Loading...
HomeMy WebLinkAboutCOMM - Meeting Minutes - 266 - 11-16-2017 - RETIREMENTrj1 MINUTE BOOK RETIREMENT BOARD WASHINGTON COUNTY, PENNSYLANIA IMR I IMITM FiR07A99I n iviinute 1No. 200 Washington County Retirement Board The quarterly meeting of the Washington County Retirement Board was held at approximately 10:35 a.m. on November 16, 2017, in the Public Meeting Room with the following members being present: Commissioners Larry Maggi, Diana Irey Vaughan and Harlan G. Shober, Jr., Controller Michael Namie and Treasurer Francis King. Also present: Chief Clerk Cindy Griffin, Secretary Paula Jansante, Solicitor Lynn DeHaven, Director of Administration Scott Fergus, Director of Finance Joshua Hatfield, Barbara Miller representing the Observer Reporter, Bruce Sakalik representing WJPA, concerned citizen Frank Byrd, and Lee Martin, PhD. Representing Marquette Associates. Approval of Minutes Mr. Maggi entertained a motion to approve Minute No. 265 dated August 17, 2017. The motion was moved by Mrs. Irey and seconded by Mr. Namie 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 the Retirement Allowance Account was reconciled to zero for the months of July, August, September, and October 2017. It was moved by Mr. King and seconded by Mr. Shober 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, 2017 $ 248,211.18 Add: ACH Credit 1,017,526.30 Add: Other Credits 41,152.84 Less: Cancelled Checks Less: ACH Debits (487,838.71) (660,659.24) Bank Balance as of July 31, 2017 $ 158,392.37 Less: Outstanding Checks (134,402.08) Less: Retirement Check Run (23,990.29) Reconciled Balance as of July 31, 2017 $ Q 20 RETIREMENT BOARD [MR I IMITF=n F-1A07Q9QI n MINUTE BOOK WASHINGTON COUNTY, PENNSYLANIA Bank Balance as of August 1, 2017 Add: Deposits to Checking Account Add: ACH Credit Less: Cancelled Checks Less: Other Debits Less: ACH Debits Bank Balance as of August 31, 2017 Less: Outstanding Checks Less: Retirement Check Run Reconciled Balance as of August 31, 2017 Bank Balance as of September 1, 2017 Add: Deposits to Checking Account Add: ACH Credit Less: Cancelled Checks Less: Other Debits Less: ACH Debits Bank Balance as of September 30, 2017 Less: Outstanding Checks Less: Retirement Check Run Reconciled Balance as of September 30, 2017 Bank Balance as of October 1, 2017 Add: ACH Credit Add: Other Credits Less: Cancelled Checks Less: ACH Debits S 15S,392.37 1,631.96 1,006,056.35 (292,489.18) (114,927.87) (661,936.25) $ 96,727.38 (61,096.91) (35,630.47) $ -0- $ 96,727.38 107.37 1,019,891.00 (102,090.09) (78,630.98) (666,471.32) $ 269,533.36 (33,090.36) (236,443.00) $ -0- $ 269,533.36 684,687.92 431,388.58 (320,264.66) (690,524.17) Bank Balance as of October 31, 2017 $ 374,821.03 Less: Outstanding Checks (345,761.83) Less: Retirement Check Run (29,059.20) Reconciled Balance as of October 31, 2017 $ -0- Requisitions Mr. Namie stated that requisitions for the months of August, September, and October 2017 totaled $2,949,638.90. 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. 11 1 E 21 1 M I N U TE RETIREMENT BOARD ]MR I IMITFn F19n7Q'JQI n Distributions August 2017 Check Payee 1421 Alexandra Louise Zanaglio 1422 Andrea Lee Zanaglio 1423 Angela Marie Zanaglio 1424 Andrew Zanaglio, Jr. 1425 Krystal Adams 1426 Julie Bakewell 1427 Michael Cross 1428 Stacey Degarmo 1429 Donald Gable BOOK WASHINGTON COUNTY, PENNSYLANIA 1430 Amy M. Garner 1431 Amy M. Garner 1432 JMS LLC as trustee of IRA of Tracie L. Igoe 1433 Jonathan McCloskey 1434 Helen C. Navrotski 1435 Fidelity Service Center FBO Nicholas A. Roberts 1436 Trustee for the Walmart 401K Plan FBO Brenda Vorhes 1437 Washington County Cash Disbursement Account 1438 Washington County Regular Payroll Escrow Account Transfer PNC Bank Transfer Washington County Retirement Account Total August 2017 Distributions September 2017 Check Payee 1440 USAA Investment Management Co. as trustee of IRA of Mallory E. Anderson 1441 Chad Armstrong 1442 Desiree Birdseye 1443 Chrome FCU as trustee of IRA of Jena Carlisle 1444 Wells Fargo Clearing Services as trustee of IRA of Dominic Carrola 1445 Capital Bank & Trust as trustee of IRA of Monica Chmiel 1446 Abram M. Cochran 1447 Gretchen Cummings 1448 Fidelity as trustee of IRA of Lori Dominick 1449 David Finder 1450 Michael Hatfield 1451 Jessica Johnston 1452 PNC Bank as trustee of IRA of Melissa M. Lesnick Amount 1,023.64 1,023.64 1,023.64 1,023.64 543.50 4,927.66 1,618.41 5,600.47 5,499.57 7,755.16 96.66 2,868.14 2,903.51 13,650.64 5,822.16 26,984.57 102,845.77 15,573.56 58,881.25 633,094.85 $ 892.760.44 Amount $ 8,564.32 2,595.60 673.03 8,941.74 2,930.95 5,009.66 4,141.96 702.53 9,160.15 9,323.93 2,651.56 10,167.72 44,108.37 22 MINUTE BOOK RETIREMENT BOARD WASHINGTON COUNTY, PENNSYLANIA IMR I IMITF:n Fir07P9A1 n 1453 PNC Investments as trustee of IRA of Betty Lou Lewis 8,506.02 1454 Crystal Moats 15.73 1455 Anna Steede 10,553.26 1456 Sean Thomas 1,247.69 1457 Shannon Thurman 1,043.76 1458 TD Ameritrade Institutional as trustee of Wendy J. Krek 64,493.44 1459 Washington County Regular Payroll Escrow Account 15,514.58 1460 Washington County Cash Disbursement Account 36,542.65 Transfer PNC Bank 59,135.85 Transfer Washington County Retirement Account 635,342.89 Total September 2017 Distributions $ 941.367.39 October 2017 Check Payee Amount 1461 Washington County Cash Disbursement Account $ 23,965.12 1462 Kristy Majocha 1,197.49 1463 Nicole Lemley 19,213.86 1464 Daniel Dunmire 4,330.71 1465 Jenny Wilson 8,540.79 1466 Jett Klinzing 540.21 1467 Anne Holmes 6,585.53 1468 Anthony Mori 33,792.48 1469 Clarissa Henry 12,910.37 1470 David Miller 1,524.47 1471 James W. Gray 8,355.08 1472 Shannon Willis 11,578.53 1473 Charles Schwab & Co. Inc. as trustee of IRA of Rachael Stiegel 20 533.08 1474 Dana M. Howell 9,037.18 1475 Vanguard as trustee of IRA of Valerie A. Fraer 2,165.55 1476 Heather Heffner 4,406.45 1477 Merrill Lynch Custodian as trustee of IRA of Kenneth J. Knowlson 108,246.52 1478 Merrill Lynch Custodian as trustee of IRA of Megan C. Knowlson 108,246.52 1479 Theresa M. Powell 116.61 1480 Walter L. Wasik 116.62 1481 Washington County Regular Payroll Escrow Account 15,691.52 Transfer PNC Bank 76,639.82 Transfer Washington County Retirement Account 637,776.56 Total October 2017 Distributions $ 1.115.511.07 11 D 23 MINUTE BOOK RETIREMENT BOARD WASHINGTON COUNTY, PENNSYLANIA IMR I IMITFn F19n7Q9QI n Old Business None. New Business Presentations Marquette Associates — Lee Martin, Ph.D. Mr. Martin began his presentation with a discussion of the Annual Pension Plan Report, stating that of the 52 Pennsylvania counties included in the report, 12 have lowered their assumed rate of return to less than 7.5%, 8 of which, including Washington County, to 7%. This is in comparison to just a few years ago when all of the reporting counties were at 7.5%. Comparing salary increase assumptions, most of Korn Ferry Group's clients, including Washington County, use a 3.5% assumption. Beginning next year, Korn Ferry Group has indicated that they will move their clients to 4.5%, thereby increasing the County's costs. Also of note is the return of cost of living adjustments. Absent from most counties in recent years, 9 counties have granted cost of living increases for their pensioners. Because of the changes with Act 63 and the removal of the lookback provision, the costs associated with cost of living adjustments, while still an expense, are less than previously. Performance -wise among the reporting counties, Washington County has remained near the top for the last 5 years. For the purpose of comparing funding ratios, all counties in the report are normalized with a 4.5% salary increase assumption. This puts Washington County's funding ratio in the range of 85% - 90%, slightly lower than Korn Ferry Group's funding ratio using a 3.5% assumption. The last metric from the Annual Pension Plan Report that Mr. Martin discussed was the ratio of active employees to retirees. From a cash flow perspective, the higher the ratio, the better. Currently Washington County has slightly more active employees than retirees, although these numbers have been converging and thus contributing to more monies flowing out of the fund. Mr. Martin briefly discussed the current market environment stating that GDP continued its upward trend, coming in at 3% for the quarter but still remaining below long-term averages of 3.5% - 4%. Inflation is still very soft but is expected to begin to rise in 2018. The majority of the world's economies are in expansion mode, a trend expected to continue. Global equities were strong for the quarter, 5.6% versus the U.S. at 4.6%. Emerging market are up 32%. The County's fund finished the quarter at $165 million, up about 12% for the year but slightly behind benchmark for the quarter, 3.3% versus 3.6%. What worked well for the quarter were the growth managers and global funds, what didn't work well were the defensive type managers. In the past 5 years, the fund has gained $66 million and averaged 9.3% return per year. Turning to individual manager performance, Twin dividend select is slightly behind year-to-date, Emerald and Wellington are both behind for the quarter but at benchmark since inception, American Funds and Dodge & Cox are ahead for the quarter and since inception, and Acadian is behind for the quarter and for the year. At this time, Mr. Shober excused himself from the meeting. Mr. Martin addressed the Board regarding the further diversification of the portfolio in the small - cap space. He presented information on three managers: Atlanta Capital, Earnest Partners, and GW&K. All three are fundamental, bottom -up managers and all three would provide a different fit for the County. 24 MINUTE BOOK RETIREMENT BOARD WASHINGTON COUNTY, PENNSYLANIA ]MR I IMITFII F1Rn7Q9QI n Mr. Martin recommended that the Board review the information, consider any possible changes with Wellington and/or Emerald, and then bring the 3 proposed managers in for presentations. At this time, Mr. King excused himself from the meeting. Lastly, Mr. Martin discussed OPEB, suggesting that the Board adopt a formal funding policy in light of GASB 74/75. The OPEB fund finished the quarter at just over $12 million and a return of 3.5%, slightly trailing the policy index. Since inception, the fund has gained $3.5 million and averaged 8.3% return per year. The Board discussed lowering the assumed rate of return on the pension fund to 6.75%. Mr. Martin said that he would speak with Korn Ferry Group to determine the extra cost of such a move and also the pros and cons of putting additional money into the pension and/or OPEB funds to decrease the unfunded liability. At the request of Mrs. Vaughan, Mr. Martin also stated that he would work on developing a funding policy for the OPEB fund. Mr. Maggi adjourned the meeting at 11:35 a.m. THE FOLLOWING MINUTES SUBMITTED FOR APPROVAL: 2018 ATTEST:�'����" 1