Pension Trustees Meeting Minutes September 15, Draft. City of Clearwater. City Hall 112 S. Osceola Avenue Clearwater, FL

Transcription

1 City Hall 112 S. Osceola Avenue Clearwater, FL Meeting Minutes Monday, September 15, :00 PM Council Chambers Pension Trustees Page 1

2 Roll Call Present 5 - Chair George N. Cretekos, Trustee Doreen Hock-DiPolito, Trustee Jay E. Polglaze, Trustee Bill Jonson, and Trustee Hoyt Hamilton Also Present: Rod Irwin - Assistant City Manager, Pamela K. Akin - City Attorney, Rosemarie Call - City Clerk, Nicole Sprague - Official Records and Legislative Services Coordinator To provide continuity for research, items are listed in agenda order although not necessarily discussed in that order. Unapproved 1. Call To Order The meeting was called to order at 1:26 p.m. at City Hall. 2. Approval of Minutes 2.1 Approve the minutes of the August 18, 2014 Pension Trustees meeting as submitted in written summation by the City Clerk. Trustee Hock-DiPolito moved to approve the minutes of the August 18, 2014 Pension Trustees meeting as submitted in written summation by the City Clerk. The motion was duly seconded and carried unanimously. 3. Citizens to be Heard Regarding Items Not on the Agenda - None. 4. New Business Items 4.1 Approve new hires for acceptance into the Pension Plan as listed. Name, Job. Class, & Dept./Div. Pension Elig. Date Wayne Daniel, Fleet Mechanic, General Services Department 06/30/2014 Douglas Hunt, Solid Waste Equipment Oper., Solid Waste Dept 06/30/2014 Charles Flounoy, Solid Waste Equipment Oper., Solid Waste Dept 06/30/2014 Sarah Rachel, Utilities Chemist, Public Utilities Dept 06/30/2014 Lori Burdell, Recreation Programmer, Parks & Recreation Dept 07/12/2014 W. David Barnhart, Industrial Pretreatment Tech, Public Utilities Dept 07/14/2014 John Beebe, Fire Inspector II, Fire Department 07/14/2014 Page 2

3 Scott Boeckel, Police Officer, Police Department 07/14/2014 Christopher Cleveland, Solid Waste Equipment Oper, Solid Waste Dept 07/14/2014 Raniel Heredia, Police Officer, Police Department 07/14/2014 Ryan Hobert, Police Officer, Police Department 07/14/2014 Joshua Gibson, Police Officer, Police Department 07/14/2014 Steven Venezia, Police Officer, Police Department 07/14/2014 Amber Priester, Library Assistant, Library Department 07/26/2014 Christa Smith, Librarian I, Library Department 07/26/2014 Belen Rubin, Library Assistant, Library Department 07/28/2014 Joshua Sherman, Solid Waste Equipment Operator, Solid Waste Dept 07/28/2014 Jonathen Trafford, Field Service Representative, Customer Service Dept 07/28/2014 Trustee Polglaze moved to approve new hires for acceptance into the Pension Plan as listed. The motion was duly seconded and carried unanimously. 4.2 Approve the following request of employees Michael Duffey, Police Department, Willie Porter, Engineering Department, and Ken Sides, Engineering Department, for a regular pension as provided by Sections and of the Employees Pension Plan. Michael Duffey, Police Officer, Police Department, was employed by the City on October 2, 1995 and his pension service credit is effective on that date. His pension will be effective August 1, Based on an average salary of approximately $72, over the past five years, the formula for computing regular pensions and Mr. Duffey s selection of the 50% Joint and Survivor Annuity, this pension benefit will be approximately $38, annually. Willie Porter, Street Sweeper Operator, Engineering Department, was employed by the City on August 8, 1994 and his pension service credit is effective on that date. His pension will be effective October 1, Based on an average salary of approximately $42, over the past five years, the formula for computing regular pensions and Mr. Porter s selection of the 50% Joint and Survivor Annuity, this pension benefit will be approximately $21, annually. Ken Sides, Senior Professional Engineer, Engineering Department, was employed by the City on January 5, 1998 and his pension service credit is effective on that date. His pension will be effective September 1, Based on an average salary of approximately $71, over the past five years, the formula for computing regular pensions and Mr. Sides selection of the 75% Joint and Survivor Annuity, this pension benefit will be approximately $32, annually. Section provides for normal retirement eligibility for non-hazardous duty employees hired prior to the effective date of this reinstatement (January 1, 2013), a member shall be eligible for retirement following the earlier of the date Page 3

4 on which a participant has reached the age of fifty-five years and completed twenty years of credited service; the date on which a participant has reached age sixty-five years and completed ten years of credited service; or the date on which a member has completed thirty years of service regardless of age. For non-hazardous duty employees hired on or after the effective date of this restatement, a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of sixty years and completed twenty-five years of credited service; or the date on which a participant has reached the age of sixty-five years and completed ten years of credited service. Mr. Porter and Mr. Sides have met the non-hazardous duty criteria. Section provides for normal retirement eligibility for hazardous duty employees, a member shall be eligible for retirement following the earlier of the date on which the participant has completed twenty years of credited service regardless of age, or the date on which the participant has reached fifty-five years and completed ten years of credited service. Mr. Duffey has met the hazardous duty criteria. Trustee Hamilton moved to approve the following request of employees Michael Duffey, Police Department, Willie Porter, Engineering Department, and Ken Sides, Engineering Department, for a regular pension as provided by Sections and of the Employees Pension Plan. The motion was duly seconded and carried unanimously. 4.3 Approve the following request of employees Marsha Beall, Parks and Recreation Department and David Humphrey, Police Department, to vest their pensions as provided by Section of the Employees Pension Plan. Marsha Beall, Staff Assistant, Parks and Recreation Department, was employed by the City on December 1, 2003, and began participating in the Pension Plan on that date. Ms. Beall terminated from City employment on July 12, David Humphrey, Police Service Technician, Police Department, was employed by the City on January 23, 1995 and began participating in the Pension Plan on that date. Mr. Humphrey terminated from City employment on July 23, The Employees Pension Plan provides that should an employee cease to be an employee of the or change status from full-time to part-time after completing ten or more years of creditable service (pension Page 4

5 participation), such employee shall acquire a vested interest in the retirement benefits. Vested pension payments commence on the first of the month following the month in which the employee normally would have been eligible for retirement. Section provides for normal retirement eligibility for non-hazardous duty employees hired prior to the effective date of this reinstatement (January 1, 2013), a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of fifty-five years and completed twenty years of credited service; the date on which a participant has reached age sixty-five years and completed ten years of credited service; or the date on which a member has completed thirty years of service regardless of age. For non-hazardous duty employees hired on or after the effective date of this restatement, a member shall be eligible for retirement following the earlier of the date on which a participant has reached the age of sixty years and completed twenty-five years of credited service; or the date on which a participant has reached the age of sixty-five years and completed ten years of credited service. Ms. Beall and Mr. Humphrey will meet the non-hazardous duty criteria and begin collecting a pension in March 2016 and February 2015, respectively. Trustee Jonson moved to approve the following request of employees Marsha Beall, Parks and Recreation Department and David Humphrey, Police Department, to vest their pensions as provided by Section of the Employees Pension Plan. The motion was duly seconded and carried unanimously. 4.4 Approve the proposed class action settlement regarding Maxwell Technologies Class Action. In April 2013, the Pension Trustees approved the Employees Pension Plan of the to serve as Lead Plaintiff with regard to the securities fraud class action re Maxwell Technologies Inc., Securities Litigation, C.A. No. 3:13-cv BEN-RBB (S.D. Cal.). This action was taken regarding alleged fraud and mismanagement on the part of Maxwell that resulted in a significant loss of stock value. While the City Pension Plan would not recover a significant amount, this action was taken to fulfill the Trustees fiduciary obligations to the plan. The parties engaged in a full-day mediation session on August 21, 2014 before Jed Melnick, Esq. of JAMS in New York City. During the mediation, the parties discussed various issues concerning Lead Plaintiff s claims, including the amount of damages that could potentially be proven in the litigation. Prior to Page 5

6 the mediation, Lead Plaintiff s Counsel Saxena White P.A. consulted with a damages expert and a forensic accountant to discuss whether a large drop in Maxwell Technology, Inc. s stock price that occurred on April 26, 2012 could be attributable to the alleged fraud, which would result in larger damages to the Class. Both experts opined that the information released in April 2012 could not likely be tied to the alleged fraud that was ultimately disclosed a year later in March 2013, resulting in potential maximum damages to the Class that could be proven at trial of approximately $24 million. Defendants countered that maximum damages in the action were $20 million, and that even this damage figure was susceptible to further challenges later in the litigation that could dramatically reduce the potential recovery for the Class. At the conclusion of the mediation session, Mr. Melnick delivered a mediator s proposal to the parties that contemplated a resolution of the Class s claims in exchange for a settlement fund of $3.3 million, which represents a recovery range of approximately 13.75% to 16.5% of maximum provable damages. This is an excellent result that greatly exceeds the median shareholder recovery in securities fraud litigation, which is a mere 2.1% of total estimated damages for all securities fraud actions and 8.9% for actions where damages were estimated between $20 and $49 million. Given these and other considerations, Lead Plaintiff s Counsel Saxena White P.A. recommends that the Board of Trustees approve of the proposed settlement. The City will recover approximately $20,000 and a possible additional $20,000 for serving as lead plaintiff. Trustee Hamilton moved to approve the proposed class action settlement regarding Maxwell Technologies Class Action. The motion was duly seconded and carried unanimously. 4.5 Approve IRS required changes to Clearwater Employee Pension Plan. Current Internal Revenue Service regulations require two amendments to the Clearwater Employee Pension Plan. These changes will require action by City Council in the form of a City Ordinance. However, before such action is taken, the changes must be approved by the Pension Trustees. The changes to Section and restated in Section Time and manner of payment which requires the plan administrator to deposit any lump sum payout exceeding $1000 into a individual retirement plan designated by a trustee should the distributee not make an election otherwise. The changes to Section and restated in Section add additional Page 6

7 language to the definition for compensation to include severance payments and overtime. Trustee Polglaze moved to approve IRS required changes to Clearwater Employee Pension Plan. The motion was duly seconded and carried unanimously. 5. Adjourn The meeting adjourned at 1:33 p.m. Chair Attest Employees Pension Plan Trustees City Clerk Page 7