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HomeMy WebLinkAbout2014 - Defined Contribution Plan Minutes CITY OF LANSING DEFINED CONTRIBUTION PENSION PLAN/ VEBA PLAN SPECIAL MEETING OF DECEMBER 17, 2014 The Administrative Board was called to order at 9:02 a.m. Present: Members: Bill Barkyoumb, Angela Bennett, Irene Cahill, Randy Endsley, Rpdyr� Hannan- 5. Absent: Antonia Kraus, Janene McIntyre .01 r�1 C i Others: Karen E. Williams, Finance; Attorney Don Kulhanek w C-) rr� Ms. Angela Bennett presided, j-ri i� cn There were no public comments. , It was moved by Ms. Cahill and supported by Mr. Barkyoumb to excuse Ms. Antonia Kraus from the Special VEBA Plan Meeting of December 17, 2014. Adopted by the following vote: 5 - 0 Ms. Angela Bennett explained that the Administrative Board needed to add District Court NonBargaining employees to the Defined Contribution Plan prior to December 31, 2014. It was moved by Mr. Barkyoumb and supported by Mr. Endsley to adopt the following resolution: RESOLUTION CITY OF LANSING DEFINED CONTRIBUTION PLAN GOVERNING COMMITTEE December 17, 2014 WHEREAS, the City of Lansing ("City") has established the City of Lansing Defined Contribution Plan and related trust (collectively referred to as the "Plan") for the benefit of employees of the City, and of other Adopting Employers who become participants therein; and WHEREAS, the Plan was closed to new members who were not elected officials of the City from 2003 until 2012 at which time the City and Teamsters Local 214 Supervisory and Non- supervisory units (collectively, "T214") entered into a Collective Bargaining Agreement ("Agreement") effective on August 1, 2012 which was ratified by T214 on September 12, 2012 and the Lansing City Council on September 17, 2012; and WHEREAS, the Agreement provided that new employees of the City who are members of T214 would become members of the Plan; and WHEREAS, the City amended the Plan to provide for membership of employees who were members of T214 on and after September 17, 2012; and WHEREAS, said Third Amendment to the Plan made it more administratively convenient in the event additional employee groups were added in the future; and WHEREAS, since that time other employee groups within the City and 54A District Court have become members of the Plan; and WHEREAS, it is necessary to revise and amend Schedule A of the Plan to provide for membership of employees who are 54A District Court Non-Bargaining Employees as of-June 1, 2014; and NOW, THEREFORE, IT IS HEREBY RESOLVED that the Governing Committee hereby revises, amends, and adopts Schedule A of the Plan as set forth in the attached Schedule A to the Defined Contribution Plan. BE IT FINALLY RESOLVED, that the Chairperson of the Defined Contribution Committee is hereby authorized to sign all documents necessary and appropriate to effectuate this Resolution, subject to prior approval as to form and content by the City Attorney, including the attached revised Schedule A to the Defined Contribution Plan. Adopted by the following vote: 5 - 0 Attorney Kulhanek discussed the resolution to update the Defined Contribution Plan and the Schedule A bargaining units to include the District Court Non-Bargaining employees. Attorney Kulhanek explained that the City Attorney's Office became aware of the District Court Order after the Defined Contribution meeting in November. The Chief Judge made the determination to include District Court Non-Bargaining. Attorney Kulhanek reviewed that Teamster 214, Supervisory and Non-Supervisory, Teamster 580 District Court, Teamster 580 Supervisory and Teamster 580 Clerical, Technical and Professional bargaining units have already been added to Schedule A. It was moved by Mr. Hannan and supported by Ms. Cahill to adjourn the meeting. Adopted by the following vote: 5 —0. The meeting adjourned at 9:08 a.m. .SCHEDULE A I. Bargaining Units An individual whose terms of employment are governed by a collective bargaining agreement between the Employer and a bargaining unit that is listed below is eligible to participate in the Defined Contribution Plan pursuant to the terms of the Plan as of the corresponding effective date also shown below. Name of Bargaining Unit Bargaining Unit Effective Date Teamsters Local No. 214 Supervisory and September 17,2012 Non-supervisory Tearnster 580- 54-A District Ct March 31, 2014 TEAMSTER 580 SUPERVISORY May 19, 2014 TEAMSTER 580 CLERICAL,TECHNICAL, May 19, 2014 AND PROFESSIONAL H. Non-Bargaining Units An individual whose terms of employment are governed by an employment relationship between the Employer and a non-bargaining unit classification that is listed below is eligible to participate in the Defined Contribution Plan pursuant to the terms of the Plan as of the corresponding effective date also shown below. Name of Non-Bargaining Unit Classification Non-Bargaining Unit Classification Effective Date 54A District Court Non-Bargaining Unit June 1, 2014 Employees Revised by the Governing Committee on December 17,2014 CITY OF A SING By: Its;� M 2 Revised by the Governing Committee on December 17,2014 r � CITY OF LANSING DEFINED CONTRIBUTION PENSION PLAN/ VEBA PLAN MEETING OF NOVEMBER 6, 2014 The Administrative Board was called to order at 9:06 a.m. Present: Members: Bill Barkyoumb, Angela Bennett, Irene Cahill, Randy Endsley, Antonia Kraus- 5. Absent: Randy Hannan, Bill Barkyoumb Others: Karen E. Williams, Finance; Attorney Don Kulhanek; Anne Omiljan, Wells Fargo. Mayor Virg Bernero submitted a the letter to committee chair appointing Mr. Bill Barkyoumb and Ms. Angela Bennett to the City of Lansing Defined Contribution/Voluntary Employee Benefit Association Board to complete the terms of two open member positions. Mr. Barkyoumb and Ms. Bennett's terms will expire April 1, 2016. There were no public comments. It was moved by Ms. Cahill and supported by Mr. Barkyoumb to approve the Administrative Board Committee Meeting Minutes for August 7, 2014. Adopted by the following vote: 5 —0 It was moved by Ms. Bennett and supported by Ms. Cahill to approve the Administrative Board Committee Special Meeting Minutes for September 11, 2014. Adopted by the following vote: 5 — 0 Ms. Anne Omiljan provided a review of the plan assets participants and fees. Ms. Kraus requested that a breakdown of the new participants compared to the existing participants be added to the report. Ms. Omiljan also discussed the channel summary report detailing how participants contact Wells Fargo. Ms. Anne Omiljan submitted the following report from Mr. Michael Johnshoy, Wells Fargo senior investment manager for the City of Lansing Defined Contribution portfolio. Investment Performance Report as of September 30, 2014 Fund Array- 1)The Fund Array structure is solid. No gaps within the array. The array holds a diversified mix of Fixed Income options, full suite of equity options (large, mid & small as well as value and growth). Finally a nice diversified mix of International options. 2) "C" Rated Funds- A) American Century Inflation Adjusted Bond Fund -This is a solid diversified fund. It holds 92%of US Treasury TIPS.The fund has held up fairly well but in general all TIPs funds has lagged the index. This has been primarily because interest rates have been volatile and most managers have kept their duration lower than the index. I would continue to monitor this fund. B) MFS Value R3 -This fund has been a C for only 2 quarters. The fund has a solid PM (Steve Gorham) and he strategy and philosophy is sound.The fund has a very good long term track record. It has beat one or both of the benchmarks 9 out of the last 10 calendar years. I would continue to monitor this fund. C) William Blair Growth Fund -This fund has bounced around a little bit between C and B the past year but it is a result of the funds generally conservative style. The fund tends to protect on the down side (years...2008 & 2011) due to its high quality bias. I think this fund complements your fund array nicely. The fund has done well over the long term too. It has outperformed one or both of the benchmarks 9 out of the last 10 calendar years. I would continue to monitor this fund. D) Oppenheimer Discovery A-This fund has only been a C for 2 quarters. This fund does tend to be volatile historically over the long term it has been a good fund. I would consider to monitor the fund unless you are uncomfortable with the volatility it can possess over time. Otherwise, the fund is performing similar to the way it has in the past. If you are comfortable with that, I would consider to continue to monitor the fund. E) American Funds Capital World Growth and Income-This is a solid world fund. It has beat the peers (Morningstar average over most of the time periods. Lately it has been tough for all funds to beat the index. I would continue to monitor the fund. F) Neuberger Berman International Equity-The has a conservative bias and tends to lag in up markets. Recently some individual stock picks have hurt the fund. The fund has bought on weakness but they feel are solid companies. The fund should be positioned for good future growth. All in all, even though some funds are listed as "C"s, given the volatility of the market, the funds are holding up ok. One interesting thing to note is that the average active mutual fund has lagged most indexes (see Morningstar versus most of the Russell indexes). Karen Williams distributed the 2015 Schedule of Meeting dates for the Defined Contribution PensionNEBA Plan. It was moved by Mr. Barkyoumb and supported by Mr. Endsley to excuse approve the 2014 Schedule of Meetings. Adopted by the following vote: 5- 0. Attorney Don Kulhanek explained that the Administrative Board needed to add Teamsters 580 CTP and Teamster 580 Supervisory Units to the Defined Contribution Plan. Attorney Kulhanek discussed the resolution to update the Defined Contribution Plan and the Schedule A bargaining units to include the two Teamsters 580 units and defined the Teamsters Local 214 as Teamster 214 Supervisory and Non-Supervisory units. It was moved by Ms. Cahill and supported by Ms. Bennett to adopt the following resolution: RESOLUTION CITY OF LANSING DEFINED CONTRIBUTION PLAN GOVERNING COMMITTEE WHEREAS, the City of Lansing ("City") has established the City of Lansing Defined Contribution Plan and related trust (collectively referred to as the "Plan") for the benefit of employees of the City, and of other Adopting Employers who become participants therein; and WHEREAS, the Plan was closed to new members who were not elected officials of the City from 2003 until 2012 at which time the City and Teamsters Local 214 Supervisory and Non- supervisory units (collectively, "T214") entered into a Collective Bargaining Agreement ("Agreement") effective on August 1, 2012 which was ratified by T214 on September 12, 2012 and the Lansing City Council on September 17, 2012; and WHEREAS, the Agreement provided that new employees of the City who are members of T214 would become members of the Plan; and WHEREAS, the City amended the Plan to provide for membership of employees who were members of T214 on and after September 17, 2012; and WHEREAS, said Third Amendment to the Plan made it more administratively convenient in the event additional employee groups were added in the future; and WHEREAS, Teamsters Local 580 Supervisory and Clerical, Technical, and Professional unions (collectively "T580") entered into a Collective Bargaining Agreement ("CBA") which was ratified by T580 on May 19, 2014; and WHEREAS, the CBA provided that new employees who are members of T580 on or after, May 19, 2014 to become members of the Plan; and WHEREAS, it is necessary to revise the Schedule A of the Plan to provide for membership of employees who are members of T580 on and after May 19, 2014; and WHEREAS, due to administrative oversight, it was not made clear that T214 included both the Supervisory and Non-supervisory units. NOW, THEREFORE, IT IS HEREBY RESOLVED that the Governing Committee-hereby revises and amends Schedule A of the Plan as set forth in the attached Schedule A to the Defined Contribution Plan. BE IT FINALLY RESOLVED, that the Chairperson of the Defined Contribution Committee is hereby authorized to sign all documents necessary and appropriate to effectuate this Resolution, subject to prior approval as to form and content by the City Attorney, including the attached revised Schedule A to the Defined Contribution Plan. Adopted by the following vote: 5- 0 Attorney Don Kulhanek reported that the Administrative Board at its November 2013 meeting voted to transfer the VEBA Plan to Wells Fargo. Attorney Don Kulhanek noted that the Investment Policy Statement had been adopted. Attorney Kulhanek discussed the resolution for the Administrative Board to effectuate the transfer. It was moved by Ms. Bennett and supported by Ms. Cahill to adopt the following resolution RESOLUTION CITY OF LANSING POST EMPLOYMENT HEALTHCARE PLAN GOVERNING COMMITTEE WHEREAS, the City of Lansing and 54-A District Court (collectively- called "Employer") established the City of Lansing Post Employment Healthcare Plan ("VEBA Plan") and related Trust ("VEBA Trust") and appointed Comerica Bank as its Trustee, Trust Fiduciary and Investment Manager through the City of Lansing Post Employment Healthcare Plan and Trust Agreement entered into on August 1, 2002, as amended, ("2002 Agreement"); WHEREAS, the VEBA Plan Governing Committee ("Governing Committee") is authorized to appoint and remove the Trustee, the Investment Fiduciary, and the' Investment Manager for the VEBA Trust; WHEREAS, Governing Committee wishes to remove Comerica Bank as the Trustee, the Investment Fiduciary, and the Investment Manager for the VEBA Trust; WHEREAS, the Governing Committee now wishes to appoint Wells Fargo Bank, N.A. as the successor Trustee, the Investment Fiduciary, and the Investment Manager for the VEBA Trust; WHEREAS, Wells Fargo, N.A. agrees to serve as successor Trustee, the Investment Fiduciary, and the Investment Manager for the VEBA Trust; NOW, THEREFORE, BE IT HEREBY RESOLVED: 1. Comerica Bank's roles as the Trustee, the Investment Fiduciary and the Investment Manager for the VEBA Trust shall be terminated; 2. Effective on such day and time as Comerica Bank completes proper transfer of all VEBA Trust assets to Wells Fargo, N.A., but no later than sixty days after the day first specified above, the Governing Committee appoints Wells Fargo Bank, N.A. as the successor Trustee, the Investment Fiduciary, and the Investment Manager to the .VEBA Trust; and Wells Fargo Bank, N.A. accepts appointment as successor Trustee, the Investment Fiduciary, and the Investment Manager for the VEBA Trust; 3. Upon proper transfer of VEBA Trust assets by Comerica Bank, Wells Fargo Bank, N.A. shall have all rights, duties and obligations of the Trustee, the Investment Fiduciary, and the Investment Manager as set forth herein and in the 2002 Agreement, the terms and conditions of which are hereby incorporated into and made a part of this Agreement. Wells Fargo Bank, N.A. agrees, from and after the day and time of such transfer, to assume all such rights, duties and obligations of the Trustee in accordance with the terms and conditions provided herein and in the 2002 Agreement; and 4. The term "investment company" as used in Sections 7.01 and 7.02 of the August 1, 2002 Agreement may include registered investment companies which Wells Fargo Bank, N.A. or any of its affiliates provides investment advice or other services to and may receive compensation from. BE IT FINALLY RESOLVED, that the Governing Committee chairperson is. hereby authorized to sign documents necessary to effectuate this resolution, subject to prior approval as to content and form by the City Attorney. Adopted by the following votes: 5 —0 Attorney Kulhanek reviewed the authorized signers documents and suggested that the selected members be approved by the Board. It was moved by Ms. Cahill and supported by Mr. Barkyoumb to list Antonia Kraus and Angela Bennett as authorized signers for all plan activity and direction, and to have Randy Endsley as authorized signer for cash processing, benefit payments, and fee and expense processing. The authorized signers were approved to act individually. Adopted by the following vote: 5 -0 Anne Omiljan reviewed the fee arrangement and disclosure and the Wells Fargo Investment Guidelines. The Administrative Board discussed the timing of the VEBA contribution in order to meet the criteria for a lower fee. Ms. Kraus requested that the investment guidelines equity strategic target to amended to 55%to match the parameters of the VEBA Investment Policy Statement. Attorney Don Kulhanek reviewed the Account Agreement Document and the Post Employment Health Care Plan Trust Successor Trustee Agreement. Wells Fargo would assume all of Comerica's duties as trustee, fiduciary and investment manager. Ms. Kraus noted that the pending item regarding health care of beneficiaries after retiree death has been on the agenda for a long amount of time. She requested that the retirement.analyst review the previous minutes for the origin of the item to determine if the pending matters should remain on the agenda. It was moved by Mr. Barkyoumb and supported by Ms. Cahill to adjourn the meeting. The meeting adjourned at 9:55 a.m. SCHEDULE A I. Bargaining Units An individual whose terms of employment are governed by a collective bargaining agreement between the Employer and a bargaining unit that is listed below is eligible.to participate in the Defined Contribution Plan pursuant to the terms of the Plan as of the corresponding effective date also shown below, Naine of Bargaining Unit Bargaining Unit Effective Date Teamsters Local No, 214 Supervisory and Septeinber 17, 2012 Non-supervisory Teamster 580- 54-A District Ct March 31, 2014 i TEAMSTER 580 SUPERVISORY May 19, 2014 TEAMSTER 580 CLERICAL, TECHNICAL, May 19, 2014 AND PROFESSIONAL 11. Non-Bargaining Units An individual whose terms of employment are governed by an employment relationship between the Employer and a non-bargaining unit classification that is listed below is eligible to participate in the Defined Contribution Plan pursuant to the terms of the Plan as of the corresponding effective date also shown below. Name of Non-Bargaining Unit Classification Non-Bargaining Unit Classification Effective Date p i I CITY OF SIN Dated: By: I Its: J//(L�. f I 3 i I i j L 2