MINUTES OF THE BOARD MEETING OF DECEMBER 1, 2016

Transcription

1 MINUTES OF THE BOARD OF FIRE AND POLICE PENSION COMMISSIONERS BOARD MEETING OF DECEMBER 1, 2016 The Board of Fire and Police Pension Commissioners of the City of Los Angeles met in the LAFPP Sam Diannitto Boardroom, located at the Los Angeles Fire and Police Pensions Building, 701 East 3rd Street, Suite 400, Los Angeles on Thursday, December 1, COMMISSIONERS PRESENT: COMMISSIONER ABSENT: DEPARTMENT OF FIRE AND POLICE PENSIONS: CITY ATTORNEY'S OFFICE: Pedram Salimpour, MD, President Ruben Navarro, Vice President George Aliano Corinne T. Babcock Sam Diannitto Adam Nathanson Belinda Vega Robert von Voigt Brian Pendleton Raymond P. Ciranna, General Manager William Raggio, Executive Officer Tom Lopez, Chief Investment Officer Joseph Salazar, Assistant General Manager Rhonda Ketay, Commission Executive Assistant Alan Manning, Assistant City Attorney President Salimpour called the meeting to order at 8:30 a.m. All the above-listed Commissioners were present at the start of the meeting. A. ITEMS FOR BOARD ACTION Item A.5 was taken out of order. 5. REVIEW OF THE REAL ESTATE INVESTMENT PROGRAM AND POSSIBLE BOARD ACTION

2 Page 2 Mr. Rick Rogers, Investment Officer III, Investments Division introduced Ms. Jennifer Young Stevens, Principal, and Mr. Robert Miranda, Vice President, from The Townsend Group then presented his report to the Board. Mr. Tom Lopez, Chief Investment Officer, Investments Division was available for questions. The Board discussed third party management, current and historical returns, Board controls, discretion in a box, and adding an additional active manager. Commissioners Nathanson and Salimpour requested data on returns and property values. RESOLUTION Commissioner Navarro moved that the Board direct Staff to issue a Request for Proposal to hire an additional active Real Estate Investment Trust (REIT) manager, which was seconded by Commissioner Aliano and approved by the following vote: ayes, Commissioners Aliano, Babcock, Diannitto, Nathanson, Navarro, Vega, von Voigt, and President Salimpour 8; nays, none. Commissioner Babcock left the meeting at 9:35 a.m. 1. MEDICARE PART B PREMIUM REIMBURSEMENT MAXIMUMS FOR 2017 AND POSSIBLE BOARD ACTION Mr. Gregory Mack, Chief Benefits Analyst, Pensions Division presented the report to the Board. The report was approved as submitted. RESOLUTION Commissioner von Voigt moved that the Board adopt the attached Resolution implementing a multiple tier Medicare Part B Premium Reimbursement, with a maximum monthly reimbursement amount of $134.00, effective January 1, 2017, WHEREAS, Los Angeles City Administrative Code Section provides that the Board of Fire and Police Pension Commissioners will pay reimbursement of Medicare Part B standard premiums for eligible retired members and qualified surviving spouses/domestic partners of the Fire and Police Pension Plan who are eligible to receive health insurance subsidies and enrolled in Medicare Parts A and B; and WHEREAS, the Medicare Part B standard premiums effective January 1, 2017, are up to $ per month;

3 Page 3 RESOLVED, that eligible members and eligible qualified surviving spouses/domestic partners shall have paid a monthly Medicare Part B premium reimbursement of up to $134.00; and RESOLVED, the Medicare premium reimbursement provided herein shall be applied to the December 31, 2016 pension payments and subsequent monthly payments and shall remain in effect until modified or cancelled by subsequent action of the Board; and RESOLVED, that the Manager-Secretary of the Department of Fire and Police Pensions be authorized to cause demands to be drawn upon the General Pension Funds of the Fire and Police Pension Plan, Tiers 1, 2, 3, 4, 5, and 6, to be paid to eligible members and beneficiaries, provided such payments have been verified against records kept by the Department of Fire and Police Pensions and found to be correct and proper, and individual reimbursement amounts are within the limits as set forth in the Los Angeles City Administrative Code, which was seconded by Commissioner Aliano and approved by the following vote: ayes, Commissioners Aliano, Diannitto, Nathanson, Navarro, Vega, von Voigt, and President Salimpour 7; nays, none. 2. CONSIDERATION OF THE JULY 1, 2015 TO JUNE 30, 2016 PENSION AND HEALTH BENEFITS VALUATION AND POSSIBLE BOARD ACTION Mr. Gregory Mack, Chief Benefits Analyst, Pension Division and Mr. Andrew Yeung, The Segal Company, presented the valuation results to the Board. Commissioner Vega moved that the Board: RESOLUTION Adopt the attached pension and health valuation report submitted by The Segal Company (Segal) for the period ending June 30, 2016; and, 2. Adopt the attached Governmental Accounting Standards (GAS) 67 Actuarial Valuation as of June 30, 2016, which was seconded by Commissioner Navarro and approved by the following vote: ayes, Commissioners Aliano, Diannitto, Nathanson, Navarro, Vega, von Voigt, and President Salimpour 7; nays, none. 3. AUDITED FINANCIAL STATEMENTS AS OF JUNE 30, 2016 AND POSSIBLE BOARD ACTION Ms. Erin Kenney, Departmental Audit Manager, Internal Audit Section introduced Ms. Melba Simpson, Partner, Mr. Robert Flemming, IT Manager, and Ms. Grace Yuen, Partner, from Simpson and Simpson. They presented their report to the Board.

4 Page 4 Commissioner Salimpour asked if there were any outstanding recommendations made by previous auditors. Ms. Yuen answered that all past recommendations have been implemented. Commissioner Vega left the meeting at 10:12 a.m. The report was approved as submitted. General Manager Ciranna thanked Simpson and Simpson and Staff for their hard work in preparing the report. RESOLUTION Commissioner Navarro moved that the Board: 1. Adopt the System's Audited Financial Statements as of June 30, 2016; and, 2. Direct staff to provide copies of the adopted Audited Financial Statements to the State Controller and City Controller before December 31, 2016, which was seconded by Commissioner von Voigt and approved by the following vote: ayes, Commissioners Aliano, Diannitto, Nathanson, Navarro, von Voigt, and President Salimpour 6; nays, none. The Board recessed the regular meeting at 10:18 a.m.to convene the Special Board Meeting. Telephonic participation by Commissioner Diannitto ended at 10:18 a.m. The regular meeting reconvened at 11:20 a.m. Commissioner Diannitto rejoined the meeting telephonically at 11:21 a.m. 4. PROPOSED RENEWAL OF HARDING LOEVNER EMERGING MARKETS EQUITY CONTRACT AND POSSIBLE BOARD ACTION Ms. Erin Kenney, Department Audit Manager, stated the Internal Audit Section received the required disclosure information regarding gifts, campaign contributions, and charitable contributions; and that there is nothing to report under LAFPP's contractor disclosure policy. Ms. Annie Chao, Investment Officer I, Investments Division presented her report to the Board. Mr. Ryan Sullivan, Consultant, from RVK was at the table as well. Commissioner Nathanson discussed other investors and the current year performance with Mr. Sullivan. Commissioner Aliano stated that Harding Loevner has outperformed the benchmark over the past several years. RESOLUTION Commissioner Navarro moved that the Board:

5 Page 5 1. Approve a new three-year contract with Harding Loevner LP for Emerging Markets Equity advisory services; 2. Authorize the General Manager to review and negotiate the terms and conditions with Harding Loevner LP for Emerging Markets Equity advisory services for the period February 1, 2017 through January 31, 2020; and, 3. Authorize the President of the Board, on behalf of the Board, to execute the contract with Harding Loevner LP for Emerging Markets Equity advisory services, subject to the approval of the City Attorney as to form and legality, which was seconded by Commissioner von Voigt and approved by the following vote: ayes, Commissioners Aliano, Diannitto, Navarro, von Voigt, and President Salimpour 5; nays, Commissioner Nathanson RENEWAL OF REAL ESTATE CONSULTANT CONTRACT AND POSSIBLE BOARD ACTION Ms. Erin Kenney, Department Audit Manager, stated that Internal Audit Section received the required disclosure information regarding gifts, campaign contributions, and charitable contributions; and that there is nothing to report under LAFPP's contractor disclosure policy. Mr. Paul Palmer, Investment Officer II, Investments Division presented his report to the Board. Commissioner Nathanson discussed fee structure and performance fees with Mr. Palmer. RESOLUTION Commissioner Navarro moved that the Board: 1. Approve a new three-year contract with The Townsend Group for Real Estate Consulting; 2. Authorize the General Manager to negotiate the terms and conditions with The Townsend Group for Real Estate Consulting services for the period February 1, 2017 to January 31, 2020; and 3. Authorize the President of the Board, on behalf of the Board, to execute the contract with The Townsend Group for Real Estate Consulting, subject to the approval of the City Attorney as to form, which was seconded by Commissioner von Voigt and approved by the following vote: ayes, Commissioners Aliano, Diannitto, Nathanson, Navarro, von Voigt, and President Salimpour 6; nays, none. B. REPORTS TO THE BOARD

6 Page 6 1. CONTRACTOR DISCLOSURE POLICY QUARTERLY REPORT Ms. Erin Kenney, Departmental Audit Manager, Internal Audit Section was available for questions from the Board. The report was received and filed. 2. UPDATE ON LAFPP RETIREES ENROLLED IN LACERS' HEALTH AND/OR DENTAL PLANS General Manager Ciranna stated that he has been working with LACERS to resolve the issue and that there has been some movement toward resolution. 3. President Salimpour asked if any Board Member made any expenditure to influence State legislative or administrative action to which their reply was negative. 4 Miscellaneous correspondence from money managers, consultants, etc. Received and Filed. 5. General Manager's Report a. Benefits Actions approved by General Manager on November 17, 2016 Pursuant to Resolution 04008, adopted by the Board of Fire & Police Pension Commissioners on August 7, 2003, the following benefit actions have been approved by the General Manager on November 17, DISCONTINUED PENSIONS TIER 1 3 Peter Cerda Police Service Retired: Died: Edwin L. Chapman Police Service Retired: Died: John P. Sgroi Police Disability Retired: Died: DISCONTINUED PENSIONS TIER 2 14 Henry Huizinga, Jr. Fire Service Retired: Died: Jervus E. King Fire Service Retired: Died: Jerrome A. Boen Police Service Retired: Died: Michael L. Brown Police Service Retired: Died: Gordon K. Galewick Police Service Retired: Died: Carlo B. Giufurta Police Service Retired: Died: Wayne K. Lueth Police Service Retired: Died: Monty B. Madison Police Service Retired: Died: Jerry L. May Police Service Retired: Died:

7 Page 7 Arley V. Tracy Fire Disability Retired: Died: Ruth E. Loupe Fire Widow Retired: Died: Shirley Binstein Police Widow Retired: Died: Marilyn G. Demena Police Widow Retired: Died: Edith Y. Poe Police Widow Retired: Died: DISCONTINUED PENSIONS TIER 5 2 Irwin J. Klorman Police Service Retired: Died: Leo Turner, Jr. Police Service Retired: Died: DISCONTINUED PENSIONS FORMER SPOUSE TIER 5 1 Denise Turner Police Service Retired: Member Died: ELIGIBLE SURVIVING SPOUSE'S PENSION TIER 2 7 Name Deceased Member Member's Class Effective Date Beverly J. King Jervus E. King Fire Service Virginia G. Boen Jerrome A. Boen Police Service Roxanne T. Brown Michael L. Brown Police Service Linda A. Dowis Roger C. Dowis Police Service Erna Y. Haskin Douglas L. Haskin Police Service Mary C. Harbridge John J. Harbridge Police Disability Ruth J. Stelzner Richard S. Stelzner Police Disability ELIGIBLE SURVIVING SPOUSE'S PENSION TIER 5 1 Name Deceased Member Member's Class Effective Date Idella Baker Ernest G. Baker, Jr. Police Service ELIGIBLE SURVIVOR BENEFIT PURCHASE PROGRAM PENSION TIER 1 1 Name Lorena S. Cerda Deceased Member Peter Cerda Member's Class Effective Date Police Service SURVIVING CHILD'S PENSION TIER 3 1 Surviving child benefits are now payable to Sierra R. Cuesta, surviving child of deceased Police Officer II, Filbert H. Cuesta, effective July 7, 2016, due to the attainment of age 18 and the continuation of full-time student status.

8 Page 8 SURVIVING CHILD'S PENSION TIER 5 2 Surviving child benefits being withheld due to non-submission of Letters of Guardianship are now payable to Andrew S. Klorman, surviving child of deceased Sergeant I, Irwin J. Klorman, effective April 2, 2016, due to the attainment of age 18 and the continuation of full-time student status. Surviving child benefits being withheld due to non-submission of Letters of Guardianship are now payable to Michael S. Mcgarity, surviving child of deceased Lieutenant I, William S. Mcgarity, effective March 31, 2014, due to the attainment of age 18 and the continuation of full-time student status. REINSTATE SURVIVING CHILD'S PENSION TIER 5 1 Pension payable to Kelsey L. Kemper, surviving child of deceased Fire Captain II, Lane A. Kemper, reinstated effective October 1, Documentation has been submitted for full-time student status. DECREASE SURVIVING CHILD'S PENSION TIER 5 1 Decrease the pension payable to Kaylen R. Kemper, surviving child of deceased Fire Captain II, Lane A. Kemper, due to the full-time student status by Kelsey L. Kemper, effective October 1, INCREASE SURVIVING CHILD'S PENSION TIER 5 1 Increase the pension payable to Robert J. Mcgarity, surviving child of deceased Lieutenant I, William S. Mcgarity, effective November 11, 2016, due to the attainment of age 22 by Ryan B. Mcgarity. DISCONTINUE SURVIVING CHILD'S PENSION TIER 5 1 Discontinue the pension payable to Ryan B. Mcgarity, surviving child of deceased Lieutenant I, William S. Mcgarity, effective November 10, 2016, due to the attainment of age 22 on November 11, PARTIAL PAYMENT OF PENSION TIER 2 1 In accordance with the City Attorney's advice, a designated proportion of the community property interest of the pension payable to Roy L. Norman, Police Disability Pensioner, is to be withheld for his former spouse, Joyce A. Ford, effective November 1, Ms. Ford will receive cost of living adjustments. MODIFIED PARTIAL PAYMENT OF PENSION TIER 5 1

9 Page 9 In accordance with the City Attorney's advice, a designated proportion of the community property interest of the pension payable to Gerald R. Travens, Fire Service Pensioner, being withheld for his former spouse, Michelle Travens, since April 30, 2016, should be released effective November 1, CONSERVATORSHIP/PAYMENT OF DEPENDENT CHILD BENEFITS TO A SPECIAL NEEDS TRUST- TIER 1-1 The Board approved dependent child status for Peter Steven Stafford on October 1, A Special Needs Trust was created per L.A.C.C. Section 1238 by the member, Peter E. Stafford, and approved by the City Attorney's Office on August 9, A certified copy of the Letters of Conservatorship of the Estate of Peter Steven Stafford, issued in the Superior Court of the State of California, County of Los Angeles, Case Number BP , appointing Richard F. Stafford, Conservator for Peter S. Stafford, dependent child of deceased Police Sergeant I, Peter E. Stafford, effective September 26, 2016, has been filed with this office. On October 17, 2016, Mr. Richard F. Stafford requested pension payments be paid to the Peter Steven Stafford Special Needs Trust pursuant to L.A.C.C. Section 1238 (d)(3)(c). Pension payments (retroactive and ongoing dependent child benefits for Peter S. Stafford) will be paid to Richard F. Stafford, trustee of the Peter Steven Stafford Special Needs Trust, for the benefit of Peter S. Stafford, effective January 21, DEFERRED SERVICE PENSION TIER 3 1 Police Carrie R. Zipperman Detective III Eff: Years 81 Days SERVICE PENSION TIER 3 2 Police Gabriel Almeida Detective II Eff: Years 186 Days Christian R. Shaw Police Officer II Eff: Years 57 Days SERVICE PENSION TIER 5 1 Police Jonathan T. Britton Police Officer III Eff: Years 30 Days

10 Minutes of the Board of Fire and Police Page 10 Pension Commissioners SERVICE PENSION/DROP TIER 3 1 Police Daniel J. Galindo Sergeant I Eff: Years 6 Days SERVICE PENSION/DROP TIER 5 3 Fire Gary W. Carpenter Captain I Eff: Years 213 Days Police Grace M. Kelly Detective I Eff: Years 12 Days Peter A. Zarcone Captain III Eff: Years 5 Days DISCONTINUE DROP TIER 5 3 Fire Charles F. Molloy Retired: Exit Close of: Police Andrew Chase Retired: Exit Close of: Heriberto Gamboa Retired: Exit Close of: MODIFIED PARTIAL PAYMENT OF DROP FUNDS TIER 5 1 In accordance with the City Attorney's advice, a designated proportion of the community property interest of the DROP funds payable to Gerald R. Travens, Fire Service Pensioner, being withheld for his former spouse, Michelle Travens, since April 30, 2016, should be released effective November 1, DESIGNATED PARTIAL PAYMENT OF DROP FUNDS TIER 5 1 In accordance with the City Attorney's advice, a designated proportion of the community property interest of the DROP funds payable to Gary S. Maga, Fire Service Pensioner, which was to be paid to his deceased former spouse, Joanne A. Maga, has been assigned to her beneficiary, Cory T. McKelvie, effective November 30, ELIGIBLE SURVIVING SPOUSE APPLICATION TIER 3 1 Name Member's Class Type % Rate Effective Date Tyler R. Fox Detective II NSC w/o prejudice: (Nadine I. Hernandez) 30%

11 Page 11 SERVICE CONNECTED DISABILITY PENSION TIER 3 1 Name Member's Rank Percentage Effective Date Board Date Lucille R. Trosclair Sergeant I 62% b. Other business relating to Department operations C. CONSENT ITEMS General Manager Ciranna gave the following update: 1. The City Council approved the changes to the elections of Board members on November 23, The Ordinance has been drafted and will go to City Council for approval on December 2, Approval of Minutes of the Regular Board meeting of March 17, Findings of Fact - Lucille R. Trosclair Tier 3 MOTION Commissioner von Voigt moved that the board approve the consent items, which was seconded by Commissioner Navarro and approved by the following vote: ayes, Commissioners Aliano, Diannitto, Nathanson, Navarro, von Voigt, and President Salimpour 6; nays, none. D. CONSIDERATION OF FUTURE AGENDA ITEMS There were no items referred for consideration. E. GENERAL PUBLIC COMMENT ON MATTERS WITHIN THE BOARD'S JURISDICTION Mr. Marcos Feldman, Ms. Andrea Leon Grossman, and Ms. Elsa Moy provided public comment. F. CLOSED SESSION ITEMS FOR POSSIBLE BOARD ACTION 1. CLOSED SESSION PURSUANT TO GOVERNMENT CODE SECTION TO CONSIDER THE PURCHASE OF TWO (2) PARTICULAR, SPECIFIC INVESTMENTS AND POSSIBLE BOARD ACTION The Board met in closed session. Upon reconvening in open session, President Salimpour stated there was no public report.

12 Page 12 The meeting adjourned at 12:00 p.m. President