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Home My WebLink AboutCOMM - Meeting Minutes - 249 - 11-21-2013 - RETIREMENTSold By IMR Limited Form 825 E00102204 117 1 u Minute No. 249 Washington County Retirement Board Washington, PA November 21, 2013 The quarterly meeting of the Washington County Retirement Board was held at approximately 10:55 a.m. on Thursday, November 21, 2013 in the Public Meeting Room with the following members being present: Commissioners Larry Maggi, Harlan Shober, and Diana Vaughan, Controller Michael Namie, and Treasurer Francis L. King. Also present: Chief Clerk Mary Helicke, Secretary Joyce Thornburg, Director of Finance Roger Metcalfe, Solicitor Lynn DeHaven, concerned citizen Frank Byrd, Barbara Miller representing the Observer -Reporter, Jim Jefferson representing WJPA, Lee Martin and Sarah Wilson representing Peirce Park, and Gene Natali, Jr. representing C.S. McKee. Approval of Minutes Mr. Maggi entertained a motion to approve Minute No. 248 dated August 15, 2013. The motion was moved by Mrs. Vaughan and seconded by Mr. King that the above mentioned minutes be approved as written. No discussion followed. Roll call vote taken: Mr. Namie — yes; Mr. King — yes; Mr. Shober — yes; Mrs. Vaughan — yes; Mr. Maggi — yes. Motion passed unanimously. Public Comment None. Treasurer's Report Mr. King stated that for July, August, September, and October 2013, the bank balance was reconciled to zero. It was moved by Mr. King and seconded by Mr. Namie that the report be approved. No discussion followed. Roll call vote taken: Mr. Namie — yes; Mr. King — yes; Mr. Shober — yes; Mrs. Vaughan — yes; Mr. Maggi — yes. Motion passed unanimously. Retirement Allowance Report Bank Balance as of July 1, 2013 $ 153,033.71 Add: ACH Credit 810,854.12 Less: Cancelled Checks (246,388.71) Less: ACH Credits (463,940.54) 318 Less: Other Debits (78,877.44) Bank Balance as of July 31, 2013 $ 174,681.14 Less: Transfers into Checking Account (435.01) Less: Outstanding Checks (157,084.83) Less: Retirement Check Run (17,161.30) Reconciled Balance as of July 31, 2013 $ Q Bank Balance as of August 1, 2013 $ 174,681.14 Add: ACH Credit 895,805.32 Less: Cancelled Checks (182,616.07) Less: ACH Debits (429,490.64) Less: Other Debits (385,715.16) Bank Balance as of August 31, 2013 $ 72,664.59 Less: Outstanding Checks (53,918.98) Less: Retirement Check Run (18,745.61) Reconciled Balance as of August 31, 2013 $ Q Bank Balance as of September 1, 2013 $ 72,664.59 Add: ACH Credit 781,386.48 Less: Cancelled Checks (140,371.64) Less: ACH Debits (457,465.75) Less: Other Debits (128,130.42) Bank Balance as of September 30, 2013 $ 128,083.26 Less: Outstanding Checks (113,964.62) Less: Retirement Check Run (14,118; 64� Reconciled Balance as of September 30, 2013 Bank Balance as of October 1, 2013 $ 128,083.26 Add: ACH Credit 786,580.85 Add: Other Credits 65,286.24 Less: Cancelled Checks (218,418.17) Less: ACH Debits (494,256.46� Bank Balance as of October 31, 2013 $ 267,275.72 Less: Outstanding Checks (256,462.52) Less: Retirement Check Run (10,813.20) Reconciled Balance as of October 31, 2013 $--&- 1 1 Sold By IMR 3119 E U Requisitions Mr. Namie stated that requisitions for the months of August, September, and October 2013 totaled $2,012,712.39. It was moved by Mr. Namie and seconded by Mr. King that the requisitions be approved. No discussion followed. Roll call vote taken: Mr. Namie — yes; Mr. King — yes; Mr. Shober — yes; Mrs. Vaughan — yes; Mr. Maggi — yes. Motion passed unanimously. Distributions August 2013 Check Payee Amount 752 Beverly Calhoun $ 94.95 753 Katie B. Carter 30.20 754 Natalie Demnyan 267.87 755 Jennifer Inaba 276.94 756 Jeanette Kelly 3,151.80 757 Cindy S. McCartney 180.01 758 WesBanco Bank as trustee of IRA of Sylvia 5,605.30 Mounts 759 Cynthia Polen 662.22 760 Ray Prevost 5,785.61 761 H D Vest Financial Services as trustee of IRA of 11,276.58 Cynthia L. Kraeer 762 Washington Co. Regular Payroll Escrow Account 7,355.15 763 Washington County Cash Disbursement Account 26,473.17 Transfer PNC Bank 29,019.86 Transfer Washington County Retirement Account 418,608.58 Total August 2013 Distributions $ 508,788.24 September 2013 Check Payee Amount 764 Washington County Cash Disbursement Account $ 20,384.77 765 Estate of Patty L. Maxwell 560.76 766 Wendy J. Briant 2,556.00 767 Jennifer Chmiel 311.56 768 Victoria Hartman 2,840.62 769 Elliott FCU as trustee of IRA of Sarah Hixson 10,078.76 770 Timothy R. Hornak 5,710.76 771 Terry Luko 5,419.68 772 Kristine M. Malchano 5,961.81 312 0 773 Christina Martin 14,815.13 774 PNC as trustee of IRA of Amy Menzer 39,931.37 775 Kelley Milliken 10,216.55 776 Stephanie Orsilli 2,903.36 777 Holly J. Prati 1,625.94 778 Cellena Sakhia 5,017.96 779 Katelyn C. Thomas 2,186.86 780 Lindsay J. Keene 45,157.16 781 Washington Co. Regular Payroll Escrow Account 7,478.65 Transfer PNC Bank 52,314.55 Transfer Washington County Retirement Account 417,783.81 Total September 2013 Distributions $ 653,a256.06 d".-4 .L..— 1%A1? Check Payee Amount 782 Washington County Cash Disbursement Account $ 72,908.69 783 Raymie Arroyo 33,210.22 784 Jennafer Buehl 991.85 785 New York Life as trustee of IRA of Judith 827.64 Dreistadt 786 Andrew Guley 17,543.80 787 Kathy J. Hartzell 19,381.70 788 Lori A. Kelley 10,385.61 789 Catherine Levers 80.84 790 Toni L. Masciarelli 9,267.28 791 Ashley Milcheck 4,897.23 792 Washington Financial as trustee of IRA of 10,983.89 Cindy Parks 793 Alex Roner 1,649.18 794 First Clearing Corp as trustee of IRA of 6,978.86 Frances S. Sauer 795 Chad Taylor 275.77 796 Crystal Sienkiel 2,185.29 797 Frank J. Sibula 80,436.16 798 Emily Plutch 372.41 799 Georgiann Janney 63,827.86 800 Washington Co. Regular Payroll Escrow Account 7,087.23 Transfer PNC Bank 86,840.80 Transfer Washington County Retirement Account 420,535.78 Total October 2013 Distributions S850,668,09 E Form 025 E00102204 3 211 u 1 1 Old Business None. New Business Mr. Maggi noted for the record an agreement with Terry A. Brogley to purchase service credit dated November 28, 1982 to October 12, 1984 in the amount of $1,897.03. Mr. Maggi entertained a motion for the approval of a contract between the Washington County Retirement Plan and Peirce Park Group, Inc. for investment management consulting services for the period January 1, 2014 to January 1, 2019. The motion to approve was made by Mrs. Vaughan and seconded by Mr. Shober. No discussion followed. Roll call vote taken: Mr. Namie — yes; Mr. King — yes; Mr. Shober — yes; Mrs. Vaughan — yes; Mr. Maggi — yes. Motion passed unanimously. Mr. Maggi entertained a motion for the purchase of Pension Estimator software from Hay Group, Inc. at a cost of $7,500.00 with a yearly maintenance fee of $750.00. The motion to approve was made by Mrs. Vaughan and seconded by Mr. King. No discussion followed. Roll call vote taken: Mr. Namie — yes; Mr. King — yes; Mr. Shober — yes; Mrs. Vaughan — yes; Mr. Maggi — yes. Motion passed unanimously. Presentations C.S. McKee — Gene Natali, Jr. Mr. Natali began his presentation with an overview of market themes, stating that sometimes it's what you don't own as well as what you do that makes a difference. For the past two quarters, there has been outperformance in large cap value, which hopefully points to a return to normalcy in the equity market. The year-to-date equity return is 27% with a benchmark of 28%, the result of a massive Fed -fueled rally. In order to get a better perspective, Mr. Natali illustrated C.S. McKee's performance over the last 13 years by first taking out the best and worst relative performance and then by taking out the two best and worst relative performances. The absolute returns are 7.3% and 3.3% respectively. He then looked at the two complete economic cycles in the same 13 year period, showing returns of 10.8% and 2.5%. His final illustration was of the two most recent economic cycles, the one before the financial crisis and the current one at the 3122 conclusion of the financial crisis. The current cycle shows returns of 25% with a benchmark of 26%. These types of numbers are just not sustainable. The questions is not so much whether things with return to normal but when they will return to normal. On the fixed income side, if the Fed acts correctly, there may be a best case scenario winding down to normalcy where bond prices and interest rates are not adversely affected. Peirce Park — Lee Martin Mr. Martin began with a market summary, stating that the equity markets are up, the federal deficit is down, and although unemployment is inching downward, wage growth is not really increasing. Historically, consumer spending will not increase without wage growth. Emerging markets, although still negative for the one-year, came back in the last quarter. International markets still trail domestic, but also showed improvement in the last quarter. Growth stocks outperformed value for the first time in a year. That being said, the County was still ahead even with a value tilt to the portfolio. Manager selection as well as the blend of managers helped outperform even though the style tilt was out of favor. Moving on to performance, the plan was up 5.2% for the quarter, about 0.50% above the index, gaining $6 million. For the year-to-date, the plan was up 13.2%, 1.7% above benchmark, gaining almost $15 million. For the one-year, three-year, five-year, and ten-year, the plan is in the top 10% of all public funds. For the quarter, domestic equities, global equities, and short-term fixed income all did very well, with real estate being the only real underperformer. To highlight some performance for the quarter, Emerald was up as is expected in the current market environment, Twin Capital was a little behind, and Wellington performed well as did New Perspective. Since inception, all of the County's managers are above index with the exception of C.S. McKee large cap, which only trails slightly. Mrs. Vaughan asked Mr. Martin if it was time to look at reducing the assumed rate of return. Mr. Martin responded that the Hay Group would need to be contacted to review the ramifications of such a move with the Board. Mr. Namie responded that he could contact the Hay Group regarding this issue. The meeting was adjourned at 11:40 a.m. THE FOLLOWING MINUTES SUBMITTED FOR APPROVAL: 2014 ATTEST: u