CITY OF KNOXVILLE PENSION BOARD
MINUTES
Thursday – July 9, 2009
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 July 9, 2009.
Present were: Mayor Bill Haslam, Mr. Greg Coker, Mr. Joe Hackney, Mr. Jim Hutchens, Ms. Barbara Pelot, Ms. Robin Shelton, Mr. Jim York, Mr. Michael Cherry and Attorney Bud Gilbert.
Also present: Mr. Jason A. Roark, Fire Department – Injury In Line of Duty applicant, and his wife Mrs. Cheryl Roark.
CALL TO ORDER:
Mayor Haslam presided and called the meeting to order at 8:17 a.m.
APPROVAL OF REGULAR MEETING MINUTES FOR June 11, 2009.
Mr. Hackney made a motion to approve the June 11, 2009, 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
DISABILITY
APPLICATION FOR INJURY IN LINE OF DUTY: PLAN C – Exhibit 2
CHARTER SECTION 1390.11
Jason A. Roark, Fire Dept. – Uniformed Option A -9
100% with reinstatement
Date of birth, August 26, 1974: 34 years of age
Total credited service: 7 years 3 months 9 days
Average monthly salary for 2 highest 12 month periods, $3,018.88 x 50% =
$1,509.44. Mr. Roark chose Option A-9 – 100% with reinstatement to Cheryl J. Roark, spouse. $1,509.44 x .96830 =
$1,461.59 pension effective August 1, 2009.
Motion: Mr. Hackney made a motion to approve this application for injury in line of duty pension, based on Dr. Jeffrey Uzzle’s medical evaluation and Mr. Cherry’s Disability Recommendation Report, with a review to be performed in one year. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
Ms. Shelton arrived at 8:21 a.m.
ADMINISTRATIVE MATTERS:
Technology Upgrades Plan
Mr. Cherry reviewed with the Board the costs involved to replace the Pension Office computer server, which due to its age and the inability to be accessed remotely, needed to be replaced in the near future. Mr. Cherry further explained that the Pension Office’s ability to receive e-mails was currently tied in with the City’s network and he would also like to have audio-visual conferencing capabilities not presently available.
Ms. Pelot recommended that Mr. Cherry confer with Janet Wright in the City’s Information Systems Department to see what assistance, and or technology could be shared from their department.
EXECUTIVE DIRECTOR COMMENTS: None
ATTORNEY COMMENTS:
Stone Energy Litigation
Attorney Gilbert informed the Board that they would be receiving by mail a memorandum for their review informing them about the pleadings relative to the Stone Energy Litigation.
Plan G1 Member Benefit Calculation Request
Attorney Gilbert informed the Board that attorney Al Holifield had requested an opinion from Mr. Gilbert on rules relating to a Pension Board member’s voting rights wherein they have a personal financial interest. Attorney Gilbert advised the Board that he would share with them his research memo on this matter when it was completed.
Contested Case Hearings
Attorney Gilbert informed the Board about a meeting scheduled later this morning with Mr. Cherry and the City’s Law Department regarding the Law Department’s willingness to represent the Executive Director in contested case hearings before the Board because Attorney Gilbert’s firm will be unable to serve in such capacity since it serves as general counsel to the Board. Attorney Gilbert also informed the Board that Attorney Bill Petty had agreed to serve as a contested case hearing officer for the Board.
Richard T. Woodby Appeal – Exhibit 3
Motion: Ms. Pelot made a motion to ratify Mr. Cherry’s actions as presented in his March 6, 2009, letter to Mr. Richard T. Woodby denying Mr. Woodby’s appeal of Mr. Cherry’s administrative determination. Mr. Hackney seconded the motion. The motion passed with all members voting for approval except Mr. Hutchens, who abstained.
Investment Committee
Attorney Gilbert informed the Board that two meetings had been held to date by the newly formed Investment Committee. Attorney Gilbert advised the Board that the meeting minutes would be presented to the Board in the near future, detailing the following actions taken by the committee:
1) Recommended Changes to Investment Committee Charter – Exhibit 4
Motion: Mr. Hackney made a motion to approve the changes to the Investment Committee Charter recommended by the Investment Committee as presented in the proposed revised draft. Mr. Hutchens seconded the motion. The motion carried unanimously by the members present.
2) Recommended a revision to the Board’s Statement of Investment Policy by adding a new bullet under the “Duties” of the Investment Consultant charging the consultant with the following additional duties:
- Maintain the role of a proactive watchdog over investment community developments that might adversely impact the Pension Fund and its investment managers;
- Notify the Board of such developments and recommend to the Board any needed actions related to the same; and
- Routinely review and recommend any needed reallocations of the Pension Fund’s investments to the Board.
3) Recommended that the Investment Consultant participate in all future Investment Committee meetings by telephone.
4) Adopted a regular practice of reviewing the Pension Fund’s recent financial statements to assess rebalancing needs.
5) Decided that the committee meeting minutes should be distributed to all Board members and to the Investment Consultant.
Glenda Fields’ Litigation
Attorney Gilbert advised the Board that he was still awaiting a decision from Chancellor Weaver on Glenda Fields’ litigation.
WITHDRAWALS:
The following employees have filed an application to withdraw employee pension contributions plus 4% interest and the supplemental retirement account as applicable in Plan G Option 1.
Anthony M. Barnes, Police Dept., Plan C - Vested
Nicky R. Bryant, Police Dept., Plan C – Vested
Donald S. Clark, Police Dept., Plan C – Vested
Glenn Olfe, General Govt., G-1 – Non-vested
Madeleine Weil, General Govt., G-1 – Non-vested
Harry F. Young, Jr. General Govt., G-1 – Non-vested
Motion: Mr. York made a motion to approve these applications for withdrawal of employee contributions. Mr. Coker seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR DEFERRED RETIREMENT: PLAN A
CHARTER SECTION 1360.28
Margaret Massey-Cox, Schools Certified No Option
Date of birth, June 27, 1947: 62 years of age
Total City credited service: 15 years 5 months
Total County credited service: 1 year 10 months
Total credited service: 17 years 3 months
Last date of employment with City: June 1987
Last date of employment with County: April 1989
Average base earnings for 4 years, $400.00 x 75% = $3.00
Average excess earnings for 4 years, $2,014.62 x 1.50% = $30.22
making a total of $33.22 benefit per year of service. $33.22 x 15.41667 =
$512.14 pension effective July 1, 2009
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 $824.90.
Motion: Ms. Pelot made a motion to approve this application for deferred retirement. Ms. Shelton seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR EARLY RETIREMENT: PLAN A
CHARTER SECTION 1360.17
James Andrews, Schools Certified No Option
Date of birth, June 21, 1950: 59 years of age
Total City credited service: 14 years
Total County credited service: 22 years
Total credited service: 36 years
Last date of employment with City: June 1987
Last date of employment with County: June 2009
Average base earnings for 4 years, $400.00 x 75% = $3.00
Average excess earnings for 4 years, $1,681.96 x 1.50% = $25.23
making a total of $28.23 benefit per year of service. $28.23 x 14 =
$395.22 x ER Factor .7513 =
$296.93 pension effective July 1, 2009
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 $2,521.84.
25 years required for Early retirement. Supreme Court ruling entitles retiree to combine City and County credited service.
Motion: Mr. Hutchens made a motion to approve this application for Early retirement. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
Lenora Knight, Schools Certified No Option
Date of birth, September 13, 1953: 55 years of age
Total City credited service: 11 years
Total County credited service: 22 years
Total credited service: 33 years
Last date of employment with City: June 1987
Last date of employment with County: June 2009
Average base earnings for 4 years, $400.00 x 75% = $3.00
Average excess earnings for 4 years, $1,083.93 x 1.50% = $16.26
making a total of $19.26 benefit per year of service. $19.26 x 11 = $211.86
$211.86 x ER Factor .5726 =
$121.31 pension effective July 1, 2009
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 $1,582.14.
25 years required for Early retirement. Supreme Court ruling entitles retiree to combine City and County credited service.
Motion: Mr. Hutchens made a motion to approve this application for Early retirement. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
Richard Ward, Schools Certified No Option
Date of birth, August 29, 1953: 55 years of age
Total City credited service: 11 years
Total County credited service: 22 years
Total credited service: 33 years
Last date of employment with City: June 1987
Last date of employment with County: June 2009
Average base earnings for 4 years, $400.00 x 75% = $3.00
Average excess earnings for 4 years, $1,168.45 x 1.50% = $17.53
making a total of $20.53 benefit per year of service. $20.53 x 11 = $225.83
$225.83 x ER Factor .5726 =
$129.31 pension effective July 1, 2009
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 $1,841.77.
25 years required for Early retirement. Supreme Court ruling entitles retiree to combine City and County credited service.
Motion: Mr. Hutchens made a motion to approve this application for Early retirement. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR RETIREMENT: PLAN G1
CHARTER SECTION 1360.12
James H. Fletcher, General Government Option A-6
100% without reinstatement
Date of birth, March 30, 1938: 70 years of age
Total credited service: 9 years 7 months 19 days
Average monthly salary for 2 highest 12 month periods, $1,939.40 x .0135% =
$26.18 x 9.63539 = $252.25. Mr. Fletcher chose Option A-6 – 100% without reinstatement to Theresa A. Fletcher, daughter. $252.25 x .5924 =
*$149.43 pension (defined benefit) effective February 1, 2009
*Mr. Fletcher chose to withdraw the supplemental retirement account in the amount of $8,093.27 as applicable in Plan G1.
Motion: Mr. Pelot made a motion to approve this application for Normal retirement payable under Option A-6. Mr. York seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR DEFERRED RETIREMENT: PLAN G1
CHARTER SECTION 1360.28
William J. Curran, General Government Option A-6
100% without reinstatement
Date of birth, June 28, 1947: 62 years of age
Total credited service: 6 years 8 months 18 days (last employed December 2004)
Average monthly salary for 2 highest 12 month periods, $2,093.60 x .0115% =
$24.08 x 6.71598 = $161.72. Mr. Curran chose Option A-6 – 100% without reinstatement to Regina M. Curran, spouse. $161.72 x .8336 =
*$134.81 pension (defined benefit) effective July 1, 2009
*Mr. Curran chose to convert the supplemental retirement account, applicable in Plan G1, into an additional, lifetime monthly annuity pending the quarter ended June 30, 2009, account value determination.
Motion: Ms. Shelton made a motion to approve this application for Deferred retirement payable under Option A-6. Mr. York seconded the motion. The motion carried unanimously by the members present.
APPLICATION FOR RETIREMENT: PLAN G2
CHARTER SECTION 1360.12
Carol T. Michaels, General Government No Option
Date of birth, April 9, 1945: 64 years of age
Total credited service: 15 years 1 month 9 days
Average monthly salary for 2 highest 12 month periods, $2,674.95 x .021 =
$56.17 x 15.10799 =
$848.62 pension effective July 1, 2009
Motion: Mr. Coker made a motion to approve this application for Normal retirement. Ms. Pelot seconded the motion. The motion carried unanimously by the members present.
Carolyn S. Nelson, General Government Option A-7
50% with reinstatement
Date of birth, April 6, 1946: 63 years of age
Total credited service: 10 years 10 months 29 days
Average monthly salary for 2 highest 12 month periods, $3,228.77 x .021 =
$67.80 x 10.91279 = $739.89. Ms. Nelson chose Option A-7 – 50% with reinstatement to Gary Eugene Nelson, spouse. $739.89 x .9092 =
$672.71 pension effective July 1, 2009
Motion: Mr. Coker made a motion to approve this application for Normal retirement payable under Option A-7 with reinstatement. Ms. Pelot seconded the motion. The motion carried unanimously by the members present.
APPROVAL OF INVOICES FOR PROFESSIONAL SERVICES:
Bryan, Pendleton, Swats & McAllister – Actuary (May 2009) $ 4,335.00
Kennerly,Montgomery & Finley – Attorney (General – May 09) 3,422.30
Kennerly,Montgomery & Finley – Attorney (General – June 09) 3,715.14
State Street – Trustee (May 2009) 3,444.28
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. Hutchens made a motion to pay these invoices. Mr. Hackney seconded the motion. The motion carried unanimously by the members present.
INVESTMENT MATTERS:
State Street Wells Notice – Exhibit 5
Mr. Cherry informed and discussed with the Board a Wells Notice received by State Street Global Advisors.
RREEF Real Estate – Exhibits 6 and 7
Mr. Cherry distributed to the Board two memorandums which had been e-mailed previously by Dan Holmes regarding the RREEF America fund.
Mr. Cherry advised the Board that the Investment Committee had not heard from Summit Strategies on these issues, but stressed to the Board that we are not directly affected since the assets held by the fund are held in a different account with RREEF.
Mayor Haslam left the meeting at 8:59 a.m. and Ms. Pelot presided.
The Board affirmed its desire to be made aware of significant investment community developments and issues involving any of the Board’s current investment managers, by Summit Strategies, regardless of the Pension Fund’s direct or indirect involvement and the Investment Consultant’s recommended action, if any, with respect to such matters.
OTHER: None
PUBLIC COMMENTS: None
ADJOURNMENT:
Motion: Mr. Hackney made a motion to adjourn the meeting at 9:20 a.m. Mr. Coker seconded the motion. The motion carried unanimously by the member present.
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Chair
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Date