BOARD OF RETIREMENT FRESNO COUNTY EMPLOYEES RETIREMENT ASSOCIATION

Transcription

1 BOARD OF RETIREMENT FRESNO COUNTY EMPLOYEES RETIREMENT ASSOCIATION Our mission is to administer the retirement benefits for the members and beneficiaries in a prudent, accurate, timely and cost-effective manner, while administering fund assets in a manner that achieves investment and funding objectives within prudent levels of risk Trustees Present: August 6, 2014 REGULAR MEETING AGENDA MINUTES Marion Austin Laura P. Basua Judith Case McNairy Dr. Rod Coburn, III Vicki Crow Robert Dowell Steven J. Jolly Trustees Absent: Eulalio Gomez Others Present: Jeffrey MacLean, Wurts & Associates Jack McIntyre, CFA, Portfolio Manager - Brandywine Global Investment Management John Ford, CFA, Director of Marketing - Brandywine Global Investment Management Scott Thiel, CIO of Fundamental Fixed Income - BlackRock Jeremy Watt, Client Relationship Manager - BlackRock Dale Hydeman, Board of Supervisor Assistant - District 4 Dean Stuckenschmidt, Deputy County Counsel Becky Van Wyk, Interim Retirement Administrator Kelly Prinz, Retirement Benefits Manager Conor Hinds, Supervising Accountant Elizabeth Avalos, Administrative Services Assistant 1. Call to Order Chair Coburn called the meeting to order at 8:35 AM. 2. Pledge of Allegiance Recited. 3. Public Presentations Trustee Case McNairy introduced and welcomed her new Assistant, Dale Hydeman. Consent Agenda/Opportunity for Public Comment A motion was made by Trustee Jolly, seconded by Trustee Basua, to accept Consent Items 4-17 as presented. VOTE: Unanimous (Absent Gomez)

2 *4. July 16, 2014 Retirement Board Regular Meeting Minutes ; APPROVED *5. Retirements ; APPROVED 2 Name Department Yrs of Svs Jennifer A. Brennan Community Health Jack David Cannon Dept of Social Services Leo Ford Dept of Social Services, Deferred 9.39 Helen Guzman Probation Michael C. Horsley Dept of Social Services Timothy Jon Jacoby Library, Deferred Nancy P. Kelly Public Defender, Deferred Trygve Larson ITSD, Deferred 5.38 Emily M. Oliver Community Health, Deferred 5.41 Charlotte F. Thompson Probation Virginia R. Tingle Community Health *6. Disability Retirements ; APPROVED Name Department Yrs of Svs Richard Cole Internal Services 8.24 Steven Fox Sheriff 5.29 Conni L. Washington Behavioral Health 1.74 *7. Educational Reading Materials July 15, 2014 Reuters article Old-style U.S. public pensions weather cost-cutting storm June 2014 Benefits Magazine Red Flags for Trustees: Detecting Weak Points in Your Fiduciary Armor *8. Public Records Requests and/or Retirement Related Correspondence from Mary Johanna Aguilar Terminez, Thomson Reuters *9. Budget Status for the quarter ended June 30, 2014

3 3 *10. Berman DeValerio Second Quarter 2014 Reports *11. Update on SACRS Ad Hoc Committee s Progress *12. Travel Report from Chair Coburn on his attendance at the International Investing and Markets course at Wharton Campus on July 28-30, 2014 in San Francisco, CA *13. FCERA Cash Flow position as of April 2014 *14. Most recent investment returns, performance summaries and general investment information from investment managers *15 PIMCO Firm and Total Return Update *16. Wellington Management Company Structure Change and Succession Planning Update *17. Invesco Core Real Estate USA Personnel Change Update 18. Discussion and appropriate action on Colony Distressed Credit and Special Situations Fund III Jeffrey MacLean, Wurts & Associates (Wurts), opened discussions by noting that Colony Capital is in the final stages of raising their third distressed real estate debt fund since Colony Distressed Credit and Special Situations Fund III (CDCF III) will likely have its final close at the end of September with a target raise of $1 billion that will likely reach its hard cap of $1.2 billion. They currently have firm commitments of $700 million with another $200 million soft circled. Wurts & Associates is recommending FCERA make a $20 million commitment, subject to availability (Colony anticipates being oversubscribed to this Fund). Detailed discussions ensued regarding the firms background and investment strategy.

4 4 It was noted that Wurts & Associates supports the idea of inviting Colony to the September 3, 2014 Regular meeting to review the existing CDCF I investment as well as the proposed investment in CDCF III. In addition, and given the time constraints of the final close, Wurts recommended a tentative approval so [legal] council would have sufficient time to review the subscription documents. A motion was made by Trustee Jolly, seconded by Trustee Austin, to tentatively approve the CDCF III mandate pending further discussion at the September, 3, 2014 Regular meeting and to authorize Foster Pepper to begin the review of the subscription documents. VOTE: Unanimous (Absent Gomez) ; APPROVED 19. Discussion and appropriate action on selection of Global Bond Mandate The Board heard presentations from and engaged in discussion with Jeffrey MacLean, Wurts & Associates, and representatives from Brandywine Global Investment Management and BlackRock on the Global Bond mandate. Each reviewed their organizational structures, investment strategies and processes, and fee structures. A motion was made by Trustee Jolly, seconded by Trustee Austin, to begin contract negotiations with Brandywine. VOTE: Unanimous (Absent Gomez) ; APPROVED 20. Discussion and appropriate action on Investment Manger Agreements Jeffrey MacLean, Wurts & Associates (Wurts), opened discussions by reminding the Board that, as a result of the recently approved asset allocation, FCERA has contemplated restructuring several existing fixed income strategies and in other cases sought new managers to fill certain mandates. Mr. MacLean gave a brief update on the status of these agreements and provided recommendations for next steps, where applicable. The Board engaged in detailed discussions regarding the implementation considerations noting that, as part of the Rebalance Implementation Plan that was discussed in April, the current core plus fixed income strategies will serve as the funding source for the new fixed income allocations. In addition, it was noted that in cases where the manager is transitioning the portfolio to a new mandate, they will generally do so opportunistically as the markets allow, and over a period no longer than one month. Wurts will work with the underlying managers and FCERA staff to ensure that all transaction costs are minimized while providing a consistent full exposure to the fixed income markets. Eaton Vance Management A motion was made by Trustee Crow, seconded by Trustee Jolly, to approve the agreement with Eaton Vance Management as presented and authorize the Chair to execute appropriate documents. VOTE: Unanimous (Absent Gomez)

5 5 Loomis Sayles & Company A motion was made by Trustee Jolly, seconded by Trustee Austin, to approve the agreement with Loomis Sayles & Company as presented and authorize the Chair to execute appropriate documents. VOTE: Unanimous (Absent Gomez) Western Asset Management Company A motion was made by Trustee Austin, seconded by Trustee Basua, to approve the agreement with Western Asset Management Company as presented and authorize the Chair to execute appropriate documents. VOTE: Unanimous (Absent Gomez) Mr. MacLean recommended that the Board authorize Wurts to work with Administration to prudently implement the rebalance transactions accordingly. A motion was made by Trustee Jolly, seconded by Trustee Case McNairy, to approve the recommendation to rebalance as recommended. VOTE: Unanimous (Absent Gomez) ; APPROVED 21. Closed Session: A. Conference with Legal Counsel Significant Exposure to Litigation pursuant to G.C (d)(2): B. Disability Retirement Applications Personnel Exception pursuant to G.C : 1. Linda O Dell 22. Report from Closed Session 21.A. Nothing to report. 21.B.1. O Dell Decision Grant a non-service connected disability retirement to the Applicant without requiring a medical records review by an Independent Medical Examiner. M Crow. S Basua. VOTE: Unanimous (Absent Gomez) 23. Report from FCERA Administration Becky Van Wyk, Interim Retirement Administrator, reported on the following: 1. The Audit Committee will meet August 11, 2014 at 2:00 PM. 2. The Personnel Committee will meet August 12, 2014 at 2:00 PM. 3. Personnel changes at Waddell and Reed. 4. An update on the request to the Board of Supervisors to add the Account Clerk and Retirement Coordinator positions. 5. An update on the General Member Special Election. Nominations will close at the end of the day. 6. A reminder that the Auditors will be in the office next week. 7. Ms. Van Wyk s vacation schedule.

6 6 24. Report from County Counsel County Counsel had nothing to report. 25. Board/Committee Member Announcements or Reports Chair Coburn reported on the following: 1. His recent attendance at the International & Emerging Markets Course at the Wharton School in San Francisco, CA. 2. A recent meeting with representatives of PIMCO. Becky Van Wyk, Interim Retirement Administrator was present. There being no further business, the meeting adjourned at 12:00 PM. Becky Van Wyk Interim Retirement Administrator/Secretary to the Board