MINUTES OF THE BOARD OF FIRE AND POLICE PENSION COMMISSIONERS BOARD MEETING OF JANUARY 4, 2018

Transcription

1 MINUTES OF THE BOARD OF FIRE AND POLICE PENSION COMMISSIONERS BOARD MEETING OF JANUARY 4, 2018 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, January 4, COMMISSIONERS PRESENT: COMMISSIONER ABSENT: DEPARTMENT OF FIRE AND POLICE PENSIONS: CITY ATTORNEY'S OFFICE: Ruben Navarro, President Corinne T. Babcock, Vice President George Aliano Ken Buzzell Brian Pendleton Pedram Salimpour, MD Belinda Vega Adam Nathanson Robert von Voigt Raymond P. Ciranna, General Manager Tom Lopez, Chief Investment Officer Joseph Salazar, Assistant General Manager Rhonda Ketay, Commission Executive Assistant Joshua Geller, Deputy City Attorney President Navarro 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 1. REVIEW OF BAILLIE GIFFORD OVERSEAS LIMITED'S CONTRACT FOR INTERNATIONAL EQUITY MANAGEMENT AND POSSIBLE BOARD ACTION Ms. Erin Kenney, Departmental Audit Manager, Internal Audit Section 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. Nathaniel Chang, Investment Officer, Investments Division presented the report to the Board. Commissioner Vega discussed fees with Mr. Chang and Mr. Paul Palmer, Investment Officer, Investments Division.

2 Page 2 The board report was approved as submitted. Commissioner Aliano moved that the Board: Resolution Approve a three-year contract with Baillie Gifford Overseas Limited for international equity management services; 2. Authorize the General Manager to review and negotiate the terms and conditions with Baillie Gifford Overseas Limited for international equity management services for the period March 1, 2018 through February 28, 2021; and, 3. Authorize the President of the Board, on behalf of the Board, to execute the contract with Baillie Gifford for international equity management services, subject to the approval of the City Attorney as to form and legality, which was seconded by President Navarro and approved by the following vote: ayes, Commissioners Aliano, Babcock, Buzzell, Pendleton, Salimpour, Vega, and President Navarro 7; nays, none. 2. REVIEW OF ALLIANCEBERNSTEIN, L.P.'S CONTRACT FOR GLOBAL REAL ESTATE INVESTMENT TRUST INDEX AND POSSIBLE BOARD ACTION Mr. Nathaniel Chang, Investment Officer, Investments Division presented the report to the Board. Commissioners Aliano and Vega discussed benchmarks, fees, and personnel changes with Mr. Chang and Mr. Ryan Sullivan, Consultant from RVK. Ms. Erin Kenney, Departmental Audit Manager, Internal Audit Section 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. Resolution Commissioner Salimpour moved that the Board: 1. Approve a new three-year contract with AllianceBernstein, L.P. for global real estate investment trust index management services; 2. Authorize the General Manager to negotiate the terms and conditions of the contract with AllianceBernstein, L.P. for global real estate investment trust index management services for the period of March 1, 2018 to February 29, 2020 February 28, 2021; and, 3. Authorize the President of the Board, on behalf of the Board, to execute the contract with AllianceBernstein, L.P. for global real estate investment trust index management services, subject to the approval of the City Attorney as to form and legality, which was seconded by

3 Page 3 Commissioner Aliano and approved by the following vote: ayes, Commissioners Aliano, Babcock, Buzzell, Pendleton, Salimpour, Vega, and President Navarro 7; nays, none. 3. DISCUSSION OF THE FINALIST CANDIDATES FOR THE INTERNATIONAL SMALL CAP EQUITY SEARCH AND POSSIBLE BOARD ACTION Mr. Paul Palmer, Investment Officer, Investments Division presented the report to the Board. Ms. Becky Gratsinger, CEO and Senior Consultant, Mr. Jim Voytko, President and Senior Consultant, and Mr. Ryan Sullivan, Consultant from RVK were available for questions from the Board. Resolution Commissioner Vega moved that the Board review the active International Small Cap equity managers listed in the attached report from RVK, and interview: AQR Capital Management Principal Global Equities Victory Capital Management with the intent of hiring one firm for the entire allocation, which was seconded by Commissioner Aliano and approved by the following vote: ayes, Commissioners Aliano, Babcock, Buzzell, Pendleton, Salimpour, Vega, and President Navarro 7; nays, none. 4. APPROVAL TO ISSUE A REQUEST FOR PROPOSAL FOR ACTUARIAL CONSULTING SERVICES AND POSSIBLE BOARD ACTION Mr. Gregory Mack, Chief Benefits Analyst, Pensions Division discussed the report with the Board. Commissioner Buzzell expressed interest in having the Board interview responding firms. Commissioner Vega moved that the Board: Motion 1. Authorize the General Manager to issue a Request for Proposal (RFP) for actuarial consulting services, including a provision for a secondary consultant to conduct an actuarial audit, if necessary; and, 2. Direct staff to report back to the Board with a recommendation(s) for contract award(s) upon completion of the competitive proposal and evaluation process, which was seconded by Commissioner Pendleton and failed by the following vote: ayes, Commissioners Pendleton and Vega - 2; nays - Aliano, Babcock, Buzzell, Salimpour, and President Navarro 5.

4 Page 4 Resolution Commissioner Buzzell moved that the Board: 1. Authorize the General Manager to issue a Request for Proposal (RFP) for actuarial consulting services, including a provision for a secondary consultant to conduct an actuarial audit, if necessary; and, 2. Direct staff to report back to the Board with a list of responding firms so the Board may evaluate the responses and decide which firms, if any, to interview, which was seconded by Commissioner Babcock and approved by the following vote: ayes, Commissioners Aliano, Babcock, Buzzell, Pendleton, Salimpour, Vega, and President Navarro 7; nays, none. 5. STATUS REPORT TO 2017 ANNUAL AUDIT PLAN AND FORECAST AND PROPOSED 2018 ANNUAL AUDIT PLAN AND FORECAST AND POSSIBLE BOARD ACTION Ms. Erin Kenney, Departmental Audit Manager, Internal Audit Section discussed the report with the Board. Ms. Elsa Moy provided public comment. The board report was approved as submitted. Resolution Commissioner Pendleton moved that the Board: 1. Review the status report to the 2017 Annual Audit Plan and Forecast; and, 2. Review and approve the proposed 2018 Annual Audit Plan and Forecast, which was seconded by Commissioner Babcock and approved by the following vote:ayes, Commissioners Aliano, Babcock, Buzzell, Pendleton, Salimpour, Vega, and President Navarro 7; nays, none. 6. APPROVAL TO ISSUE A REQUEST FOR PROPOSAL FOR HEALTH CONSULTING SERVICES AND POSSIBLE BOARD ACTION Commissioner Aliano discussed his concerns with the Ad Hoc Committee on Retiree Health Plans meeting structure and location with the Board. President Navarro stated that future Ad Hoc Committee on Retiree Health Plans meetings would be scheduled in a manner that would allow greater retiree representation and encouraged any interested Commissioners to attend the meetings.

5 Page 5 Ms. Eunice Zordilla, Senior Management Analyst I, Medical and Dental Benefits Section presented the report to the Board. The board report was approved as submitted. Resolution Commissioner Buzzell moved that the Board authorize the General Manager to issue a Request for Proposal (RFP) for health consulting services, which was seconded by Commissioner Babcock and approved by the following vote: ayes, Commissioners Aliano, Babcock, Buzzell, Pendleton, Salimpour, Vega, and President Navarro 7; nays, none. 7. AIRPORT DEPARTMENT CONTRIBUTION RATE FOR JANUARY 8, 2018 AND POSSIBLE BOARD ACTION Mr. Gregory Mack, Chief Benefits Analyst, Pensions Division discussed the report with the Board. Mr. Joseph Salazar, Assistant General Manager, Pensions Division answered questions from the Board. Commissioner Salimpour stepped out of the boardroom prior to the vote. Resolution Commissioner Buzzell moved that the Board adopt the contribution rate for the Airport Department's employer contribution due on January 8, 2018, which was seconded by Commissioner Babcock and approved by the following vote: ayes, Commissioners Aliano, Babcock, Buzzell, Pendleton, Vega, and President Navarro 6; nays, none. B. REPORTS TO THE BOARD 1. QUARTERLY PORTFOLIO PERFORMANCE REPORT BY RVK Ms. Becky Gratsinger, CEO and Senior Consultant, Mr. Jim Voytko, President and Senior Consultant, and Mr. Ryan Sullivan, Consultant from RVK presented their report to the Board. 2. UPDATE ON IMPLEMENTATION OF CALIFORNIA GOVERNMENT CODE SECTION ALTERNATIVE INVESTMENT FEES Ms. Miki Shaler, Senior Management Analyst I, Investments Section presented the report to the Board. Mr. Tom Lopez, Chief Investment Officer, Investments Division answered questions from the Board. 3. President Navarro 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.

6 Page 6 5. General Manager's Report a. Benefits Actions approved by General Manager on December 19, 2017 Pursuant to Resolution 04008, adopted by the Board of Fire and Police Pension Commissioners on August 7, 2003, the following benefit actions have been approved by the General Manager on December 21, DISCONTINUED PENSIONS TIER 1 1 Carolyn A. Simmerman Police Widow Retired: Died: DISCONTINUED PENSIONS TIER 2 6 Gary R. Lonza Fire Service Retired: Died: Don E. Sitts Fire Service Retired: Died: Glenn R. Ackerman Police Service Retired: Died: Stuart E. Foreman Police Service Retired: Died: Ernest F. Malan Police Service Retired: Died: Marshall E. Prindle Fire Disability Retired: Died: DISCONTINUED PENSIONS TIER 5 1 Richard A. Beach Police Service Retired: Died: DISCONTINUED PENSIONS FORMER SPOUSE TIER 2 2 Rose A. Rodriguez Police Service Retired: Member Died: Maryann Prindle Fire Disability Retired: Member Died: ELIGIBLE SURVIVING SPOUSE'S PENSION TIER 2 11 Name Deceased Member Member's Class Effective Date Lois C. Johnson Ray L. Johnson Fire Service Barbara J. Sitts Don E. Sitts Fire Service Beverly E. Carr Thomas L. Carr Police Service Kathryn Foreman Stuart E. Foreman Police Service Carol A. Fox Richard J. Fox Police Service Nancy M. Harris Claude M. Harris, Jr. Police Service Adela Rubalcava John Rubalcava Police Service Barbara J. Valles Fred G. Valles, Jr. Police Service lone L. Gamrat John F. Gamrat Fire Disability Mary H. Nelson Ralph G. Nelson Fire Disability Joanne E. Rose William D. Rose Fire Disability

7 Page 7 ELIGIBLE SURVIVING SPOUSE'S PENSION TIER 5 1 Name Deceased Member Member's Class Effective Date Carol A. Beach Richard A. Beach Police Service ELIGIBLE DOMESTIC PARTNER'S PENSION TIER 3 1 Name Deceased Member Member's Class Effective Date Anthony W. Smith-Roberts Lawrence J. Roberts Fire Disability ELIGIBLE SURVIVOR BENEFIT PURCHASE PROGRAM PENSION TIER 2 1 Name Deceased Member Member's Class Effective Date Patricia N. Cronkhite Clyde L. Cronkhite Police Service PARTIAL PAYMENT OF PENSION TIER 5 1 the pension payable to Dale H. Thurow, Fire Service Pensioner, is to be paid to his former spouse, Lori Simmons Thurow, effective September 1, Ms. Simmons Thurow will receive cost of living adjustments. DESIGNATED PARTIAL PAYMENT OF PENSION TIER 2 1 the pension payable to Anthony J. Couch, Fire Disability Pensioner, which was paid to his deceased former spouse, Laura F. Couch, has been designated to her beneficiaries, Todd M. Couch and Timothy C. Couch, effective October 16, Both beneficiaries will receive cost of living adjustments. MODIFIED PARTIAL PAYMENT OF PENSION TIER 5 2 the pension payable to Thomas E. Croell, Fire Service Pensioner, being withheld for his former spouse, Ann M. Croell, since June 18, 2016, should be released effective December 1, the pension payable to Donald E. Green, Fire Service Pensioner, being withheld for his former spouse, Alfreda Ashmore Green, since June 1, 2017, should be released effective December 1, DISCONTINUE PARTIAL PAYMENT OF PENSION TIER 5 1 the pension payable to Edard L. Hayes, Police Service Pensioner, which was being paid to his former spouse, Brenda D. Hayes, has been discontinued. Ms. Hayes' portion reverts to the member, effective December 1, 2017.

8 Page 8 CONSERVATORSHIP TIER 2 1 A certified copy of the Letters of Conservatorship for the Person and the Estate of Josephine Lamaster, issued in the Superior Court of California, County of Los Angeles, Case Number 16STPB01578, appointing Los Angeles County Office of the Public Guardian, Conservator for the Person and the Estate of Josephine Lamaster, surviving spouse of deceased Police Officer, William J. Lamaster, effective October 19, 2017, has been filed with this office. Pension payments will be paid to Los Angeles County Office of the Public Guardian for the benefit of Josephine Lamaster, effective December 1, CONSERVATORSHIP TIER 5 1 A certified copy of the Letters of Limited Conservatorship for the Estate of Marie E. Aguilar, Suanna D. Aguilar and Jordan A. Aguilar, issued in the Superior Court of California, County of Los Angeles, Case Numbers VP , BP , and BP , appointing Debora J. Aguilar, Conservator for Marie E. Aguilar, Suanna D. Aguilar and Jordan A. Aguilar, dependent children of deceased Police Officer III, Arthur Aguilar, effective August 11, 2017, has been filed with this office. Pension payments will be paid to Debora J. Aguilar for the benefit of Marie E. Aguilar, Suanna D. Aguilar and Jordan A. Aguilar, effective August 29, SERVICE PENSION TIER 5 2 Fire Bennett P. Rogers Eff: Years 88 Days Police Steven Reyes Eff: Years 72 Days SERVICE PENSION/DROP TIER 5 5 Fire Don M. Contreras Engineer Eff: Years 3 Days Police Jeffrey A. Brugger Detective III Eff: Years 10 Days Mitchell D. Nowlen Police Officer II Eff: Years 9 Days Maria M. Umansky Detective III Eff: Years 206 Days Ted J. Watson Police Officer II Eff: Years 6 Days DISCONTINUE DROP TIER 3 1 Fire Curt J. Williamson Retired: Exit Close of:

9 Minutes of the Board of Fire and Police Pension Page 9 Commissioners DISCONTINUE DROP - TIER 5-9 Police John A. Alviani Retired: Exit Close of: Robert B. Bermudez Retired: Exit Close of: John F. Egan Retired: Exit Close of: Warren S. Jones Retired: Exit Close of: Raymond Martinez Retired: Exit Close of: Nicole M. Nunez Retired: Exit Close of: Robert Rodriguez Retired: Exit Close of: Jesse A. Soltero Retired: Exit Close of: David A. Stambaugh Retired: Exit Close of: PARTIAL PAYMENT OF DROP FUNDS - TIER 5-1 the DROP funds payable to Dale H. Thurow, Fire Service Pensioner, is to be paid to his former spouse, Lori Simmons Thurow, effective August 31, MODIFIED PARTIAL PAYMENT OF DROP FUNDS - TIER 5-2 the DROP funds payable to Thomas E. Croell, Fire Service Pensioner, being withheld for his former spouse, Ann M. Croell, since June 17, 2016, should be released effective December 1, the DROP funds payable to Jose J. Salazar, Police Service Pensioner, being withheld for his former spouse, Victoria L. Aguirre, since January 31, 2014, should be released effective December 1, b. Other business relating to Department operations General Manager Ciranna gave the following updates: 1. The 2017 Annual Report is completed and posted on the LAFPP website. General Manager Ciranna thanked Staff for their all their work on the report. 2. LAFPP will post the Notice of Intention to amend its Conflict of Interest Code at City Hall, City Hall East, and LAFPP on January 5, A written comment period will commence on January 5, 2018 and terminate on February 4, 2018 C. CONSIDERATION OF FUTURE AGENDA ITEMS There were no items referred for consideration. D. GENERAL PUBLIC COMMENT ON MATTERS WITHIN THE BOARD'S JURISDICTION There were no public comments.

10 Page 10 President Navarro recessed the meeting for a break at 10:20 a.m. and reconvened at 10:30 a.m. E. DISABILITY CASES DISABILITY CLAIM NEW CLAIM TIER 5 Christopher A. Bouse (P) Police Officer III Nonservice-connected disability pension is granted at 40% with no foreseeable purpose for review. Motion made by Commissioner Aliano, seconded by Commissioner Buzzell and adopted by the following vote: ayes, Commissioners Aliano, Babcock, Buzzell, Pendleton, Salimpour, Vega, and President Navarro 7; nays, none; absent, Commissioners Nathanson and von Voigt 2. Officer Bouse was present and was represented by Thomas J. Wicke, Esq. of Lewis, Marenstein, Wicke, Sherwin and Lee. Commissioner Babcock left the board room for the remainder of the meeting at 11:47 a.m. F. CLOSED SESSION ITEM FOR POSSIBLE BOARD ACTION 1. CLOSED SESSION PURSUANT TO GOVERNMENT CODE SECTION TO CONSIDER THE PURCHASE OF ONE (1) PARTICULAR, SPECIFIC INVESTMENT AND POSSIBLE BOARD ACTION The Board met in closed session. Upon reconvening in open session, President Navarro stated there was nothing to report. The meeting was adjourned at 12:05 p.m. President