CITY OF KNOXVILLE PENSION BOARD
MINUTES
Thursday – November 13, 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 November 13, 2008.
Present were: Ms. Barbara Pelot, Mr. Greg Coker, Mr. Joe Hackney, Mr. Buddy Harrell, Ms. Robin Shelton, Mr. Michael Cherry and Attorney Bud Gilbert.
Also present: Mr. Alan Pennington and Ms. Mandy Lee Bratton with Bryan, Pendleton, Swats & McAllister; Mr. Tim Sant, Summit Strategies; Mr. Mike Lammers and Mr. Tom Digeman with UBS Global Asset Management; Mr. W. Alan Purser and Mr. Chip George with RREEF; Mr. Peter Marron and Mr. Ken Sobolewski with Pinnacle Associates.
CALL TO ORDER:
Ms. Pelot presided and called the meeting to order at 8:15 a.m.
APPROVAL OF REGULAR MEETING MINUTES FOR October 9, 2008.
Ms. Shelton made a motion to approve the October 9, 2008, 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:
Actuary Presentation
Alan Pennington – Bryan, Pendleton, Swats & McAllister presented the actuarial valuation as of July 1, 200 8.
Motion: Mr. Hackney made a motion to defer acceptance of the actuarial valuation to the December Pension Board meeting. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
Elections
Mr. Cherry informed the Board about the elections underway for Pension Board, Seat A representatives, in both the General Government and Police Uniformed body divisions. Mr. Cherry advised the Board that both Buddy Harrell’s (General Government) and Greg Coker’s (Police – Uniformed) terms would end December 31, 2008.
Mr. Cherry advised the Board that one nomination, for Greg Coker, from the Police Department had been received and certified by the staff, and ballots had been mailed to all active employees in the Police Department.
In the General Government section, Mr. Cherry advised the Board of three nominations received and certified, Mr. James Hutchens, Mr. Donald Jenkins and Mr. Stephen King, with ballots due to be mailed out Friday, November 14, 2008.
Post Retirement Benefit Adjustment – Exhibit 2
Mr. Cherry reviewed with the Board the cost of living adjustments effective January 1, 2009, with a formal resolution to be presented to the Board for their acceptance at the December Pension Board meeting.
Schedule Pension Board Meetings for First Quarter 2009
Thursday, January 8, 2009 – 8:15 a.m.
Thursday, February 12, 2009 – 8:15 a.m.
Thursday, March 12, 2009 – 8:15 a.m.
The Pension Board meeting schedule was accepted without objection.
EXECUTIVE DIRECTOR COMMENTS: None
ATTORNEY COMMENTS:
Glenda Fields’ Litigation
Attorney Gilbert informed the Board that his firm is finalizing the response brief for the Glenda Field’s litigation, and copies would be forwarded to each Board member upon its completion.
Securities Litigation
Attorney Gilbert advised the Board that he continued to work on the development of a policy for the Board regarding their participation in securities litigation.
Investment Management
Attorney Gilbert discussed with the Board some of the details involved in the contract with Batterymarch, the fund’s new international emerging markets manager hired by the Board in July.
ENROLLMENTS:
The following General Government employees have filed applications to become members of the Plan G1 pension system.
Ronald L. Frank
Jennifer D. Graham
Lisa B. Hatfield
Keri A. Henley
Mary W. Lewis
Evangeline A. Moore
Randall A. Webb
Motion: Mr. Harrell made a motion to approve these applications for enrollment in the Plan G1 pension system. Mr. Hackney 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.
Dawn Broyles, General Govt., G1 – Non-vested
John D. Case, General Govt., Plan G1 – Vested
Julius Harper, General Govt., Plan G1 – Non-vested
Charles Pack, Police Dept., Plan C – Vested
Jeffrey S. Roberson, General Govt., Plan G1 – Non-vested
Dena Stevenson, General Govt., Plan G1 – 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.
DISABILITY
APPLICATION FOR INJURY NOT IN LINE OF DUTY: PLAN G2
CHARTER SECTION 1360.20
Howard G. Montgomery, Jr., General Government Option A-7
50% with reinstatement
Date of birth, March 5, 19 58: 50 years of age*
*Computed as if 62 years of age
Total credited service: 20 years 6 months 9 days
Average monthly salary for 2 highest 12 month periods, $2,720.18 x 2.1% =
$57.12 x 20.52466 = $1,172.37. Mr. Montgomery chose Option A-7 – 50% with reinstatement to Patricia Ann Montgomery, spouse. $1,172.37 x .9429 =
$1,105.43 pension effective October 1, 2008.
Motion: Mr. Hackney made a motion to approve this application for Disability Not in Line of Duty retirement payable under Option A-7 based on Dr. Lisa Bellner’s report and Mr. Cherry’s disability recommendation report with a review to be performed in one year. Ms. Shelton seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR RETIREMENT: PLAN G1 – NORMAL
CHARTER SECTION 1360.12
Maurice T. Bridges, General Government Option A-6
100% without reinstatement
Date of birth, October 15, 1939: 69 years of age
Total credited service: 11 years 4 months 27 days
Average monthly salary for 2 highest 12 month periods, $3,530.32 x .0135% =
$47.66 x 11.40731 = $543.67. Mr. Bridges chose Option A-6 – 100% without reinstatement to Debra L. Bridges, spouse. $543.67 x .7073 = $384.54.
*Mr. Bridges elected to convert the supplemental retirement account applicable in Plan G1 into an additional monthly annuity. Mr. Bridges benefit consists of $384.54 (defined benefit) plus $141.20 (supplemental portion).
*$525.74 pension effective November 1, 2008.
Motion: Mr. Harrell made a motion to approve this application for normal retirement payable under Option A-6. Ms. Shelton seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR RETIREMENT: PLAN G2 – NORMAL
CHARTER SECTION 1360.12
John E. Venn, General Government Option A-6
100% without reinstatement
Date of birth, October 26, 1946: 62 years of age
Total credited service: 12 years 5 months 26 days
Average monthly salary for 2 highest, 12 month periods, $4,087.09 x .021 =
$85.83 x 12.48790 = $1,071.84. Mr. Venn chose Option A-6 – 100% without reinstatement to Mary Ellen Venn, spouse. $1,071.84 x .8148 =
$873.34 pension effective November 1, 2008.
Motion: Mr. Coker made a motion to approve this application for normal retirement payable under Option A-6. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR DEFERRED RETIREMENT: PLAN G1
CHARTER SECTION 1360.28
Leslie Henderson, General Government No Option
Date of birth, October 5, 1946: 62 years of age
Total credited service: 5 years 10 months
Average monthly salary for 2 highest, 12 month periods, $6,691.46 x .0115 =
$76.95 x 5.83333
$448.87 (defined benefit) pension effective November 1, 2008
A one time payment will be issued for the supplemental retirement account applicable in Plan G1.
Motion: Mr. Harrell made a motion to approve this application for deferred retirement. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR DEFERRED RETIREMENT: PLAN G2
CHARTER SECTION 1360.28
Lonnie V. Corum, General Government Option A-7
50% with reinstatement
Date of birth, October 28, 1946: 62 years of age
Total credited service: 13 years 8 months 23 days
Average monthly salary for 2 highest, 12 month periods, $2,032.46 x .021 =
$42.68 x 13.72968 = $585.98. Mr. Corum chose Option A-7 – 50% with reinstatement to Evelyn Corum, spouse. $585.98 x .8938 =
$523.75 pension effective November 1, 2008
Motion: Mr. Harrell made a motion to approve this application for deferred retirement, subject to TCA Section 8-35-124, payable under Option A-7. Ms. Shelton 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.
Robert J. Weatherstone, General Government – Plan G1 No Option
Date of birth, October 19, 1945: 63 years of age
Total credited service: 16 years 4 months 12 days
Plan A benefit: Average base salary for 2 highest 12 month periods, $400.00 x .0084% = $3.36 x 5.0 = $16.80 plus average excess salary for 2 highest 12 month periods, $2,479.81 x .017 = $42.16 x 5.0 = $210.80. Total A benefit = $227.60.
Plan G1 benefit: Average monthly salary for 2 highest 12 month periods, $2,879.81 x .0121 = $34.85 x 11.36621 = $396.11.
*Total defined benefit: $623.71
$623.71 pension effective November 1, 2008.
DROP complete October 31, 2010.
*Defined benefit portion only. Mr. Weatherstone will receive a one time payment of Supplemental Retirement Account upon termination.
Motion: Mr. Harrell made a motion to approve this application for DROP retirement. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
Sharon E. Boyce, General Government – Plan G2 Option A-6
100% without reinstatement
Date of birth, December 24, 1949: 58 years of age
Total credited service: 34 years 4 months 7 days
Average monthly salary for 2 highest 12 month periods, $7,279.56 x .021 =
$152.87 x 34.35251 = $5,251.47. Ms. Boyce chose Option A-6 – 100% without reinstatement to Albert Jackson Woodall, spouse. 5,251.47 x .8738 =
$4,588.73 pension effective November 1, 2008.
DROP complete October 31, 2010.
Motion: Mr. Harrell made a motion to approve this application for DROP retirement payable under Option A-6. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
David L. Hubbard, General Government – Plan G2 No Option
Date of birth, September 7, 1953: 55 years of age
Total credited service: 28 years 9 months 11 days
Average monthly salary for 2 highest 12 month periods, $3,308.41 x .021 =
$69.48 x 28.78014 =
$1,999.64 pension effective November 1, 2008.
DROP complete October 31, 2010.
Motion: Mr. Harrell made a motion to approve this application for DROP retirement. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
APPROVAL OF INVOICES FOR PROFESSIONAL SERVICES:
Bryan, Pendleton, Swats & McAllister – Actuary (Sept. 2008) $6,590.00
Kennerly,Montgomery & Finley – Attorney (General – Oct. 2008) 2,240.27
Kennerly,Montgomery & Finley – Attorney (G. Fields – Oct. 2008) 152.00
Kennerly,Montgomery & Finley – Attorney (Global Crossing) 183.63
State Street – Custodial (September 2008) 8,457.26
State Street – Trustee (July 2008) 3,342.49
State Street – Trustee (August 2008) 3,319.26
Aberdeen – Money Manager (3rd Qtr. – 2008) 35,018.24
AQR – Money Manager (3rd Qtr. – 2008) 87,258.00
Calamos – Money Manager (3rd Qtr. – 2008) 29,421.00
INTECH – Money Manager (3rd Qtr. – 2008) 8,153.74
Pinnacle – Money Manager (3rd Qtr. – 2008) 60,733.00
STW – Money Manager (3rd Qtr. – 2008) 27,431.98
UBS – Money Manger (3rd Qtr. – 2008) 22,128.23
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: Ms. Shelton made a motion to pay these invoices. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
INVESTMENT MATTERS:
Money Manager Reviews
UBS Money Manager Review
Mr. Mike Lammers and Mr. Tom Digeman with UBS Global Asset Management made a presentation and distributed a written report. A copy is on file in the Pension Office.
RREEF – DB Real Estate Money Manager Review
Mr. W. Alan Purser and Mr. Chip George with RREEF made a presentation and distributed a written report. A copy is on file in the Pension Office.
Pinnacle
Mr. Peter Marron and Mr. Ken Sobolewski with Pinnacle Associates made a presentation and distributed a written report. A copy is on file in the Pension Office.
Tim Sant – Summit Strategies
Mr. Tim Sant made a presentation of the 3rd Quarter 2008, Performance Report. Copies of his reports are on file in the Pension Office.
OTHER: None
PUBLIC COMMENTS: None
ADJOURNMENT:
Motion: Mr. Coker made a motion to adjourn the meeting at 12:20 p.m. Mr. Hackney seconded the motion. The motion carried unanimously by the member present.
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Chair
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Date