 Budget Committee Meeting Minutes

Trustee Coburn requested that a typing error on page 4 (first paragraph ~ boar to board) of the April 18, 2012 Retirement Board Regular Meeting Minutes be corrected. Administration agreed.

A motion was made by Trustee Coburn, seconded by Chair Gomez to Approve Item 4 with noted corrections. VOTE: Unanimous (Absent – Criego, Crow)

RECEIVED AND FILED; APPROVED

*5. Retirements

Leo Adcock Public Health, Deferred 7.36 Dorothy J. Akioyame Public Health, Deferred 7.78 Patricia K. Anderson Library 14.08 Gloria L. Baiz Dept of Social Services 20.69 Dina R. Barrera Behavioral Health 12.24 Priscilla Benavidez County Clerk/Registrar of Voters 17.28 Calie J. Boland FMAAA 13.87 Lydia E. Bubenik ACTTC 22.92 Lynn O. Bundy Dept of Social Services, Deferred 9.42 Consaundra Burriel ITSD 21.12 Gilbert Carter, Jr. Assessor/Recorder 17.05 Anna Chiechi-Wilson VMC, Deferred 11.46 Vivian C. Christensen Public Health 15.27 Debra M. Downton Assessor/Recorder 36.11 Jon L. Endara Dept of Social Services 19.85 Robert T. Ensom Behavioral Health 15.13 James Falkowski Child Support Services 26.66 Debra Gamino Probation 30.90 Jagmit S. Gill Dept of Social Services, Deferred 9.07 Marsha Joann Gill Behavioral Health 19.83 Hope N. Giordano Dept of Social Services, Deferred 10.34 Karen E. Godfrey Dept of Social Services 23.42 Claude A. Gonzales Behavioral Health 23.42 Reuben Gonzalez Sheriff 28.86 James R. Gurnard Public Health 14.22 Cristina O. Gutierrez Probation 20.41 Nancy Gutierrez Dept of Social Services 20.69 Kenneth P. Haire Public Works and Planning 27.20 Dorothy D. Hammerich Public Works & Plan, Deferred 9.25 Toni D. Hanson Behavioral Health 10.39 Pearl Harris Behavioral Health 14.41 05/02/12 Regular Meeting Minutes 3 Lorine H. Haynes District Attorney 15.86

Merle A. Heggen Sheriff 30.00 Sandy Herrera Dept of Social Services 28.13 Calvin Horne Public Works and Planning 19.97 Norma Jean Jay Sheriff 20.04 Jessica Kampen Sheriff 25.17 Bernice Kao Library 10.07 William W. Latta Behavioral Health 13.66 Susan L. Logoluso Agriculture 29.86 Donna L. Marquez Probation 29.21 Paul Marquez Sheriff 11.38 Rhonda J. Martin Sheriff 23.34 Leroy E. Manfield, II General Services 13.01 Carol A. Merrick Behavioral Health 22.76 Darlene F. Neeley Dept of Social Services 11.16 Marlene Pascua Dept of Social Services 33.81 Dana Lynn Peterson VMC, Deferred 6.37 Shahla Rahmani Public Health 22.49 Olivia Rendon Co Clerk/Reg of Voters, Deferred 13.21 Rebecca Rodriquez ACTTC 22.06 Steven D. Rodriquez Dept of Social Services 30.99 Terreance J. Schmal Public Works & Plan, Deferred 1.44 Lori Tindall Dept of Social Services 23.17 Brenda Sue Tolley Dept of Social Services 20.44 Jerilynn Tolley Dept of Social Services 29.71 Doan Trang Troung Behavioral Health 15.13 Patricia Tuck Probation 26.83 Richard L. Weatherson Public Works and Planning 27.29 Margaret Ybarra Sheriff 21.84

*6. Disability Retirement

Robert Martinez Sheriff 18.10

*7. Deferred Retirements

Timothy L. Rivera Sheriff 12.51 Leslie Vera Library 9.31 Lee Yang Behavioral Health 6.87

*8. Request to Rescind Deferred Retirement

Carey K. Sarente Dept of Social Services 6.70 05/02/12 Regular Meeting Minutes 4

*9. Update of Board of Retirement directives to FCERA Administration

RECEIVED AND FILED

*10. Most recent investment returns, performance summaries and general investment information from investment managers

Trustee Coburn asked if the investment information could be formatted in a consistent manner. Michael Kammel, Wurts & Associates, noted that the information is received from various investment managers on a monthly basis and could not be changed. However, Wurts compiles this information uniformly in their quarterly reports.

A motion was made by Trustee Coburn, seconded by Chair Gomez, to Accept Item 10 as presented. VOTE: Unanimous (Absent – Criego, Crow)

RECEIVED AND FILED

*11. FCERA Cash Flow position as of March 2012

RECEIVED AND FILED

*12. Systematic Performance Restatement

RECEIVED AND FILED

*13. Resolution adopting Tier IV for new FCERA Employees

Trustee Criego joined the Board at 8:48 AM.

14. Presentation on Core Plus Portfolio review presented by Jeremy Watt and Kelly Campbell ~ BlackRock

The Board heard a report from Jeremy Watt and Kelly Campbell of BlackRock that included a firm and product overview, performance review, portfolio profile, and investment return outlook.

Detailed discussions ensued which addressed the firm’s recent performance, current positioning, risk management, and future investment return outlook.

NO ACTON TAKEN

15. Presentation on Oaktree Opportunities Fund IX presented by Bob O’Leary and Francie Maletis ~ Oaktree Capital

05/02/12 Regular Meeting Minutes 5 The Board heard a report from Bob O’Leary and Francie Maletis of Oaktree Capital that included a firm and product overview, performance review, portfolio profile, and investment return outlook.

At the request of Trustee Jolly, Ms. Maletis commented on the firm’s recent change in ownership noting that in 2007, the firm’s principals continue to own 50% of the firm and will retain voting control with employees owning the remaining 25%.

Detailed discussions ensued which addressed the firm’s recent performance, current positioning, risk management, and future investment return outlook.

A motion was made by Trustee Jolly, seconded by Trustee Basua, to proceed with the funding of the Oaktree Opportunities Fund IX. VOTE: Unanimous (Absent – Crow)

RECEIVED AND FILED; APPRPROVED

16. Discussion and appropriate action on Waddell & Reed Guideline Amendment recommendation

Michael Kammel, Wurts & Associates, opened discussions by stating that Waddell & Reed seeks to amend their Investment Guidelines by changing their diversification limit to the greater of 7% or 2% over a security’s weighting in the Russell 1000 Growth Index, at market, in order to better manage risk relative to the benchmark and recommending approval of the guideline change.

Detailed discussions ensued regarding the portfolios exposure to Apple stock and the difficulties that the diversification limit of 7% has on portfolio managers to maintain a significant active overweight in this stock.

A motion was made by Trustee Jolly, seconded by Chair to Gomez, to Approve the Guideline Amendment recommendation as presented. VOTE: Unanimous (Absent – Crow)

17. Closed Session:

A. Public Employee Appointment – pursuant to G.C. §54957(b) (Retirement Administrator)

B. Disability Retirement Applications – Personnel Exception (G.C. §54957):

1. Glen Green

18. Report from Closed Session

17.A. The Board's counsel has prepared a draft proposed contract with Phillip Kapler to become the new FCERA Administrator, subject to final negotiations with Mr. 05/02/12 Regular Meeting Minutes 6 Kapler, and subject to discussion and anticipated Board approval of a final negotiated contract at the Board's June 6, 2012 Board meeting.

The draft proposed contract is a public record and is available for inspection upon request by any member of the public, and FCERA staff will provide the County's Chief Administrator Officer with a copy of the draft proposed contract.

17.B.1. The Board requested that the court reporter’s transcript be prepared for the Glen Green hearing held on December 9, 2011, and thereafter the Board will consider it and the evidence produced at the hearing, and take action, under Government Code Section 31534(b). M – Criego. S – Gomez. VOTE: Unanimous (Absent – Crow)

19. Report from FCERA Administration

1. The Regular Board meeting on May 16, 2012 has been cancelled due to the SACRS Spring Conference. 2. Becky Van Wyk, Assistant Retirement Administrator will be out of the office May 3- 4, 2012 to attend a meeting in Bakersfield, CA.

20. Report from County Counsel

Susan Coberly, Deputy County Counsel, had nothing to report.

21. Board Member Announcements or Reports

Trustee Criego noted that it was brought to his attention from “several” FCERA Members that Service Credit Purchase calculations are taking almost two years to complete. Administration noted that the issue would be addressed in detail during Budget discussions.

There being no further business the meeting adjourned at 10:41 AM.

Eulalio Gomez Chair to the Board

05/02/12 Regular Meeting Minutes