CITY OF KNOXVILLE PENSION BOARD
MINUTES
NOVEMER 10, 2005
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 November 10, 2005.
Present were: Mayor Haslam, Mr. Kent Bates, Mr. Scott Calloway, Mr. Buddy Harrell, Mr. Stephen King, Mr. Christopher Kinney, Ms. Barbara Pelot, Attorney C. C. “Bud” Gilbert and Mr. Michael Cherry.
Also present: Mr. Dan Holmes, Summit Strategies; Mr. Alan Pennington and Ms. Mandy Lee Bratten, Bryan, Pendleton, Swats & McAllister; Mr. Scott Hazen and Mr. Mike Lammers, UBS Global Asset Management; Mr. Jon Thompson and Mr. Chip George, RREEF.
CALL TO ORDER:
Kent Bates presided and called the meeting to order at 8:20 a.m.
Actuary Presentation
Alan Pennington – Bryan, Pendleton, Swats & McAllister presented the actuarial valuation as of July 1, 2005. A copy of the report is on file in the Pension Office.
Mayor Haslam arrived at 8:44 a.m. during the actuarial presentation and presided.
APPROVAL OF REGULAR MEETING MINUTES FOR October 13, 2005
Motion: Mr. Bates made a motion to approve the October 13, 2005, meeting minutes. Mr. Harrell 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:
Pension Board Representative Elections and City Council Appointment
Mr. Cherry updated the Board on the Police Department - Seat A, and the General Government – Seat A representative elections, which were still underway. Mr. Cherry advised the Board that he would draft a letter to Vice-Mayor Mark Brown requesting that a City Council representative be appointed before the end of year.
Post Retirement Benefit Adjustment Resolution – Exhibit 2
Motion: Mr. Calloway made a motion to approve the Post Retirement Benefit Adjustment Resolution. Mr. Bates seconded the motion. The motion carried unanimously by the members present.
EXECUTIVE DIRECTOR COMMENTS: None
ATTORNEY COMMENTS:
Glenda Fields Litigation
Attorney Gilbert advised the Board that there was no change regarding the Glenda Fields litigation and that the matter was still scheduled for court later this month.
Global Crossing Bankruptcy Proceedings
Attorney Gilbert advised the Board that the first legal fees invoice, listed on the agenda, had been received from Wilmer, Cutter, Pickering, Hale and Door, in the amount of $608.04. Attorney Gilbert advised the Board that his firm was still waiting to hear from the bankruptcy court on the bankruptcy proceedings matter.
ENROLLMENTS:
The following General Government employees have filed applications to become members of the Plan G1 pension system.
Carolyn S. Beech
Kevin M. Blue
David W. Brown
Matt Conard
Joshua Cox
John F. Gordon, Jr.
Aaron Kline
Charlene H. Landry
Heather Leinbach
Michael D. Widener
Motion: Mr. Bates made a motion to approve these applications for enrollment in the Plan G1 pension system. Mr. Kinney 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.
Jason A. Birkmeier, Police Department, Plan C, Non-vested
James A. Henley, Police Department, Plan C, Non-vested
Penny L. Mize, General Government, Plan G-1, Non-vested
Gerald Nelson, General Government, G-1, Non-vested
Neil Smith, Police Department, Plan C, Non-vested
Motion: Ms. Pelot made a motion to approve these applications for withdrawal of employee contributions. Mr. King seconded the motion. The motion carried unanimously by the members present.
APPEALS:
RETIREMENTS:
APPLICATION FOR RETIREMENT: PLAN A
CHARTER SECTION 1360.12
Walter Joe Downs, Sr., Schools Non-Certified Option A-7
50% with reinstatement Date of birth, September 13, 1943: 62 years of age
Total credited service: 35 years 1 month (combined City & County)
Average base earnings for 3 years, $400.00 x 75% = $3.00
Average excess earnings for 3 years, $4,783.15 x 1.50% = $71.75
making a total of $74.75 benefit per year of service. $74.75 x 35.08333 =
$2,622.48 Total benefit
1,397.74 minus County benefit
1,224.74 Mr. Downs chose Option A-7 – 50% with reinstatement to Jessie V. L. Downs, spouse. $1,224.74 x .8907
$1,090.88 City pension effective November 1, 2005.
Motion: Ms. Pelot made a motion to approve this application for retirement payable under Option A-7. Mr. Calloway seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR EARLY RETIREMENT: PLAN A
CHARTER SECTION 1360.17
Deborah F. Milligan, Schools Certified No Option
Date of birth, October 7, 1950: 55 years of age
Total City credited service: 11 years 9 months
Total County credited service: 18 years 3 months
Total credited service: 30 years
Last date of employment with City: June 1987
Last date of employment with County: October 2005
Average base earnings for 4 years: $400.00 x 75% = $3.00
Average excess earnings for 4 years, $1,054.60 x 1.50% = $15.82
making a total of $18.82 benefit per year of service. $18.82 x 11.750 =
$221.14 x ER factor .5245 =
$115.99 pension effective November 1, 2005.
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 and County benefit is $807.68.
25 years required for Early retirement. Supreme Court ruling entitles retiree to combine City & County credited service.
Motion: Mr. Calloway made a motion to approve this application for retirement. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR DEFERRED RETIREMENT: PLAN A
CHARTER SECTION 1360.28
Margaret R. Ellison, Schools Certified Option A-9
100% with reinstatement
Date of birth, October 24, 1943: 62 years of age
Total City credited service: 21 years
Total County credited service: 12 years 8 months
Total credited service: 33 years 8months
Last date of employment with City: June 1987
Last date of employment with County: February 2000
Average base earnings for 4 years, $400.00 x 75% = $3.00
Average excess earnings for 4 years, $1,378.12 x 1.50% = $20.67
making a total of $23.67 benefit per year of service. $23.67 x 21 =
$497.07. Ms. Ellison chose Option A-9 – 100% Joint & Survivor with reinstatement to Laura Diane Ellison Johnson, daughter. $497.07 x .7167 =
$356.25 pension effective November 1, 2005.
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 and County benefit is $1,115.48.
Motion: Ms. Pelot made a motion to approve this application for a deferred retirement payable under Option A-9. Mr. Kinney seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR RETIREMENT: PLAN G2 – RULE OF 80
CHARTER SECTION 1371.4
Walter S. McDaniel, General Government No Option
Date of birth, October 25, 1951: 54 years of age
Total credited service: 30 years 6 months 29 days
Average monthly salary for 2 highest – 12 month periods, $2,879.10 x 2.1% =
$60.46 x 30.57945 =
$1,848.83 pension effective November 1, 2005.
Motion: Mr. Harrell made a motion to approve this application for retirement. Mr. Bates seconded the motion. The motion carried unanimously by the members present.
David L. Parks, General Government Option A-6
100% without reinstatement
Date of birth, March 31, 1956: 49 years of age
Total credited service: 30 years 6 months 21 days
Average monthly salary for 2 highest – 12 month periods, $2,644.07 x 2.1% =
$55.53 x 30.55754 = $1,696.86. Mr. Parks chose Option A-6 – 100% without reinstatement to Sandra S. Parks, spouse.
$1,696.86 x .9019 =
$1,530.40 pension effective November 1, 2005.
Motion: Mr. Harrell made a motion to approve this application for retirement payable under Option A-6. Mr. Bates seconded the motion. The motion carried unanimously by the members present.
Tanyas R. White, General Government No Option
Date of birth, September 21, 1950: 55 years of age
Total credited service: 27 years 4 months 15 days
Average monthly salary for 2 highest – 12 month periods, $2,309.47 x 2.1% =
$48.50 x 27.37443 =
$1,327.66 pension effective November 1, 2005.
Motion: Mr. Harrell made a motion to approve this application for retirement. Mr. Bates 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 G2.
The following employee has 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.
Bobby R. Sisk, General Government Option A-7
50% with reinstatement
Date of birth, February 13, 1953: 52 years of age
Total credited service: 28 years 11 months 16 days
Average monthly salary for 2 highest – 12 month periods, $2,628.34 x 2.1% =
$55.20 x 28.96050 = $1,598.62. Mr. Sisk chose Option A-7 – 50% with reinstatement to Joyce Ann Sisk, spouse. $1,598.62 x .9388 =
$1,500.78 pension effective November 1, 2005.
DROP complete October 31, 2007.
Motion: Mr. Bates made a motion to approve this application for retirement payable under Option A-7. Ms. Pelot seconded the motion. The motion carried unanimously by the members present.
Randolph B. Vineyard, General Government Option A-9
100% with reinstatement
Date of birth, August 7, 1953: 52 years of age
Total credited service: 29 years 1months17 days
Average monthly salary for 2 highest – 12 month periods, $11,017.49 x 2.1% =
$231.37 x 29.12991 = $6,739.79. Mr. Vineyard chose Option A-9 – 100% with reinstatement to Dale R. Vineyard, spouse. $6,739.79 x .8834 =
$5,953.93 pension effective November 1, 2005.
DROP complete October 31, 2007.
Motion: Mr. Bates made a motion to approve this application for retirement payable under Option A-9. Ms. Pelot seconded the motion. The motion carried unanimously by the members present.
APPROVAL OF INVOICES FOR PROFESSIONAL SERVICES: (GREEN TAB)
Bryan, Pendleton, Swats & McAllister – Actuary (September 2005) $ 8,693.00
Kennerly, Montgomery & Finley – Attorney (General, Oct. 2005) 4,603.58
Wilmer,Cutter, Pickering, Hale and Door, LLP (Global Crossing) 608.04
STW – money manager (3rd Qtr. 2005) 34,797.17
TCW – money manager (3rd Qtr. 2005) 85,407.34
Sterling Johnston – money manager (3rd Qtr. 2005) 82,008.89
Calamos Investments – money manager (3rd Qtr. 2005) 38,528.00
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. Bates made a motion to pay these invoices. Mr. King seconded the motion. The motion carried unanimously by the members present.
OTHER:
INVESTMENT MATTERS:
Dan Holmes – Summit Strategies
Mr. Dan Holmes made a presentation of the 3rd Quarter 2005, Performance Report. A copy of his report is on file in the Pension Office.
UBS Money Manager Review
Mr. Scott Hazen and Mr. Mike Lammers of UBS Global Asset Management made a presentation and distributed a written report. A copy of the report is onfile in the Pension Office.
RREEF – DB Real Estate Money Manager Review
Mr. Jon Thompson and Mr. Chip George made a presentation and distributed a written report. A copy of the report is on file in the Pension Office.
Mayor Haslam left the meeting at 10:30 a.m.
Final Investment Policy – Recommended Changes – Exhibit 3
Mr. Holmes and Mr. Gilbert led a discussion with the Board of recommended final changes to the investment policy. They also recommended additional changes not reflected in the draft version attached to these minutes. The Pension Board concurred with the final recommended changes.
Mr. Kinney made a motion that a final marked up version subject to the inclusion of the additional changes discussed and recommended by Mr. Holmes and Mr. Gilbert be adopted. Mr. Kinney’s motion also instructed the final version be presented to City Council for their consideration at the December 6, 2005 council meeting. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
PUBLIC COMMENTS:
ADJOURNMENT:
There being no further business, the following motion was made:
Motion: Mr. Kinney made a motion to adjourn the meeting at 10:49 a.m. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
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Chair
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Date
M:\Board\minutes\2005\november.doc