MINUTES OF THE BOARD MEETING OF AUGUST 6, 2015

Transcription

1 MINUTES OF THE BOARD OF FIRE AND POLICE PENSION COMMISSIONERS BOARD MEETING OF AUGUST 6, 2015 The Board of Fire and Pension Commissioners of the City of Los Angeles met at the LACERS Board Room, located at the Los Angeles Times Building, 202 W. First Street, Suite 500, Los Angeles on Thursday, August 6, COMMISSIONERS PRESENT: COMMISSIONERS ABSENT: DEPARTMENT OF FIRE AND POLICE PENSIONS: CITY ATTORNEY'S OFFICE: Robert von Voigt, President George Aliano Cielo Castro Sam Diannitto (participated telephonically) Adam Nathanson Ruben Navarro Belinda Vega Pedram Salimpour, MD Corinne Tapia Raymond P. Ciranna, General Manager William Raggio, Executive Officer Tom Lopez, Chief Investment Officer Robyn Wilder, Chief Benefits Analyst Barbara Nobregas, Commission Executive Assistant Joshua Geller, Deputy City Attorney President von Voigt called the meeting to order at 8:38 a.m. All of the above-listed Commissioners were present at the start of the meeting with the exception of Commissioner Vega who arrived at 9:48 a.m. A. COMMITTEE REPORTS 1. REVIEW OF THE INTERNAL AUDIT CHARTER AND POSSIBLE BOARD ACTION Ms. Erin Kenney, Departmental Audit Manager, and Mr. James Yeung, Internal Auditor IV, were before the Board.

2 Page 2 The board report was approved without discussion. RESOLUTION Commissioner Navarro moved that the Board approve the proposed updated Internal Audit Charter, which was seconded by Commissioner Aliano and approved by the following vote: ayes, Commissioners Aliano, Castro, Diannitto, Nathanson, Navarro, and President von Voigt 6; nays, none. 2. FOLLOW UP TO THE SUBSIDY PROGRAM AUDIT HEALTH PLANS ADMINISTERED BY THE LOS ANGELES POLICE RELIEF ASSOCIATION AND POSSIBLE BOARD ACTION Ms. Erin Kenney, Departmental Audit Manager, and Mr. James Yeung, Internal Auditor IV, were before the Board. Commissioner Navarro stated his concern about saving time for staff and the board in regards to items going before a Committee, and then the board. He believed the process is duplicative. He also stated that he did not receive an answer about a Committee meeting that turns into a special board meeting, is it then in fact a board meeting? If not, the committee item then has to go before the board and again the process is duplicated. Ms. Kenney introduced Ms. Diane Whisnant, the new Executive Director of the Los Angeles Relief Association. RESOLUTION Commissioner Navarro moved that the Board review, receive, and file the follow up to the Subsidy Program Audit Health Plans Administered by the Los Angeles Relief Association (LAPRA), which was seconded by Commissioner Castro and approved by the following vote: ayes, Commissioners Aliano, Castro, Diannitto, Nathanson, Navarro, and President von Voigt 6; nays, none. B. ITEMS FOR BOARD ACTION 1. REVIEW OF INTERNATIONAL EQUITY MANAGER CONTRACT OF BOSTON COMMON ASSET MANAGEMENT AND POSSIBLE BOARD ACTION Mr. Paul Palmer, Investment Officer II, and Ms. Annie Chao, Investment Officer I, Investments Division, presented Boston Common Asset for a contract renewal. Mr. Ryan Sullivan, Associate Consultant, of RV Kuhns, addressed Commissioner Nathanson's concern regarding Boston's under performance, recommending renewal of the contract, and Ms. Chao stated that the historical performance is listed on a composite level.

3 Page 3 RESOLUTION Commissioner Navarro moved that the Board: 1. Approve a three-year contract with Boston Common Asset Management for international equity management services; 2. Authorize the General Manager to negotiate and approve the terms and conditions of a contract with Boston Common Asset Management for international equity management services for the period October 1, 2015 through September 30, 2018; and, 3. Authorize the President of the Board, on behalf of the Board, to execute the contract with Boston Common Asset Management for international equity management services, subject to the approval of the City Attorney as to form, which was seconded by Commissioner Aliano and approved by the following vote: ayes, Commissioners Aliano, Castro, Diannitto, Navarro, and President von Voigt 5; nays, Commissioner Nathanson DISCUSSION OF BOARD-APPROVED PROCEDURES FOR TIER TRANSFER REQUESTS AND POSSIBLE BOARD ACTION Mr. Gregory Mack, Senior Management Analyst II, Active Member Services, was before the Board and provided a summary of the Tier transfer issue. The Board members gave their respective opinions on the issue. Mr. Ken Buzzell, Director, Los Angeles Retired Fire & Association, Inc., provided public comment. RESOLUTION Commissioner Navarro moved that the Board uphold Items 1, 3, 4 of the current procedures for processing late tier transfer requests and Item 2 as revised, as follows: 1. The Department receives a written request from a member requesting a tier transfer and providing an explanation as to why his/her prior election or waiver was invalid. 2. Staff will consult the City Attorney's Office as to whether a legal basis exists for remedial action. If both staff and the City Attorney agree that a legal basis does not exist, staff will perform the ministerial duty of denying the request and will inform the member that he/she may appeal staff's decision by submitting a

4 Page 4 written request to the General Manager for a hearing before the Board. If both staff and the City Attorney agree a legal basis exists, or if staff and the City Attorney cannot agree on whether a legal basis exists, the matter will proceed to the next step. 3. If both staff and the City Attorney agree that a legal basis exists, LAFPP staff will consult with the City Attorney's Office to determine whether a factual finding is necessary to support the legal basis. If the legal basis does not require a factual finding, relief will be granted administratively and the request will be approved. If the legal basis does require factual finding(s), or if both staff and City Attorney cannot agree on whether a legal basis exists, the matter will be referred to the Board. 4. For all requests referred to the Board, staff will provide the Board with an analysis and the factual findings that must be made in order to approve the transfer request, which was seconded by Commissioner Aliano and approved by the following vote: ayes, Commissioners Aliano, Diannitto, Nathanson, Navarro, and President von Voigt 5; nays, Commissioner Castro APPROVAL OF PROPOSED AMENDMENT TO BOARD RULE 7.0: AUTHORIZATION OF SPECIAL ACTUARIAL STUDIES Ms. Robyn Wilder, Chief Benefits Analyst, Pensions Division, presented the report detailing the amendments to the Board policy. Commissioner Navarro stated that the Board disagreed previously with the issue, and how illustrations have been used against the Board in the past. General Manager Ciranna discussed the value of the illustrations and his support of them. RESOLUTION Commissioner Navarro moved that the Board approve the proposed amendment to Board Operating Policies and Procedures, Section 7.0: Authorization of Special Actuarial Studies, which was seconded by Commissioner Nathanson and approved by the following vote: ayes, Commissioners Aliano, Castro, Diannitto, Nathanson, Navarro, and President von Voigt 6; nays, none. 4. AWARD OF CONTRACTS FOR INVESTIGATION/SURVEILLANCE SERVICES AND POSSIBLE BOARD ACTION Ms. Erin Kenney, Department Audit Manager, stated that Internal Audit Section received the required disclosure information including that regarding gifts, campaign contributions, and charitable contributions; and that there is nothing to

5 Page 5 report under LAFPP's contractor disclosure policy. Mr. Christopher Annala, Senior Management Analyst II, and Ms. Tina Zipper, Senior Management Analyst I, were available for questions. The board report was approved without discussion. RESOLUTION Commissioner Navarro moved that the Board: 1) Approve the selection of Alpha-One Investigations for investigation/surveillance services for a three-year term, with a total contract amount not to exceed $150,000; 2) Approve the selection of ICS Merrill for investigation/surveillance services for a three-year term, with a total contract amount not to exceed $150,000; 3) Authorize the General Manager to negotiate the terms and conditions of the contracts; and, 4) Authorize the President of the Board, on behalf of the Board, to execute the contracts, subject to the approval of the City Attorney as to form, which was seconded by Commissioner Aliano and approved by the following vote: ayes, Commissioners Aliano, Castro, Diannitto, Nathanson, Navarro, and President von Voigt - 6; nays, none. C. REPORTS TO THE BOARD Item Cl was heard in the latter portion of the meeting. 2. President von Voigt asked if any Board Member made any expenditure to influence State legislative or administrative action to which their reply was negative. 3. Miscellaneous correspondence from money managers, consultants, etc. - Received and Filed. 4. General Manager's Report a. Benefits Actions approved by General Manager on July 16, 2015 Pursuant to Resolution 04008, adopted by the Board of Fire & Pension Commissioners on August 7, 2003, the following benefit actions have been approved by the General Manager. DISCONTINUED PENSIONS - TIER 1-2

6 Page 6 Kenneth G. Turner Service Retired: Died Betty Baxter Widow Retired: Died: DISCONTINUED PENSIONS TIER 2 10 Edward H. Phelps Fire Service Retired: Died: Harvey P. Friend Service Retired: Died: George R. La Rue Service Retired: Died: William J. Murphy Service Retired: Died: Earl H. Carlson Fire Disability Retired: Died: George Duarte Fire Disability Retired: Died: Harry B. Schuck Fire Disability Retired: Died: Sondra L. Hartkopf Widow Retired: Died: Blanche T. Horkan Widow Retired: Died: Joann Lance Widow Retired: Died: DISCONTINUED PENSIONS FORMER SPOUSE TIER 2 1 Jeanne F. Wolcott Fire Disability Retired: Member Died: ELIGIBLE SURVIVING SPOUSE'S PENSION TIER 2 1 Name Margaret P. Duarte Deceased Member George Duarte ELIGIBLE SURVIVING SPOUSE'S PENSION TIER 5 1 Member's Class Fire Disability Effective Date Name Deceased Member Member's Class Effective Date Lovania R. Gregory Ray A. Gregory Service SURVIVOR BENEFIT PURCHASE PROGRAM TIER 2 1 Name Mark S. Turnipseed Member's Class Disability INCREASE SURVIVING CHILD'S PENSION TIER 5 1 Effective Date Survivor Benefit % % Increase the pension payable to Kendall B. Hoss, surviving child of deceased Firefighter III, Kelly R. Hoss, effective April 1, 2015, due to the discontinuance of full-time student status by Bailey P. Hoss. There are no minors remaining. DISCONTINUE SURVIVING CHILD'S PENSION TIER 5 1 Discontinue the pension payable to Bailey P. Hoss, surviving child of deceased Firefighter III, Kelly R. Hoss, effective April 1, 2015, due to the discontinuance of full-time student status. PARTIAL PAYMENT OF PENSION TIER 5 2

7 Page 7 In accordance with the City Attorney's advice, a designated proportion of the community property interest of the pension payable to Keoki Deporter, Fire Service Pensioner, is to be paid to his former spouse, Patricia L. Deporter, effective July 31, Ms. Deporter will receive cost of living adjustments. In accordance with the City Attorney's advice, a designated proportion of the community property interest of the pension payable to Arthur J. Duran, Service Pensioner, is to be paid to his former spouse, Jacqueline F. Newby, effective June 1, Ms. Newby will receive cost of living adjustments. MODIFIED PARTIAL PAYMENT OF PENSION TIER 5 1 In accordance with the City Attorney's advice, a designated proportion of the community property interest of the pension payable to Daryl L. Maxwell, Service Pensioner, being withheld for his former spouse, Victoria A. Maxwell, since April 30, 2015, should be released effective July 1, DEFERRED SERVICE PENSION TIER 3 1 Frank R. Trevino, Jr. Sergeant I Eff: Years 258 Days SERVICE PENSION TIER 3 1 Fire Kathleen D. Bosak Firefighter III +3 Eff: Years 30 Days SERVICE PENSION TIER 4 1 Fire Alicia L. Mathis Captain I Eff: Years 159 Days SERVICE PENSION TIER 5 4 Fire Paula E. Perry Engineer Eff: Years 0 Days Alison F. Alexander Detective II Eff: Years 127 Days James E. Flynn Detective III Eff: Years 231 Days Gloria J. Snipes Officer III Eff: Years 1 Day SERVICE PENSION/DROP TIER 3 2 Debra K. Dickerson Officer II +6 Eff: Years 92 Days Rachel Ramirez Officer II Eff: Years 51 Days SERVICE PENSION/DROP TIER 4 2

8 Page 8 Sterling D. Gordon Officer III Eft Years 0 Days Christopher A. Walter Officer III Eff: Years 261 Days SERVICE PENSION/DROP TIER 5 42 Fire Alfred J. Flores Captain I Eff: Years 350 Days Charles E. Garcia Captain I Eff: Years 240 Days Kevin J. Hamilton Captain I Eff: Years 298 Days Lee T. Hazelquist Apparatus Operator Eff: Years 48 Days Charles K. Herrera Captain II Eff: Years 62 Days John B. Hicks Firefighter III Eff: Years 349 Days Terance M. Hubbard Firefighter III Eff: Years 150 Days Paul J. Jordan Inspector I Eff: Years 105 Days Kenneth S. Mason Firefighter III Elf: Years 68 Days Dexter G. McDaniel Firefighter III Eff: Years 92 Days Scott T. Melanson Engineer Elf: Years 59 Days David A. Navarro Firefighter III Elf: Years 139 Days James P. Vlach Captain I Elf: Years 0 Days Steven J. Arellano Sergeant II Elf: Years 79 Days Robert C. Boyd Detective II Eft Years 265 Days Patrick J. Cronin Officer III Elf: Years 310 Days Clifton E. Frazier Sergeant II Elf: Years 79 Days Larry P. Garcia Officer II Eft Years 5 Days Rosalie S. Garcia Sergeant II Elf: Years 5 Days Dan L. Hadfield Officer II Eff: Years 223 Days Barrett D. Halcromb Detective I Elf: Years 312 Days William N. Heider Officer III Eff: Years 9 Days Robert J. Hernandez Detective II Eft Years 0 Days Jeffrey A. Hofmeyer Detective I Eff: Years 162 Days Emerson L. Holder Sergeant II Eff: Years 309 Days Mark T. Holguin Detective III Eff: Years 0 Days David L. Hovey Officer II Eft Years 0 Days Darryl Y. Ito Captain I Eff: Years 49 Days Daniel T. Jenks Detective III Eft Years 173 Days Kevin J. Jolivette Detective II Eff: Years 238 Days Lawrence P. Jones Sergeant I Eft Years 0 Days Perry J. Jones Officer III Eff: Years 0 Days Nicole M. Nunez Officer II Eff: Years 3 Days Mark M. Ramirez Officer III Eff: Years 175 Days Gregory R. Staats Detective II Eft Years 15 Days Sharen S. Stallworth Detective II Eft Years 149 Days Pamela A. Stirling Detective III Elf: Years 135 Days Craig A. Taylor Detective I Eft Years 164 Days

9 Page 9 Darrell W. Vanroy Detective II Eff: Years 67 Days Phillip A. Walters Officer II +2 Eff: Years 31 Days Natalie Y. Whisenton Detective II Eff: Years 5 Days Daniel T. Wise Detective I Eff: Years 344 Days SERVICE PENSION/DROP TIER 5 1 CORRECTION Fire Kurt R. Tietze Engineer Eff: Years 212 Days DISCONTINUE DROP TIER 3 1 Jose R. Yearwood Retired: Exit Close of: DISCONTINUE DROP TIER 4 2 Raymond Madrid Retired: Exit Close of: David M. Parra Retired: Exit Close of: DISCONTINUE DROP TIER 5 18 Fire Brian E. Allen Retired: Exit Close of: Keoki Deporter Retired: Exit Close of: Craig L. Fujimoto Retired: Exit Close of: Joseph F. Jackson, Jr. Retired: Exit Close of: Benjamin Kuzichev Retired: Exit Close of: Sheldon G. McKowan Retired: Exit Close of: Paul A. Proni Retired: Exit Close of: Christopher P. Bonilla Retired: Exit Close of: Brenda Y. Cureton Retired: Exit Close of: Jesus Corral Retired: Exit Close of: Russell A. Freeman Retired: Exit Close of: Thomas M. Glazebrook Retired: Exit Close of: Barry C. Kirschenmann Retired: Exit Close of: Byong K. Kwon Retired: Exit Close of: Daryl Lewis Retired: Exit Close of: Lewis J. Parker Retired: Exit Close of: Auston Price Retired: Exit Close of: William F. Sera Retired: Exit Close of: PARTIAL PAYMENT OF DROP FUNDS TIER 5 1

10 Page 10 In accordance with the City Attorney's advice, a designated proportion of the community property interest of the DROP funds payable to Keoki Deporter, Fire Service Pensioner, is to be paid to his former spouse, Patricia L. Deporter effective July 30, 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 pension payable to Daryl L. Maxwell, Service Pensioner, being withheld for his former spouse, Victoria A. Maxwell, since April 29, 2015, should be released effective July 1, DISABILITY PENSION ADJUSTED TIER 2 1 Name Gregory A. Bielman Member's Class Sergeant I Type % Rate Effective Date Board Date From: 50% To: 55% b. Other business relating to Department operations General Manager Ciranna gave the following updates: With the Board's approval of the building budget, the construction on the Headquarters facility is moving forward. D. COMMITTEE CALENDAR 1. Audit Committee Last met: 07/16/15; next meeting: 10/15/15 2. Benefits Committee Last met: 04/02/15; next meeting: 08/20/15 3. Governance Committee Last met: 05/21/15; next meeting: 08/06/15 4. Ad Hoc Emerging Investment Managers Last met: 11/06/14; Dissolved on 07/17/15 President von Voigt announced the upcoming Committee meetings. E. CONSENT ITEMS 1. APPROVAL OF TRAVEL AUTHORITY (TAPIA) PENSION REAL ESTATE ASSOCIATION, 25TH ANNUAL INSTITUTIONAL INVESTOR REAL ESTATE CONFERENCE 2. Approval of Minutes a. Minutes of the Regular Board meeting of April 2, 2015 b. Minutes of the Audit Committee of April 16, 2015

11 Page 11 c. Minutes of the Special Board Meeting of April 2, 2015 (Benefits Committee) and April 2, 2015 (Governance Committee) 3. Findings of Fact a. Kellie A. Ellwood Tier 5 c. Gregory A. Bielman Tier 2 b. Christina Higuera Tier 5 MOTION Commissioner Aliano moved that the Board approve the consent items, which was seconded by Commissioner Navarro and approved by the following vote: ayes, Commissioners Aliano, Castro, Diannitto, Nathanson, Navarro, and President von Voigt 6; nays, none. F. CONSIDERATION OF FUTURE AGENDA ITEMS No items were referred for consideration. G. GENERAL PUBLIC COMMENT ON MATTERS WITHIN THE BOARD'S JURISDICTION There were no additional public comments. C. REPORTS TO THE BOARD (continued) 1. SEMI-ANNUAL REVIEW OF CORE AND SPECIALIZED MANAGER PRIVATE EQUITY PROGRAMS AND THE COMMODITIES ALLOCATION TO PRIVATE EQUITY Messrs. Brian P. Murphy and Todd A. Hughes, both Managing Directors, and Ms. Elizabeth M. Campbell, Vice President from Portfolio Advisors presented their report to the Board. Messrs. Murphy and Hughes provided an overview of the advisory mandate and timeline. Mr. Hughes reviewed the private equity portfolio, the core and specialized managers, the commodity portfolio, the Strategic Plan, an update of the firm, and discussion on investment process. Commissioner Nathanson discussed fund of funds, advisory duties, and fees with Mr. Hughes and fees and economies of scale with Mr. Tom Lopez, Chief Investment Officer. President von Voigt recessed for break at 10:24 am. and reconvened the meeting at 10:35 a.m. H. DISABILITY CASES DISABILITY CLAIM NEW TIER 5

12 Page 12 Ian M. Schunke (H) Sergeant I Service-connected disability pension is granted at 35% with no foreseeable purpose for review. Motion made by Commissioner Vega, seconded by Commissioner Aliano and adopted by the following vote: ayes, Commissioners Aliano, Castro, Diannitto, Nathanson, and Vega 5; nays, Commissioners Navarro, and President von Voigt - 2. Petty Santos, Commander, Fiscal Operations, Human Resources, Los Angeles Harbor Department testified regarding Sergeant Schunke. Sergeant Schunke was present and was represented by his attorney, Thomas J. Wicke. Commissioner Navarro left the boardroom for the remainder of the meeting at 11:30 a.m. I. CLOSED SESSION ITEMS FOR POSSIBLE BOARD ACTION 1. CLOSED SESSION PURSUANT TO GOVERNMENT CODE SECTION TO CONSIDER THE PURCHASE OF ONE (1) PARTICULAR, SPECIFIC INVESTMENTS AND POSSIBLE BOARD ACTION The Board met in closed session. Commissioner Nathanson left the boardroom for the remainder of the meeting at 11:40 a.m. 2. CLOSED SESSION PURSUANT TO GOVERNMENT CODE SECTION TO CONFER WITH REAL PROPERTY NEGOTIATOR; Properties: 315 S. Hewitt Street and 713 E. 3rd Street; Negotiators: David Weiner, Martin Cawley, Ray Ciranna, Negotiating parties: Sentinel Real Estate Corporation and LAFPP: Under negotiation: Instruction to negotiator will concern price The Board met in closed session. Upon reconvening in open session, President von Voigt stated there was no public report. The meeting adjourned at 11:52 a.m. President