OLD SAYBROOK PENSION BENEFITS BOARD
Thursday, March 28, 2013
Town Hall Conference Room at 7:00 p.m.
Present: Suzanne Taylor, Raymond Muratori, Stephen Sheehan, Gary Lehrman
Also Present: Sharon Migliaccio, Tom Forma– Merrill Lynch, Joseph Johnson – OS Fire Department, and Paul Baldi – Town employee
The meeting of the Old Saybrook Pension and Benefits Board was called to order at 7:00 p.m. by the Chair, Suzanne Taylor She welcomed the Board and all present to the Board meeting.
The Minutes of the February meeting were reviewed and needed some correction. Suzanne noted that one item had been left out of the minutes: “Part time employment of the retired was to be researched and discussed at the March meeting”. Ray Muratori informed the board that under Investment Reports its states that Ray, Eileen, and Suzanne are on the finance sub-committee. It should have been Gary not Ray. After some discussion the minutes were accepted as corrected.
Chair’s Report:
• Connecticut Public Pension Forum – There will be a meeting of the CPPF on May 15, 2013 in Cromwell. Some Board members are already registered due to the October meeting being cancelled.
• Suzanne received notification that William True of the Old Saybrook Fire Department has received final additional service increasing his benefit amount.
Calculations for Richard Goduti’s pension benefit have been received from Milliman. He is to receive benefits as of August 1, 2012. Some discussion ensued and the benefits were found to be consistent with that approved by the board at the last meeting.
Colin Linscott, an employee of the Public Works Department has resigned as of April 1, 2013. He has requested refund of his pension contributions. Some discussion ensued regarding why he was not receiving a pension. It was explained that he had worked at the Transfer Station part-time for several years and only full-time for three years.
• Charles Polka of Met Life had been into talk to Sharon Migliaccio. She had directed him to the First Selectman’s office who directed him to talk to Suzanne Taylor. He called her to set up a time to meet and a phone date was set for a few days hence, but he never called back. Discussion followed.
Investment Reports
• Tom Forma of Merrill Lynch reported on the status of the Town’s pension portfolio. There is $17,206,821 in the Town’s plan and $932,972 in the Health Care plan as of March 22, 2013. The reserve amount will be forthcoming.
Due to recent stock performance, a percent above our investment police allowance, Tom told the Board we have 66 percent in Equities, 30 percent in Fixed Income and 4 percent in Cash. There is 46% in Large Cap Growth, 28% in Large Cap Value, 11% in SMID and 17 percent in International. Year to Date the performance is at 4.15 percent. For the Fiscal Year the performance is at 11.78 percent. He went on to talk about the performance of our managers.
Alliance has a year to date of 5.53 percent and a fiscal year of 17.64 percent.
Neuberger Berman has YTD of -0.63 percent and a FY of 1.40 percent.
INVESCO Int’l has an YTD of 2.31 percent and a FY of 16.82 percent.
Eaton Vance has YTD of 9.52 percent and a FY of 17.50 percent
There was some discussion about the market and several questions.
Tom told the board that this is the first time the fund is over seventeen million. It was noted that Merrill Lynch no longer handles the pension contributions because they now go directly into the bank and are used to pay pension benefits.
Tom is concerned with the performance of the bond market. There was some discussion regarding moving some of the bond money into stocks, which would require a change in our investment policy. After more discussion a motion was made by Steven Sheehan and seconded by Ray Muratori to amend our investment policy allowing an additional five percent to be invested in stocks, thus officially raising the amount to 70 percent. Some discussion followed and all were in favor. Consequently, there is no need to divest from the current stock holdings and now it is possible to invest additionally into stocks, which the board is considering to be held by an
additional money manager.
Discussion regarding additional money managers – Tom presented three money managers for consideration.
o Zacks Investment Management, an all caps manager which deals mostly in small and mid caps. They are quantitative in their approach.
o Eagle Asset Management and John Hancock Asset Management two firms who are analytical. A detailed comparison of the three firms was presented and extensive discussion ensued. A motion was made by Steve Sheehan and seconded by Ray Muratori to invite John Hancock to our next meeting for first consideration as an additional money manager. After further discussion the motion was unanimously approved and the board
will invite John Hancock for the first interview. Tom will arrange the interview for the April meeting.
The Board thanked Tom for his presentation.
Old Business
• Status of the Study of the Fire Department Pension Plan Changes – The Fire Department is requesting increasing Ron Baldi’s benefit by $116 per month. His earlier officer service was not calculated at the time the Officer’s Incentive document was adopted. Mr. Baldi has and is a long time member of the Old Saybrook Fire Department having served as Chief as well as a firefighter. Discussion ensued and a motion was made by Steve Sheehan and seconded by Ray Muratori to approve the increase by $116 for Ronald Baldi making his benefit $453.13 per month. After more discussion the motion was accepted.
• Two additional improvements have been requested by the Fire Department: A Cost of Living Adjustment and an increase in the amount of service to be counted as credit for retirement that would be equal to that provided to other town pensioners. It was also noted that it has been ten years since the last COLA for the firefighters. Milliman presented several variables as to cost for the boards review. Some preliminary discussion and explanation of the variables was held, but a further discussion of the matter will be held at the April meeting when Chief J. T. Dunn plans to be present.
• Liaison Appointments – Appearing for the fire department was Joe Johnson and it is anticipated that generally Chief Dunn will be the official liaison. No Police liaison was present.
• Part-Time Employment of Retired Police Officers – Suzanne read an email to Carl Fortuna regarding the Police department hiring retired police officers as full time School Resource Officers. She also cited the particular section of our Plan that does not allow for retirees to receive a pension from the town if they are employed full time. Lt. McDonald, who retired June 2011, has been rehired apparently full time as a School Resource Officer. There was some discussion but not having all the details the board has continued the matter until the April meeting when it is hoped more information will be available. It was determined that Ray Muratori, Steve Sheehan and Suzanne Taylor will seek to confer with
the First Selectman prior to the April meeting as to his perspective on the matter.
• The status of Health Insurance plans and negotiations and the duties of pension plan administrator were tabled to a later meeting.
One other addition to the Chairs Report should be added. A Thank you latter from Kathy Randall of the Board of Education for answers to her detailed questions concerning how to interpret several parts of the retirement plan.
New Business
There were some questions from an employee regarding 401 K and the Town’s pension plan. A brief discussion of the pros and cons of such plans was held.
The next meeting will be April 25, 2013 at 7:00 p.m. A motion was made to adjourn by Raymond Muratori and seconded by Steve Sheehan. The meeting adjourned at 9:12 p.m.
Respectfully Submitted,
Sharon E. Migliaccio
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