MINUTES
HULL CONTRIBUTORY RETIREMENT BOARD MEETING
May 26, 2004
The regular meeting of the Hull Contributory Retirement Board, duly posted to be held in the Selectmen's Meeting Room, Town Hall, Hull, MA on the above date was called to order at 9:04 a.m. Present were Leonard Colten, Chairperson, Members Chris McCabe, Ann MacNaughton and James Yacobucci, and Retirement Administrator Marcia Bohinc.
The Board read and attested to the minutes of the April 28, 2004 regular board meeting without correction.
The Board signed all bill warrants for May 2004.
The Board signed the contributory payroll for May 2004.
Richard Colton, identified by PERAC as having failed to comply with the medical evaluation process as required by G.L. c. 32, §8, was duly notified by the Retirement Board of his right to appear before the retirement board. He failed to appear; therefore his retirement allowance will be terminated due to failure to comply with the request for medical records or verification that no records exist. He has been notified of his right to appeal the action to the Contributory Retirement Appeal Board.
Mr. Colton's benefits had previously been suspended by the board for failure to submit the required annual report of earnings as required by G.L. c32, §91A.
The Board approved the new member application for highway department employee Vincenzo G. Magnoli, III.
Retirement Allowance Adjustments
Following a thorough review and correction of the Cost of Living Adjustment (COLA) Reimbursement Report from the State, the board reviewed and approved payment adjustments for several retirees as required by G.L. c. 32, §20(5)(c)(2).
Payments in arrears were identified for several retirees for a variety of reasons, however most were due to incorrect COLA calculations made in the early 1980's. The current retirement allowance has been corrected for the May 31, 2004 payroll, and the overdue amounts will be paid in May and June. The retirees due a retro payment are: Flora Belmarsh, Blanche Bennett, Josephine Darcy, Eleanor Emanuello, Irene Embree, Linda May, Jeannette Means, Virginia Mercurio, June Osgood, Hildred Parent, John Sharp, George Sutherland.
Also discovered in this review was a discrepancy in the payment of supplemental dependant allowances. According to the Public Employee Retirement Administration Commission (PERAC), the Hull Contributory Retirement System accepted the provisions of G.L. c. 32 §22D as of December 31, 1990, a provision of which increased the supplemental dependant allowance. The retirees of the Hull Retirement System did not receive an increase in the dependant allowances until 1999.
Three of the retirees due a retro payment also received supplemental dependant allowances. Further research is required prior to finalizing the payments due to these three retirees.
Note: If the dependant allowance was to be increased effective January 1, 1991, other retirees will be due a past payment for their dependant allowances.
The board also reviewed and approved the request for reimbursement to the system from six retirees identified as being overpaid. Again the reasons were varied, however all errors in the calculations originated several years ago. The current retirement allowance has been changed for the May 31, 2004 payroll. The requests for reimbursement, along with the retirees' rights prescribed by G.L. c32, §20(5)(c)(3) to request the board to waive repayment will be sent today. A deadline for requesting a waiver has been set as June 25, 2004, or the board will begin to recover the overpayments. The board will consider all requests for waivers in the June meeting. The retirees from whom a reimbursement is being requested are: James Greer, John Lisenby, Eleanor Murphy, John Papasodero,
Joseph Quirk, Georgia Trapp.
Hull Housing Authority
The board was updated on the status of the negotiations for the receipt of the outstanding appropriations from the Hull Housing Authority (HHA), including a review of the latest correspondence between the HHA, the Retirement Board and the Retirement Board Attorney Michael Sacco. The correspondence included a request dated April 28, 2004 from the Housing Authority to the Retirement Board asking the Retirement Board to refrain from contact while they attempt to resolve the outstanding matters. Other correspondence included a letter dated April 30, 2004 from Michael Sacco to Paul Daley, e-mails on May 12 and May 13, 2004 forwarded by Mr. Sacco from Mr. Daley requesting information on the calculation of the amount due and other additional information. The final correspondence was a letter dated May 17, 2004
to Paul Daley from M. Bohinc responding to information requests. Following this letter, M. Bohinc and P. Daley met in person on May 18th to review the information and determine any additional information the HHA might require to satisfy the matter.
In that meeting, Mr. Daley reported that he had budgeted the entire appropriation amount for FY05, and has 80% of the appropriation amount for FY04. FY03 is still in dispute and he has requested additional actuarial valuation information prior to agreeing to pay. Mr. Daley indicated that he might request the Retirement Board to grant a payment plan for the FY03 amount and a portion of FY04.
Mr. Daley followed up with a note verifying the additional information requested from the board's actuary, and his desire that all parties understand that the process is moving forward in a positive manner. He informed attorney Sacco of the productive meeting and the need for the additional data dealing with former Town/Authority employees who would be proportionally assessed to both employers based on time spent at each area of employment.
Leonard Colten, stating that the HHA has been given ample time to begin payment, and that the retirement system has thus far received nothing, is ready to pursue legal action for recovery. Because the HHA has acknowledging the debt and is now discussing payment, Chris McCabe would like to hold off on legal action of one board suing another. At this time, the retirement board is willing to continue let M. Bohinc work directly with Mr. Daley towards resolution. The board will take no further legal action at this point.
The Board reviewed the current year-to-date trial balance and cash accounts' reconciliation without question.
Investments
The following investment materials were provided to the Board:
Investors Fund Performance - Updated through April 2004
PRIT - Summary of Plan Performance - April 30, 2004
PRIM Board Update - April 2004
SSgA - Total Return through April 2004
SSgA - Total Return through March 2004 with Executive Summary
SSgA Tactical Asset Allocation Investment Commentary
Freedom Capital Management, LLC - Client Update First Quarter 2004
The board reviewed the current asset allocation between SSgA, Freedom Capital and the Pension Reserves Investment Trust (PRIT) to determine the investment of the FY05 allocation in the amount of $2,220,255, which is expected on July 1, 2004. In a discussion led by L. Colten on the performance of PRIT, asset exposure and investment expertise, he stated that he thinks it would be appropriate to make a greater investment in PRIT and less in State Street.
Because of the impending search for an investment consultant, a motion was made by C. McCabe and seconded by Jim Yacobucci to invest the appropriation 25%/25%/50% respectively. In contrast to previous years, this allocation is to be applied directly to the incoming assets, and not taken into account with the existing assets and rebalanced to an ending allocation of 25%/25%/50%. This will achieve a greater current overall investment in PRIT. Voted unanimously.
Consultant Process
The board reviewed PERAC Memo #9/2004 - Re-certification of Investment Consultants, along with the PERAC supplied A Guide for Selecting Pension Investment Consultants - Writing RFPs and Evaluating Proposals. Without further discussion, C. McCabe made a motion, seconded by J. Yacobucci to direct M. Bohinc to draft a request for proposal (RFP) for review in the June meeting.
Election Update
The nomination period has closed (noon, Thursday, May 13, 2004) with three certified candidates: Donald F. Brooker (retired, police department), John J. King (active, fire department) and Francis Yannizzi (retired, police department).
By June 3, 2004, a letter with voting instructions, an official ballot, ballot envelope and stamped return envelope will be mailed to all active members, retirees and beneficiaries. The order of candidates on the ballot will be determined by a random drawing.
The Election Officer will record the return of ballots using the return envelope and lock the ballots in the Retirement Office until June 29, 2004 at 6:00 p.m. At this time, the return envelopes with the ballots inside the ballot envelope will be turned over to the Town Clerk for separation and tally. The Election Officer will witness the ballot counting, along with any other interested parties. The new elected member will be announced on June 29th.
The Board read all informational mail:
Retired State, County and Municipal Employees Association of Massachusetts - FY05 Senate Budget Pension Changes
PERAC Memo #19/2004 - Implementation of the Goodridge Decision
PERAC Memo #20/2004 - Post-Retirement Earnings Limitations in G.L. c. 32 § 91
The Babson Staff Letter - April 23, 2004
The Babson Staff Letter - May 14, 2004
Segal Bulletin - April 2004 (2)
Boston Partners' Quarterly Review, Fourth Quarter 2003
PERAC Corporate Governance & Public Investments Forum
The next regular Board Meeting is scheduled for Wednesday, June 30, at 9:00 a.m. in the Selectmen's Meeting Room.
The Hull Contributory Retirement Board meeting adjourned at 10:15 a.m.
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