BOARD OF RETIREMENT FRESNO COUNTY EMPLOYEES RETIREMENT ASSOCIATION

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1 Trustees Present: BOARD OF RETIREMENT FRESNO COUNTY EMPLOYEES RETIREMENT ASSOCIATION January 5, 2011 Alan Cade Michael Cardenas Nick Cornacchia Franz Criego Vicki Crow Eulalio Gomez Steven Jolly Phil Larson John Souza Others Present: Regina Wheeler, Alternate Trustee Michael Cunningham, FCERA Member Jeffrey MacLean, Wurts & Associates Joseph Young, Dimensional Fund Advisors Karen Umland, Dimensional Fund Advisors Kenneth Tollmann, Morgan Stanley William Lock, Morgan Stanley Tony Cousins, Pyrford Peter Schmole, Pyrford John West, Research Affiliates Rob Arnott, Research Affiliates via tele-conference Susan Coberly, Senior Deputy County Counsel Roberto L. Peña, Retirement Administrator Becky Van Wyk, Assistant Retirement Administrator Elizabeth Avalos, Administrative Secretary 1. Call to Order Chair Gomez called the meeting to order at 8:36 AM. 2. Pledge of Allegiance Recited. 3. Introduction and welcome to Trustee, Alan Cade Jr., newly elected General Representative and Regina Wheeler, newly elected Retiree Alternate Trustee. Chair Gomez welcomed newly elected Trustee Alan Cade, Jr. and Alternate Trustee Regina Wheeler. 4. Election of Chair and Vice Chair for the Calendar Year Chair Gomez nominated Alan Cade, Jr. for Chair of the Board of Retirement and himself as Vice Chair. A motion was made by Chair Gomez, seconded by Trustee Cardenas, to Accept the nominations. VOTE: Unanimous (Absent Criego)

2 2 5. Public Presentations None. 6. Discussion and appropriate action on appointments to the Retirement Board Standing Committees: Audit, Budget, Disability, Personnel and Consultant Evaluation The Board elected members to the Standing Committees to fill positions as follows: (changes noted in bold) Audit Committee Vicki Crow Chair Michael Cardenas Nick Cornacchia Steven J. Jolly Personnel Committee Eulalio Gomez - Chair Michael Cardenas Nick Cornacchia John Souza Budget Committee Vicki Crow - Chair Alan Cade, Jr. Michael Cardenas Phil Larson Disability Committee Eulalio Gomez Chair Franz Criego Steven J. Jolly John Souza Consultants Evaluation Committee Franz Criego Chair Alan Cade, Jr. Eulalio Gomez John Souza A motion was made by Trustee Larson, seconded by Vice Chair Gomez, to Accept the Committee appointments noted above. VOTE: Unanimous Consent Agenda/Opportunity for Public Comment A motion was made by Trustee Souza, seconded by Vice Chair Gomez, to Approve Consent Agenda Items 7 through 18 as presented. VOTE: Unanimous *7. Approve the December 15, 2010 Retirement Board Regular Meeting Minutes *8. Retirements Douglas Bumatay Probation Sharon J. Burroughs Sheriff Penny L. Carmany ITSD 20.54

3 Bert P. Cheeseman General Services Linda F. Cotta District Attorney, Deferred 5.91 Lee G. Cotter District Attorney, Deferred 9.53 Mike Davis Sheriff Jane De La Cruz Dept of Social Services Stella Jauregui Public Health Jeffrey L. Johnson Sheriff Leslie Knoble Probation George A. LaBorde Sheriff Gerald H. Luccardo Assessor-Recorder Joanne Madril Coroner, Deferred James P. Martinez Child Support Services James Robert McCullough Public Health, Deferred 7.10 Maria Meza Dept of Social Services Janie Montoya Dept of Social Services Anita Olvera Superior Court Dale E. Petersen Assessor-Recorder, Deferred 4.94 Billy D. Reischling Public Works & Planning Tony Rodriquez Assessor-Recorder, Deferred 2.04 Warren Bernard Rost Public Health Lavette Denise Sanders Dept of Social Services Della Sandoval Sheriff Penelope Smith Library, Deferred 5.66 Lourdes I. Soriano Public Health Vasiliki Tegos Superior Courts, Deferred Susan Thompson Dept of Social Services, Deferred *9. Disability Retirements Glen L. Green Sheriff *10. Deferred Retirements James L. Cummings Sheriff 2.36 Paul Garcia Child Support Services Kirk C. Kirkland Sheriff 3.14 Vernon R. LeSage Sheriff 2.99 Maria Maniscalco Dept of Social Services 6.88 Richard Rios Pubic Health 3.71 Lisa A. Tristan Public Works & Planning *11. Request to Rescind Deferred Retirement Craig Solis Probation

4 *12. Public Records Requests and/or Retirement Related Correspondence from Caitlan McMahon, Credit Suisse Securities; Sherri Lewis, Standard & Poor s MMD; Meredith Mertens, Seizert Capital Partners; and Jim Anderson, Mendocino County Employees Retirement Association *13. Update of Board of Retirement directives to FCERA Administration *14. Most recent investment returns, performance summaries and general investment information from investment managers *15. Educational Reading Materials 4 December 9, 2010 Bloomberg Business Week article San Diego s Tough-Love Pension Proposal December 14, 2010 PlanSponsor.com article CalPERS Sets New Asset Allocation Strategy December 15, 2010 PlanSponsor.com article Academic and Think Tank Hypocrisy In the Public Retirement Arena December 15, 2010 Top 1000 Funds article In defense of hedge funds of funds December 16, 2010 PlanSponsor.com article Fitch Considers Pension Funding in Government Credit Ratings December 16, 2010 The Mercury News article San Jose City Council selects financial experts for pension boards December 22, 2010 Top 1000 Funds article Clarifying the concept of risk management December 27, 2010 Pensions & Investments article Pension liquidity crisis leads P&I s top story list Fall 2010 The Monitor Newsletter November/December 2010 The Journal Newsletter CALAPRS Principles of Pension Management March 22-25, 2011 Palo Alto, California *16. Board of Retirement Annual Attendance Report for the calendar year 2010 *17. State Street Global Advisors post-transition analysis of funds to Waddell & Reed and Winslow Capital

5 *18. Travel Advance Requests from Chair Gomez and Trustees Cardenas and Cornacchia for hotel accommodations in the amount of $ (three nights) to attend the CALAPRS General Assembly March 5-8, Discussion and appropriate action on selection of investment management firms for the International Equity mandate 5 Jeffrey MacLean, Wurts & Associates, opened discussions by recommending that the Board select two of the four firms scheduled to present for further on-site due diligence with the goal of selecting one investment firm to manage the $165 million International Equity Mandate. Discussions ensued regarding whether on-site due diligence visits are necessary to the selection process with Trustee Larson noting his opposition to on-site due diligence visits. A motion was made by Trustee Souza, seconded by Vice Chair Gomez, to select two investment firms for further consideration and to schedule on-site due diligence visits. VOTE: Yes Cade, Cardenas, Cornacchia, Criego, Crow, Gomez, Jolly, Souza. No Larson. MOTION PASSED. The Board heard presentations from representatives of Dimensional Fund Advisors, Morgan Stanley, Pyrford, and Research Affiliates with each reviewing their organizational structures, investment strategies and processes, and fee structures. For the record, Mr. MacLean, noted that John West of Research Affiliates was once employed by Wurts & Associates. Detailed discussions ensued regarding the various investment strategies, approaches, and fees structures of each of the firms. A motion was made by Trustee Crow, seconded by Trustee Cardenas, to select Dimensional Fund Advisors and Research Affiliates for further consideration. ROLL CALL VOTE: Yes Cardenas, Cornacchia, Criego, Crow, Jolly, Larson, Cade. No Gomez, Souza. MOTION PASSED. It was noted that, based on individual schedules and timing, two Trustees (Cornacchia, Criego, or Jolly) will join Mr. MacLean and Roberto L. Peña, Retirement Administrator, on the on-site due diligence visits. 20. Discussion and appropriate action on resolution authorizing two Trustees to sign documents related to the sale of the Fresno Station Business Center Becky Van Wyk, Assistant Retirement Administrator, opened discussions by reminding the Board that in November 2010, the Board adopted a resolution authorizing Trustees Gomez and Hackett to sign documents necessary to complete the parcel map adjustment (lot split) and sale of the Fresno Station.

6 6 Ms. Van Wyk noted that the parcel map adjustment and sale were not completed prior to December 31, As a result of the recent Board election, Trustee Hackett is no longer a member of the Board. Therefore, the Board must authorize a new signatory to complete the sale of the property. Ms. Van Wyk recommended that the Board adopt a resolution appointing Trustee Gomez and a replacement Trustee to sign the documents necessary to complete the sale of the Fresno Station. Ms. Van Wyk read the resolution out loud for the record. A motion was made by Trustee Larson, seconded by Trustee Criego, to Adopt the resolution authorizing Chair Cade and Vice Chair Gomez to sign the documents necessary to complete the sale of the Fresno Station. VOTE: Yes Cardenas, Cornacchia, Criego, Crow, Gomez, Jolly, Larson, Cade. Abstain Souza. MOTION PASSED. Trustee Larson departed at 12:00 PM. Roberto L. Peña, Retirement Administrator, pulled Closed Session Agenda Items 21.A.1. and 21.B.1. as there was nothing to discuss. 21. Closed Session: A. Conference with Legal Counsel Actual Litigation - pursuant to G.C (a) 1. Geraldine Chisom, et al. v. Board of Retirement, etc., et al., Fresno County Superior Court Case No. 10 CECG B. Conference with Real Property Negotiators pursuant to G.C Property: 1713 Tulare Street, Fresno, CA Agency Negotiators: Brian Decker of Colliers Tingey C. Disability Retirement Applications Personnel Exception (G.C ): 1. Rudolph Gutierrez 22. Report from Closed Session 21.A.1. Pulled. 21.B.1. Pulled. 21.C.1. Rudolph Gutierrez Decision To grant Non-Service Connected Disability benefits pending a hearing for application for Service Connected Disability benefits. M Jolly. S Criego. VOTE: Unanimous (Absent Larson)

7 7 23. Report from FCERA Administration Roberto L. Peña, Retirement Administrator, reported on the following: 1. State Street Bank deposited retiree benefit checks on December 31, 2010 instead of December 30 th (the last working day of the month for FCERA) as requested by Administration. Members were notified of the mistake via the FCERA web-site. Only minor inconveniences were reported by members. 2. FCERA staff has scheduled its first pre-retirement seminar on January 20, Due to the overwhelming response for attendance, the seminar will be held at the Fresno County Plaza Ballroom. 3. Administration requested that the Trustees bring their Trustee Binders to the next meeting in order to have the binders updated. 4. The deadline to register to attend the National Association of Securities Professionals conference is January 7, An invitation to attend Boot Camp for Elected Officials on February 17, Report from County Counsel Susan Coberly, Senior Deputy County Counsel, had nothing to report. 25. Board Member Announcements or Reports Vice Chair Gomez thanked the FCERA staff for organizing the upcoming Pre-Retirement Seminar. There being no further business, the meeting adjourned at 12:19 PM. Roberto L. Peña Secretary to the Board