POL121316 CITY OF PORT ST. LUCIE MUNICIPAL POLICE OFFICERS' RETIREMENT TRUST FUND BOARD OF TRUSTEES MEETING MINUTES .1 DECEMBER 13, 2016 A Regular Meeting of the BOARD OF TRUSTEES of the MUNICIPAL POLICE OFFICERS' RETIREMENT TRUST FUND was called to order by Chairman Vega on December 13, 2015, at 2:00 p.m., at the Port St. Lucie City Hall, Room 188, 121 SW Port . St. Lucie Boulevard, Port St. Lucie, Florida. 1. CALL TO ORDER 2. ROLL CALL Members Present: Assistan1 Chief William B. Vega, Jr., Chairman Natalie Cabrera, Trustee OfficerPaul Griffith, Trustee Sergeant Tara Pavlyshin, Secretary Members Not Present: Daniel Kleman, Trustee Others Present: Jeanine Bittinger, Plan Accountant, Davidson, Jamieson, & Cristini Richard Cristini, Plan Accountant, Davidson, Jamieson, & Cristini Lee Dehner, Plan Attorney, Christiansenand Dehner, P.A. (arrived at 2:05 p.m.) Siera Feketa, Pension Plan Specialist Edwin M. Fry, Jr., Finance Director/Treasurer Doug Lozen, Board Actuary, Foster & Foster, Inc. Grant McMurry, Investment Manager, ICC Capital Management Karen Russo, Vice President, Salem Trust Co. Sandra H. Steele, Plan Administrator (arrived at 2:05 p.m.) Dave West, Senior Consultant, Bogdahn Group Jeannette C. Baeza, Deputy City Clerk 3. PUBLIC COMMENTS No one signed up to speak under this Item. 4. ANNOUNCE THE NAME OF NEW POLICE OFFICERS HIRED SINCE THE MEETING OF THE BOARD OF TRUSTEES ON SEPTEMBER 20, 2016 - JEAN VALENTIN-BELLO AND MATTHEW REYNOLDS Chair Vega announced the names into the record. 5. ANNOUNCE THE NAME OF POLICE OFFICERS WHO HAVE RESIGNED AND/OR TERMINATED SINCE THE MEETING OF THE BOARD OF TRUSTEES ON SEPTEMBER 20, 2016 - CARLTON TOPPIN (CONCLUDED 5 YEARS IN THE DROP) 1 MUNICIPAL POLICE OFFICERS' RETIREMENT TRUST DECEMBER 13; 2016 FUND MEETING MINUTES Chair Vega announced the names into the record. 6. ANNOUNCE THE NAME OF POLICE OFFICERS WHO HAVE RESIGNED, AND ARE ELIGIBLE TO RECEIVE A DEFERRED RETIREMENT BENEFIT, SINCE THE MEETING OF THE BOARD OF TRUSTEES ON SEPTEMBER 20, 2016 - NONE There were no names to be announced into the record at this time. 7. ANNOUNCE THE NAME OF POLICE OFFICERS. WHO HAVE REQUESTED A LEAVE -OF ABSENCE (MAXIMUM OF 180 DAYS) SINCE THE MEET[NG OF THE BOARD OF TRUSTEES ON SEPTEMBER 20, 2016 - NONE There were no names to be announced into the record at this time. 8. ANNOUNCE THE NAME OF POLICE OFFICERS WHO ARE CURRENTLY -SERVING IN ACTIVE MILITARY SERVICE AND ARE NOT HAVING THEIR EMPLOYEE 9% CONTRIBUTION DEDUCTED FROM THE[R SALARY (ClTY CONTINUES TO CONTRIBUTE ITS CONTRIBUTION) - NONE There were no names to be announced into the record at this time. 9i ANNOUNCE THE NAME ,OF POLICE OFFICERS WHO ARE PRESENTLY VESTED AND INACTIVE, AWAITING DISTRIBUTION OF THEIR RETIREMENT BENEFIT UPON REACHING ELIGIBILITY-RUSSELL CULLUM, THOMAS EISERT (BENEFICIARY), JOSEPH GOLINO, LUIS PAGAN, HAMLET POLANCO, ROBERTO SANTOS, AND FRED ZIMMERMAN Chair Vega announced the name.s intothe record. 10. ANNOUNCE THE NAME OF POLICE OFFICERS WHO HAVE BEEN IN THE DROP PLAN BUT HAVE RESIGNED PRIOR TO THE END OF THEIR DROP AGREEMENT AND WILL RECEIVE A LUMP SUM DROP PAYMENT AND BEGIN TO COLLECT THEIR MONTHLY BENEFIT - JOHN FOX Chair Vega announced the names into the record. 11. ANNOUNCE THE NAME OF RETIRED POLICE OFFICER WHO HAVE DIED SINCE THE LAST MEETING OF THE BOARD OF TRUSTEES ON SEPTEMBER 20, 2016-NONE There were no name� to be announced into the record at this time. 12. REVIEW AND APPROVAL OF SALEM TRUST STATEMENTS FOR SEPTEMBER, OCTOBER, AND NOVEMBER, 2016 - HOLD FOR AUDIT This Item will be held foraudit. 2 MUNICIPAL POLICE OFFICERS' RETIREMENT TRUST 'DECEMBER 1·3, 2016 FUND MEETING MINUTES 1:,t OLD BUSINESS A. UPDATE; ON STATUS OF ADMMINISTRATIVE SERVICES AGREEMENT BETWEEN THE BOARD OF TRUSTEES AND CITY Trustee Griffithstated, 'The two people we need are not here." Chair Vega stated, "We will come back to th_is one." 14. NEW BUSINESS A. PRESENTATION OF QUARTERLY REPORT BY PLAN ACCOUNTANTS Mr. Cristini stated, ''You should have a copy of the pompiled report in front of you. The only comment-tnat I would make, prior fo .getting started is that this work was done before­ our time onsite with your records, which was finished last 'night. The on·ly thing that we found as a result 0fthat, which· you will see differenGes in your audited statements, are the reclassifications in expense categories. The bottom lihe will not change. We reclassified some officeexpenses and a few other things, when we actually.sat down and went through the invoices. We felt that under Presentation Disclosure Rules, they should be reclassified. It was an authorized and approved expenditure, but it met certain categories that you typicaliy �ee in your reports better in other places." Mr:. Cristirti· stated, ''If you turn to Page 3, it's the Statement of Fiduciary Net Position. For the current year, you Will see that the total receivables are $839,000, which is a big increase,from last year at thistime,. with the broker-dealer. As you r�call, this r�presents sales of securities for which you didn't receive ,the money until the first week in October. You did receive those dollars, so it closed. the loop. As for prepaid insurance, yo1,1r th insurance runs from September 15 to September 15th, so rather ttiansplit hairs, we just picked up the entire amount that you paid for your prepajd insurance, or your insurance, being $7,999. That was the premium for thatyear, �nd will expire on.September 15, 20,17. ' Investments at fair value, asyou can see in our total investments, i� $81.8 million, versus $71.6 million._ Just. a heads up ·here, something ,good happened, becau$e of the total investments. We'll come to how that occurred on the nextpage. Accounts payable went down, but we ended up with a lot of liabilities, one of which was th� Actuary's bill. Another one that is not goi_ng to be !'.:looked.in 'the number, we saw where this· 89ard approved the increase from $4,500 to $6,000;. as far as the administrative fee, but that had not been paid. Through September· 30th, the old fee was still paid. There was a calculation, and it comes .out to $11,638.74; but it is not in this payable num_ber. That represents the difference betw�en the $4,500 and $6,000 that this -Board: approved. My understanding was that there was an issue with the .agreement. itself, which is, why the payments did .not increase from $4,500 to $6,000. It looks like it is measur9-ble ,and ayailaple under the­ rules, except for the technicality of whatever needs to be a.djusted in the agreement betwe�nthis Board and the City, for this purpose." The Finance Director stated_, "I have a question about. that. I know that the Board of Trustees· had agreed to thatr but my feeling is that until that ?greement has gone in, 3 MUNICIPAL POLICE ,QFFICERS' RETIREMENT TRUST DECEMBER 13, 2016 FUND MEETING MINUTES because I know the City and the Board have been working on that agreement... I guess my feeling is that even the Board is authorized, until that agreement is approved by the City Council, I would wonder about ... I understand that the Board has agreed to that, but the City Council hasn't approved the agreement at this point." Chair Vega asked, "Okay, so what do you have?" The Finance Director replied, "It is just a question. If I goes to the City Council, and the City Council, for whatever reason, feels that it should be different... I don't anticipate .... " Mr. Cristini interjected, "It almost falls under the Accounting Standards called Estimates. You can book an estimate and fix it next year. My concern with it is that let's say it goes through and is approved, but we leave it at the lower number, so we're walking around saying we have $81,556,000 in the Plan as a net position, well really, it's that number minus $11,638.74. It's not a material number. I have a reticence about carrying a wagon behind me, in case I get run over by a truck and somebody forgets. This is part of a transaction that occurred this fiscal year. Quite frankly, because of its size, the only thing that bothers me is that I know it's there and not to put it at the end of the year in which it occurred, The big part of the problem is that we have the debtor here, being the Board, who is saying, 'Yes, I'll pay it.' Now, we're saying that the party who is going to get the money is saying, 'I don't know if I want it or not,' for various reasons." Chair Vega remarked, "I know what you're saying." Mr. Cristini said, "It's like playing tennis, and there is a big wall between you. I can hit it over the wall, but I don't know if it's going to come back at me from the other side, because I can't see." Trustee Griffithasked, 'What is your recommendation?" Mr. Cristini replied, "My recommendation would be to book it. If it turns out not to be, we'll put the money back into the Plan on October 1 st." Trustee Griffith asked, "Do you need a motion forthat?" Mr. Cristini replied, "No. We'll write it up in the summaryof what we call the search form of recorded liabilities." Chair Vega asked, "Mr. Fry, do you feel there would be a problem with it not getting approved?" The Finance Director replied, "No, I just wanted you to be aware of it.