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QUARTERLY BOARD MEETING

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QUARTERLY BOARD MEETING Powered By Docstoc
					                    ROUND LAKE BEACH POLICE PENSION FUND
                         QUARTERLY BOARD MEETING
                                 July 27, 2010

1. MEETING CALLED TO ORDER

  President James Simoncelli called the meeting to order at 5:06 p.m.

2. ROLL CALL

  Roll Call: James Simoncelli, Sandra Molidor, Annmarie Pryde, and Ryan Rodriguez. Ed Gueroult was
  absent. Gary O’Neil, Pension Board Accountant, Marcus Lerman from Vanguard, and Carol McMullen,
  Administrative Secretary, were present.

3. READING & APPROVAL OF MINUTES OF LAST MEETING

  The minutes of the Board Meeting of May 18, 2010, were pre-read; motion by Sandra Molidor to accept
  these minutes as read, second by Ryan Rodriguez, motion carried.

4. REVIEW AND ACT ON INVESTMENT ACTIVITY

  Annuity figures as of 06-30-2010 were:
         PX0000490-AA market value was $722,568.94, with surrender value $718,715.24
         PX0000638-AA market value was $589,746.41, with surrender value $586,669.90
  Annuity PX0000490-AA matures 11-05-2010; Annuity PX0000638-AA matures 01-22-2011.

  $100,000 was wire transferred from Vanguard to State Bank of the Lakes on 05-24-10. Investment
  presentation was received from Lisa Beatovic of State Bank of the Lakes asking the Board to review it. A
  prospectus was received from Protective Life Insurance Company, Prosaver Platinum Annuities. The
  following reports were received from Vanguard – Quarterly Investment Report, U.S. Government Bond
  Funds Annual Report, U.S. Stock Index Funds, Large Cap Portfolios Annual Report, and a Prospectus
  Summary on the Prime Money Market Fund.

  Marcus Lerman gave a brief commentary on the markets during the second quarter 2010; reviewed the
  Quarterly Investment Report as of 06-30-10, showing a loss for the quarter of ($155,794), a gain for YTD
  of $94,091, and a gain for inception-to-date (09-30-09 to 06-30-10) of $60,404. Marcus discussed the
  possibility of holding some high quality corporate bonds in the future, to better balance the bond portfolio.
  There is currently 39.3% in equities and 60.7% in bonds. The portfolio value as of 06-30-2010 was
  $9,063,023.65. The management fee for under $10 million is 25 basis points; once the fund hits the $10
  million, the fee will be 15 basis points for anything over $10 million.

  Jim asked Marcus why the Vanguard Institutional Index Fund was sold and not transferred in kind
  shares. There was a loss of $192,772.49 incurred since MB Financial Bank sold this Fund instead of
  transferring this fund. Marcus stated that it is a paper loss, Vanguard wanted it transferred in kind, it
  was most likely proprietary; but this Fund would have been sold by Vanguard if it had been transferred
  in kind. The reason Vanguard wanted it transferred in kind was so the fund was not out of the market at
  any time.

  Gary asked if Marcus saw a time where the fund could be managed internally by the Board and not by
  Vanguard. Marcus replied that the Board could, but most Board members have different opinions as to
  where the fund should be; the discipline is where Vanguard comes in. One mistake eliminates the
  advantage of not having Vanguard fees; one little mistake, like not rebalancing at the right time, or being
  in the wrong allocation.

  Jim asked Marcus why the $100,000 wire transfer on 03-04-10 was taken out of the Short-Term Treasury
  Fund and not taken out of the money market. Marcus explained that there is a managed and a self-
  managed account. The Short-Term Treasury Fund is the managed account, which ends in 5325, and
  where the wire transfers have been taken from. The money market is the self-managed. The advisor fee
  comes out of the managed account. Marcus will look into why the money was taken out of the managed
  account and will make sure that all future wire transfers will be taken out of the self-managed money
  market account.

  Gary mentioned that when we were audited by the Illinois Department of Insurance they stated that the
  45% maximum equity is based on cost basis, rather than the market value of the equities. Gary wanted
  Marcus to know that this was their guideline.

  Ryan asked Marcus if he examined our portfolio to ensure that we are within the guidelines of the State
  as far as equities. Marcus stated he does and suggested that he meet with us at least once a year to
  review the guidelines and discuss any changes from the State; if there are any changes in the meantime,
  to relay these changes to Marcus since we are his only Illinois Pension Fund.

  Gary stated that the bank balance yesterday was $461,904.92, and we usually keep $150,000 in the
  checking account and recommended the Board invest $300,000. Marcus stated the money should go into
  the managed account; any money going into the self-managed money market account will stay there and
  not be invested. He will watch for this wire transfer and make sure it goes into the right account.

5. READING OF THE REPORT OF THE TREASURER

  Gary reviewed the 2nd Qtr 2009 Unaudited Financial Statements from 04-01-10 to 06-30-10. As of 06-30-
  10 assets in the State Bank of the Lakes were $446,540.24; CD with Great Lakes Credit Union -
  $259,369.94; Norstates Bank CD - $250,000.00; Other various annuities and Vanguard funds total
  $9,908,037.61; GNMA’s and other Vanguard brokerage services account assets are $92,555.25, bringing
  total book value assets to $10,956,503.04. In June 2009 the total assets were $11,019,574.07, for a
  difference of $63,071.03 or -.0057%.

  Revenue for the quarter included interest income of $189.02; property tax revenue $353,567.35; dividend
  income (reinvested) $61,225.75; participant contributions $55,487.88; bringing total revenue for the
  quarter to $470,470.00. Operating expenses for the quarter included: insurance $2,366.00; legal &
  accounting $1,500.00; money/investment management fees $7,252.89; office expense $6.13; pension
  benefits paid $182,127.84; secretarial fees $5,212.81; state pension fees $1,958.02; telephone &
  communication $338.05; bringing total operating expenses to $200,761.74; for a total net income of
  $269,708.26 for the quarter.

  For January 1 to June 30, 2010 total income was $640,574.75; total expense was $418,651.37 for a net
  income of $221,923.38.




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  Vanguard money market reconciliation opening balance was $1,870.38, with interest income from
  Securities at $1,145.49; principal payments from securities $4,127.47; interest from money fund $0.06;
  investments of $7,143.40; for an ending balance of $0.00.

  Vanguard Cash & Equity Recap shows $0.00 in the Vanguard Prime Money Market Fund; $1,140,689.73
  in the Vanguard Intermediate Term Treasury Fund; $1,689,946.39 in the Vanguard Long-Term Treasury
  Fund; $455,406.88 in the Vanguard Short-Term Treasury Fund; $794,510.10 in the Vanguard Total
  International Stock Index; $3,088,587.32 in the Vanguard Total Stock Market Index Fund; $92,555.25 in
  Vanguard Brokerage Services; $950,063.35 in the Vanguard Short-Term Federal Fund; $963,833.84 in
  Vanguard GNMA Fund (Admiral Shares); for a total equity ending cost balance of $9,175,592.86.

  State Bank of the Lakes deposit reconciliation showed participant contributions for the quarter at
  $55,487.88; tax levy deposits totaling $353,567.35; sweep account interest of $189.02; unclassed (transfer
  from Vanguard) $100,000.00, for total deposits for the 2nd quarter of 2010 at $509,244.25.

  The Pension Fund Investment Mix shows $955,910.18 (8.44%) in cash, $5,521,185.30 (48.73%) in bonds,
  $1,312,315.35 (11.58%) in annuities, and $3,541,838.32 (31.26%) in equities, for a Grand Total of
  $11,331,249.15 for the 2nd quarter 2010.

  Motion made by Sandy Molidor to accept the Treasurer’s Report as of 06-30-2010 as presented, second by
  Ryan Rodriguez; motion carried.

  Motion made by Sandy Molidor to wire transfer $300,000 to the managed account at Vanguard from the
  checking account at the State Bank of the Lakes; second by Annmarie Pryde; motion carried

6. OLD BUSINESS

  Tax Levy – Tax levies received were $18,450.05 on 06-10-10; $260,817.95 on 06-10-10; and $41,127.22 on
  06-14.10.

  The debit card was received for the Pension Fund; the pin number is in the file cabinet. The Fiduciary
  Liability Insurance Policy Certificate was received with an expiration date of 04-15-2011. Nothing was
  received regarding the audit yet.

  Doctors for annual exams – Jim contacted and received information from Illinois Bone & Joint Institute
  regarding annual exams, and presented the information to the Board. The Board would like to start
  sending officers on disability for their annual exams without going through an attorney, which would
  save a considerable amount of money. The Board would like a representative from Illinois Bone & Joint
  Institute come out to discuss fees and doctors with the Board. IPPFA stated that the Pension Board was
  responsible to pay for these medical exams, not the Village, since the Board granted the pension, not the
  Village; this can be found in the Pension Code.

  IPPFA sent information regarding IPPFA online training course for the State of Illinois required
  training. Ed is still not a signor on State Bank of the Lakes checking account.

7. PRESENTATION & APPROVAL OF BILLS AND DISBURSEMENTS

  Motion by Annmarie Pryde to accept the bills as presented and pay them as they become due, second by
  Sandy Molidor; motion carried.
  .
      AT&T – Apr-May - $108.35; May-Jun - $108.35; Jun-Jul - $108.26
      TTI (long distance) – Apr - $5.45; May - $3.19; Jun - $3.27




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         Postage (debit card) - $18.43 – Kaiser annual exam – medical records to doctor, registered letter
          to Kaiser; Klipp annual exam – letter to doctor, registered letter to Klipp
         State Disbursement Unit – Klipp child support payments $213 – Apr, May, Jun
         Carol McMullen - $6.13 – reimbursement for office supplies, postage & keys
         Temporarily Yours Secretarial – Apr 19 - $872.13; May 3 - $912.07; May 17 - $865.47; May 28 -
          $991.97; Jun 11 - $758.96

8. APPLICATION FOR MEMBERSHIP

  None.

9. NEW BUSINESS

  Board nominations were held for Board Positions. Annmarie Pryde nominates Jim Simoncelli for
  President, second by Ryan Rodriguez. There were no other nominations for President. Annmarie Pryde
  nominates Sandy Molidor as Vice-President, second by Ryan Rodriguez. There were no other
  nominations for Vice-President. Sandy Molidor nominates Ed Gueroult for Secretary, second by Ryan
  Rodriguez. There were no other nominations for Secretary. Annmarie Pryde made a motion to close the
  nominations and accept the slate as presented, second by Ryan Rodriguez, motion carried. A new
  Corporate Resolution was signed by the Board members.

  Annmarie Pryde made a motion to hire Tim Sharpe as our actuary, second by Ryan Rodriguez; motion
  carried. The new business rep for the State Bank – Lisa Beatovic stopped into the Pension Office and
  discussed ACH with Carol. Carol has started working on listing all the files in the Pension Office, to
  report to the State for records destruction, as required by Administrative Code, Department of Insurance.
  There is a Group Decreasing Term Life Insurance Plan offered by IPPFA effective 10-01-10, available to
  all active members and current retirees. Carol will discuss this with Nancy in Human Resources to see
  who will be the primary contact for this. The 2008 Pension Code Books have been printed by West and
  are now available at $40.00 per book. Ryan Rodriguez made a motion to purchase one of the 2008
  Pension Code Books, second by Sandy Molidor; motion carried.

  Information was received from IPPFA regarding pending federal legislation (HR4213) that could affect
  public employees that have 457 or 403B deferred compensation plans. A letter was received from Alliant
  Insurances Inc., requesting to provide a Fiduciary Liability proposal under a national fiduciary liability
  program they have developed. Information received from IPPFA Public Affairs regarding harmful
  legislation. The IPPFA Newsletter for 07-23-10 can now be read online. Great Lakes Credit Union is
  offering an educational workshop regarding rules of retirement on 07-29-10. The Mid-sized Retirement &
  Pension Plan Management Conference is in Chicago on Oct 5-8, 2010.

10. CONSIDER APPLICATIONS FOR BENEFITS

  Jeff Klipp – Letters were sent directly to Dr. Vogel and Jeff Klipp to schedule his annual exam. He had
  his exam with Dr. Stephen Vogel on 07-20-2010, who stated he remains disabled from his position as a
  police officer and is unable to perform all of the essential duties the job entails. He also states that it is
  unlikely that his functioning will return to the point where he can resume his duties as a police officer.
  Dr. Vogel’s bill has not been received yet. Dr. Vogel’s letter gave the Board the impression that Jeff Klipp
  has not done anything over the last several years to improve his situation, including surgery, not wearing
  a brace or physical therapy. A letter will be written to Dr. Vogel with several questions, including if there
  is some regimen that he could follow in order to strengthen his knee. The Board discussed the possibility
  of sending Jeff Klipp to a different doctor for another exam. A medical release form will be sent to Jeff
  Klipp and then to Dr. Vogel to release the records to the Pension Office for further distribution to another
  doctor, possibly Dr. Norman Kohn. A letter will be sent to Dr. Kohn with a brief history of Jeff Klipp,
  asking if he would examine him.



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    Dan Kaiser – Medical release forms were sent to Dan Kaiser to fill out for all of the doctors he has seen
    since his last exam. Medical records were received in the Pension Office and forwarded to Dr. Norman
    Kohn. Letters were sent directly to Dr. Norman Kohn and Dan Kaiser to schedule his annual exam. He
    had his exam with Dr. Norman V. Kohn on 07-15-2010, who stated he remains unable to perform the full
    duties of a police officer and that his limitations are stable, and are expected to continue for an extended
    time. Dr. Kohn’s bill was received ($500.00), which covered the review of Dan’s medical records and for
    the medical exam.
    Kenneth Coppes – Returned to active duty on May 15, 2010, and is making arrangements with Human
    Resources to start re-paying his pension contributions for the period March 16 through May 14, through
    payroll deductions.
    Roger Callese – Has been re- paying his pension contributions for time off for military duty, at the rate of
    $33.75 per pay period.
    Jason Plichta - Resigned on 07-26-2010. He is going to work for Lake County; he is checking into
    transferring his time into IMRF and will contact the Pension Office as to the disposition of his funds if he
    cannot transfer his time.
    Gary Chesney– Turns 55 on 08-31-2010 and will receive his first 3% increase on 09-01-2010. Form W-4P
    will be sent to him regarding federal withholding.
    Jonathan Meck – has not requested his pension contributions of $95.58.

11. ADJOURNMENT

    The next scheduled Board meeting is set for Tuesday, October 26, 2010 at 6:00 p.m.

    With no further business, a motion was made to adjourn at 7:01 p.m. by Annmarie Pryde, second by Ryan
    Rodriguez; motion carried.


 Respectfully submitted,




 Edward Gueroult
 Secretary
                                    BY:     Carol McMullen
                                            Recording Secretary




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