CITY OF KNOXVILLE PENSION BOARD
MINUTES
Thursday – October 9, 2008
8:15 A.M.
917B E. 5TH AVENUE
The regular meeting of the City of Knoxville Pension Board was held in the Pension Board conference room at 917 E. 5th Avenue at 8:15 a.m. on October 9, 2008.
Present were: Mayor Bill Haslam, Mr. Greg Coker, Mr. Joe Hackney, Mr. Buddy Harrell, Ms. Barbara Pelot, Mr. Jim York, Mr. Michael Cherry and Attorney Bud Gilbert.
Also present: Mr. Dan Holmes, Summit Strategies; Mr. David Nyren and Mr. Alex Becks,
Gryphon International Investment; Mr. Eric Welt and Mr. Martin Coughlin, Calamos Investments; Mr. John B. Stimpson and Mr. Peter Barcia, UBP Asset Management.
CALL TO ORDER:
Mayor Haslam presided and called the meeting to order at 8:15 a.m.
APPROVAL OF REGULAR MEETING MINUTES FOR September 11, 2008.
Mr. Harrell made a motion to approve the September 11, 2008, meeting minutes. Ms. Pelot seconded the motion. The motion carried unanimously by the members present.
APPROVAL OF REVISED AGENDA: Exhibit 1
The Revised Agenda was approved without objection.
CONTRACTS: None
ADMINISTRATIVE MATTERS: None
EXECUTIVE DIRECTOR COMMENTS: None
ATTORNEY COMMENTS:
William Manis Overpayment
Attorney Gilbert informed the Board that he had spoken to William Manis’ daughter regarding the recovery of overpayments of approximately $5,000 made to Mr. Manis, a retired General Government – Plan A retiree, after his death. Attorney Gilbert in discussion with the Board, decided to have Ms. Manis sign a promissory note for the funds, which Ms. Manis indicated had been spent, and set up a re-payment plan which would include interest. Attorney Gilbert advised the Board that he would keep them apprised on this matter.
Securities Litigation – Exhibit 2
Attorney Gilbert advised the Board that, Schiffrin, Barroway Topaz & Kessler LLC had inquired as to whether the Pension Board would be interested in assuming the lead plaintiff position in the class action litigation against Longs Drugstore. After a discussion with the Board regarding the pros and cons of such a position, it was decided that Attorney Gilbert would draft a statement for the Board’s review stating the Board’s position and philosophy in regards to assuming the position of lead plaintiff, which he will present to the Board in November.
Global Crossing Litigation
Mr. Cherry advised the Board that the settlement was complete in the Global Crossing Litigation. Attorney Gilbert advised the Board that a final, quarterly billing might be forthcoming.
ENROLLMENTS:
The following General Government employees have filed applications to become members of the Plan G1 pension system.
Kathleen M. Groves
Motion: Ms. Pelot made a motion to approve this application for enrollment in the Plan G1 pension system. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
WITHDRAWALS:
The following employee(s) have filed applications to withdraw employee pension contributions plus 4% interest and the supplemental retirement account as applicable in Plan G Option 1.
Gary L. Allen, General Government, G1 – Non-vested
Judson Dunnavant, Police Dept., Plan C – Non-vested
Jason McCarter, General Govt., Plan G1 – Vested
Christopher Stickrod, General Govt., Plan G1 – Non-vested
James K. Ward, Fire Dept., Plan C – Non-vested
Motion: Mr. Coker made a motion to approve these applications for withdrawal of employee contributions. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR SURVIVOR’S BENEFIT: PLAN G2
CHARTER SECTION 1360.24
Randall L. Cooper, active General Government employee died in service September 6, 2008. Mr. Cooper’s statistics:
58 years of age, 11 years 10 months 3 days service
Average monthly salary for 2 highest 12 month periods, $3,012.53 x .021 =
$63.26 x 11.841555 = $749.10. Mr. Cooper chose Option A-6 - 100% Joint & Survivor to Clydette McReynolds. $749.10 x .8148 =
$610.37 Clydette McReynolds monthly benefit beginning October 1, 2008.
Motion: Mr. Harrell made a motion to approve this application for a survivor’s benefit payable under Option A-6. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR RETIREMENT: PLAN F
CHARTER SECTION 1304
Charles A. Hansard, Fire Uniformed *Option
Date of birth, June 6, 1936: 72 years of age
Total credited service: 46 years
Highest monthly salary, $5,875.35 x 60% =
$3,525.21 pension effective October 12, 2008
*Plan F has a built-in option to beneficiary of 60% of retiree’s benefit being received at member’s death.
Motion: Mr. Hackney made a motion to approve this application for retirement payable under Plan F. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR DEFERRED RETIREMENT: PLAN A
CHARTER SECTION 1360.28
Robert Bowers, General Government Option A-8
75% with reinstatement
Date of birth, September 13, 1946: 62 years of age
Total credited service: 15 years 8 months
Average base salary for 2 years, $400.00 x .75% = $3.00
Average excess monthly earnings for 2 years, $3,455.81 x 1.50% = $51.84
making a total of $54.84 benefit per year of service. $54.84 x 15.665525 =
$859.10. Mr. Bowers chose Option A-8 – 75% with reinstatement to Brenda W. Bowers. $859.10 x .8531 =
$732.90 pension effective October 1, 2008.
Motion: Mr. Harrell made a motion to approve this application for retirement payable under Option A-8. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
Charlotte Smith, Schools Certified No Option
Date of birth, March 13, 1948: 60 years of age
Total City credited service: 16 years 9 months
Total County credited service: 21 years
Total credited service: 37 years 9 months
Last date of employment with City: June 1987
Last date of employment with County: May 2008
Average base earnings for 4 years, $400.00 x .75% = $3.00
Average excess earnings for 4 years, $1,560.35 x 1.50% = $23.41
making a total of $26.41 benefit per year of service. $26.41 x 16.75 =
$442.37 x ER Factor .9075 =
$401.45 pension effective October 1, 2008.
The City benefit payment is determined using City only salaries and City service time.
The City benefit does not include any County service.
The total amount of the combined City & County benefit is $2,401.50.
Motion: Mr. Harrell made a motion to approve this application for retirement. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR RETIREMENT: PLAN G2 – RULE OF 80
CHARTER SECTION 1371.4
Timothy A. Bean, General Government Option A-4
50% without reinstatement
Date of birth, September 5, 1957: 51 years of age
Total credited service: 29 years 1 month 3 days
Average monthly salary for 2 highest, 12 month periods, $2,210.76 x .021 =
$46.43 x 29.09155 = $1,350.72. Mr. Bean chose Option A-4 – 50% without reinstatement to Rebecca A. Ogle. $1,350.72 x .9227 =
$1,246.31 pension effective October 1, 2008.
Motion: Mr. Harrell made a motion to approve this application for Rule of 80 retirement payable under Option A-4. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
Regenia D. Whaley, General Government No Option
Date of birth, July 9, 1953: 55 years of age
Total credited service: 36 years 15 days
Average monthly salary for 2 highest 12 month periods, $3,946.00 x .021 =
$82.87 x 36.04110 =
$2,986.73 pension effective October 1, 2008.
Motion: Mr. Harrell made a motion to approve this application for Rule of 80 retirement. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR PARTICIPATION IN THE DELAYED RETIREMENT OPTION PROGRAM (DROP): PURSUANT TO CHARTER SECTION 1371.8 – PLAN G.
The following employees have chosen a Delayed Retirement Option and will receive a one-time payment of the accumulated monthly benefits on termination of employment with the City of Knoxville.
David L. Doyle, General Government – Plan G2 No Option
Date of birth, January 27, 1948: 60 years of age
Total credited service: 28 years 5 months 24 days
Average monthly salary for 2 highest 12 month periods, $4,929.69 x .021 =
$103.52 x 28.48242 =
$2,948.50 pension effective October 1, 2008.
DROP complete September 30, 2010.
Motion: Mr. Harrell made a motion to approve this application for DROP retirement. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
Ricky W. Miller, General Government – Plan G2 No Option
Date of birth, October 17, 1958: 49 years of age
Total credited service: 30 years 1 month 18 days
Average monthly salary for 2 highest 12 month periods, $2,469.18 x .021 =
$51.85 x 30.13265 =
$1,562.38 pension effective October 1, 2008.
DROP complete September 30, 2010.
Motion: Mr. Harrell made a motion to approve this application for DROP retirement. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
APPROVAL OF INVOICES FOR PROFESSIONAL SERVICES:
Bryan, Pendleton, Swats & McAllister – Actuary (August 2008) $9,023.00
Kennerly,Montgomery & Finley – Attorney (General – Aug 08) 2,117.20
Kennerly,Montgomery & Finley – Attorney (General – Sept 08) 2,605.64
Kennerly,Montgomery & Finley – Attorney (G. Fields – Aug 08) 260.00
State Street – Custodial (July 2008) 8,374.68
State Street – Custodial (August 2008) 8,388.96
State Street – Trustee (March 2008) 3,365.56
State Street – Trustee (June 2008) 3,371.17
Mr. Cherry, Executive Director, has reviewed the bills and certifies that they are consistent with the services provided and are within the budgeted figures of the system’s financial plan.
Motion: Mr. Hackney made a motion to approve payment for these bills. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
INVESTMENT MATTERS:
Money Manager Reviews
Gryphon International Investment
David Nyren and Alex Becks of Gryphon International Investment
made a presentation to the Board. A copy of the report is on file in the Pension Office.
Calamos Investments
Eric Welt and Martin Coughlan of Calamos Investments made a presentation to the Board. A copy of the report is on file in the Pension Office.
UBP Asset Management
John B. Stimpson of UBP Asset Management made a presentation to the Board, along with Peter Barcia of UBP Asset Management. A copy of the report is on file in the Pension Office
Dan Holmes – Summit Strategies
Investment Discussion
Mr. Holmes met with the Board to discuss the market activity and future investment strategies. Copies of Mr. Holmes discussion material are on file in the Pension Office.
Mayor Haslam left the meeting at 10:55 a.m. and Ms. Pelot presided.
OTHER: None
PUBLIC COMMENTS: None
RECESS:
A recess was called at 12:03 p.m., and the meeting was scheduled to reconvene on Friday, October 17, 2008, at 1:30 p.m.
The meeting was reconvened on Friday, October 17, 2008, and called to order at 1:45 p.m. by Ms. Pelot.
Present were: Mayor Bill Haslam, Mr. Joe Hackney, Mr. Buddy Harrell, Ms. Barbara Pelot, Mr. Jim York, Mr. Michael Cherry and Attorney Bud Gilbert.
Also present: Mr. Dan Holmes, Summit Strategies.
INVESTMENT MATTERS
Mr. Holmes made a presentation on Private Equity Diversified Funds.
Motion: Mr. Hackney, upon the recommendation of Mr. Dan Holmes, made a motion to retain Adams Street Partners 2009, as the private equity diversified funds manager subject to the review and recommendation of an investment management contract by Mr. Gilbert. Mr. Cherry was authorized to sign such contract and proceed with all necessary administrative procedures to put into effect this investment manager agreement upon advice and consultation with Dan Holmes of Summit Strategies. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
ADJOURNMENT:
Mr. Hackney made a motion to adjourn the meeting at 3:39 p.m. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
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Chair
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Date