CITY OF KNOXVILLE PENSION BOARD
MINUTES
DECEMBER 8, 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, 917 E. 5th Avenue at 8:15 a.m. on December 8, 2005.
Present were: Mr. Kent Bates, Mr. Scott Calloway, Mr. Buddy Harrell, Mr. Stephen King, Mr. Christopher Kinney, Ms. Barbara Pelot, Mr. Michael Cherry and Attorney Bud Gilbert.
Also present: Jerrod Smith, former Knoxville Police Department Officer, an appeals applicant: Lt. Cheri Matlock, Knoxville Police Department.
CALL TO ORDER:
Mr. Bates presided and called the meeting to order at 8:23 a.m.
APPROVAL OF REGULAR MEETING MINUTES FOR November 10, 2005
Motion: Ms. Pelot made a motion to approve the November 10, 2005, meeting minutes. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
APPROVAL OF REVISED AGENDA: Exhibit 1
CONTRACTS: None
ADMINISTRATIVE MATTERS:
City Council Approves Investment Policy – Exhibit 2
Mr. Cherry informed the Board that the revised Investment Policy was approved by City Council at the December 6, 2005, City Council meeting. Attorney Gilbert distributed to the Board an official copy with all the changes marked. Mr. Cherry advised the Board that a copy of the City Council meeting minutes will be attached to the Pension Board’s meeting minutes as of today’s date, as soon as they are available from City Council.
Mr. Cherry also informed the Board that the procedures brought before City Council for making changes to the Pension System passed on first reading and would be on the City Council’s December 20, 2005, agenda for a second reading. Mr. Cherry advised the Board that he would send letters to employee groups informing them again about the procedures and would also schedule a time that Attorney Gilbert would be available to answer any questions employees might have.
Reminder to elect Officers (Chair, Vice-Chair & Secretary) for 2006, at the January 12, 2006, Board Meeting
Mr. Cherry reminded the Pension Board members that officers for the 2006 calendar year would need to be elected at the January 12, 2006, Pension Board meeting.
Schedule Pension Board Meetings for First Quarter 2006
Thursday, January 12, 2006 – 8:15 a.m.
Thursday, February 9, 2006 – 8:15 a.m.
Thursday, March 9, 2006 - 8:15 a.m.
It was the consensus of the Board to accept the Pension Board meeting schedule for the first quarter 2006.
Acceptance of Actuarial Report
Motion: Mr. Calloway made a motion to accept the actuarial report as of July 1, 2005, as prepared and presented by the Pension Board’s actuary at the November 10, 2005, Pension Board meeting. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
Mr. Cherry advised the Board that he would send a letter to the Treasurer’s Office regarding the City’s employer contributions.
Pension Board Representative Elections and City Council Appointment
General Government Seat A Election – Exhibit 3
Mr. Cherry advised the Board that Buddy Harrell had been certified as elected to General Government – Seat A representative for the three year term beginning January 1, 2006 through December 31, 2008. Mr. Cherry informed the Board that Mr. Harrell had receive 100% of the votes.
Uniformed Bodies Seat A Election – Exhibit 4
Mr. Kinney arrived at 8:28 a.m.
Mr. Cherry directed the Board’s attention to the three page handout in the FYI file detailing the results of the Uniformed Bodies Seat A election. After a discussion of the election and resulting withdrawal letters submitted by Mr. Ryerkerk and Mr. Moran, the following motion was made:
Motion: Mr. Kinney made a motion to declare a run off election be held between the two candidates, Mr. James Coker and Mr. Brian Moran, who were the two highest vote recipients. Ms. Pelot seconded the motion. The motion passed unanimously by the members present.
Plan C to G1 Transfers – Exhibit 5
Mr. Cherry discussed with the Board a procedure for Division C employee transfers to Pension Plan G1 that he, in conjunction with the Board’s actuary, Alan Pennington, had prepared. Mr. Cherry advised the Board that he would prepare a list of affected employees to date, and bring the list to the Board before the procedure would be adopted as a final rule.
EXECUTIVE DIRECTOR COMMENTS:
Letter to Steve Sanders – Exhibit 6
Mr. Cherry advised the Board of a notification he had received that Steve Sanders, a former Knoxville Police Officer, who is receiving an In Line of Duty pension, is employed as a Police Officer for the City of Oliver Springs. Mr. Cherry advised the Board that he had written a letter to Mr. Sanders requesting documents for the Board’s review to determine if Mr. Smith is still disabled. Mr. Cherry informed the Board that Mr. Sanders had been given a 30 day notice to submit the documentation, and if the documentation is received in a timely manner, the Board will be able to review the records at the January 12, 2006, board meeting.
ATTORNEY COMMENTS:
Glenda Fields Litigation
Attorney Gilbert informed the Board that the Glenda Field’s litigation had been re-scheduled, at the request of Attorney Tony Farmer, for January 5, 2006.
Global Crossing Bankruptcy Proceedings
Attorney Gilbert advised the Board that Global Crossing Bankruptcy briefs had been submitted, but no opinion had been issued yet from the bankruptcy court.
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.
James S. Boles, General Government, Plan G-1, Non-vested
Vickie E. Fox, Police Department, Plan C – Non-vested
Eric V. Hill, General Government, Plan G-1, Non-vested
David P. Hudgins, General Government, Plan G-1, Non-vested
Motion: Mr. Calloway 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:
Jerrod W. Smith – Police Dept. Uniformed – Exhibit 7
Jerrod Smith, a former Knoxville Police Department Officer, appeared before the Board to appeal Mr. Cherry’s administrative determination to deny his application for an injury in line of duty pension disability. Attorney Gilbert advised Mr. Smith that he had the right to have legal representation, and if additional time was needed, the matter could be deferred to a later meeting. Mr. Smith informed the Board that he was ready to proceed with the decision by the Board.
Motion: Mr. Kinney made a motion to defer the appeal to the January 12, 2006, board meeting in order to give the board members time to review all of Mr. Smith’s medical records. Ms. Pelot seconded the motion. The motion carried unanimously by the members present.
RETIREMENTS:
APPLICATION FOR DISABILITY NOT IN LINE OF DUTY RETIREMENT: PLAN G1
CHARTER SECTION: 1360.20
Beverly D. Solomon, General Government No Option
Date of birth, February 15, 1961: 44 years of age*
*(computed as if 62 years of age)
Total credited service: 15 years 6 months 13 days
Plan A benefit: Average base salary for 2 highest 12 month periods, $400.00 x .0081% = $3.24 x 7.83333 = $25.38 plus average excess salary for 2 highest 12 month periods, $1,317.19 x .0162% = $21.34 x 7.83333 = $167.16. Total A benefit =
$192.54.
Plan G1 benefit: Average monthly salary for 2 highest 12 month periods, $1,717.19 x .0115% = $19.75 x 7.70229 = $152.12
*Total defined benefit: 344.66
$344.66 pension effective November 1, 2005.
One time payment of Supplemental Retirement Account
*Defined benefit portion only. Ms. Solomon had previously applied for and received a lump sum for the supplemental retirement account.
Motion: Mr. Harrell made a motion to approve this application for a Disability Not In Line of Duty retirement. Ms. Pelot seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR INJURY IN LINE OF DUTY RETIREMENT: PLAN G1
CHARTER SECTION: 1360.22
Tresia L. Conner, General Government Option B-12
15 Yr. Certain & Life
Date of birth, July 16, 1965: 40 years of age*
Total credited service: 2 years 1 month 17 days**
*(computed as if 62 years of age)
**Computed as if worked until 62 (23 years 10 months 2 days)
$324.16 (defined benefit) pension effective May 1, 2005.
One time payment of Supplemental Retirement Account
Motion: Mr. Harrell made a motion to defer this application for an injury in line of duty pension to the January 12, 2006, board meeting. Ms. Pelot seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR RETIREMENT: PLAN A
CHARTER SECTION 1360.12
Nancy R. Sexton, Schools Non-Certified No Option Date of birth, March 31, 1937: 68 years of age
Total credited service: 28 years 8 months (combined City & County)
Average base earnings for 3 years, $400.00 x .88% = $3.52
Average excess earnings for 3 years, $2,063.48 x 1.76% = $36.32
making a total benefit of $39.84 benefit per year of service. $39.84 x 28.6667 =
$1,142.08 Total benefit
797.12 minus County benefit
344.96 City pension effective December 1, 2005.
Motion: Mr. Calloway made a motion to approve this application for retirement. Mr. King seconded the motion. The motion passed unanimously by the members present.
APPLICATION FOR RETIREMENT: PLAN G1
CHARTER SECTION 1360.12
James J. Prater, General Government No Option
Date of birth, November 22, 1943: 62 years of age
Total credited service: 8 years 4 months 24 days
Average monthly salary for 2 highest 12 month periods, $1,856.14 x .0115% = $21.35 x 8.39909 = $179.32
*Total defined benefit: $179.32 (all service was post 1997)
$179.32 pension effective December 1, 2005.
One time payment of Supplemental Retirement Account
*Defined benefit portion only. Mr. Prater will receive a lump sum for the supplemental retirement account.
Motion: Mr. Calloway made a motion to approve this application for retirement. Mr. King seconded the motion. The motion passed unanimously by the members present.
APPROVAL OF INVOICES FOR PROFESSIONAL SERVICES:
Bryan, Pendleton, Swats & McAllister – Actuary (October 2005) $ 9,098.00
Kennerly, Montgomery & Finley – Attorney (Nov. 2005-General) 3,659.60
Kennerly, Montgomery & Finley – Attorney (Nov. 2005-G. Fields) 2,250.00
UBS – money manager (3rd Qtr. 2005) 30,249.55
INTECH – money manager (3rd Qtr. 2005) 94,441.69
Deutsche – money manager (3rd Qtr. 2005) 38,584.63
State St. Global – money manager (3rd Qtr. 2005) 4,490.70
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. Harrell made a motion to pay these invoices. Ms. Pelot seconded the motion. The motion carried unanimously by the members present.
INVESTMENT MATTERS:
Conference call to Dan Holmes
A teleconference was held with Dan Holmes to discuss the Non-Large Cap Growth Equity Manager Search. After a lengthy discussion with Mr. Holmes the following motion was made:
Motion: Ms. Pelot made a motion to interview Pinnacle, Cortina and Oberweis. Mr. Kinney seconded the motion. The motion carried unanimously by the members present.
Mr. Holmes advised the Board that he would schedule the interviews either in January or February 2006.
Mr. King left the meeting at 10:13 a.m.
OTHER:
RECOGNITION OF MR. KENT BATES SERVICE ON THE PENSION BOARD:
Mr. Cherry presented Mr. Bates with a plaque in appreciation of his service on the Pension Board.
PUBLIC COMMENTS: None
ADJOURNMENT:
There being no further business, the following motion was made:
Motion: Mr. Kinney made a motion to adjourn the meeting at 10:17 a.m. Mr. Harrell seconded the motion. The motion carried unanimously by the members present.
______________________
Chair
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Date
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