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OLD SAYBROOK PENSION BENEFITS BOARD
Thursday, May 23, 2013
Town Hall Conference Room at 7:00 p.m.
Present: Suzanne Taylor, Gary Lehrman, Carol Voigt, Steve Sheehan (was excused)
Also Present: Sharon Migliaccio, Tom Forma and Kevin Nichols– Merrill Lynch, Brian Arcara and Charles Glousky – Eaton Vance, Paul Baldi and Kathleen Marshall – Town employees
The meeting of the Old Saybrook Pension and Benefits Board was called to order at 7:05 p.m. by the Chair, Suzanne Taylor She welcomed the Board and all present to the Board meeting.
The Minutes of the April 25th meeting were reviewed and accepted as presented.
Chair’s Report:
- Connecticut Public Pension Forum – There was a meeting of the CPPF on May 15, 2013 in Rocky Hill. Suzanne, Carol, and Sharon attended. Sharon and Carol gave their opinions on the topics presented. Carol particularly liked the speaker who talked on Farmland Investments. Sharon thought the presentation by Becky Stielman from Milliman was well done and interesting.
- Budget Results – Suzanne informed the Board that the Fiscal Year 2013-2014 budget passed with our budget request intact.
- Other – Suzanne reported that she had received an actuarial review of the retirement application for Lionel Levesque who worked for the Board of Education as a Janitor. He has asked to retire effective August 1, 2013 and his request was authorized by the Board and subsequently signed by the chair thereupon. Sharon will send Mr. Levesque the Boards congratulations.
Investment Reports
- Eaton Vance – Charles S. Glovsky CPA, Vice President, gave an overview of Eaton Vance Investment Managers as it affects our funds. Eaton Vance is a Large-Cap Value manager whose offices are based in Boston. Overall they manage $255.1 billion in assets. According to Charles Glovsky he concurs with recent publications regarding oil production returning to the U.S. and suggested that the United States could be independent in oil production by the year 2020. Also, he reported that the Federal Budget Deficit went from 1.1 Trillion to 642 Billion this quarter. These macro events may be some of the reasons the stock market is performing so well right now. Eaton Vance feels the stock market in the U.S. is doing much better than Europe. The actual results of our funds under their management
were also discussed and the Board seemed pleased with the overall return to date. After additional questions and discussion the board thanked Eaton Vance for the presentation and management of our funds.
- Merrill Lynch - Tom Forma of Merrill Lynch reported on the status of the Town’s pension portfolio. There is $17,870,593 in the Town’s plan and $966,171 in the Health Care plan as of May 21, 2013. Tom told the Board we have 70 percent in Equities, 27 percent in Fixed Income and 3 percent in Cash. There is 49% in Large Cap Growth, 24% in Large Cap Value, 10% in SMID and 17 percent in International. Year to Date the performance is at 9.40 percent. For the Fiscal Year the performance is at 17.68 percent. He went on to talk about the performance of our managers.
Alliance has a year to date of 13.29 percent and a fiscal year of 26.29 percent.
Neuberger Berman has YTD of.-.52 percent and a FY of 1.51 percent. Invesco Int’l has an YTD of 6.85 percent and a FY of 22 percent. Eaton Vance has YTD of 17.56 percent and a FY of 26.11 percent and John Hancock who was hired as the Pension Benefits Board manager in April have a YTD of 7.21 percent and for the FY 7.17 percent. There was some discussion about the market and several questions.
Suzanne asked Tom about the performance of the bond market. He had been worried that the rate would rise but they haven’t yet. He explained about how the market value of bonds can be determined: Quantity times Price equals the Market Value. He also talked about the different types of bonds, Treasury, Corporate, and Mortgage. Treasury and Mortgage bonds tend to move faster but Corporate Bonds don’t go up in rate as much. After extensive discussion in particular of the underperformances of bonds the Board asked that Neuberger Berman, our bond manager, attend the June 27th meeting.
Old Business
There was nothing to report for the Fire Department. More will be discussed at the June meeting.
- ICMA update – The representative from ICMA, Laura Hancock, recently met with several employees and two new employees have enrolled while others have changed their investment options. Gary has given Laura his information so when she arranges another visit or has other concerns he will be notified. He was happy that some of the employees responded to her visit.
- Health Insurance Suzanne reported that it appears there is now information concerning the actual costs of health and other personnel benefits available that show just how much the town is paying for these costs according to an article published in Harbor News this week. She asked Sharon to obtain a copy of the information. Nothing new has been communicated to the Board concerning any future changes in our health plan.
Kathy Marshall had some questions and concerns about the Pension and Benefit’s Board involvement with employee’s health insurance. After some discussion Suzanne thanked Kathy for her questions and told her that the Pension Benefits Board does not make final decisions on these negotiations and can only give advice.
- Police Department SRO Officer etc – A motion was made to enter into executive session but after some discussion the board decided there was no need. The board reviewed a response from Attorney Pat McHale regarding retired employees working as SROs while collecting a pension. After some discussion it was decided to table this until the June meeting.
- Other – Concerning the GASB requirements for a valuation of our retiree health care costs i.e. OPEB, our actuary, Steve Lemanski has informed Suzanne that the OPED valuation will be completed by June 5, 2013 in time for our June meeting. Sharon reported that Lisa Carver has been asking when it would be forthcoming so Sharon will tell her.
New Business
The next meeting will be June 27, 2013 at 7:00 p.m. A motion was made to adjourn by Carol Voigt and seconded by Gary Lehrman. The meeting adjourned at 9:20 p.m.
Respectfully Submitted,
Sharon E. Migliaccio
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